Racing Amendment (Integrity and Disciplinary Structures) Bill 2018

Ms PENNICUIK (Southern Metropolitan) — I rise this evening to speak on the Racing Amendment (Integrity and Disciplinary Structures) Bill 2018, which is an interestingly named bill. It is basically a bill that follows on from a number of other bills that we have seen in this place very much since the problems with greyhound racing that were demonstrated with the live baiting scandals back in 2014 and the reports from the chief veterinary officer and the racing integrity commissioner on that in 2015, and this bill follows on allegedly from the recommendations of the Bittar report in 2016. Of course following the live baiting scandals across south-eastern Australia was the New South Wales special inquiry into greyhound racing, which uncovered the sheer number of greyhounds that are killed in that sport every year. I will return to that a little later in my contribution.

I feel like I am back where we were five months ago in March when we were debating the Racing Amendment (Modernisation) Bill 2017, which I described as a bill that did very little and not much at all. All it really did was change the appointment of people to the board of Racing Victoria such that there would be an advisory panel made up of racing people to appoint people with racing backgrounds to the board of Racing Victoria, and that is exactly what happened with the first appointment of people to that board.

We have integrity and disciplinary problems across all the racing codes, which all the speakers have mentioned very briefly. But one of those of course has been the doping scandal that played out across the media for a very long time late last year and early this year, and that was the doping crisis that was linked to basically every racing track in Victoria, including the major country tracks, and involved more than 100 horses. It had been going on under the noses of the so-called integrity bodies — Racing Victoria and the racing integrity commissioner — for something like eight years without being detected. So that is the sort of problem we have. There also have been ongoing issues with race fixing, and we have had people in the greyhound industry who have been convicted of offences and are still allowed to participate in the industry. So that particular bill did not do much in terms of the so-called modernising of the governance structure at Racing Victoria.

Of course the issue that I raise is the problem with the bill we have before us now — that the integrity functions and the commercial functions of the racing codes have not been separated. That has always been the issue. You need to separate the integrity functions from the commercial and promotional functions of the three codes: Racing Victoria, Greyhound Racing Victoria and Harness Racing Victoria. That is, in fact, what Mr Bittar recommended.

I read his report back in 2016, and I re-read it again in preparation for this bill, because the minister said that this bill implemented the recommendations, the intent and the spirit of the Bittar report, but it does not do that. It falls short of the major change that is required. I will talk about the report of Paul Bittar: Review of the Integrity Structures of the Victorian Racing Industry. It is quite a comprehensive report reviewing those structures and looking at other jurisdictions in Australia and New Zealand. Of course Mr Bittar himself is well-known for his role as the head of the British racing industry, so he is a racing figure.

He came up with two models and his own model. One was called the strengthened coordination model, one was called the key functions combined model and one was the Victorian racing integrity unit (VRIU) model which he proposed. He said, with regard to the other possible models which are based on models that exist in the other jurisdictions except for Tasmania, which has separated its functions, that:

Ultimately, while the 'strengthened coordination model' and the 'key functions combined model' have a number of the attributes of the VRIU model, the key element they couldn't deliver on was the governance separation of integrity from commercial and genuine cross‐code commitment.

The particular points that he identified as strengths of the model that he was proposing — the Victorian racing integrity unit — was that the integrity functions would be free from the influence of commercial arms of industry, would deliver clear lines of accountability of all aspects of integrity services and would provide a central point of coordinated and effective intelligence sharing and management systems. These were amongst about four or five other aspects, but I think they are the key ones that he put forward. He also made another point on the following page, page 41, of his report that:

There is also likely to be greater confidence in providing intelligence if it is going to a dedicated integrity body that is responsible for total oversight of the racing industry.

I think that is a really important point, but that is not what this bill delivers. It does not deliver anything like that.

If I go to the provisions of the bill, it establishes the Victorian Racing Integrity Board, which is the body ostensibly modelled on the Victorian racing integrity unit proposed by Mr Bittar, but it does not resemble it very much. The bill also replaces the existing Racing Victoria, Greyhound Racing Victoria and Harness Racing Victoria racing appeals and disciplinary boards with the Victorian Racing Tribunal. This bill actually establishes the Victorian Racing Tribunal, and in fact that is the main part of the bill. Most of the bill is taken up with that.

