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Macedon Ranges

Equine Strategy
2012 - 2016
TABLE OF C ONTENTS

KEY TO ICONS 1

DEFINITION OF TERMS 2

1. INTRODUCTION 3
1.1. BACKGROUND TO THE EQUINE STRATEGY 3
1.2. STRATEGY METHODOLOGY 4

2. THE EQUINE INDUSTRY IN THE MACEDON RANGES 5


2.1. INTRODUCTION 5
2.2. EXPENDITURE IMPACT 5
2.3. JOBS IMPACT 6

3. SWOT ANALYSIS 7
3.1. INTRODUCTION 7
3.2. STRENGTHS 7
3.3. WEAKNESSES 8
3.4. OPPORTUNITIES 9
3.5. THREATS 10

4. STRATEGIC DIRECTIONS 11
4.1. INTRODUCTION 11
4.2. STRATEGIC DIRECTION 1: INDUSTRY ENGAGEMENT 11
4.3. STRATEGIC DIRECTION 2: SUPPLY CHAIN ENHANCEMENT 12
4.4. STRATEGIC DIRECTION 3: ADDRESS BARRIERS TO INVESTMENT IN THE EQUINE INDUSTRY 13
4.5. STRATEGIC DIRECTION 4: INFRASTRUCTURE AND PRODUCT DEVELOPMENT 14
4.6. STRATEGIC DIRECTION 5: EVENTS 15
4.7. STRATEGIC DIRECTION 6: EDUCATION AND TRAINING 16
4.8. STRATEGIC DIRECTION 7: DEVELOP A PLAN TO CAPTURE THE TITLE EQUINE CAPITAL OF
AUSTRALIA 17

5. IMPLEMENTATION 18

FIGURES
FIGURE 1: EXPENDITURE BY MACEDON RANGES EQUINE SECTORS 2010 6

TABLES
TABLE 1: ECONOMIC IMPACT OF MACEDON RANGES EQUINE INDUSTRY 5
TABLE 2: TOP TEN EMPLOYING SECTORS IN MACEDON RANGES SHIRE 6

6. APPENDICES
APPENDIX A: EQUINE SECTOR ECONOMIC IMPACT ASSESSMENT 2011 22
APPENDIX B: ECONOMIC IMPACT ASSESSMENT REGIONAL INPUTOUTPUT MODEL 41
APPENDIX C: ESTIMATED EXPENDITURES BY CATEGORY AND INDUSTRY 43
KEY TO ICONS

Breeding Business Clubs

Dressage Education Emergency


Management

Equine Health Eventing Harness

Leisure Riding Racing Show Horse

Show Jumping Tourism

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DEFINITION OF TERMS

Agistment A contract or fee to pasture livestock, including the accommodation of horses.

Arabian (or Arab Horse) A breed of horse that originated on the Arabian Peninsula; Arabians dominate
endurance riding.
Australian Stock Horse A hardy breed of horse noted for endurance, agility and good temperament. It is
used today in a wide variety of disciplines and is still valued as a working horse by stockmen and women.

Consumption Induced Effects - The induced production of extra goods and services as a result of private final
consumption expenditure of households affected by the equine sector on which the economic impact
assessment is based.

Covering Mating a stallion with a female horse.

Economic Impact (or Economic Impact Analysis) The effect of a policy, project, activity, event or industry on
the economy of a given area. Economic impact is usually measured in terms of changes in output and
associated changes in jobs.

Economic Output The quantity of goods and services produced in a given time by a firm, industry or region /
country.
Equestrian Horse sports such as dressage, eventing, show jumping and show horse competition as well as
activities such as pony club, adult riding clubs etc.

Expenditure on Imports (also Expenditure outside Shire) Direct Expenditure from the equine sector outside
the Macedon Ranges Shire; e.g. expenditure on stallion service fees in the Hunter Valley, NSW by local
thoroughbred studs.
Foaling Down A mare giving birth to a foal.

Initial Output Effects - The estimated initial expenditure of the equine sector on the general Macedon Ranges
Shire economy. This will be estimated through interviews with major stakeholders in the local equine sector,
supplemented by findings of the Macedon Ranges Equine Business Survey.

Input-Output Model - An Input-Output (I-O) table fulfils two key functions; it is firstly a descriptive framework
for showing the relationship between industries and sectors and between inputs and outputs in an economy.
Secondly, it is an analytical tool for measuring the impact of autonomous disturbances on an economys
output, employment and income.

Local Expenditure Direct expenditure from the equine sector within Macedon Ranges Shire industries.

Pony A term encompassing several breeds of small horses, including the Australian Pony, Australian
Miniature Pony, Connemara Pony, Dartmoor Pony, Fjord Horse, Hackney Pony, Highland Pony, New Forest
Pony, Shetland Pony and Welsh Ponies (A, B, C & D).

Production Induced Effects - This is the estimated impact of the Initial Output Effects on the general
economy.

Quarterhorse A solid, powerful horse originally bred for sprinting in quarter-mile races held in America.
Stallion Service Fee A service fee for the covering or insemination of a mare.

Standardbred A particular breed of horse best known for its use in harness racing, i.e. trotting and pacing.

Stud (or Horse Stud) An establishment where horses are bred, raised and / or agisted.

Thoroughbred A particular pure breed of horse best known for its use in horse racing due to their known
athleticism, speed and spirit.

Warmblood A term encompassing various breeds of medium to large horses particularly suited for
equestrian sports.

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1. INTRODUCTION

1.1. B ACKGROUND TO THE EQUINE S TRATEGY


The Macedon Ranges Shire Council (MRSC) recognises that the horse is an important part of the
culture and ethos of the Macedon Ranges. The horse forms a large part of the local economy from
the breeders to the support industries such as vets, farriers, dentists, trainers and instructors,
suppliers and manufacturers of horse related products as well as fencing and other horse property
building and maintenance.

The horse also provides a considerable contribution to the community through its recreational
activities such as pony and adult riding clubs, trail riding clubs, dressage clubs and local
competitions and training.

In addition, the Macedon Ranges Shire is experiencing substantial growth in requests for planning
and building approvals for equine related infrastructure and facilities. This is, in part, due to the
imminent closure of facilities in Melbourne and the higher cost value of property in metropolitan
areas. Council seeks to understand the planning requirements to assist in the development of the
sector, without compromising the sustainability and lifestyle experienced by residents.

In 2008, Regional Development Victoria undertook an economic analysis of the thoroughbred and
standardbred industries in six selected regional municipalities (Macedon Ranges was one of the
six) which provided the following information:

The economic impact of horse sales annually was $62.8 million;

$287 million in direct spending;

4,200 FTE (Full Time Equivalent) jobs;

In excess of $700 million in investment in the past seven years.

