Chairman’s Message

Summary of the Chairman’s Annual Report 2016

An Era of Reformation

This is my seventh report as Greyhounds Australasia (GA) Chairman and I am pleased to confirm that the industry is reforming as we promised twelve months ago.

Since mid 2014, GA has led industry thinking on what is required to build a truly sustainable greyhound racing industry.  By mid 2015, the industry was ready to ask the community to give it a chance to rebuild the community’s trust.  It has been granted that chance and is now seeking to be judged on future performance. 

The industry has undergone, and continues to undergo, very significant change.  The key metric is animal welfare not financial success with all members fully committed to the effective management of sustainability risk.

In July of this year, GA announced a national industry vision that included the eradication of unnecessary euthanasia as a national priority.  While there remains a great deal to be done to achieve this vision,  I believe we are perhaps the only livestock or working animal related industry that can now say it genuinely puts the welfare of its animals ahead of industry profit. 

The future of greyhound racing in Australia and New Zealand rests on the success of controlled breeding programs, vastly improved rehoming capabilities and industry culture change.  Industries are now moving to models that match the number of racing greyhounds required to meet minimum commercial agreements to the rehoming capacity of owners, controlling authorities and private rehoming partners.  While the minimum race number requirements may be exceeded in some states, this will not be traded off against the greyhound welfare standards expected of us.  Wagering and market share growth are no longer the sole drivers of those decisions.

Over the next twelve months, I expect all major jurisdictions to publish targets and strategies to achieve full rehoming of every greyhound whelped not subject to any medical, behavioural or legal issue, in line with the RSCPA’s policy.  

The NSW Industry

The year was dominated by the fallout from the February 2015 Four Corners program “Making A Killing”.  The New South Wales industry, including GA’s largest member GRNSW, was subject to intense scrutiny by the Commission of Inquiry into the NSW Greyhound Racing Industry which concluded in June 2016.

Despite the attention from, and requirements of, the Commission, GRNSW, under Interim CEO Paul Newson, was a reform leader.  Among its year’s achievements were the introduction of licencing for previously unregulated service providers such as rearers, enhancing the quantity and integrity of drug detection initiatives, instigating major research studies into greyhound chase motivation and track design and maintenance, and introducing an intelligence led, outcomes focused industry supervision strategy.  GRNSW’s claim to the Commission that it was now a capable regulator and deserved the opportunity to continue change were well founded.  

At the time of writing, the NSW Parliament had passed legislation to close the NSW industry on 30 June 2017.  GA believes the decision, driven by the Premier Mike Baird, to be wrong headed and deeply unfair.  Support for the Bill relied on unverifiable and demonstrably incorrect information from the Commission of Inquiry Final Report and was taken without any consultation with the industry or Coalition MPs, many of whom represent electorates heavily reliant on our industry, and who were well placed to debate the merits of a decision to close.  In making its decision, the government ignored the nature and impact of change since February 2015, the real prospect of significant further change from proposed initiatives and very importantly, the devastation that the decision would bring to people and families both directly involved or reliant on the industry to live.

GA was deeply involved in the NSW Industry Alliance’s efforts to overturn the decision and has continued this involvement by consulting and advising the NSW Reform Panel under the chairmanship of former NSW Premier, Morris Iemma. 

Achievements

During the year, GA facilitated the delivery of a tool that will enable controlling authorities to identify the impact of change on industry sustainability.  KPMG were contracted to build the model which applies evidenced based decision making principles to critical decisions such as breeding volume requirements and the financial impact of decisions which control the numbers bred.   For the first time, controlling authorities can anticipate the impact of decisions, helping choose the most appropriate amongst many change decision alternatives, and to provide both decision makers and participants with confidence in the future.

In March, the CEO and I met with Deputy Prime Minister and Minister for Agriculture, The Hon. Barnaby Joyce, to lobby for change to the regulation governing greyhound exports.  Change is required to eliminate the prospect of a person exporting an Australian greyhound to an overseas jurisdiction that fails to meet Australian welfare standards.  Our request was for evidence of GA’s support of the export be provided as part of the notification of export process.  This evidence would be in the form of receipt of a GA Greyhound Passport.  Mr Joyce supported GA’s proposed change and, while the changes necessary have been referred to state Ministers for process approval, we are grateful for the Minister’s important contribution to improved greyhound welfare.

GA also facilitated the development of a master brand for the state based Greyhound Adoption Programs.  Due for launch in late 2016, the new brand seeks to provide a consistent national narrative about the greyhound breed and their suitability as pets.  It will position the national industry as catering for the welfare needs of all greyhounds regardless of lifecycle stage and including greyhounds deemed not suitable for racing.

Our member bodies have begun the enormous task of bringing previously unregulated service providers such as greyhound rearers in to the regulatory environment.  Overcoming this fundamental regulatory weakness will allow controlling authorities to better manage welfare outcomes at every stage of the greyhound’s lifecycle.  Members progressed different education forums where ensuring participants took home a true understanding of modern community and government expectations was at the forefront.  Members also sought participant and representative group feedback on the nature of their change programs.

