Key Takeaways
- Vela and Lindsay each gave $65,000 to NZ First in 2023; by 2026 Vela has contributed $150,000 and Lindsay (with his wife) $100,000.
- NZ First has received $300,000 of its $475,000 total 2026 donations from racing‑industry sources, making it the second‑largest donor among parties this year.
- A commissioned report warns the racing sector faces a structural deficit of > $50 million per year, with cash reserves projected to run out by the end of the 2027/28 season without intervention.
- The “loops of decay” stem from fewer breeders, a 22 % drop in foal numbers over ten years, frequent race cancellations due to poor track conditions, and high administrative costs.
- The report recommends governance unification, a strategic property vehicle, tax and regulatory reforms for breeding, moving Racing Integrity Board funding to central government, and modernising TAB NZ legislation to diversify revenue.
- Tax experts view several proposed changes as outright concessions, noting the industry has long enjoyed privileged treatment unlike other gambling forms.
- Previous government support includes a $50 million bailout in 2020 and tax reductions in 2018; a 2023 deal with Entain guarantees minimum payouts until 2028, after which revenues are expected to fall sharply.
- Industry veterans fear racing may become a “cottage industry” within a decade due to declining horse supply, high costs, ageing participants, and weak youth engagement.
Donation Overview
Vela and Lindsay are identified as donors to NZ First. In 2023 each contributed $65,000 to the party. By 2026 Vela’s cumulative donations have risen to $150,000, while Lindsay and his wife, Lady Jocelyn Lindsay, have together given $100,000. Additionally, NZ First received $50,000 from businesses linked to racing‑industry figure Nelson Schick, who was not a member of the committee that commissioned the report. These figures illustrate the substantial financial ties between the party and the racing sector.
Election‑Year Disclosure Rules and NZ First’s Position
Under electoral law, any donation exceeding $20,000 received during an election year must be declared within twenty days of receipt. To date, NZ First has declared $300,000 of its $475,000 total 2026 donations, a sum largely traceable to racing‑industry sources. This disclosure volume places NZ First as the second‑highest donor among all political parties in the current election cycle, highlighting the prominence of racing‑related contributions in its fundraising profile.
Structural Deficit and the “Loops of Decay”
The racing industry-commissioned report warns of a structural deficit exceeding $50 million annually. If no further support is provided, cash reserves are projected to be exhausted by the close of the 2027/28 racing season. The report identifies two primary drivers of what it terms “loops of decay”: a declining number of foals being bred and a rise in race cancellations caused by deteriorating track conditions. Together, these factors threaten the viability of the sector.
Breeder Decline, Foal Numbers, and Track Conditions
Specific data underscore the industry’s contraction: there are now 500 fewer breeders than in 2015, and foal numbers have fallen by 22 % over the past decade. Poor maintenance of racecourses leads to frequent race cancellations, further reducing revenue streams and discouraging investment. These intertwined trends create a negative feedback loop where lower activity diminishes funds needed for track upkeep, which in turn leads to more cancellations.
Administrative Burden and Governance Recommendations
Administrative costs are reported at $91 million per year, a figure the report argues could be cut substantially by consolidating the separate boards governing horse and harness racing into a single entity. The report’s first recommendation calls for unifying racing governance under one accountable body responsible for strategy, funding, calendar, and marketing. Such consolidation aims to eliminate duplication, improve decision‑making, and free resources for core operational needs.
Ageing Demographic and Youth Engagement
The report notes that both participants and audiences in horse racing are ageing, with weak youth engagement limiting the influx of new bettors. An ageing demographic reduces the overall betting volume, which is a critical revenue source for the industry. Without strategies to attract younger fans and participants, the sector’s long‑term sustainability is jeopardised, exacerbating the financial pressures highlighted elsewhere in the report.
Vela’s Letter, U‑Turn, and Donation Influence
A leaked letter accompanying the report, authored by Vela as committee chair, claimed the study had been requested by Minister Peters. Peters’ office denied this, stating the report originated from TAB NZ’s committee. When contacted by RNZ, Vela conceded he had misstated the fact. He maintained that, even without the report’s recommended changes, the racing industry would face a difficult future, but he did not believe his donation would affect the likelihood of those recommendations being adopted. Vela defended his contributions as a normal part of democratic participation, while NZ First party secretary Holly Howard emphasized that donations are handled by party officials, not ministers or MPs, and that the party had no awareness of the report.
Tax Concessions, Historical Bailouts, and Expert Critique
Tax specialist Lisa Marriott of Victoria University of Wellington characterised several report recommendations as outright tax breaks, including accelerated depreciation for brood mares and yearlings and 100 % deductibility for New Zealand‑bred yearling purchases. She observed that the industry has enjoyed privileged treatment for decades, unlike other gambling forms that return profits to the community. Historical support includes a $50 million bailout in 2020 (with $26 million covering outstanding supplier bills) and tax reductions in 2018 for “high‑quality” horse purchases. A 2023 agreement with offshore betting giant Entain temporarily outsourced TAB NZ’s monopoly, guaranteeing minimum payouts until 2028; after that, revenues from a 50/50 split of gross betting revenue are expected to be markedly lower.
Industry Outlook, Cottage Industry Warning, and Report Recommendations
Industry veteran Brian de Lore predicts that racing may devolve into a “cottage industry” within ten years, citing declining horse numbers, prohibitive breeding costs, public perceptions of redundancy, and dwindling crowds. While he acknowledges some of the report’s proposals could help, he dismisses the tax recommendations as unrealistic given the current economics of breeding. The report’s five core recommendations are: (1) unify racing governance under a single accountable body; (2) create a Strategic Property Vehicle to deploy industry capital across a rationalised venue network; (3) modernise tax and regulatory settings to revive the foal crop; (4) transfer Racing Integrity Board funding to central government to remove conflicts of interest; and (5) modernise TAB NZ’s legislative framework to diversify revenue, counter offshore leakage, and sustain funding beyond the Entain guarantee. These measures aim to reverse the current downturn and preserve racing as a high‑value export sector.