It is interesting that it seems to me to resemble the Racing Appeals Tribunal, otherwise known as the RAT, which was abolished several years back. Appeals powers were given to the Victorian Civil and Administrative Tribunal, which Ms Bath was referring to. I note that in the Bittar report the reason given by the codes as to why they wanted that function taken from VCAT was that things took a long time, longer than they wanted the cases to be heard et cetera. But the Lewis report back in 2008 found the same thing about the Racing Appeals Tribunal. That was in place before this particular mechanism was put in place, so in fact that mechanism did not work and the previous one apparently did not work. Let us see if this one does.

I am a bit concerned that there is no outside body to which appeals by either offenders or the stewards could go to, because this whole thing, this whole structure, is so insular and just involves racing people, so that is another problem. If you look at Mr Bittar's report, he outlines on pages 58 and 59 the consultations that were undertaken for that report. Of course the Minister for Racing in his second-reading speech says, 'Well, the point of the review is to consult with the industry', and consulting with the industry is exactly what happened.

There are 24 industry bodies — I will admit some of them were other sporting bodies, but mainly they were racing industry bodies — and also various licensed persons from the codes, various club directors and executives, various form analysts, members of the racing media et cetera. These are the people who were consulted by Mr Bittar, who is also a racing person. The RSPCA is the only outside body mentioned in his report. Some of the other sporting codes are mentioned, and the reason he went to them was to see how they dealt with the conflict of interest that exists when you are the promoter and commercial arm and also the integrity arm. That is a conflict of interest that is very difficult to overcome. Mr Bittar mentions it many times in his report, and he says that not only is it there but there is a perception in the community that it is there. And it is there, and there is a perception that it is there. This bill does nothing to overcome that.

Mr Bittar did not really go outside the racing industry to get any views from anywhere else about how you could improve integrity in the racing industry and across the codes, which would have been a good thing. There are integrity bodies, there are academics, there are organisations, there are ethics organisations who could have given some advice about that, but that was not sought by Mr Bittar. Although, to give him credit, he did a good job at analysing what was occurring across the codes and in the other jurisdictions in Australia and New Zealand for comparison's sake. But the model that he put forward is not the model that is in this bill.

The Minister for Racing in his second-reading speech makes the same comment as to why the integrity functions and the commercial functions have not been separated as recommended by Paul Bittar — this is on the second page of the second-reading speech:

The codes argued, and the government has accepted, that it is appropriate for them to retain responsibility for reviewing and enforcing the rules of racing. It is also accepted that they are responsible for licensing policies.

In other words that is what the industry wanted, and that is what they have got.

So here is a major disappointment and a lost opportunity to actually meaningfully make a difference and institute a much-needed structural change in terms of integrity in the racing industry, but it has not been taken. Despite everything that has been said, that opportunity has not been taken.

As I say, the lack of consultation beyond industry participants is a concern, because if Mr Bittar had gone out and sought some other independent advice on this, he would have come back to realise that we do need to separate the commercial and integrity arms of those codes.

Just in terms of the setting up of the Victorian Racing Integrity Board, which is in part 5 of this bill, the government's model establishes that board, which it says fulfils the intent of Mr Bittar and complements the racing bodies and strengthens relationships with them. This board will receive integrity plans from the three codes and oversee the relationship between the three codes. It will consider and provide direction to, and address any problems with, the integrity departments of those codes. It will review and make recommendations on licensing.

Actually the function of licensing should be taken away from the codes and given to another body as well. I mean, you would have to look pretty far to see many other industries that run their own show, make their own rules and issue their own licences without any oversight — particularly an industry that has ongoing integrity problems because it involves wagering. It is different from any other sport. Mr Bittar was looking at the other sports and he made the comment in his report that he looked at them to see how they dealt with integrity and the conflict that — he says in his report — exists between integrity and commercialisation. But he made the point that the real difference is that they do not involve — well, they had not hitherto involved — so much betting, because we do now have a lot more external agencies betting on other sports, so it is becoming an issue there, but it is very much an issue in the racing industry.

This board will be set up with a chair and so-called independent deputy chairs, who must all have — there will be three of them — a knowledge of the racing codes. So there will be one from Greyhound Racing Victoria, one from Racing Victoria and one from Harness Racing Victoria. I concede that the government has set a very high bar in terms of their judicial experience to be able to be appointed to the board, but I have to wonder how a person can gather so much knowledge and experience of a racing code if they are not very involved in it or have not been very involved in it. So there again is another problem with this structure.