In 2010, Council established a focus group consisting of a cross section of the industry from major
breeders and trainers to vets, dentists, farriers, adult riding and pony clubs, alternate breeders, the
arabian and quarterhorse societies, holistic therapists and experienced trainers. This group
reaffirmed the importance of the equine industry to the Macedon Ranges, garnered support for the
Equine Strategy and identified a number of additional opportunities.

As a result of the above, the following Council position statements were developed:

MRSC recognises the importance of the equine industry to the Shire, its input into the culture
and ethos of the community as well as economic and social impacts;

MRSC aims to assist the development and growth of the sector in a strategic and sustainable
manner; and

MRSC aims to be able to create a planning framework that is sustainably supportive of the
sector.

To advance these position statements, Council commissioned two reports:

1. An Economic Impact Analysis of the equine sector in the Macedon Ranges Shire; and

2. A five-year strategy for the development of the sector.

Regional Development Victoria provided matching funding to that committed by MRSC to conduct
the necessary research and develop a five year strategy.

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1.2. S TRATEGY M ETHODOLOGY
A number of Strategic Directions and Strategies have been developed following a process that has
included:

Examining the results and recommendations of the Economic Impact Analysis;

Research of equine related activities and infrastructure in other regions, states and countries;

Review of reports and associated information;

Consultation approximately 50 face to face and telephone interviews were conducted with
industry participants (including those consulted for the economic impact analysis);

Two industry workshops and one public forum held to present the findings and discuss the
proposed strategic directions;

Internal and extensive external consultation; and

An extensive SWOT analysis.

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2. THE EQUINE INDUSTRY IN THE MACEDON
RANGES

2.1. INTRODUCTION
An Economic Impact Analysis of the equine industry in the Macedon Ranges Shire was prepared
by Urban Enterprise prior to the commencement of this strategy (refer to Economic Impact
Assessment Appendix A). The process undertaken to collect the information included a survey
sent to over 200 equine related representatives in the Shire including breeders and trainers, other
equine businesses such as equipment suppliers and businesses delivering services such as vets
and farriers, as well as clubs. In addition, approximately 50 face to face and telephone interviews
were conducted with industry participants, as well as two industry workshops and one public
forum.

2.2. EXPENDITURE IMPACT


The economic impact assessment found the equine sector to be an important contributor to the
Shires economy. The result of this study is that in the 2009/10 financial year, the equine sector
generated an economic impact of $140 million in the Macedon Ranges Shire, as shown in table
below.

Figure 1 shows expenditure by Macedon Ranges equine sectors. This highlights the level of
expenditure captured by each equine sector and the level of local expenditure capture. The
sectors which contribute most to the Macedon Ranges economy are breeding, the leisure horse
industry and horse training.

Figure 1 also highlights a high level of escape expenditure in the equine industry to areas outside
of Macedon Ranges particularly in breeding, horse training and other equine activities (equine
health, equipment and feed).

TABLE 1 ECONOMIC IMPACT OF MACEDON RANGES EQUINE INDUSTRY

Economic Impact $

Direct Expenditure of Equine Sector $96,359,215

Total Economic Impact $139,997,646

Source: Urban Enterprise 2011.

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FIGURE 1 EXPENDITURE BY MACEDON RANGES EQUINE SECTORS 2010 (IN $MILLIONS)

$27.6

$22.0 $22.6
$21.3
$19.2
$17.5
$13.7
$11.1
$8.4
$5.1

Breeder Events Leisure Horse Horse Training Other Equine


Industry Activities

Expenditure in Macedon Ranges Shire Expenditure Outside Macedon Ranges Shire

Source: Urban Enterprise 2011.

2.3. JOBS IMPACT


Table 2 provides context for the size of the equine industry in Macedon Ranges Shire by
comparing it to the top industries in terms of persons employed within the Shire. Based on the
economic impact analysis undertaken the equine industry employs 772 persons, making it the 7th
largest industry in the Macedon Ranges Shire in terms of providing local jobs.

TABLE 2 TOP TEN EMPLOYING SECTORS IN MACEDON RANGES SHIRE

No. Jobs in Macedon


Industry 2006 % total
Ranges Shire

1 Retail trade 1,419 14%

2 Education & training 1,090 11%

3 Manufacturing 1,059 11%

4 Health care & social assistance 937 10%

5 Tourism 900 9%

6 Construction 802 8%

7 Equine Sector 772 8%

8 Accommodation & food services 724 7%

9 Agriculture, forestry & fishing 574 6%

10 Public administration & safety 637 6%

TOTAL EMPLOYMENT IN SHIRE 9,854

Source: Macedon Ranges Equine Industry Economic Impact Analysis (Urban Enterprise, 2011). Note the table above includes
the top eight Industry Divisions in Macedon Range Shire in terms of local employment. Tourism industry and equine industry
are not covered adequately by the ANZSCO categories and hence have independent primary assessments of their size. The
table does not add up to 9,854 jobs as a number of smaller industries are not included in the table for ease of reporting.

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3. SWOT ANALYSIS

3.1. INTRODUCTION
The following SWOT analysis has been prepared drawing on the extensive industry consultation
including the equine industry survey sent to over 200 equine related representatives in the Shire,
over 50 one on one consultations with industry participants as well as two industry workshops and
one public forum.

3.2. S TRENGTHS
Very equestrian aware community;

Macedon Ranges is recognised within the equine community as a premier area for equine
activities along with the Hunter Valley and Mornington Peninsula because of its:

a. Ideal due to its central position, access to major highways and other regional centres
as well as proximity to Melbourne, Werribee Park Equestrian Centre and Melbourne
Airport (all accessible in under an hour). For equine hobbyists, the Macedon Ranges is
in commuting distance to Melbourne for work;

b. Proximity to metropolitan racing tracks and Tabcorp Park at Melton which is important
for studs/trainers - horses can be susceptible to motion sickness after 3 hours of travel;

c. Land affordability - compared to other peri-urban horse areas, property prices in the
Macedon Ranges are still affordable for the equine hobbyist looking for a small horse
property;

d. Topography good soils, good quality ryegrass and clover which is very important for
broodmares at certain times, and the climate, apart from winter, is ideal for horses; and

e. Good rainfall and bore water is high quality.

Braemar College is strong in equestrian, winning most major events entered;

Major thoroughbred horse studs Eliza Park, Woodside Park, Yallambee Stud and Wingrove
Park all provide significant economic impact for the Macedon Ranges;

Kyneton and Hanging Rock Racing Club has recently been rezoned to enable education and
events at the Kyneton racecourse (NMIT Kyneton Park);

NMIT support of the region through commercial relationship with the Kyneton & Hanging
Rock Racing Club;

Breeds attract international inquiries e.g. Arabian bloodlines attract international visitors;

Risk of contracting hendra virus is low for the Macedon Ranges due to lack of fruit bat
camps;

Concentration of high quality international instructors and riders living in the Macedon
Ranges;

Concentration of horses and clubs in the Shire creates strong communities of interest;

Region renowned for semi-rural lifestyle and liveability;

Interest in equine activities is growing, particularly the middle aged female market;

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Agricultural shows at Kyneton and Lancefield.

