Leading Sport – Brian Kavanagh

As part of our Leading Sport series of interviews with those determining the future of sport in Ireland we caught up with Brian Kavanagh, CEO of Horse racing Ireland on where the industry is towards the end of 2017, how plans are evolving for some major initiatives in 2018 and how the sport here deserves to be seen given its international status.

Kavanagh is one of Ireland’s most experienced administrators. He managed the Curragh Racecourse before stepping up to the top job in the sport upon the formation of Horse racing Ireland in 2001.

Widely respected across Europe and the World of racing he has overseen significant capital investment in Irish racecourses during his tenure and also the rise of training powerhouses like those of Aidan O’Brien and Willie Mullins who are among Ireland’s greatest ever winners on the international sporting stage.

Sport for Business: Where does Racing sit as we approach the end of 2017?

Brian Kavanagh: Racing is in good shape though not without its challenges. On a number of measures, we are doing well. Irish trainers, jockeys, trainers, and breeders are enjoying unprecedented success around the world and that is filtering back into the health of the sport back at home.

The Deloitte Report which we released recently gave us some really good indicators, many of which we knew but all of which became stronger through independent validation.

SfB: Does Racing still need that external validation?

BK: Yes. Deloitte has great credibility across sport and when they say it’s so it becomes so. People will always say that I would say that but with other voices joining the chorus the genuine story is told stronger.

It is sometimes difficult to get beyond the notion of racing as the Sport of Kings, being about wealthy people throwing money around and having fun.

We are also responsible though for a major contribution to the rural economy and that shone through in the report.

It raised a number of amber warning lights over Brexit and other issues but that is good because it focuses our minds on addressing them ahead of becoming a real issue.

SfB: How important is keeping the balance between sport and industry?

Well, we need to honour the sporting greats we have among us. There is a danger we take people like Aidan and Willie for granted, that what they are achieving is normal. It is anything but. They are running hard and fast at the epicentre of the sport.

But all that begins in Tipperary with feed and riders working the horse every morning.

SfB: Is their dominance bad for the sport here?

BK: You could never say it was bad. What they are achieving is outstanding and while it does present challenges, we are meeting them. Ten years ago could you have imagined that Michael O’Leary would have 200 horses in training, that JP McManus would double his string and that British owners like Graham Wylie and Alan Potts would base their strings here to be amongst and be competing against the best of the best?

They are paying big money to generate employment and economic activity in Bagenalstown and Longwood where there is not any comparable opportunity for work.

We do try to raise standards by catering for all qualities but continually trying to raise quality.

I’m also conscious that excellence is often criticised as being bad for the game. Steve Davis, Tiger Woods and others have heralded calls that nobody else can win, but time tends to play a hand that brings opportunity to all.

SfB: There is still a sense that Horse racing is considered as ‘not really a sport at all.’ Is that fair?

Well, we have always argued strongly for the economic strength of the industry but how can you say that Ruby Walsh is not a great sports star or that Cheltenham is not one of the greatest sporting spectacles of our time.

The funding structure is different and I can understand the occasional envious glance from others who focus purely on sport but we are every inch a sport. As well as an industry.

It is a natural fit for us to be in the Department of Agriculture as opposed to Sport and sometimes that colours the opinion of people within sport.

SfB: In terms of funding the Horse and Greyhound Fund stayed still this year after rising for a few years to a level close to where it was ten years ago. Was that a disappointment?

BK: We got back to where we were before savage cuts across 2009 and 2010 but we have argued strongly that the Fund should come from betting tax. That argument did not carry the day this year but we are massively undertaxed on betting compared to other jurisdictions. Doubling from the current one percent would deliver as much as €100 million which would pay for the Fund and leave money behind for general spending as well.

It remains a strong argument though and we will continue to press the case. The betting industry are important partners of ours but the debate is changing and a lot of advertising is now being looked at through a social lens as well as an entertainment one.

SfB: What about the argument that betting on racing only accounts for part of betting now?

