Tabcorp set to increase takeout rates for weekend punters

Doug Freeman
Doug Freeman and Tabcorp are set to sting punters with an increased takeout on weekend horse racing and the Melbourne spring carnival

TABCORP is set to pick more money out of punters’ pockets by increasing takeout rates for weekend horse racing.

The gaming giant is planning on charging weekend and Melbourne spring carnival punters more under a secret plan titled “Project Alfred”, which is expected to earn Tabcorp between $2 million and $3 million per year, although it has planned to inject benefits back into promoting the tote.

The company is asking the Competition Tribunal for approval to go ahead with a $11 billion merger with rival Tatts, but counsel for the Australian Competition & Consumer Commission, Andrew McClelland QC, told the tribunal he had received documents in relation to Project Alfred that “cast doubt on a lot of evidence” given by Tabcorp’s witnesses.

“This has just been disclosed to us and has caused us some concern,” McClelland said.

Tabcorp takes a cut of the total amount bet on each race or type of bet – under Project Alfred, this takeout rate will decrease on weekdays and increase on Fridays and over the weekend, which is when the majority of punters bet.

McClelland found some worrying data with Project Alfred, which could exceed the maximum take-out rate.

“They also disclose some plans to increase the take-out rate above the maximum statutory rates in some jurisdictions,” he said.

Doug Freeman, Executive General Manager for Tabcorp, told the tribunal Tabcorp’s “strategy was we would increase the take-out rates on certain days, decrease them on other days” and related what they’re trying to achieve to what corporate bookmakers do.

 

“There was likely to be a net difference which we then intended to use that extra revenue to promote more, just like the corporates do,” Freeman said.

“We presented it to Victorian Racing, we have explained it to our key stakeholder, and they are a total supporter of it.

“The take-out is a minor factor in the indicative dividend. The amount of bets on those horses is by far the most significant driver of that price.

“The take-out is not where competition happens in the parimutuel (tote betting) market. The actual indicative dividend is what the customer looks at.

“The key driver of the indicative dividend is the amount of investments on each runner in the race. So if there’s a large number of bets on a horse in a race, its price will be lower.”

Neil Young QC, representing the James Packer’s CrownBet, said he also wanted to see documents relating to Longitude.

Longitude is software to allow improved management of tote pools.

Young said the new information with Tabcorp’s previous statements that a merger with Tatts would benefit racing by allowing bigger tote pools.

“Again this is a matter not consistent with earlier evidence,” Young said.

Longitude “will have consequences for eliminating any need to make changes to any pooling arrangements”, he added.

Our take and the Twitter reaction

We’re not happy about the increased takeout for weekend horse racing punters and the Twitter users aren’t either.

This is just another way for corporations such as Tabcorp to underhand the punters and they tried to sweep it under the rug.

To think weekend punters won’t notice or care about an increased takeout shows you how misguided these tote betting agencies can be, especially in the world of modern media.

Twitter users vented their frustrations and one user nailed it on the head a couple of months ago.

It’s fair to say no punter is happy with this latest attempt from Tabcorp to thwart the people that keep this industry ticking.

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