3.3. W EAKNESSES
Council does not have a strong relationship with major studs in the Macedon Ranges;

The current planning scheme presents a barrier to development of the equine industry within
the Shire. Some issues within the Farm Zone include:

a. Events can be held no more than 10 days of the year which means there are limitations
on equine establishments such as studs having equine, food or music events; and

b. The Farming Zone provides challenges when building a dwelling on lots of less than 40
hectares.

Awareness of the contribution made by the Kyneton & Hanging Rock Racing Club to the local
community is low;

Kyneton & Hanging Rock Racing Club training facilities at NMIT Kyneton Park are at capacity
which is also an impediment to trainers wishing to relocate to the region;

While there are some hospital facilities in the Shire, for specialist emergency surgeries such
as colic, c-sections and serious fractures which require a high level of aftercare, or for
treatment of infectious diseases needing isolation areas, horses have to be taken to either
Werribee, Shepparton or Ballarat. For many breeders this is an impediment as a mare or foal
may not survive the journey to one of the major hospitals e.g. Eliza Park is relocating most of
their foaling to stud in Nagambie to be closer to these specialist services;

While some horse transport services exist in the Shire, the services for the larger equine
businesses can be inadequate;

Competition riders need to train year round so require indoor facilities during wetter months.
Currently riders are forced to use private facilities (if they are available) or have to go outside
the region;

People with private indoor facilities / arenas generally do not allow other people or groups use
of facilities because of public liability issues;

Cost of hiring private indoor arenas is very expensive for individuals and clubs;

Veterinary nursing courses are not available locally. Nurses have to travel to the National
Centre of Equine Education in Wangaratta to complete the equine component of a certificate
course;

As wages are relatively low for many employees working in the equine industry, a lack of low
cost accommodation is an issue;

Lack of suitable infrastructure for events;

Non-thoroughbred horses e.g. Arabian horses are unable to access Kyneton racecourse for
training purposes or events;

Lack of signage on the roads advising drivers that the Shire is an equine area and to drive
carefully around horses;

There is a perception that it is not possible to obtain a permit for a dwelling in conjunction with
equine facilities;

The need for bushfire planning major studs are concerned about bushfire potential.

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3.4. O PPORTUNITIES
Consultations with the equine community supported the concept of an Indoor Equestrian Centre to
include the following facilities and possible users:

Suitable for competition qualifying rounds of Equitana (an international large scale
horse event encompassing major competition, education and exhibition) very specific
requirements e.g. 3,000 seat arena, under lights, indoor and outdoor

Suitable for World Cup qualifying events

Facilities for the World Equestrian Games

Explore the opportunity to incorporate polo and polocrosse

Use for different types of activities including equestrian and western competitions,
breed shows etc. as well as training clinics and other educational activities

Most high quality equestrian trainers require indoor facilities

Would attract more quality instructors and trainers

Schools would use the facility e.g. Braemar College, Assumption College

Could attract Olympic athlete programs

Undercover exhibition areas

Needs to be multi-purpose as there are other potential users of such a facility e.g.
dogs, sheep, alpacas etc.

Outdoor arenas and stables

Could stage horse / breed shows local groups have to go outside the Shire (e.g.
Werribee, Bunyip, Mornington Peninsula) for breed shows

Incorporate meeting and facilitation rooms to be used in conjunction with events and
educational forums. Would also provide opportunity for clubs and groups to meet
collectively (each club tends to work in isolation limited opportunities to meet)

The establishment of this facility would alleviate demand on existing adult and pony club
grounds that struggle to hold events. While normal monthly rallies can be facilitated at
existing venues, having an alternative venue for competitions would help minimise risk and
provide additional services to clubs.

GENERAL OPPORTUNITIES

Council could encourage investment in the equine industry for employment opportunities;

Closer working relationship between Council and major studs e.g. industry expo with Eliza
Park, tourism links with international visitors / buyers etc.;

Improve trail infrastructure for horses e.g. riding trail between Romsey and Lancefield;

Investigate the need for a veterinary hospital, similar to Werribee, for large animals in the
Shire;

Promote the opportunity for people to ride horses into towns, e.g. Lancefield, Romsey;

Development of an equine based network and networking events;

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Education providers to develop sessions for horse owners e.g. pasture management, horse
care, including horse care for the New to Horses parent; as well as preparing a resource
guide on land management for small land holders;

Horses and horse riding used for health and wellbeing e.g. Riding for the Disabled;

Improve coordination and marketing of the various equine related events that take place
across the Shire;

Equine training will be available at NMIT Kyneton Park from 2012 with diploma courses
available e.g. track riding and stablehand. However, there are opportunities for degree
courses and other equine related training;

Preparation of a basic services guide so that people can find equine services (e.g. vets,
farriers, dentists, etc.);

Review the Planning Scheme to provide for 2 5 hectare blocks for leisure horse enthusiasts
in appropriate locations;

Greater promotion and integration of equine tourism promote B&Bs, restaurants, horse
studs and events;

Internet / online shopping provides opportunities for the development of home-based


businesses e.g. supply and / or manufacture specialty products not available locally;

Fire trails could be mapped and made available for trail riding purposes;

Opportunity to host an official racehorse rehabilitation program and for local trainers / riders to
be qualified to participate in program.

3.5. THREATS
Fire trails now seem to be closed for access by horse riders and will drive horse riders away
from area;

Bushfires are a major concern for the studs and local horse owners;

Internet shopping has affected local horse supply businesses e.g. saddles, boots, and rugs.
People can research and buy online, however, equipment such as saddles must be correctly
fitted to rider and horse;

Outbreak of influenza / disease;

Quarantine is an issue for international horses coming to Australia for competition; and

Lack of tourist accommodation within the Shire.

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4. STRATEGIC DIRECTIONS

4.1. INTRODUCTION
Seven Strategic Directions have been developed for the Equine Strategy. In total, twenty-seven
Strategies support the Strategic Directions. The Strategic Directions are:

1. Industry Engagement

2. Supply Chain Enhancement

3. Address Barriers to Investment in the Equine Industry

4. Infrastructure and Product Development

5. Events

6. Education and Training

7. Develop a Plan to Capture the title Equine Capital of Australia

4.2. S TRATEGIC D IRECTION 1: INDUSTRY ENGAGEMENT

RATIONALE

The equine industry in the Macedon Ranges encompasses a broad range of businesses, groups
and organisations. These include breeders of thoroughbreds, standardbreds and warmbloods,
trainers, specialist coaches and instructors, vets, farriers, horse health experts, feed, fencing and
equipment suppliers, as well as transport providers. The groups include: pony and adult riding
clubs, trail riding clubs, dressage, western and the various breed groups.

