Horse Racing Ireland has conceded there will be job losses "across the board" at Tote Ireland on the back of a seven-year deal with the British Tote.
The new deal between Tote Ireland and the UK Tote Group has been described as an alliance and Tote Ireland will remain a wholly owned subsidiary of the semi-state body, HRI.
There had been speculation some months ago that the 90-year-old State-licensed pool betting operation, which has seen significant falls in turnover in recent years, might be sold off, either wholly or partially.
However on Tuesday there was confirmation of a joint-service agreement designed to bring the UK Tote’s expertise to the Irish Tote’s off-course product in particular.
"In simple terms the off-course element of the business will be operated through the UK Tote Group, the online and the call centre," said HRI's chef executive Brian Kavanagh.
“The on-course will be operated through Tote Ireland, all merged into the one pool operated by Tote Ireland.”.
He said Tote Ireland currently employs 17 full-time staff and more than 400 casual workers for the racecourse. HRI’s top official wouldn’t comment on how many jobs might be lost. However he said there would be opportunities under the new business model as well.
“We will work it out over the coming months but there will be downsizing and there will be a new operating model. We will engage with the staff on that,” Kavanagh said.
“It will be across the board. There will be a new operating model on-track. It still requires staffing. It still requires management. Elements of the administrative support and the call centre online element of it will be operated through the UK.
“So the Tote will look quite different in a year’s time to what it looks like now [structurally\). To the punter it will look very much the same but with new product offerings and increased liquidity,” he added.
Tote betting has declined significantly in recent years and struggled in a radically altered gambling landscape dominated by exchange and online betting.
In 2018 total Tote betting dropped by a third to €69.2 million. A lot of that was due to a slide in international betting into pools. However on-course turnover fell by 7.7 per cent to just €10.7 million.
Last year total Tote Betting slipped again, dropping by 13 per cent to €60.2 million.
“In reality in a betting market as open as Ireland’s, a small Tote will always struggle to compete with the bigger operations,” Kavanagh said
“All the moves globally have been towards consolidation, mainly to give access to marketing resources, technology, product development and so on.
“A small organisation like the Tote will always struggle with that. The intention is to piggyback on the advantages that will come from the UK Tote Group and their access to international markets.”
He added that Irish jump racing holds plenty of international appeal in Britain and France in particular while Irish Flat racing’s appeal extends around the world.
HRI's chairman, Nick Hartery, said in a statement that the alliance will also allow the Tote build a "stronger and more agile on-course presence in Ireland."
Kavanagh later expanded on that and said: “Some of the Tote technology is end of life. It’s at the end of its cycle. So the actual equipment and the way it is operated has changed. There’s a move to more hand-held and more computer based technology rather than the big machines of old.”
The British Tote, which was founded by Winston Churchill in 1928, entered private ownership in 2011. Last October it was acquired by the umbrella UK Tote Group in deal which valued it at over £100 million.
The Group's chief executive, Alex Frost, said on Tuesday: "We are delighted to be announcing this alliance with Tote Ireland. Both organisations are woven into the fabric of racing and bring local and international tote pool betting together across 85 racecourses in Ireland and Great Britain, and nearly 2,000 race meetings a year.
“We will work with the Tote Ireland team to bring innovation and creative thinking to how pool betting is presented to racing fans, both on-course and through off-course digital channels.
The alliance between Tote Ireland and the UK Tote Group is to start on January 1st, 2021.
