Fine Gael and Labour have indicated support for Government plans to provide almost €300 million in State funding to the horse and greyhound industries.
Under plans brought before the Dáil and Seanad yesterday, the Government will commit to providing €296 million to a special horse and greyhound racing fund over the next four years.
The fund will be used to finance various aspects of the industry, including new facilities and race prize funds.
The fund will be mainly financed from the current 2 per cent tax on off-course betting, with the Government making up the expected shortfall directly from Exchequer funds. The decision to increase the fund was one of Mr Charlie McCreevy's last decisions as minister for finance.
The Government set up the fund in 2001 and to date €254 million has been allocated through it to the horse and greyhound industries, with horse racing receiving €206.4 million.
Introducing regulations to provide the funding, the Minister for Arts, Sports and Tourism, Mr O'Donoghue, said the money was needed to enable the two State boards overseeing both industries, Horse Racing Ireland and Bord na gCon, to continue with their development plans.
Both industries would face "very severe financial difficulties" if the current fund was allowed to lapse, he told the Joint Oireachtas Committee on Arts, Sport and Tourism.
Mr O'Donoghue said both sectors contributed significantly to the economy, and that the estimated gross cost of the tax incentives for the thoroughbred breeding sector was €3 million per anum, while "conservative estimates put the combined tax contribution of the stallion and broodmare sector to the Irish economy at €37.5 million".
"Off-course betting in 2003 totalled €1.9 billion and total on-course betting was €237 million. The gross output of the breeding sector is estimated to be worth €330 million per annum. Bloodstock production now accounts for approximately 10 per cent of all livestock production in Ireland and 4.4 per cent of total agricultural output."
Supporting the regulations, Fine Gael's spokesman on sport, Mr Jimmy Deenihan, said that by 2008 the levy on off-course betting would entirely finance the fund. Labour's spokesman on sport, Mr Jack Wall, said he "fully supports what's there in the regulations".