and express postal and telegraph facilities on the racecourses, by transmitting their telegrams-on a big race day, like the Derby, 16 per cent. Lee, 7412-3. of the whole telegraph business done is in connection with racing and betting-and by taxing them for Income Tax, Super-tax and Death Duties. Your Committee are not impressed by this argument, but if the establishment of betting offices does imply recognition, they consider it is the duty of the State (as prohibition is impossible) to recognise betting by making it more difficult. The proposed scheme makes it illegal to bet anywhere except on a course or in a registered office under State supervision. 5597. They reject the view that the State by registration or taxation is Benson giving any imprimatur to betting. It no more encourages or invites Perkins, betting than by the licensing and taxation of liquor sellers and intoxicants it encourages or invites drinking. They believe that a tax on betting will go a considerable way to assist in decreasing it. Just as education, wiser administration of the licensing laws and high taxation have in recent years put an end practically to drunkenness (not to drinking)-and Your Committee are not prepared to apportion the credit to any particular one of the three-so, they believe, will education, a wise registration law and administration of it with respect to betting offices, and a duty on individual bets decrease betting generally and put an end to excess betting, which is the cause of the great social evil-suffering and demoralisation of character. Having regard to the widespread practice of betting and its prevalence See para. 30. among all classes, on which all the witnesses were unanimous, it is difficult to see how these proposals can increase it. An objection to the betting office has been raised on the ground that it is likely to be a meeting place for disorderly characters and lead to breaches of the peace or to cause long queues of people to collect for the purpose of either making bets or receiving payment of their winnings. The first ground is founded on the experience of the pre-1853 betting offices. But this is no fair comparison. Then the police force was small and comparatively unorganised, the large mass of the people were uneducated and, more important than all, the bookmaker was not licensed or registered and ran no risk of the loss of his livelihood by the loss of his licence through not conducting his business properly. Not a single police witness expressed any fear of such a risk or the slightest doubt of the easy and complete control by the police of the betting office and its customers. Your Committee think that there is no cause for any fear on this ground or that persons who bet or collect their winnings at a betting office are any more likely to be disorderly than those who do so at the office of the totalisator on the course. 42. To ensure the full value of this reform, street betting must be put an end to. Bookmakers must cease canvassing. The practice of having agents perambulating the streets, in all works, mines, shipyards and factories, in rural villages, hotels, stables, racing establishments and, in fact, everywhere, canvassing, calling at artizan homes and urging persons of both sexes and all ages to bet, for the sake of the commission they receive, must cease. Your Committee believe that an opportunity now presents itself to accomplish this.. The crux is the street bookmaker, and his extinction must be assured. It must be made worth his while to carry on his business under the new Statute and the result, they think, will be accomplished. The evidence shows conclusively that the street bookmaker carries on his business on the whole with scrupulous honesty, and, what is more important, that he hates the position of being a pariah of society and continuously hunted by the police. He would, above all things, like to have his business regularised, to be free from the constant artifices to evade the police, to be rid of the cost and trouble of maintaining numbers of agents, outlookers and spies, and Your Committee believe, in many cases, satisfying demands of blackmail. Allow him to carry on his business in an office Thompson, 4026 et seq.; Bigham, 1650-1; Evans, 5246. See also 4803-6; 5008. McLean, Thompson, 402-5; Caldwell, 780; Bigham, 1366-8; Denton, 8911. See also Wilson, 9491. Croll, 4688; Mar- Denton, 8912-3. and a large part of this expense goes. But he is already an adept at the evasion of the law. It follows therefore, in Your Committee's opinion, that there must not be, as a set-off against the advantages that he will gain, the financial disadvantage of a heavy tax. In other words, the position must not be made such that it will be worth while for a considerable number of bookmakers to go on evading the law against street betting and the tax as well. For this reason Your Committee strongly recommend that the tax in the first instance should not be greater than 24 per cent. on the amount staked. Your Committee are satisfied that the majority of street bookmakers would gladly pay this tax to have their business regularised, and could do so. and pay their office expenses as well, as an economic proposition, out of their saving of expenses alone. If they are right in their view that the tax will be paid by a shortening of the odds, it follows a fortiori that the street bookmaker will readily desert the street and establish himself in an office. 