While these businesses and groups comprise the sector, there is minimal liaison or communication
between the different groups within the Shire. The key reason for this lack of communication is that
people are busy and dedicate their time and effort to develop and operate their respective
businesses or groups. There may be informal communication between group members, e.g. meet
at an event, but there are no structured forums or opportunities to network.

There is a role for Council to help provide a process for communication and networking between
various groups and businesses within the Shire. This communication and networking will reduce
escape spending, share resources, develop opportunities based on critical mass and empower
groups and individuals. Successful communication and networking will lead to increased business
investment and development, additional employment and innovation.

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STRATEGIES

Strategy 1.1 Develop a comprehensive database of equine businesses within the Shire.

Strategy 1.2 Provide a portal for the dissemination of information across the sector and a
directory of all services and providers of services for the equine industry. This could also include a
brood mare directory for people seeking foster mares.

Strategy 1.3 Liaise with the local equine industry to determine the potential for the
establishment of a formal Equine Industry Network (suggested name: R.E.I.N. Ranges Equine
Industry Network).

Strategy 1.4 Explore opportunities to engage with the broader equine industry (e.g. Racing
Victoria, Equitana, Equestrian Victoria and Equestrian Australia, Victorian Horse Council and
others).

Strategy 1.5 Liaise with the equine industry to determine the appropriate emergency
management procedures for horses e.g. large animal rescue and establishment of safe areas for
horses in the event of emergencies such as bushfires.

4.3. S TRATEGIC D IRECTION 2: SUPPLY C HAIN ENHANCEMENT

RATIONALE

The Equine Sector Economic Impact Analysis identified existing supply chain activities with
nominated values and economic contributions. In addition, as part of the consultation, interviewees
were asked to identify supply chain activities and potential supply chain gaps.

In general, the nature of supply chains and supply chain gaps has changed over the last number of
years. A key reason for this change has been the development of the internet and online shopping.
In the recent consultation it was difficult to identify gaps as interviewees noted that if they needed
an item that was not available locally they could usually source the item online.

The Equine Sector Economic Impact Analysis and consultation did identify supply chain gaps that
could be addressed to enhance local economic development as well as providing a better service
to residents.

STRATEGIES

Strategy 2.1 Promote business opportunities to address identified gaps in the equine industry
supply chain, to enhance local employment opportunities and the economy. The gaps identified in
the Equine Sector Economic Impact Analysis include:

Fodder and horse supplements (manufacturing);

Husbandry services e.g. farriers;

Agistment;

Stallions / service and semen fees;

Saddlery / saddle fitting services;

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Small farm contractors e.g. hay, fencing, pasture & weed management;

Horse transportation services; and

Export opportunities e.g. horses, specialist training services and locally manufactured
equipment / feeds.

4.4. S TRATEGIC D IRECTION 3: A DDRESS B ARRIERS TO INVESTMENT IN THE EQUINE INDUSTRY

RATIONALE

Much of the equine industry operates in Farming Zone or Rural Conservation Zone. Currently,
these two zones do not cater appropriately to the needs of some equine businesses and present a
significant barrier to investment.

One of the core issues relates to the minimum lot area of 40 hectares to use the land for a dwelling
as of right. The equine industry can operate a viable business on significantly less than 40
hectares due to the high yield nature of these businesses e.g. horse trainers.

A revision of the new planning provisions should be undertaken for equine uses in the rural areas.
In particular, controls need to allow for the multiple uses within equine businesses including
educational, tourism, agistment, events and accommodation. The Farming Zone and Rural
Conservation Zone cannot cater adequately for enterprises with such a diverse business mix; the
application of the Rural Activity Zone or Special Use Zone would provide for these complementary
uses however these uses should be directed to the most appropriate locations.

Consultation with the equine industry and an increase in planning and building applications
highlights that the Shire is likely to face growing demand for smaller rural allotments with
allowance for dwellings to accommodate a range of equine enterprises, including properties for
leisure horse owners.

STRATEGIES

Strategy 3.1 Review provisions for equine uses and development in the Planning Scheme, in
particular:

Rezoning of larger diversified equine businesses to an appropriate zone (Rural Activity Zone
or Special Use Zone);

Review Clause 22.12 in the Planning Scheme to include further direction based around the
needs of the equine industry;

Through future projects investigate the introduction of lower minimum lot sizes for subdivision
and for use of the land for a dwelling in a Farming Zone in appropriate locations within the
municipality to reflect the requirements for the equine industry, or provide greater flexibility /
discretion for equine businesses in rural areas; and

Consider feedback regarding rural living opportunities within the Rural Living Strategy 2012.

Strategy 3.2 Provide decision making criteria to assist planning staff with the business
requirements of the equine industry.

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4.5. S TRATEGIC D IRECTION 4: INFRASTRUCTURE AND PRODUCT DEVELOPMENT

RATIONALE

The consultation undertaken for this project identified opportunities for development of soft and
hard infrastructure to support equestrian activities. Overwhelming feedback during consultation
identified that the key piece of infrastructure needed is the development of an equestrian centre
with large indoor arena in the Shire.

Additional infrastructure needs included a veterinary hospital, horse riding trails and signage.
Improving the standard of local infrastructure will enhance the reputation of the Macedon Ranges
as a region that supports the equine industry. The infrastructure would attract many events and
activities that will bring people to the region as well as providing for the needs of the local horse
industry. It also presents opportunities for the establishment of other equine related business and /
or businesses servicing the growing equine industry e.g. horse friendly accommodation.

STRATEGIES

Strategy 4.1 Promote the demand for the establishment of an international standard indoor
equestrian centre that can attract and host international competitions and events. This will include
supporting the preparation of a feasibility study and a business case for the indoor equestrian
centre which should consider the following:

Indoor and outdoor arenas (allow for two indoor rings);

Lighting;

Meeting rooms and facilities;

Equine gallery (National Equine Gallery);

Retail e.g. saddlery;

Surface requirements;

Seating capacity;

Outdoor training areas;

Parking;

Disaster plan - potential holding area for horses;

Cross country course to facilitate eventing competitions;

Polo and / or polocrosse; and

Suitable locations.

Strategy 4.2 If the Centre is feasible (see Strategy 4.1), investigate the opportunity for
associated residential development surrounding the Centre.

Strategy 4.3 Determine the demand and potential for an equine hospital in the Shire.

Strategy 4.4 Explore the opportunities for increasing horse trails in the Shire in conjunction with
relevant stakeholders. Considerations should include:

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FEBRUARY 2012
Identifying horse friendly trails on road reserves;

Review existing walking / riding trails and identify opportunities for new trails;

Areas for horse float and truck parking; and

The development of a brochure that provides details of all horse friendly locations together
with riding trails and horse friendly accommodation.

