UK Tote Group – Supplementary written evidence (GAM0112)

Introduction 

1. The UK Tote Group would like to sincerely thank the House of Lords Select Committee on the Social and Economic Impact of the Gambling (“the Committee”) for their invitation to Alex Frost, Chief Executive of the UK Tote Group, to provide oral evidence to the Committee on Tuesday 28th January 2020.

2. The UK Tote Group acquired the Tote on Wednesday 16th October 2019, after the closing date for written evidence to the Committee. Therefore, to support the oral evidence provided to the Committee last month, the UK Tote Group would like to submit the following written evidence for the consideration of the Committee.

Introduction to the UK Tote Group

3. The UK Tote Group is the proud owner and steward of the Tote, the UK’s leading pool betting operator. The company is backed by over 160 individual investors, the majority of whom are racehorse owners and breeders. Investors are united by a shared desire to see a revitalised Tote which provides better value and an improved experience for customers, as well as ensuring the Tote is back at the heart of British horseracing, helping to financially secure the future of the sport.

4. The UK Tote Group has the support of leading figures from across the sport including Champion Flat Trainer John Gosden, twice Epsom Derby-winning jockey Frankie Dettori, 20-times Champion Jumps Jockey Sir AP McCoy, and TV presenter Clare Balding.  

The History of the Tote

5. As the Committee is no doubt aware, the Tote has been a fundamental part of British horseracing since 1928. It was established by an Act of Parliament when Sir Winston Churchill was Chancellor of the Exchequer in order to:

• Provide a safe, state-controlled alternative to illegal bookmakers; and
• Ensure a proportion of revenues were used for “purposes conducive to the improvement of breeds of horses or the sport of horseracing”.

6. The Tote stayed in Government ownership until 2011 when it was sold to Betfred who went on to sell it to the UK Tote Group in October 2019.

How the Tote operates

7. The Tote is a pool betting operation offering single and multileg bets on horseracing, including the Placepot and Scoop6. The full range of Tote bets can be found at tote.co.uk. It is distinguished from fixed-odds betting as customers bet into a pool with each other, and do not bet against a bookmaker. This ensures the Tote is agnostic about results and welcomes winning customers.

The Tote and Responsibility             

8. Responsibility is at the heart of the Tote and central to this is ensuring a safe betting environment for customers. The Tote’s website offers customers a range of safer betting tools. These include:
• Deposit and loss limits;
• Time outs;
• Reality checks;
• Self-Exclusion – for the Tote individually or via Gamstop; and
• FAQs and Guidance around responsible gambling.

9. Through dialogue with stakeholders and learning from independent research, as well as customers, policymakers and technologists, we plan to develop and constantly improve the Tote’s commitment to safer betting.

British Horseracing and the Tote

10. The Tote is built on the success of British horseracing. The sport enjoys the patronage of Her Majesty the Queen and is widely recognised as the best horseracing jurisdiction in the world. It makes up an important part of the UK’s economy and society, including:  

• Contributing £3.5 billion to the UK economy, with employment of over 85,000;
• Being the second most attended sport in the country with between 5 and 6 million people going racing every year, of which 40% are women;
• Hosting 4 of the top 10 highest attended sporting events in the UK;
• Putting on nearly a quarter of the best 100 races in the world; and
• Being the most broadcast sport through free-to-air TV via 4-year deal with ITV.

11. The Tote has a strong and unique financial bond with British horseracing based on a seven-year partnership with racecourses which will see the Tote pay a minimum of £50 million to the sport. This is in addition to paying the Horserace Betting Levy, sponsoring races and supporting some of horseracing’s leading equine charities and good causes.

The UK Tote Group’s global plans for the Tote

12. As a pool betting operator, the Tote is powered by liquidity (just like lotteries are). The global market for horserace pool betting totals over $100 billion.  Although British horseracing hosts a quarter of the best 100 races in the world, the Tote’s share of the pool betting market is less than 1% as illustrated in the map below:

13. The UK Tote’s share of the global market can be revolutionised in the years ahead by collaborating with international pool betting operations around the world. Several leading horseracing jurisdictions have already indicated they are keen to work with the Tote on the basis it can benefit horseracing globally.

14. This year’s Royal Ascot marked an important moment for the Tote. Together with the Hong Kong Jockey Club and Ascot Racecourse, it launched “World Pool”. This saw customers from 13 countries having the opportunity to bet into a single pool on races from Royal Ascot.  Overall liquidity grew from £18 million to £92 million (+415%), along with the first ever £1 million pool on the Diamond Jubilee on the final day of the meeting.[1] This provides a clear template for future collaboration with pool betting operators.

The role of the UK Government in the success of the Tote as a proud British Brand

15. The UK Tote Group plans to continue to grow the company’s headquarters in Wigan, along with an additional office in central London. We have already trebled the workforce since acquiring the business last year and plan to develop an apprentice scheme for young people in the technology sector.

16. The Tote is working with the Government to unlock future international opportunities and increase the returns from pool betting to British horseracing, while making an increased contribution to the UK economy.

17. This includes collaborating with the relevant organisations in British horseracing, as well as working with the Department for Digital Culture Media and Sport (DCMS), Department for International Trade (DIT) and British Embassies to build strong relationships with the relevant people.

18. A revitalised Tote will be a success story which can be championed by the Government to illustrate the country’s leadership in horseracing and responsible sports betting.

18 February 2020