Mr Bittar said in his report, 'Well, one of the big issues is culture. You know, we really need to fix the culture of these organisations'. I could not agree with him more; they do need to be fixed. That has been identified by the New South Wales inquiry into greyhound racing, by the inquiry into thoroughbred racing, by the inquiry into harness racing, by the racing integrity commissioner and by the chief veterinarian. They all said that, and everyone would have to agree. I think it was Sal Perna who said that it was endemic, the culture of the greyhound racing industry and their reluctance to reform themselves.

But he played down the structure more than I would, because I say the structure that you set up will dictate what outcome you get, and if you still have a structure that allows the codes to run their own show and their own integrity with some oversight from this new board, you are not going to get much of a different outcome, and not only that but this board will be paid for by the codes. That is the government's model.

The model that was recommended by Paul Bittar to establish a Victorian racing integrity unit was for the delivery of integrity services across the three codes independently of them with an independent selection panel to encompass rule-making, policy, licensing and animal welfare, to cover all race-day regulations, stewards, veterinary services, intelligence and investigations, and to establish memorandums of understanding with external agencies to run training for integrity staff.

He made the point, which I mentioned before, that there is likely to be greater confidence in providing intelligence to a dedicated integrity body with oversight of the industry and the perceived conflict of interest with regard to not doing that. And I agree. I think that people would be more likely to take intelligence to a body that is separate from the actual codes, and I would suggest that a lot of the problems of things never being uncovered have occurred because perhaps people have tried to report matters to the codes and they have not been taken anywhere by those codes in the past, which is why you could have a doping scandal running for eight years in the state of Victoria with nobody seeming to know anything about it, even though they are called integrity councils and integrity commissions. I think that the board as it is being set up by the government is a lost opportunity. It is not what should have been done. It is not what I have understood would be done when I have suggested the government get on with it on other occasions. That is part 5 of the bill.

There are some functions which I will go to in committee stage with the minister, such as conducting investigations and referring some investigations to the racing integrity commissioner, who may then refer them back to the Victorian Racing Industry Board, which I think seems a bit circular and confusing. I also think this structure that is being set up is not very straightforward or streamlined or separated; there is a lot of overlap, so I will ask the minister for some clarification on that. That is the board that is being set up. At the moment there is no oversight of the codes really, so perhaps some oversight is better than no oversight, but the elephant in the room is that everything is pretty well left in place except you are putting in a board to do a bit of oversight. That is basically all that is happening here.

The disciplinary part of this integrity and disciplinary structures bill relates to the recommendation by Mr Bittar to do away with the appeals and disciplinary boards that the four codes have and to put in place a different structure. Now the government is putting in place what I think is a main part of the bill, which is the Victorian Racing Tribunal. When looking at that, it may work, notwithstanding the comments I made before that the previous Racing Appeals Tribunal was disbanded and the VCAT process was put in place and that is being disbanded for the exact same reason that the first one was disbanded.

However, going to my point about separation, the Minister for Racing on the fourth page of his second-reading speech says about the racing appeals and disciplinary boards (RADBs) that:

There is a perception in the industry, particularly from participants, that the existing RADBs are not properly independent of the controlling bodies.

Well, I think it is not only a perception; it is a fact. Also:

… there are concerns across the industry about the suitability of VCAT to hear racing appeals, especially on a merits review basis.

I found that a quite curious comment from the Minister for Racing because VCAT is set up to hear appeals on any number of matters and has been hearing appeals on racing matters for a good 10 years. There is no reason why there cannot be a particular list in VCAT, and there probably is, to deal with these issues, as there are lists for all manner of other things that VCAT is able to look at. There were comments also about the tribunal not having experience and knowledge of the industry. I think really they just need to have experience and knowledge of the law to be able to sit as a VCAT tribunal member. I am not sure whether this was entirely necessary, but I think that all things being considered it could work well. Let us hope it does.

There are some changes being made to the Office of the Racing Integrity Commissioner under this bill to give more power to the commissioner to compel people to attend hearings, produce documents et cetera, to get the relevant information that is needed. I think they are good changes and I welcome those. I have always thought the racing integrity commissioner probably needed more powers. Perhaps if the racing integrity commissioner had had more powers in the past some integrity matters that we know about in all the racing codes may not have gone as far as they have. The bill also gives the commissioner statutory immunity.