Strategy 4.5 Explore opportunities for promoting equine related tourism:

Encourage the development of horse friendly accommodation for visiting riders (examples
can be found at www.havehorsewilltravel.com.au);

Investigate the potential to establish a Horse and Wine tour. A good example is Horse Back
Winery tour (found at www.horsebackwinerytours.com.au);

Investigate other equine tourism business opportunities including:

Horse stud tours; and

Accommodation and food related activities on equine properties in the region.

Strategy 4.6 Continue to work cooperatively with Kyneton and Hanging Rock Racing Club to
assist the development of additional training facilities and associated infrastructure e.g. Kyneton
racecourse is at capacity and construction of a new synthetic track would increase training
opportunities.

4.6. S TRATEGIC D IRECTION 5: EVENTS

RATIONALE

As identified in the Economic Impact Analysis and through the consultation, the Shire has a very
diverse range of equine groups that are undertaking regular activities e.g. pony club and local
events e.g. breed shows. There are opportunities to increase the type of activities undertaken,
particularly activities and events that encourage different groups to collaborate.

In addition, the development of quality infrastructure will enable higher profile events to be
conducted in the region. For example, bidding for high-level equestrian and western events that
are classed as international qualifying competitions, visiting international master classes, equine
entertainment and education options that could be undertaken utilising this infrastructure.

There are also opportunities for collaborative events that can showcase the various equine groups
to each other, to the wider community and to visitors. Many of these groups operate in isolation, so
combined events showcasing the diversity of the local equine industry will enable group
representatives to network and identify further opportunities for collaboration.

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FEBRUARY 2012
STRATEGIES

Strategy 5.1 Develop a comprehensive local equine events calendar.

Strategy 5.2 Investigate the potential and assess the benefits of a horse stud open day in
conjunction with key industry partners.

Strategy 5.3 If an Equestrian Centre with indoor facilities is established, develop an events
attraction strategy.

4.7. S TRATEGIC D IRECTION 6: EDUCATION AND T RAINING

RATIONALE

The equine industry offers many different career opportunities such as horse handling, stud
management, teaching, training, marketing, riding, driving and grooming. Associated career
opportunities exist in horse health, equipment and feed supplies, transport, veterinary, farriery,
dentistry and a number of others.

The equine industry as a whole has a role to play in the promotion of education and training
opportunities in the region as well as career and employment opportunities. Research suggests
that opportunities exist in areas such as horse training, various levels of stud certificate training
and associated areas e.g. business and marketing.

STRATEGIES

Strategy 6.1 Conduct a survey of the equine industry to identify employment gaps and develop
strategies to address the gaps.

Strategy 6.2 Continue to liaise with NMIT (and other appropriate education institutions) to
identify equine education courses that can be provided locally, e.g. farriery, OH&S courses for
business owners and employees.

Strategy 6.3 Conduct a careers expo in conjunction with the equine industry to promote career
and employment opportunities in the sector. This could be held in conjunction with stud open days.

Strategy 6.4 Explore the potential for the establishment of a Macedon Ranges Scholarship
fund to send talented competitors or instructors to international events. The Equine Network
(Strategy 1.4) could be responsible for raising the funds needed for this concept.

Strategy 6.5 Develop guidelines for the sustainable land management of equine properties for
inclusion in Councils Voluntary Environment Resource Inventory.

Strategy 6.6 Conduct education programs on an as needs basis for horse owners. Example
topics for education could include horse care for the New to Horses parent, equine diseases and
the need to register horses and horse properties, as well as sustainable land management
practices for horse properties.

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FEBRUARY 2012
4.8. S TRATEGIC D IRECTION 7: D EVELOP A PLAN TO C APTURE THE TITLE EQUINE C APITAL OF
A USTRALIA

RATIONALE

The Macedon Ranges Shire is home to a number of international standard trainers, instructors and
judges for a range of equestrian performance activities. These people train riders locally, nationally
and internationally and attract those seeking training / instruction from all over the world.

There are particular regions of Australia noted for different types of equine activities which have
developed a high profile reputation based on those equine activities. These include:

Polo Gold Coast and Richmond NSW.

Rodeo Far North Queensland;

Thoroughbred Breeding Hunter Valley NSW; and

Western Riding Tamworth NSW.

There is no region in Australia that is recognised as the capital for all things equine.

The research and anecdotal evidence indicates that Macedon Ranges has a significant
concentration of world-class competitors, instructors, trainers and equine breeders to validate a
claim to be the Equine Capital of Australia. By claiming this title, strategies can be built around
the concept that can further enhance the local industry and attract support e.g. sponsorship and
government funding, for infrastructure and events.

STRATEGIES

Strategy 7.1 Research and investigate the potential to develop the Macedon Ranges as the
Equine Capital of Australia.

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FEBRUARY 2012
5. IMPLEMENTATION

Strategy Number Strategy Priority Timeframe KPI

Strategic Direction 1: Industry Engagement

1.1 Develop a comprehensive database of equine businesses within the Shire High 2012 Database Completed

1.2 Provide a portal for the dissemination of information across the sector and a Medium 2012 / 2013 Electronic portal
directory of all services and providers of services for the equine industry. This established
could also include a brood mare directory for people seeking foster mares

1.3 Liaise with the equine industry to determine the potential for the High 2012 Network investigated and
establishment of a formal Equine Industry Network (suggested name; R.E.I.N. established if sufficient
Ranges Equine Industry Network) demand

1.4 Explore opportunities to engage with the broader equine industry (e.g. Racing Medium Ongoing Relationships developed
Victoria, Equitana, Equestrian Victoria, Equestrian Australia, Victorian Horse and/or under development
Council and others)

1.5 Liaise with the equine industry to determine the appropriate emergency Medium 2012 / 2013 Safe Areas identified and
management procedures for horses e.g. large animal rescue and promoted
establishment of safe areas for horses in the event of emergencies e.g.
bushfires.

Strategic Direction 2: Supply Chain Enhancement

2.1 Promote business opportunities to address identified gaps in the equine High 2012 / 2013 Continue to identify and
industry supply chain to enhance local employment opportunities. The supply promote business
Ongoing
chain gaps identified in the Equine Sector Economic Impact Analysis include: opportunities
Fodder and horse supplements (manufacturing)
Husbandry services (farriers)
Agistment
Stallions / service and semen fees
Saddlery / saddle fitting services
Small farm contractors e.g. hay, fencing, pasture and weed management
Horse transportation services
Export opportunities (e.g. horses, specialist training services and locally
manufactured equipment / feeds)

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FEBRUARY 2012
Strategic Direction 3: Address Barriers to Investment in the Equine Industry

3.1 Review the provisions for equine uses and development in the Planning High 2012 / 2013 Review completed
Scheme, in particular:
Rezoning of larger diversified equine businesses to an appropriate zone
(Rural Activity Zone or Special Use Zone)
Review Clause 22.12 in the Planning Scheme to include further direction
based around the needs of the equine industry
Through future projects investigate the introduction of lower minimum
lots sizes for subdivision and for use of the land for a dwelling in the
Farming Zone in appropriate locations within the municipality to reflect
the requirements for the equine industry, or provide greater flexibility /
discretion for equine businesses in rural areas
Consider feedback regarding rural living opportunities within the Rural
Living Strategy 2012