43. They further believe that on the passing of such a Statute and the removal of the inequality of the law as between rich and poor, and with the provisions of reasonable means for betting in offices under Government control, the whole attitude of the industrial or poorer class of the population towards street betting would be altered. They do not believe that this part of the population desires to have their streets infested by bookmakers or themselves in the streets or at their work, or their wives at home, importuned to bet, any more than the rest of the population does. They do believe that the hostility to the police and the sympathy with the bettors in betting cases is due to (i) the inequality of the law under which the rich can legally bet and the poor can only illegally bet, and (ii) the widespread and almost universal view that betting is not in itself wrong and should not be legally declared wrong. The evidence of all the police officers before them was to this effect. They accept it, and they accept the further view of these police officers that if the law were so altered as suggested street betting could and should be practically stamped out; in other words the police would be competent to deal with it. 44. They further think that the provision that except on racecourses and other places where it is now legal all cash betting should take place in the bookmaker's office, enforced by the penalty of cancellation for breach of this provision, would put an end to the widespread system of paying commission to agents. It might take some time to accomplish this, but the bookmaker would be careful not to jeopardise his registration any more than the publican jeopardises his liquor licence. No doubt, the betting craze being what it is, men in big industrial works would in practice depute one of their number to go to the office and take their bets or make their bets for them, but in the opinion of Your Committee there is a vast difference between that and the present system of one workman being paid by a bookmaker to importune his mates to bet. 45. By the establishment of registered betting offices the secret and illegal betting houses which permeate our towns will automatically cease to carry on business. This should be borne in mind by those strict moralists who shrink from the idea of an open and controlled betting house, which is the only practicable alternative to the secret and illegal house. 46. They further think that one result of putting all bookmakers and all professional betting on the same legal footing will be to diminish credit betting. At present a credit bookmaker cannot demand cash and can only bet on credit, with the result that however carefully managed his business may be there is yearly a considerable percentage of bad debts, enlarged no doubt by legal inability to enforce payment. Your Committee have no doubt that there will be a marked tendency for these bookmakers to demand cash. This will be all to the good, as they are certain that persons are more likely to bet beyond their means in moments of excitement or in the hope or necessity of recouping losses when they can bet on credit than if they have to put down the cash. Your Committee regard cash betting as less harmful than credit betting. 7949-53. 47. Some have argued that if betting is taxed the bet should be made Heathorn, legally enforceable in our Civil Courts. Your Committee can see no good ground for this: on the contrary they would regard such an alteration of the law as most undesirable and retrograde. The Courts would again be clogged with frivolous betting cases: there would again be the grave abuses so common in the past where older and astute men got hold of young and inexperienced persons, supplied them with money for betting purposes and, often under the influence of drink or excitement, induced them to make improvident bets. Moreover, on the whole, the bookmakers do not desire any such alteration of the law. 48. It remains now to consider the cost of collecting of such a duty as before described. The Board of Customs and Excise, who are most skilled in such matters, placed before Your Committee an estimate of 1} per cent. of the amount collected-or £75,000 for an annual sum of £5,000,000. Your Committee have no means of checking this figure : they think it small and increase it to £100,000. 49. They are therefore of opinion that the imposition of a Betting Duty as above described is both practicable and desirable, that an ad valorem duty of 21 per cent. on the amount staked in each bet will produce an annual sum of £5,000,000, and that its realisation can be safely relied upon. In dealing with the question of desirability, they have not dealt with financial grounds generally, but it is clear that a yearly sum of £5,000,000 is a valuable acquisition to the country's revenue, and, if used for the reduction of taxes that press heavily on the cost of food or of other taxes, will provide a substantial alleviation of the burden on the mass of the people. Christian, 2485; Crimp, MISCELLANEOUS. 