Breeding Drain or Racing Gain: Who is really benefiting from recent prizemoney raises?

Cover image courtesy of Sportpix

As we continue our dissection of key pressure points shaping the health of the racing and breeding industries in our Breeding Drain or Racing Gain series, one question looms large: who is really benefiting from the recent boom in prizemoney?

On the surface, record returns and flashy million-dollar races suggest a sport in rude health. But dig deeper and a more complex picture emerges - one where the benefits are unevenly distributed, the middle tier is shrinking, and the sustainability of grassroots participation is under pressure.

It’s not that prizemoney isn’t rising - it’s that most people aren’t seeing it. The increases look impressive on paper but have done little to change the financial reality for the average owner.

In this piece, we examine how prizemoney has been allocated in New South Wales - the state leading the charge in dollar growth - and whether those investments are fuelling long-term industry strength or simply propping up the top end.

How have prizemoney increases been allocated?

In Racing NSW’s 2023/24 annual report, the principal racing authority delivered an 11 per cent increase in prizemoney statewide, with returns to owners and participants increasing to $407 million from $371 million.

Over $111.8 million of this number was paid to country owners, trainers, and jockeys, and Racing NSW reports that prizemoney was increased statewide by $27.5 million.

On paper, those numbers look impressive, but take a closer look. The Everest, still not a Group 1 at the time, received a $5 million boost on its own, jumping from $15 million to $20 million. The newly named G1 King Charles III Stakes, replacing the George Main Stakes on the Everest undercard, also saw its prizemoney jump from $1 million to $5 million.

Table: Breakdown of black-type and feature race prizemoney increases in New South Wales in 2023/24

Additions like the $1.5 million Alan Brown Stakes and the $1 million 7 Stakes, plus Group-level minimums being raised, meant NSW added over $28.9 million to black-type and feature race prizemoney in 2023/24.

To step back, just 48 races in New South Wales offered $1 million or more in prizemoney last season, yet they soaked up $109 million in total.

That’s 26.8% of all prizemoney distributed statewide, concentrated in less than 1% of the races.

By contrast, $6.4 million was directed toward boosting prizemoney for 272 Super Maiden races; a move that provided meaningful support at the base of the pyramid. This was a smart and well-distributed investment: $2 million went to 51 metropolitan midweek maidens, while a similar amount was spread across 117 country maidens. The allocation reached horses and participants across all levels, not just those at the top.

Table: Super Maiden prizemoney allocation by race type

The $1million Country Championships was the only country-exclusive feature race to see a prize boost in 2023/24 ($250,000 to raise the prizemoney from $750,000), which equates to 9.5 per cent of the season’s prizemoney increases being aimed at country racing.

When discussing prizemoney, it is reasonable to acknowledge that, of course, the best horses running in the biggest races will receive exceptional prizemoney for their performances.

But the other end of the scale cannot be ignored to have a functioning racing ecosystem... If only the big players can afford to play on, then the industry will only lose out.

What returns are owners actually seeing?

Racing Australia’s annual Fact Book puts total net returns to owners and participants in New South Wales at $418.4 million across 10,442 horses - an average of $40,073 per horse. But averages can be misleading. Of that total, $151.8 million came from just 194 black-type and feature races, meaning a large share of prizemoney went to a small pool of runners.

Those top-tier races carried an average prize pool of $782,454, or $682,882 if you exclude The Everest. Take those feature races out of the equation, and the remaining $266.6 million in prizemoney drops the average return per horse to just $25,536, nearly half the original figure.

Removing the 19.1 per cent of prizemoney that is deducted for the trainer, jockey, and welfare funds, the money making it to the average owner’s pocket lessens again to $20,659.

That’s less than half the average cost to keep a horse in work for a year - and it assumes your horse wins something at all. It's a long way from breaking even. In real terms, the average owner is still going backwards - and prizemoney growth hasn’t kept pace with rising costs.

According to the Fact Book, 4.6 per cent of racehorses didn’t earn a cent in 2023/24. Most horses - around 90 per cent - earned less than $100,000 for the year, with 40.6% earning under $10,000.

Just 5.4 per cent of horses made between $100,000 and $499,999, and only 163 horses nationwide cleared the $500,000 mark.

Table: Racing Australia Fact Book's nationwide spread of seasonal prizemoney ($)

Racing NSW accounts for 36.1 per cent of the national racehorse population. Based on national figures, that means around 59 horses in NSW earned over $500,000 last season, while more than 4,700 earned less than $10,000.

While Racing Australia doesn’t publish median prizemoney figures, the distribution breakdown offers a clear signal. With more than 69 per cent of horses earning under $50,000, and over 40 per cent earning less than $10,000, it’s reasonable to infer that median returns remain stubbornly low - likely still hovering just above the $10,000 mark.

In other words, despite the growth in total prizemoney, most participants are no better off. The gains are real, but they are not widely shared.

The sport of the people?

The owners - and the trainers - at the lower end of racing are feeling the pinch the most. Even Racing NSW acknowledges that for most horses, prizemoney doesn’t come close to covering training costs.

Using the number of starters in Racing NSW’s Draft Strategic Plan 2024 to estimate horses in training and Racing NSW's estimated training fees, the weighted average for training fees per annum sits at $52,823. (Estimate is inclusive of routine veterinary care and four months of spelling).

However, this differs drastically by region and level of racing; Racing NSW’s 2024 estimates for annual metropolitan training fees spiral to $70,023, or approximately $192 per day.

Table: Racing NSW's estimate for training fees

Stepping back to the weighted average training fee, the owner of the average horse would be looking at paying 2.1 times the average prizemoney (feature races removed).

If we assume half of the horses earning between $10,000–$99,999 sit at the lower end of that range, nearly 7,300 horses in NSW likely didn’t earn enough to cover even their training bills.

Racing has long asked owners to accept losses in exchange for passion, pride, and the thrill of the game. But if the game keeps shifting to favour only the few, how long before the rest stop playing?

What are we incentivising?

For the owner on the thin end of the wedge, the rise of prizemoney for Super Maidens is promising, but is it really enough?

One Saturday metropolitan win ($82,500 to the winner) will essentially cover a year’s worth of training fees for the metropolitan trainer, whereas a provincial horse would need to win 2.8 races to cover the same span ($20,550 to the winner from a standard $42,000 event).

A country horse attending country meetings with no boost in prizemoney would need to win 3.4 races in order to cover the estimated yearly training fees.

In a Letter to the Editor submitted to TTR in August 2024, Matthew Sandblom stated that the average yearling price in 2023/24 was approximately $154,000 (inc GST); that average yearling needs 7.5 provincial wins to earn back its purchase price, nevermind the training fees.

In 2023/24, 633 European-bred horses earned a bit over $60 million in prizemoney across Australia - about $110,000 each. These horses are specifically bought to target metro and feature races, especially in staying events where local-bred depth is limited.

It's worth remembering that imports bypass the local system from birth that supports the breeding industry from the ground up.

“The enormous prize money attached to races like The Everest and Golden Eagle is impressive, but it raises questions about balance,” said one respondent to our series via email, and they are spot on.

When the G1 Everest’s prizemoney boost accounts for 17.3 per cent of black-type and feature race prizemoney increases, it only benefits 12 horses. The same number stand to gain from the $4 million increase for the King Charles III.

A far larger amount of horses across the board, and their ownership, would benefit from that money being distributed more widely.

There’s no doubt prizemoney has grown - but the growth is uneven, and largely irrelevant to the majority. Without real movement in median returns, racing risks becoming a sport where the headlines thrive but the foundation cracks.