BK: Racing here still accounts for over 70 percent in betting shops and as high as 50 percent online among the Irish betting public. Raising the tax would not necessarily all go to horse and greyhound racing but we generate most of the activity and that remains unquestioned.

There is €5.1 Billion in betting in Ireland at the moment, on an annual basis, generating €51 Million in tax. Ten years ago the figure was €1 Billion and the tax €70 Million. Something is not right in that correlation. At a time when Government is always looking for money to send towards multiple causes. Betting whether viewed as entertainment or vice, in the same way as a drink, for example, is undertaxed. You’d pay 23 percent tax on a paper to see the races that are on but less than half of that, taking into account the betting margin when you go to have a bet.

SfB: How important is the Curragh redevelopment?

BK: Very much so. Its the HQ and spiritual home of racing but has been starved of investment and development for 60 years. It had reached a stage where the facilities were no longer fit for purpose. It stages 10 of our twelve Grade One races and yet it had only got five percent of capital spending over the last twenty years. It was time and will be as important to racing as Croke Park was to the GAA or the Aviva Stadium to Rugby and Soccer.

It will allow us to reconnect with our Dublin and our Kildare audiences. we are half way there and then the challenge will be to rebuild the business as a marquee sports location of which the country can be proud.

SfB: And the temporary facilities this year have been better than what they replaced.

BK: That’s right. It was not a great place to spend time but they were 1962 facilities in 2016. next year we will tweak again and they will be better and then we will be through it with a great theatre for the sport in 2019.

It has also been important to marshal the support of major private investors like the Aga Khan who have now got ‘skin in the game’ that locks in Ireland’s position as a racing centre of excellence.

SfB: And how about Leopardstown and the move to a Dublin Racing Festival?

BK: Leopardstown has been great. We have worked well with them on a number of areas as part of our development fund. We provide 40% and they put up the rest, largely through their media rights money to keep moving forward.

They have a very positive management team and there will be upgrading again in the future of the public and the racing facilities. The Thursday night meetings have been a great addition for corporate nights out and the Racing is top class throughout the year.

The Dublin Festival with €75,000 minimum prize money and the best racing you could imagine over two days, only six weeks before Cheltenham is really exciting.

SfB: Racing has long loved its Festival scene. At Punchestown, Galway, Listowel and many more but Dublin has never been badged in that way before. That has now changed.

BK: Yes it was very deliberate to call it the Dublin Racing Festival. It’s a strong marketing tag in the UK and there has been a great reaction from racegoers. We want to build a diverse programme of activity. This year we are playing France away in the Six Nations with a 5 PM start which we will show after racing on Saturday on the big screen, and then we might find plenty heading into Croke Park for a Dublin League game under lights. It promises to be one of the best sporting weekends of the year and racing will be at the heart of it.

SfB: On a personal basis you had your challenge in terms of the Oireachtas Committee questioning your longer tenure than is the norm on a semi-state, how tough was that?

BK: It was tough but there are plenty more people with much bigger problems. My concern was greater in terms of racing being dragged into the spotlight in an area that was not ideal.

SfB: Were there positives that came out of it?

BK: Yes, we have deliberately built out a stronger management team and lessened the emphasis on fewer shoulders. Suzanne Eade has been in two years and has come in and grasped the business quicker than anyone could have imagined. She brings a different perspective to how we manage and has been a great addition.

Two years ago facing the retirement of Michael O’Rourke and Margaret Davin was a daunting prospect but now we have brought in people of the calibre of John Osborne from the National Stud, Jonathan Mullin from the Racing Post and Paul Dermody from Leinster Rugby to join us in senior positions.

SfB: What is worrying you about the future?

BK: Brexit and funding are the biggest challenges we face.

SfB: And what do you find most exciting?

BK: The quality of the racing we have just keeps going from strength to strength. The new management team, the Dublin Festival and the Curragh are the best bits of the day. Altogether helping us to make the Horse Racing stronger. It’s a great position to be in.

Horse Racing Ireland is one of the more than 230 organisations that play an active part in the Sport for Business community.  

The Leading Sport series is in partnership with our friends at PwC

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Image Credit Inpho

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