50. During the course of the Inquiry, Your Committee heard evidence on some aspects of betting which might have been germane to the matter referred to them and on which they will make some observations if only for the purpose of showing that they have not escaped, but are well worthy of, consideration. The Stewards of the Jockey Club placed the fullest information in their power before Your Committee. It should be understood that while, by its power of licensing racecourses, jockeys and trainers, and its disqualification of horses that run in races on any courses other than so licensed, the Jockey Club has a complete authority and jurisdiction over Flat Racing in Great Britain, it does not concern itself with betting. Betting disputes are referred to and settled by Tattersall's Committee, to which the Jockey Club merely appoints two members, but over which it has no control. After an award is given, if any person is declared to be a defaulter, the Jockey Club, for the sake of good order, warn him off the racecourses under their control. But such warning-off order is purely ministerial and automatic and the merits of the award are not inquired into by them. Jersey, 1425-31. 51. As to horse racing itself in this country, it is the fact that the expenses of racing have increased enormously. Our State, alone of countries where horse racing is carried on, gives no public money for its encouragement or assistance. The stakes are in a great measure provided by the owners of horses and, though the Jockey Club as a term of its licence to many of the gate-money meetings require sums out of the 1504-8. racecourse funds to be added to the stakes, with the result that now the Jersey, Moorhouse, 7596-7, 7672-5. owners find 50 per cent. of the prize money instead of 62 per cent., the expenses of racing and of maintaining a stud of racehorses are so great that only very few of the owners can maintain a racing stable and run racehorses without the assistance of sums won by betting. It may, therefore, be true to say that without betting there would be no racing, but it is certainly not true that without racing there would be no betting. The evidence given orally and the reports on the betting laws in existence in our Dominions and in foreign countries placed before Your Committee show conclusively that betting is an instinct of human nature and, further, See para. 30. that this instinct is specially strong in the Anglo-Saxon race. In the Moorhouse, 7590 et seq. Moorhouse, 7604. Moorhouse, 7697-9. Grieve. opinion of Your Committee, wherever this race goes it will have horse races and it will bet. In a democratic country it is impossible to prohibit either horse racing or betting, and, even if horse racing were to be prohibited, the betting instinct would find another outlet. It was urged before Your Committee by the Society for the Encouragement of Thoroughbred Breeding that if any tax is imposed on betting some portion of it ought to be earmarked for the encouragement of horse breeding by making a State contribution to the stakes at our racemeetings, as is done by most of the other countries which impose a duty on betting. It is undoubtedly true that the racecourse is the only real and supreme test of a thoroughbred horse. It is only there that he can be tested for stamina, soundness, and speed. England is the home of the thoroughbred and it is only here that he can retain his perfection. We have the best, and the world has to come to us for sires to replenish their stock, which always deteriorates after leaving our shores. At home, except for the heavy breeds. the thoroughbred is the foundation of all horses. Horsebreeding is a national industry of great value. It is vital to maintain our superiority in thoroughbred stock. There is much to be said for the request made, but Your Committee had to decide that this matter was not within their Terms of Reference and they make no recommendation on it. 52. Another subject of interest on which Your Committee heard evidence was the installation in this country of the Totalisator or parimutuel system of betting. They had a practical demonstration of the working of a model of the Totalisator as now used in Australia. Having regard to the conclusions to which Your Committee have come there is no necessity to enter into any detailed explanation of these systems. Shortly, the Totalisator is a machine worked by electricity, which (working on a principle analogous to that of a cash register and a calculating machine) registers every bet made with it and shows publicly, as soon as each bet is made, the amount of money staked on each horse in the particular race and the total amount staked on all the horses in that race. As soon as the horses start, a button is pressed and no more bets can be taken. Immediately the Judge has declared the winner he presses a further button; and