3.2 Provide material to assist planning staff with the business requirements of the High 2013 / 2014 Equine material
equine industry disseminated

Strategic Direction 4: Infrastructure and Product Development

4.1 Promote the demand for the establishment of an international standard indoor High 2012 Funding for feasibility
equestrian centre that can attract and host international competitions and study and business case
events. secured
2013
Support the preparation of a feasibility study and business case for the Indoor Feasibility study and
Equestrian Centre which should consider the following: business case completed
Indoor and outdoor arenas (allow for two indoor rings) 2014 - 2016 Recommendations
Lighting implemented, if feasible
Meeting rooms and facilities
Equine gallery (National Equine Gallery)
Retail e.g. saddlery
Surface requirements
Seating capacity
Outdoor training areas
Parking
Disaster plan - potential holding area for horses
Cross country course to facilitate eventing competitions
Polo / polocrosse a possibility
Suitable locations

4.2 If the Centre is feasible (see Strategy 4.1), investigate the opportunity for 2015 Investigation complete and
associated residential development surrounding the Centre recommendations made

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FEBRUARY 2012
4.3 Determine the demand / potential for an equine hospital in the Shire Medium 2013 / 2014 Demand analysis
completed and quantified

4.4 Explore the opportunities for increasing horse trails in the Shire in conjunction Medium 2013 / 2014 Horse friendly trails on
with relevant stakeholders. Consideration should include: road reserves identified
Identifying horse friendly trails on road reserves Equine friendly
Review existing walking / riding trails and identify opportunities for new opportunities for new trails
trails prioritised
Areas for horse float and truck parking Parking areas identified
The development of a brochure that provides details of all horse friendly
locations together with riding trails and horse friendly accommodation Brochures developed

4.5 Explore opportunities for promoting equine related tourism: Medium 2013 / 2014 Planning and equine
industry information
Encourage the development of horse friendly accommodation for
available for
visiting riders. Examples can be found at
accommodation providers
www.havehorsewilltravel.com.au
Investigate the potential to establish a Horse and Wine tour. A good Ongoing Horse and wine tour and
example is Horseback Winery Tours www.horsebackwinerytours.com.au equine business
Investigate other equine tourism business opportunities, including: opportunities investigation
Horse stud tours; and completed
Accommodation and food related activities on equine properties 2013 / 2014 Recommendations
implemented

4.6 Continue to work cooperatively with Kyneton and Hanging Rock Racing Club High 2012 Assistance provided
to assist the development of additional training facilities and associated Ongoing
Ongoing
infrastructure where necessary, e.g. Kyneton racecourse is at capacity and a
new synthetic track would increase training opportunities

Strategic Direction 5: Events

5.1 Develop a comprehensive local equine events calendar Medium 2012 / 2013 Calendar established

5.2 Investigate the potential, and assess the benefits of a horse stud open day in Medium 2013 / 2014 Investigation completed
conjunction with key industry partners

5.3 If an Indoor Equestrian Centre is established, develop an events attraction Medium 2014 / 2015 Strategy completed
strategy
Targeted trainers and
events approached and
program developed
Ongoing

MACEDON RANGES EQUINE STRATEGY 20 MACEDON RANGES SHIRE COUNCIL


FEBRUARY 2012
Strategic Direction 6: Education and Training

6.1 Conduct a survey of the equine industry to identify employment gaps and Medium 2013 / 2014 Survey completed
develop strategies to address the gaps
Recommendations
implemented

6.2 Continue to liaise with NMIT (and other appropriate education institutions) to High 2012 Courses established
identify equine education courses that can be provided locally, e.g. farriery

6.3 Conduct a careers expo in conjunction with the equine industry to promote Medium 2013 / 2014 Careers expo held
career and employment opportunities in the sector. This could be held in
conjunction with stud open days

6.4 Explore the potential for the establishment of a Macedon Ranges Scholarship Medium 2016 Scholarship fund
fund to send talented competitors or instructors to international events. The investigated, and
Equine Network (Strategy 1.4) could be responsible for raising the funds for
If feasible, assistance
this concept
sought from Equine
Network

6.5 Develop guidelines for sustainable land management of equine properties for Medium 2012 Guidelines developed
inclusion in Councils Voluntary Environment Resource Inventory.

6.6 Conduct education programs on an as needs basis for horse owners. Medium 2013 / 2014 Education programs
Example topics for education include horse care for the new to horses conducted when
parent, equine diseases and the need to register horses and horse properties, appropriate
as well as sustainable land management practices for horse properties

Strategic Direction 7: Develop a Plan to Capture the Title Equine Capital of Australia

7.1 Research and investigate the potential to develop the Macedon Ranges as Medium 2016 Investigation completed
the Equine Capital of Australia
Recommendations
implemented

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FEBRUARY 2012
APPENDIX A

Equine Sector Economic Impact


Assessment
JULY 2011

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ASSESSMENT JULY 2011
CONTENTS

EXECUTIVE SUMMARY 25
EQUINE SECTOR ECONOMIC IMPACT ASSESSMENT 25
WHAT IS THE EQUINE SECTOR? 25
ECONOMIC IMPACT ASSESSMENT 26

1. METHODOLOGY 28
1.1. INTRODUCTION 28
1.2. DEFINITION OF THE EQUINE SECTOR 28
1.3. EXPENDITURE CATEGORIES 31
1.4. METHODOLOGY OF THE ECONOMIC IMPACT ASSESSMENT 32

2. ECONOMIC IMPACT ASSESSMENT 33


2.1. INTRODUCTION 33
2.2. EXPENDITURE ESTIMATIONS BY CATEGORY 33

3. ECONOMIC IMPACT FINDINGS 39


3.1. SUMMARY 39

FIGURES
FIGURE 1: ESTIMATED DIRECT EXPENDITURE BY CATEGORY (MILLIONS), 2009/10 27
FIGURE 2: EQUINE INDUSTRY SECTORS: EXPENDITURE FLOW DIAGRAM 31
FIGURE 3: EQUINE SECTOR ECONOMIC IMPACT FLOW DIAGRAM 32
FIGURE 4: ESTIMATED EXPENDITURES BY EXPENDITURE CATEGORIES (MILLIONS), 2009/10 39
FIGURE 5: EQUINE SECTOR ECONOMIC IMPACT FLOW DIAGRAM 43

TABLES
TABLE 1: EQUINE SECTOR ECONOMIC IMPACT, 2009/10 26
TABLE 2: EXPENDITURE ASSUMPTIONS, HORSE BREEDING 33
TABLE 3: ESTIMATED EXPENDITURE ASSUMPTIONS, HORSE RACING EVENTS 35
TABLE 4: EXPENDITURE ASSUMPTIONS, LEISURE HORSE RIDERS 36
TABLE 5: ECONOMIC IMPACT OF EQUINE SECTOR, 2009/10 40
TABLE 6: ESTIMATED EXPENDITURES BY CATEGORY, INPUT OUTPUT INDUSTRY GROUP ABS 2006 44

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ASSESSMENT JULY 2011
EXECUTIVE SUMMARY

E QUINE S ECTOR E CONOMIC IMPACT A SSESSMENT


Urban Enterprise was appointed to undertake research into the economic impact of the Macedon Ranges
Equine Sector.