The bill also make some changes — these are not mentioned in the purposes clause of the bill — to Greyhound Racing Victoria (GRV). These changes, according to the second-reading speech of the Minister for Racing:

… provide clarity and certainty for GRV in the exercise of its power to licence and register greyhound racing participants —

including suspension, cancellation et cetera. It clarifies that:

… it has the power to apply a fit and proper person test …

It expands the powers of entry of members of the board and authorised officers to premises where greyhounds are kept and to inspect those premises et cetera. Again, they are welcome powers or clarifications, but they will not do much, given that we have not actually fixed the problem, which is that we have the commercial and the promotional wings still tied in with the integrity of these bodies. That is not the case around the world. It is not even the case everywhere in Australia. It is not the case in Tasmania and, as I understand it, it is not the case in Queensland either. As I said, I think it is a totally lost opportunity.

I want to go back to the second-reading speech from the Minister for Racing where he claims that the Victorian racing industry contributes more than $2.8 billion annually to the Victorian economy and employs more than 29 000 people. I am presuming that the minister got that figure of 29 000 people from the 2013 independent expert's report on the size and scope of the Victorian racing industry. That report makes a disclaimer and says that the figures and sources of the information it bases its report on have not been audited.

IBISWorld released its report on the horse and dog racing industries in Australia in 2017, which examines all codes of racing nationally from 2015 to 2017 and forecasts trends up to 2021. It found that in the industry as a whole revenue is set to fall at a rate of about 2.3 per cent by 2021, and that employment is in decline from 17 000-odd jobs to around 9000-odd jobs. So there is a very large discrepancy between the number of jobs claimed by the industry and the number that has been claimed by the minister without checking his facts. I am not sure exactly what the facts are. I am just saying that there is a large discrepancy there, and there are a lot of people outside of the industry and outside of the minister and his office who say these figures are very questionable. That, I think, is itself an integrity issue — that we have ministers who refer to figures that are not correct.

In terms of greyhound racing, for example, towards the end of his second-reading speech the minister made the claim that greyhound racing is worth some $408 million. Again the report from which this figure comes says:

This report … has been produced independently … as requested by Greyhound Racing Victoria … The report has been prepared to meet the requirements set out by GRV … The information, statements, statistics and commentary … contained in this report have been prepared … from a combination of publicly available material, Greyhound Racing Victoria data and from confidential discussions …

et cetera.

IER has prepared this report on the information that was received or obtained, on the basis that —

it —

is accurate and, where it is represented to IER as such, complete. The information contained in this report has not been subject to an audit.

But the $408 million is not actually direct expenditure on greyhound racing. The figure even in this report is $298 million, and the $408 million is total value added, which anyone knows, if they look at any of these economic reports, is money that is spent on greyhound racing. But if it was not spent on greyhound racing, it would not disappear in a puff of smoke and not be available or not spent in the economy; it would be spent on other things.

It is very disappointing that the government keeps coming in here and talking about the value of duck shooting to regional areas, for example, using very, very spurious figures that are not overseen and not tested. I think that governments should be very accurate with the figures that they use and not rely on figures supplied by an industry that is promoting itself. I do not think there is anything in this bill that is going to require the Victorian Racing Integrity Board to actually verify the information that is put out in the annual reports of Racing Victoria, Greyhound Racing Victoria or Harness Racing Victoria.

I just wanted to go, as I usually do, to the animal welfare issues that are endemic to these industries. I talked before about the live baiting scandals that were exposed in 2014 that members from all sides, including Ms Bath, have said need to be stamped out, and of course they do. But the biggest problem in greyhound racing has always been the over-breeding and the incredible number of animals that are killed every year for no particular reason other than that they are not winning races anymore or never were winning races, so they are not a profitable product.

Now Greyhound Racing Victoria has moved on that issue because of the public outcry about it. The racing integrity commissioner in his report in 2015 estimated that 4000 healthy greyhounds were euthanised for no reason whatsoever every year in Victoria. Greyhound Racing Victoria in the following year, for the first time, reported that that figure was something like 3100, and in its most recent report it claims that figure has gone down to around 1500. Now, that is still 27 dogs per week, but nobody is really verifying that. Who is actually checking those figures? Nobody. There is no integrity with regard to that. In any case, that is still far too many dogs being killed in greyhound racing.

Earlier this year I presented a petition with regard to greyhound racing asking the minister to phase it out and close it down. In that petition we noted that of the 231 race meetings in Victoria in the first 10 weeks of 2017 only 11 were free from an injury or death. So there is an awful lot of dogs that are also injured in greyhound racing. This is a sport that is based on exploiting animals only so people can bet on them. Victoria is awash with gambling opportunities, whether it be with the three racing codes or whether it be with poker machines, which the government has licensed into perpetuity for Victoria to have the most poker machines per capita anywhere in the world.