The culture change required to re-establish community trust remains possibly the most important of all industry changes.  Several controlling authorities have made substantial efforts to consult with industry this year.  In particular, the success of Greyhound Racing Victoria’s ongoing workshop program, where the GRV leadership establish the rules of engagement and industry leaders control the debate, has provided a useful template for others.   

During the year, GA was grateful for the re-establishment of the Australian Federation of Greyhound Owners, Breeders and Trainers Association.  While primarily the task of controlling authorities, understanding the points of view of participants is a fundamental requirement of GA as a facilitator of change.  I welcome President Brenton Wilson’s engagement with GA during the year and look forward to this group’s strong contributions in the future.

Challenges

Governance

Industry governance changes have started to challenge the role and financial viability of GA.  The establishment of the Queensland Racing Integrity Commission on 1 July this year, the recommendation to the Victorian government to establish a Victorian Racing Integrity Unit in 2018 and the continued role of the Office of Racing Integrity in Tasmania challenge the traditional GA purpose and membership.

During the year, generating national consensus on rules and policy was becoming more challenging.  Greyhound Racing Victoria and Racing Queensland must continue to respond effectively to the Perna/Milne and McSporran Inquiries as their priorities and Greyhound Racing NSW was obligated to proceed cautiously while the Commission of Inquiry remained on foot.  The omnipresent threat of government intervention in other jurisdictions also called for the prioritisation of local responses, often ahead of national ones. 

In response, GA has reviewed its pre-Board decision making process and is to form a suite of new and revised committees to set and maintain an implementable national agenda.  These committees will utilise the expertise of significantly improved legal, policy and compliance resources within our member bodies to complement our subject matter expertise and make uniform, responsive and binding decisions in the interests of all current and future industry participants.

Financial Performance and Sustainability

GA’s financial position is sound although there is significant risk to the company’s viability.

The year produced an almost perfectly balanced budget against a very modest budget surplus.  This was an outstanding result considering there was a significant reduction in Frozen Semen Database Fee income, primarily as a result of a dramatic fall in breeding market confidence leading to an over 40 per cent decline in breeding volume.

Historically, GA’s revenues have come almost exclusively from participants paying a fee for service.  The fees to name a greyhound; to have a breeding female inseminated with frozen semen; to register or transfer a breeding unit; and to DNA greyhounds have been sufficient only to cover GA’s modest outgoings.  The fees have traditionally been kept as low as possible to encourage participation. 

This approach did not adequately address the risk of external shock.  To address the future revenue shortfalls, the Board approved a request for members to pay an annual membership fee to cover costs starting in FY17.  The amount payable reflects each member’s GA voting entitlement, which is, broadly, a product of their capacity to earn income. 

While GA has been a very strong advocate for significant reductions in breeding volume in many jurisdictions to eliminate unnecessary euthanasia, the growth of the dual regulator model and the current rule and policy settings in place to achieve new sustainable breeding volume levels mean that further long term structural change to the GA budget is likely.

Core Service Delivery

As the challenging year progressed, GA remained focussed on delivering high quality service to participants and members.  GA named 12,141 greyhounds, processed 1,760 FSI Services, 2,230 FSI/Breeding Unit Registrations and 2,260 FSI/Breeding Unit Transfers.  We sold 1,425 DNA kits and registered 46 Sires.  Edition 63 of the Stud Book was produced and hundreds of queries on all matter of things to do with our great industry were answered by the GA team.

Thank you

I extend sincere gratitude to my fellow GA Directors for their support of me and the GA team throughout this difficult year.  I don’t under-estimate the complexities in being asked to support national consensus wherever possible with the responsibility to progress the unique changes required of their own jurisdictions.

Long standing Directors Adam Wallish, Mark Bottcher and Jim Leach resigned their roles and I thank them for their wise counsel during their tenure.  Thank you also to the contribution of Ian Hall whose tenure coincided with the term of his contract as Administrator of Racing Queensland.

New Directors Dale Cartwright, Alan Clayton, Barry Hamilton and Phil Holden were welcomed and each has an important role to play in helping GA fulfil its charter.

To GA staff members Steven Hosking, Michelle Grima, Marsha Zinas and Heather Villinger, thank you on a job very well done.  Congratulations especially to Michelle who hit eleven years’ service with GA this year.

Our Chief Executive Scott Parker continues to focus on the industry’s sustainability challenge.  His arguments supporting the need for significant industry reform back in early 2014 have proven prescient and his contribution to the design of a sustainable industry model beyond racing requirements has been a major factor in being given this chance to restore public trust and retaining a fighting chance of survival in NSW.  Scott’s capacity to anticipate challenges to the effective governance and financial viability of GA and to devise solutions has been much appreciated by the Board.  Thank you Scott for your leadership, resilience and commitment to this industry.

Finally, as always, my thanks to our 30,000 owners, trainers and breeders in Australia and New Zealand who are so invested in the success of this code.  It will be your willingness to accept change as being in the best interests of all current and future participants that will be the greatest contribution to our future success.  Good luck to all of you.

Russell Ware
Chairman
Greyhounds Australasia Ltd

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