The economic impact of the equine sector was assessed through analysis of its key expenditure categories,
including breeding, events, leisure horse riding, horse training / coaching and other equine activities.
Assumptions on spending in these categories were established through surveys and consultation with
stakeholders in the region and through a review of equine related literature. This information was used to
determine the direct spending attributed to the equine sector in the Macedon Ranges Shire. The secondary
economic impact attributable to this expenditure was calculated using a regional input-output model that
estimates the impact of spending in one industry segments across the Shire economy.

Economic impact will be defined as the effect of the direct expenditure by the Macedon Ranges Equine
Sector on the economy of the Shire as a whole. It is important to note that the economic impact is different to
economic output (defined as the value of the goods and services produced in a given time by the equine
sector). Economic impact will be measured through the change in the value of the Macedon Ranges
economy and the number of jobs supported by expenditure of the equine sector.

W HAT IS THE EQUINE SECTOR?

According to the 2004, Henley Centre Report of Research on the Horse Industry in Great Britain, the equine
sector is defined as:

encompassing all activity that has the horse as its focus and activity that, in some reasonable capacity,
caters for such an industry

Furthermore, the equine sector will be segmented into two key sub-sectors: the Core Equine Sector and the
Supplementary Equine Sector. The Core Equine Sector will consist of:

Horse Breeding;

Equine Education;

Horse Training / Equestrian Coaching;

Private Leisure Horse Owners; and

Equestrian Clubs and Associations.

The Supplementary Equine Sector will consist of:

Land-based equine business;

Equine Health;

Husbandry Services;

Fodder Suppliers; and

Other Sectors e.g. retailers, wholesalers, trade and quarantine services, equine insurance services.

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ASSESSMENT JULY 2011
E CONOMIC IMPACT A SSESSMENT

OVERVIEW OF ECONOMIC IMPACT

The economic impact assessment found the equine sector to be an important contributor to the Shires
economy and level of employment. The result of this study is that in the 2009/10 financial year, the equine
sector generated an economic impact of $140 million and supported 772 jobs in the Macedon Ranges Shire,
as shown in Table 1. In addition, the local equine sector broadly contributes to other Victorian regions and
New South Wales economies; the Macedon Ranges Equine Sector has spent an estimated $72.17 million
outside the Shire.

TABLE 1 EQUINE SECTOR ECONOMIC IMPACT, 2009/10

Macedon Ranges Shire


Expenditure Outside the
Direct Economic Estimated Shire Shire
Total Economic Impact
Expenditure in the Shire Employment
$96,359,215 $139,997,646 772 $72,170,358

Source: Urban Enterprise 2011

DIRECT EXPENDITURE BY EQUINE SECTOR

The economic impact analysis has found that breeders are the primary contributing component of the local
equine sector to the Macedon Ranges Shire economy; horse studs (primarily thoroughbred breeders) have
generated over $27.6 million worth of expenditure in Macedon Ranges Shire. Breeders have also spent over
$22 million outside the Shire, primarily through purchase of high quality stallion services fees, transportation
and agistment fees.

Second in direct spending, the leisure horse industry has generated an estimated $22.6 million in
expenditure. $21.3 million was spent by the horse training / coaching sector and $13.7 million has been
generated by equine events held within the Shire, primarily through race meetings organised through the
Kyneton and Hanging Rock Racing Club. In particular, race meetings attract over 30,000 per year to the
Shire. Equestrian events such as dressage, eventing, show jumping and show horse competitions held by
local clubs and associations also contribute to the event component of the equine sector.

Other Equine Activities, primarily fodder, equipment retailers, wholesalers, husbandry services and
construction; contributed $11.1 million worth of expenditure in the Shire.

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ASSESSMENT JULY 2011
FIGURE 1 ESTIMATED DIRECT EXPENDITURE BY CATEGORY (MILLIONS), 2009/10

$22.0

$19.2

$5.1

$17.5
$8.4

$27.6
$22.6 $21.3
$13.7
$11.1

Breeder Events Leisure Horse Horse Training Other Equine


Industry Activities

Expenditure Outside Macedon Ranges Shire


Expenditure in Macedon Ranges Shire

Source: Urban Enterprise 2011

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ASSESSMENT JULY 2011
1. METHODOLOGY

1.1. INTRODUCTION
This section outlines the methodology of measuring the economic impact of the equine sector in
the Macedon Ranges Shire. Clear definitions of the industry are required to establish the economic
output and impact, as it must be possible to make distinctions between final output and
intermediate consumptions. The methodology is based upon an adaptation of the expenditure
approach to economic sizing used by the ABS.

1.2. D EFINITION OF THE EQUINE SECTOR

The Henley Centre Report of Research on the Horse Industry in Great Britain defines the horse
sector [or equine sector] as encompassing all activity that has the horse as its focus and activity
that, in some reasonable capacity, caters for such an industry.

This report will divide the equine sector into two components: the Core Equine Sector and the
Supplementary Equine Sector.

1.2.1. THE CORE EQUINE SECTOR

The Core Equine Sector represents individuals, organisations and activities that involve the direct
use of horses for the activity. The Core Equine Sector consists of the following segments:

HORSE BREEDING
The horse breeding sector in the Macedon Ranges Shire plays a critical role as the main economic
contributor to the local horse industry because of the temperate climate, availability of suitable land
and its central location. The Shire is a major producer of thoroughbred horses because of the local
infrastructure and close proximity to other regional horse racing centres and Metropolitan
Melbourne. Other horses produced include Arabians, Australian Stock Horses, Warmbloods and
several pony breeds.

PRIVATE LEISURE HORSE OWNERS

Private leisure horse owners defined as owners for whom the horse is not part of a business
enterprise. Private leisure horse owners are numerically the largest proportion of the industry,
although they do not directly produce economic output. This sector exacts economic contribution
through acquiring horse equipment, suppliers, utilising husbandry and health services; all of which
contribute a significant portion to sustaining the Macedon Ranges Equine Sector.

RACING CLUBS

The Macedon Ranges Equine Sector has one thoroughbred racing association, the Kyneton and
Hanging Rock Racing Club, which holds race days at the Hanging Rock Racecourse and at NMIT
Kyneton Park. The Racing Club contributes significantly to the local economy; in total, the Racing
Club will hold over 16 meetings within the 2010/11 year and attract over 30,000 visitors and
considerable tourism expenditure to the Shire.