On the issue of wastage in the greyhound racing industry, it is the same in the thoroughbred racing industry, where thousands of horses every year are killed just because they are no longer winning races or never were winning races. All of these industries are based on that particular fact, and it is not a fact that many people talk about in here, but it is an uncomfortable truth. The Coalition for the Protection of Racehorses have called for 1 per cent of the Victorian Racing Industry Fund from unclaimed wagering to be spent on rehoming thoroughbred horses, and so it should be. There is nowhere near enough being done in this regard.

A long time ago the Senate called for whips to be taken out of racing. Some countries have done that already. There is no need to be whipping horses. I was speaking the other day in here about the debacle in Bendigo where several horses were injured in the first two races of an event that should never have been held because the track was way too hard for jumps racing. They were still very long races of 3.2 kilometres and 3.6 kilometres, at speed, forcing horses to jump over jumps with whips. Fourteen of them fell over. About half the horses did not finish the race. I do not have the exact figures here, but you can look back at what I did say, and I got the exact figures from the steward's report. There were also fines for jockeys in that particular event for misusing whips.

We have got a litany of animal cruelty problems. In terms of jumps racing, it is banned everywhere except Victoria and South Australia. Horses are 20 times more likely to be injured, and they are catastrophic injuries, because they are jumping. They come down, they break their necks, they snap their legs and then vets come out, put a screen around them and shoot them on the track. It is not the sort of spectacle that we should be promoting in this state. It has been banned in all of the other states for a long time because of this cruelty and because of the injuries that occur to horses. I have since learned that another horse that fell at that race has died. I bet — and I hate to use that word — there will be more horses that —

Mr Finn — What price?

Ms PENNICUIK — Members might think it is funny that horses fall and break their necks and snap their legs, but I can tell you I do not think it is funny, and it happens in jumps racing every single time there is an event. Every single time there is a horse injured and they do not appear again — they just disappear. That is an activity that should be — and should long ago have been — banned, but it is not banned because the minister says, 'It is up to Racing Victoria'. Well, Racing Victoria is conflicted, because jumps racing is a commercial activity and it does not want to use its integrity or its animal welfare powers or anything else to trump that commercial activity.

I do not even understand why it has any commercial value anymore. I am very sure if jumps racing was to be phased out, no-one would notice except for people like me and many others in the community who would not have to worry about the horses that get killed and injured in it. Most people in the community hate jumps racing, even people in regional areas. It is one of those other myths that we hear, that everybody in regional Victoria loves to see horses putting themselves at risk by jumping over hurdles at long distance at great speed and hurting themselves. That is not what people like to see at all. A lot of people probably do not go to those racing events because there is jumps racing there.

There is a lot to do in terms of fixing the integrity of the racing industry. This bill does a few things. Perhaps the board will provide some oversight where there is basically none. I do think that further powers for the racing integrity commissioner are warranted and probably overdue. Clarification of what can happen with Greyhound Racing Victoria is not a step backwards but it is not a major step forwards either. The Victorian Racing Tribunal may work, but again it is very enclosed in the whole racing bubble. Everything in it is racing. Everything is run by racing people. All the boards are populated by people who have been involved in racing a long time and have an interest in racing. Although I do understand that you will not be allowed to be on the board if you have any ownership or interest in actual racing, apart from that it is such an insular and circular industry that does not have any oversight from outside.

Even just looking at the consultation, as I mentioned earlier, in the lead-up to this bill there was no consultation; nothing that is listed anyway. Mr Gepp got up and listed who had been consulted and there was no-one outside the racing industry that he mentioned. Mr Ondarchie reeled off a whole bunch of people that were consulted: basically the racing industry. So the racing industry has been very well consulted about this. But in terms of getting some outside perspective on what the problems are with this industry and putting in place a structure that will actually do something to improve integrity in the industry, this is not the bill that does that.

But it does make some slight improvements, and that is all we ever get in terms of fixing the racing problems. We get a lot of talk about how 'everything is going to be fixed, and yes, we will put in what Mr Bittar recommended', but that is not what we have got here. It is just some small improvements, and I am not sure about the Victorian Racing Tribunal because it is basically a racing tribunal. It would have been better if there had been some outside oversight in that regard too.

With not long to go, I think this is an important issue to many Victorians who are concerned about integrity and the issues that have been going on across the racing industry for a very long time. There has been scandal after scandal, whether it is doping, whether it is race fixing or whether it is animal welfare issues, and I do not think this structure is really going to do much to make that different.