Thanks very much.
Good morning, Madam Chair and members of the committee. Thank you very much for the opportunity to speak with you today. I'm the executive director of the Canadian Pari-Mutuel Agency, CPMA. Let me start by explaining a little bit about the CPMA.
The CPMA is a special operating agency situated within Agriculture and Agri-Food Canada that regulates and supervises parimutuel betting on horse races. The legislative authority was established in the 1920s.
The mandate of the CPMA is to ensure that parimutuel betting on horse racing is conducted in a way that is fair to the betting public.
You might not be familiar with the term “parimutuel”. Very simply, it's a form of betting that is pool-based, where the bettors are competing with each other for a portion of the pool. The winners divide the total amount of the bet—that is to say, the pool—in proportion to their bets, less a predetermined percentage for the management of the pools by the racetrack operators, applicable provincial taxes and the CPMA's federal levy.
The CPMA's funding model is set up under the Revolving Funds Act, which means it does not receive any government funding. Rather, its revenue is generated through a 0.8% levy applied against each dollar bet in Canada on horse racing.
The total amount bet in Canada on horse racing in fiscal 2019 was $1.2 billion, which generated an annual revenue of just over $9 million for the CPMA. The sector and the CPMA rely on the revenues earned from this betting to fund their operations. Over the last decade or so, these funds, the total amount bet in Canada, have been declining steadily. In the last 20 years, they have dropped by about 27%.
With the funds generated through its levy, the CPMA currently monitors parimutuel betting at 31 racetracks and 145 betting theatres. Betting theatres might be something that you're familiar with at your favourite sports bar. The CPMA has a staff of 31. I'm going to very quickly highlight the three buckets of things that we do.
First, we provide regulatory approval and oversight for betting on parimutuel horse races. This includes, for example, ensuring accurate calculations of the amounts retained by the racetrack operators and the amounts paid out to the winners. We investigate complaints, and we audit systems.
Second, we issue betting permits and licences to Canadian racetracks and their associated betting theatres.
Third, we deliver the equine drug control, or anti-doping, program to deter the unauthorized administration of drugs and medications to racehorses. This national program ensures consistency and helps maintain the integrity of the sport. In an average year, the CPMA tests approximately 25,000 samples of blood or urine. Where a drug violation is found, a certificate of positive analysis is issued by the CPMA. It is up to the province to adjudicate and impose penalties on the violation. For example, that could be a fine or a suspension.
While the CPMA is focused on betting and equine anti-doping, it's the provincial governments that regulate the sport itself. For example, it is the provinces that assign the race dates; officiate the races, with judges and stewards; and license the racetracks, owners, trainers and jockeys.
Now, very quickly, I would like to address the technical elements of Bill C‑218 as they relate to horse racing.
Bill C‑218 is silent on horse racing, which means that if Bill C‑218 proceeds as currently drafted, it could be interpreted as permitting the provinces and territories to conduct and manage all forms of betting on horse racing, including parimutuel betting, which is an area that is currently regulated by the federal government through the CPMA.
If the provinces and territories were to offer and regulate betting on horse racing, it could take customers away from the racetrack operators, who currently are the only entities issued betting permits by the CPMA. This would put further pressure on the horse racing industry and the revenues base of the CPMA.
That's it. I think that's my five minutes.
I'd be very happy to answer your questions related to regulating parimutuel betting on horse racing.
Thank you.