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Argentina – Buenos Aires unions reject proposals for gradual end to state subsidies

By - 10 April 2018

A preliminary draft put forward by owners and breeders of thoroughbred horses to the government of the province of Buenos Aires has been rejected by other unions in the sector.

A number of racehorse owners associations and horse breeder organisations propose extending the removal of state subsidies for two years, and then gradually removing them every six months until reaching the five per cent mark now required by the government.

However, Omar Alegre, General Secretary of the Union for Staff of the Hippodrome of La Plata said: “The unions have another vision, which is to defend horse racing law 13,253, because we believe it is very well done until something surpassing it appears we have a more comprehensive vision,” he said.

Alegre says that the new measures will amount to simply extending the horse racing industry’s life for another four years. “The draft is very consistent with the position of the governor: it is to apply gradualism to what Vidal has asked for. Instead of dying today, the agony will be a little slower, from here to four or five years,” he said. According to the union, income at the racetracks would have to increase tenfold in order to be sustainable which is “is impossible.”

The Association of Racetrack and Betting Agency Personnel (APHARA) has also rejected the new proposals. “It is incongruous and only preserves the right and the benefits of some”, the union said.

In 2005, the government created the Horse Racing Improvement Fund in order to give the sector a boost in the face of the proliferation of slot machines. Five per cent of the amount generated by slots in the capital goes to the fund, while 34 per cent goes to the coffers of the province of Buenos Aires. In turn, according to Provincial Law No. 13.253, the government must allocate through the Provincial Institute of Lotteries and Casinos (IPLyC) between 9 per cent and 15 per cent to the four racetracks in the province since they do not generate their own profits. At the racetracks, 60 per cent goes to the prize pool and the rest to operating expenses and infrastructure.

In February, Governor of the province of Buenos Aires María Eugenia Vidal announced that she would cut subsidies to horse racing tracks completely. The government of the Province of Buenos Aires will reduce subsidies for horse racing by as much as $300m per year in its first phase. It is the government’s position that horse racing in the province of Buenos Aires has its own revenue sources such as betting, as well as simulcast sales abroad. However, for more than ten years, the province of Buenos Aires has subsidised the activity of racetracks and subsidised different trade associations.

In 2017 alone, the government allocated $1,000m to the sector, a figure that year after year is increasing and it is estimated to stand $1,300m in 2018. In this context, Vidal confirmed that the Executive branch had decided, “to cut the subsidy to $300m, which is the minimum that the law allows us to give to the sector. We will also send a bill to the legislature of the Province so that this subsidy will be reduced to zero,” she said in February.

“With the $1000m that we gave (to horse racing ) in 2017, we could have put in place 30 public emergency clinics, built 1000 homes or constructed 120 kilometres of road. These are the priorities of the Province. This is part of a policy that started from the first day to combat illegal gambling and to restrict legal gambling in the Province. We recently announced the closure of three casinos and a bingo. This has been our policy. We have had a very clear position when it comes to illegal and legal gaming.

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