Menu
Race Images - Gallops

Owners fear RITA is insolvent and say they must be given accurate information.

Owners muscle up: OIA request for answers from RITA could fuel judicial action

Racehorse owners have resorted to using the Official Information Act to force the Racing Industry Transition Agency to reveal the extent of its reportedly dire financial position.

In a letter to the Chair and Board of RITA, the Minister for Racing Winston Peters, and the Department of Internal Affairs, the New Zealand Thoroughbred Racehorse Owners’ Federation has asked a slew of questions around RITA’s viability to fund the industry.

The federation says the information is vital to allow stakeholders to make a decision on whether to start a formal judicial process to revoke Cabinet’s appointment of RITA for neglecting to meet the requirements of the Minister.

President Bernard Hickey says the owners are particularly concerned that RITA was in such a serious financial position even before COVID-19 that it led to a change of bankers.

RITA had not disclosed its true financial position and had failed to fund the codes as intended due to its lack of cash flow prior to level 4 lockdown.

“The industry wants transparency, and honest facts and figures to allow it to participate in solutions. Yes, there have been public meetings and general public notices but their content and lack of specific honesty has been questioned by all.”

Racehorse owners’ president Bernard Hickey … “the industry wants transparency.”Racehorse owners’ president Bernard Hickey … “the industry wants transparency.”The federation is seeking any information that relates to RITA asking the Government for injections of funds or any other financial arrangement to allow it to keep trading.

With parliament set to resume sitting on Tuesday, questions will also be asked in the House this week by Hawkes Bay MP Lawrence Yule around the financial position of RITA. Questions must be answered in six days followed up with the relevant documents.

Hickey says the federation believes RITA has breached in part or full its duty of care to the New Zealand racing industry and its stakeholders.

“This is resulting in a number of owners and licence holders considering their options to the peril of the industry.”

Specifically, Hickey refers to the Minister for Racing’s letter of July 25, 2019 expressing his expectations of RITA, which it believes have been severely compromised.

In his letter the Minister demanded RITA:

* Make best use of the $3.5m Crown contribution to the cost of industry change – ensuring that this funding ‘buys change’ rather than underwrites business as usual activities.

* Improve customer service while improving operational efficiencies.

* Provide for temporary management of residual functions, if necessary, after the formation of RITA’s successor organisation and the devolution of the intended functions to the codes.

* Avoid any further deterioration in the RITA balance sheet and put steps in place for improvement.

* Embed a customer service ethos that invests efforts into keeping promises, being realistic in making promises, and delivering on target.

The letter also said RITA must complete the work started by the Ministerial Advisory Committee.

It should:

* Prepare a devolution of racing functions to the racing codes.

* Continue assessment whether TAB betting operations should be outsourced to a third party – including exploring the extent to which joint venture and other arrangements with betting, broadcasting and gaming operators can provide the organisation with cost-effective access to up-to-date skills, knowledge and technologies.

Racing Minister Winston Peters with former top jockey Noel Harris.Racing Minister Winston Peters with former top jockey Noel Harris.Minister’s instructions on prize-money

The Minister instructed RITA should ensure as much money as possible goes to additional prizemoney – not racing industry overheads by:

* Maintaining the current level of overall funding to the codes as a baseline.

* Minimising transitional costs for the industry and government.

* Looking for efficiency gains in operations without compromising organisational capability and ensure the transfer of functions to the codes does not result in an overall increase in cost to the industry.

* Progress the doubling of returns to owners as a key component of the cycle of revitalisation in the Massara Report.

Critically, RITA was to have provided written and non-financial reports to the Minister for Racing and his department not later than four weeks after the end of each quarter.

“I may alter this frequency depending on RITA’s performance and risks,” Peter said.

“In addition, there is a ‘no surprises’ expectation, under which RITA is required to inform my office and the department of any material matter that arises and respond promptly to information requests.”

Questions sent in under the Official Information Act by the federation seek, among other things, to discover whether the above instructions have been carried out.

Under the Act answers must be provided within 20 working days but extensions can be sought if producing a large quantity of information unreasonably interferes with the operations of the agency.

Our runners this week