Arena Racing Company (ARC) has confirmed that compulsory redundancies are likely as the UK racecourse operator looks to mitigate the impact of betting shop closures resulting from the decision to slash fixed odds betting terminal (FOBT) stakes to £2 (€2.29/$2.62).
ARC estimating that around 1,000 licensed betting offices will be closed as a result of the decision to cut maximum stakes from £100 to £2, it has told staff that it will be forced to reduce its headcount.
The closures are expected to significantly impact media rights revenue, which expected to fall by up to £60m this year.
The racecourse operator was unwilling to share any information on how many positions it expected to cut. It currently employs around 650 permanent staff, and thousands more across its 16 UK racetracks.
ARC has already reduced its executive contribution to prize money for the horse racing industry in 2019, with its prize budget for the year set at £15.3m, down 13% from the £17.5m allocated for prizes in 2018. This is expected to impact 3,406 races across its portfolio.
At the time ARC chief executive Martin Cruddace said the business could not continue to maintain its executive contribution to prize money, and predicted that the impact of the closures would be felt in the racing industry for years to come.
The move to cut maximum FOBT, or B2 machine, stakes from £100 to £2 is set to come into force from April 1, after the UK government was forced to push forward its original plans to bring in the stake cut from October 2019 after MPs rebelled against the perceived delay. It will be accompanied by a 6% rise in remote gaming duty to 21% of gross revenue.
The Association of British Bookmakers has predicted that as many as 4,500 shops will be closed due to the cut, with 21,000 jobs at risk as a result.