A campaign to extend the term of the chair of Racing NSW threatens to further inflame its conflict with the other state racing bodies – led by Racing Victoria – which has thrown the multibillion-dollar industry into turmoil and paralysed the national governing body.
Russell Balding has been chair of Racing NSW for 12 years, well past the original statutory eight years, thanks to two previous extensions which required special legislation. Recent guidelines issued by NSW Treasury say directors of statutory corporations such as Racing NSW should “generally be for two terms of three years each”.
Now lobbying is under way to persuade the New South Wales government to again extend his term, a move that would cement the reign of one of the most powerful men in Australian sport: Peter V’landys.
V’landys is the key player in the dispute which has culminated in litigation in the NSW supreme court, pitting Racing NSW against Racing Victoria and all the other state racing authorities.
The impasse has left Racing Australia unable to make important decisions, because Racing NSW has used its veto to block votes. Victoria has a similar veto.
“[Racing Australia] is ineffective because it effectively requires unanimity to make decisions and in recent years that has frequently been impossible to achieve,” said a senior person in one of the other state racing authorities. “Victoria has offered to give its veto up as part of a voting restructure. NSW has not.”
Contentious matters include a proposal to reduce the use of whips in line with European rules, something Racing Victoria sees as central to maintaining the sport’s social licence. NSW opposes the change, saying the whips now in use do not hurt the horse.
There is also a stalemate over “the pattern” – an agreed schedule of Group 1 races, the most prestigious thoroughbred races around Australia – that seeks to avoid clashes and set a timetable so that the top horses race against one another.
John Messara, the owner of Arrowfield stud and a previous chair of Racing NSW, was appointed as an independent chair of Racing Australia in May 2021 to try to break the impasse.
He stood down after 10 months and told Guardian Australia the experience was “very frustrating”.
“The issues are not momentous, in my view, but I was unable to make any headway.
“That’s the point of Racing Australia – to deal with national issues that come up.
“However, people have got issues on matters and at this point in time they appear irresolvable.”
NSW has alleged in its legal action that the current schedule amounts to an anti-competitive restraint of trade – a claim denied by Racing Victoria and the other bodies. In the past few years NSW has started new events in the midst of the spring carnival, which traditionally was the province of Victoria.
In particular NSW wants its marquee event, the Everest – which now carries $20m in prize money – recognised as a Group 1 race.
Begun in 2017 and staged in October, it was seen by V’landys as the way to boost the share of gambling revenue for NSW. It has enraged Racing Victoria, whose state is the traditional home of the spring carnival, while NSW previously held all its premier events in the autumn.
The NSW racing minister, David Harris, says he has met his Victorian counterpart to discuss the rift and remains committed to “a collaborative, constructive process” to thoroughbred racing, but also backs the Everest gambit.
“I have been vocal in my support of the Everest being elevated to Group 1 status,” Harris says. “The Everest is a major event on the racing calendar with significant prize money and interest from around Australia and the world and deserves Group 1 status.”
Horse welfare issues that are the responsibility of the national body also remain unresolved.
Racing NSW has claimed Victoria and the other state racing bodies have engaged in an elaborate alleged conspiracy to exclude NSW from Racing Australia.
Appearing for Racing NSW in the supreme court in May, Tony Bannon SC said documents showed the other state bodies discussing “plan A” and “plan B” to try to get Racing NSW to cooperate with reforms of “the Pattern” by Racing Australia.
Plan B was about setting up an alternative body to Racing Australia that would not include Racing NSW, Bannon alleged.
Victoria and the other states say their main aim is to bring NSW back into the fold, and plan B was about trying to break the impasse.
Key evidence in court documents for the alleged conspiracy includes an alleged “tactical plan” prepared by the prominent PR consultant Sue Cato and her partner on the project, Clive Mathieson, a former editor of the Australian newspaper, for Racing Victoria and the other state authorities. The document war gamed how to beat V’landys – through the media and ultimately, if necessary, through the establishment of a new body that would exclude NSW.
With the parties now in the courts, resolution seems further away than ever.
A polarising figure
The Guardian spoke to tens of people in the industry, but none would go on the record about who was to blame for the impasse.
Privately, some criticise the management of Racing Victoria but others point to Peter V’landys as the sticking point.
V’landys, the chief executive of Racing NSW for nearly 20 years, is both revered and feared, drawing both plaudits and criticisms for his stewardship of the sport.
He has also been chairman of the NRL since 2019.
The board of Racing NSW approved the dual roles he occupies, but some see it as a potential conflict because rugby league and racing compete for gambling dollars, for audiences, for media support and, at times, for government funding.
A former senior minister told the Guardian it was hard to see how the arrangement did not pose a conflict of interest, particularly as Racing NSW is a government statutory corporation, albeit one that has been given autonomy.
That has not stopped V’landys criticising state governments, including when he attacked the former premier Dominic Perrottet last year over the decision to cut $600m in support for an upgrade of suburban stadiums.
Unlike the NRL, which is owned and controlled by the clubs and its members, Racing NSW and similar bodies in other states are funded via a share of gambling revenue, which is prescribed by legislation and topped up with government grants – $35m in the case of Racing NSW in 2021-22.
Racing NSW also controls huge amounts of crown land on which race tracks are located.
Theoretically the government is the master, but in NSW its role is limited to reappointing the board.
Harris says: “Racing NSW oversees and administers thoroughbred racing under the Thoroughbred Racing Act 1996, covering all commercial, welfare and integrity issues relating to horse racing.
“The Act provides that Racing NSW does not represent the Crown and is not subject to direction by or on behalf of the NSW government.”
Jeff Garrett, legal practice director at Attwood Marshall, where he specialises in equine law, says that is because governments have wanted to steer clear of responsibility for ensuring integrity in the racing industry, a perennially thorny issue.
But by remaining at arm’s length, the government has allowed Racing NSW to become a fiefdom with enormous regulatory and financial clout.
Stewards in the racing industry have wide-ranging powers over participants. They can hold investigations and ban people from the sport, including for conduct that brings racing into disrepute.
After 20 years as chief executive, V’landys has appointed or is likely to have been involved in the appointment of almost every key position in the NSW racing industry: the chief steward, the chief vet, even the head of the Trainers Association, thanks to funds which Racing NSW controls.
The Australian Turf Club and regional clubs also depend on subsidies from the state body.
V’landys has undoubtedly grown the profile of racing in NSW and put it on a sounder financial footing. Prize money has increased from $118.9m in 2011-12 to $377m in 2023-24.
Through a mix of longevity, personal relationships and advertising dollars he has gained influence beyond racing into the media and politics.
His power will be tested once more on the decision over Balding’s term as chair of Racing NSW.
The NSW Trainers Association, which receives some of its funding from Racing NSW, has written to the minister urging Balding’s reappointment.
Those who are opposed, including some breeders and horse owners have also been lobbying.
Several senior figures met the premier, Chris Minns, a month ago to urge board rejuvenation. They have followed up with a letter, urging the premier to look at “board renewal” rather than a continuation of Balding’s term.
NSW Treasury released guidelines on appointments to statutory corporations in February.
“A director’s tenure will generally be for two terms of three years each,” the guidelines say. “This allows for periodic refresh to bring in new directors with different ideas and perspective, contributes to improved outcomes in the board’s oversight of the business and limits ‘group thinking’ which could constrain the effective decision making of the board.”
V’landys declined to respond to the Guardian’s questions, other than to list his achievements as chief executive of Racing NSW. Balding referred the Guardian to V’landys.