thereupon the total amount staked, after deducting the percentage allowed for Government Tax and expenses of management, is allotted to the holders of tickets on the winning horse in proportion to the amounts staked on it by them (or in case of place betting according to the due proportions), and on another intimation conveyed electrically that the winning horse is declared "all right" the shares of the winning bettors are paid out. All that the backer has to do is to take a ticket from a clerk behind a ticket office window for the horse he wishes to back at the regulation stake (say 10s.) and everything else is done mechanically on this extraordinarily ingenious machine. It is amazing that however many bets are made at one time the machine registers and totalises them all, and however large the amount staked on a particular race the paying out commences within five minutes of the declaration of "all right." The pari-mutuel system, which is in use all over France, is practically the same as the Totalisator, but is worked in the main by human instead of mechanical agency. There is no doubt that by either of these two systems the backer gets exactly his fair and full odds as shown by the amount of money going on te the horses running in the particular race (after the statutory deductions), and for this reason they are popular with the majority of the public who frequent the racecourses where they are installed. Indeed there is some evidence to show that they are an actual inducement to some people, especially women, to bet. Your Committee directed their consideration to the question whether these systems, or rather the machines, should be made legal here, and whether as a part of the machinery for the collection of a betting duty their use should be made compulsory either on the racecourses or elsewhere. So far as Your Committee's information goes, in all the Dominions and countries where they are compulsorily in use, betting has by statute been confined to the racecourse, and bookmakers have been absolutely prohibited from carrying on business away from the racecourse, where they are regulated and taxed. In some, bookmakers have been prohibited from carrying on business at all, and an attempt has been made to prevent competition with the Totalisator. This prohibition of bookmakers and limitation of betting to the racecourses may be possible in new countries or in countries like France where the habit of betting away from the course is not widespread and is indeed little practised. But without making a minute investigation or having full evidence of the working of these prohibitions in the various countries where they exist, Your Committee have heard enough evidence to satisfy them that the prohibition of bookmakers is ineffective and has only led to take as examples, in France, Ontario and New South Wales-to the rapid and extensive growth of illicit bookmaking both in offices and in the street. The practical working of the Totalisator shows that the large bets gradually cease to be made on it. In Ontario the ordinary bet is 2 dollars, and in New South Wales 10 shillings, and the pigeon-holes or ticket offices for bets of 5 pounds and over are being closed. This is due to the fact that as each bet made is added to the total stake on a particular horse the public is aware of the extent to which it is being backed and rush in to back it, with the result that in some cases where the favourite wins the winners do not even get the amount of their stakes back. Persons connected with a horse likely to win, and those who have information or who have really worked out the horse's form and wish to back it for a substantial sum know that if they use the Totalisator they will in effect be breaking the market against themselves; they therefore make their bets off the course and with bookmakers. Your Committee are satisfied that by no statutory sanction of the Totalisator in this country could betting off the course be prevented or bookmakers prohibited. Stephen, 7285; Fawcett, 7563, 7584-6. Hamilton, 2356; Christian, 2862-5; McCarthy, 3490-3524; 7263 et seq.. Stephen, Yates, 8383 et seq. See also Benson Perkins, 5621-3; Gillie, 58915, 5899-5901. Further, the scheme of racing in this country is totally different from that in our Dominions. Here we have two hundred and ninety-six days Appendix II. in the year on which races are run, and these take place at no less than forty-five different racecourses. With the exception of Newmarket (the headquarters of racing), which has twenty-nine days, Liverpool (ten days) and Manchester (nine days) no place has more than eight, many only six and some only two days' racing in a year. It is improbable that any more racecourses will be licensed by the Jockey Club for many In the Dominions, on the other hand, though racing, particularly in Australia and New Zealand, is extremely popular, the racecourses are more under Government control, they are fewer in number but have actually more racing days in the year on each course and thus there is a better chance of a profitable return on the cost of the erection of the Totalisator. years. |