Unlike other sectors, racing events create economic impact through non-riders; race day
spectators contribute through admission, betting, purchase of food & beverages, hospitality
packages, transport and accommodation.

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ASSESSMENT JULY 2011
CLUBS AND ASSOCIATIONS (ADULT RIDING AND PONY CLUBS)

Equestrian clubs, centres and associations are primarily non-profit organisations, providing a
platform for community and social interactions. Based on consultations with Horse Riding Club
Association of Victoria (HRCAV) and Pony Club Association of Victoria (PCAV), there are
approximately 8 adult riding club and 8 pony club associations within the Macedon Ranges Shire.
These clubs and associations hold events such as dressage, eventing, show jumping and show
horse competitions that contribute to the local economy and also contribute to the social well-being
of the community.

HORSE TRAINING / COACHING


Thoroughbred and harness horse training (conducted at NMIT Kyneton Park) is a key facilitator in
providing essential skills across the thoroughbred racing and training industry. The racing club
facilitates approximately 80 horse trainers and between 100 and 120 horses train at NMIT Kyneton
Park every day. Training and racing in the Macedon Ranges Shire attracts jockeys and horses
from all over Victoria. Furthermore, the Shire also comprises numerous horse trainers and
coaching schools that provide training for equestrian and leisure riders including club and
association members and riders competing in the Olympic disciplines.

EQUINE EDUCATION
NMIT Kyneton it is the first Victorian TAFE to introduce a degree specialised for the equine sector.
However, NMIT does not currently utilise the Kyneton Racecourse for educational purposes
(except for conference and meeting room facilities); plans have been put into place to consolidate
programs within NMIT Kyneton Park in the future. This activity does not currently have a direct
economic impact within the Shire and is not included in further analysis.

HORSE RIDING TOURISM

Trail riding tourism services play a prominent role in drawing non-owning riders to the equine
industry by offering products such as leisure-riding and day-trekking. However, consultations have
revealed that trail riding / hire horses are not available in the Macedon Ranges. As such, this
activity does not currently have a direct economic impact within the Shire, and is not included in
further analysis. Infrastructure requirements to facilitate growth in this sector will be analysed in the
strategy.

1.2.2. THE SUPPLEMENTARY EQUINE SECTOR

The Supplementary Equine Sector includes the services that support the regions Core Equine
Sector including land-based businesses, equine health, husbandry services and fodder suppliers.
These activities are vital to the sustainability of the equine sector and also generate economic
impact within the Shire.

LAND-BASED BUSINESSES

The land-based equine sectors include businesses that particularly provide land and infrastructure
for the accommodation of horses through agistment and other paid-for equine services. This
industry is crucial in providing accommodation for leisure horses and ponies, equestrian horses,
racehorses, broodmares / foaling down services etc.

EQUINE HEALTH

The Supplementary Equine Sector also includes equine health services, specialised veterinarians
and dentists that cater to the surrounding horse population. The Macedon Ranges Business

EQUINE SECTOR ECONOMIC IMPACT 28 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
Register indicates that there exist a number of specialised veterinarians and dentists servicing the
equine sector in the region. The equine health industry is crucial in ensuring the health and
sustainability of the Shires horse population, and though small in size, contributes significant
structural roles in ensuring the well-being of the industry.

HUSBANDRY SERVICES

Farriers and barehoof trimmers are the major husbandry service for the equine sector and are
responsible for the maintenance, care and shoeing of the horses hooves. Other husbandry
services would include horse therapists, chiropractors and masseurs.

NMIT in particular provides for the Certificate III in Farriery, critical in supplying farriers to not only
the general Victorian horse industry but the local Shire as well, however, the courses are currently
held outside the NMIT Kyneton campus.

FODDER SUPPLIERS

Fodder suppliers provide the food and nutritional source for the Macedon Ranges horse
population. Fodder is distributed through local retailers and wholesalers. Much of the hay
consumed by horses is produced locally; however the raw stocks of most grains and pellets are
sourced from outside the Shire.

OTHER SECTORS
Other supplementary sectors include trade and quarantine services (for importing / exporting of
horses), equipment retailers and wholesalers, equine specialised insurance providers, horse
product manufacturing and transportation.

Figure 2 provides a graphical depiction of the equine sector; more specifically the expenditure
flows within and outside the industry that will inform the economic impact assessment.

EQUINE SECTOR ECONOMIC IMPACT 29 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
FIGURE 2 EQUINE INDUSTRY SECTORS: EXPENDITURE FLOW DIAGRAM

Source: Urban Enterprise 2011

1.3. EXPENDITURE C ATEGORIES


Research reveals that a number of establishments partake in several activities across the core
equine and supplementary equine industry; for example, a horse breeder or trainer / coach may
provide agistment services. As such, for the purposes of the assessment, expenditure of the
equine sector (both core and supplementary sectors) will be simplified and compartmentalised into
the following categories:

Breeders this reflects the expenditure of the horse breeding industry;

Events this reflects the expenditure of racecourse facilities to host events, and expenditure
by visitors to these events;

Leisure Horse Riders this reflects the expenditure by the leisure horse riding community, in
particular the adult riding club members and pony club riding members;

Horse Training / Coaching this reflects the expenditure to host horse training within the
Shire, as well as expenditure by horse trainers and riding instructors themselves;

Other Services this reflects the expenditure of components of other sectors including land-
based businesses, insurances, husbandry services and horse product manufacturing.

1.4. M ETHODOLOGY OF THE E CONOMIC IMPACT A SSESSMENT


The economic impact assessment is based on the input-output analysis framework. The method
focuses on the impact on the economic expenditure and employment at a local Shire and state
level.

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ASSESSMENT JULY 2011
Input-Output (I-O) analysis is a widely used technique for estimating economic impacts of an
activity in a region, it examines how the industry affects an economy through its linkages between
all other sectors in the industry. For the detailed economic methodology, refer to Appendix B.

The Total Economic Impact of the equine sector is constructed through three categories:

Initial Output Effects the estimated initial expenditure of the equine sector on the general
Macedon Ranges Shire economy. This has been sourced through interviews with major
stakeholders in the local equine sector supplemented by the findings of the Macedon Ranges
Equine Business Survey;

Production Induced Effects this is the estimated impact of the Initial Output Effects on the
general economy. The Production Induced Effects are made up of two components:

The First Round Effects is the amount of output required from all industries of the
economy to produce the Initial Output Effect; and

Industrial Support Effects the effects of the second and subsequent rounds of induced
production;

Consumption Induced Effects the induced production of extra goods and services as a result
of private final consumption expenditure of households affected by the equine sector.

Coupled together, the Production Induced Effects and Consumption Induced Effects are known as
the Indirect Expenditure Effects.

Figure 3 graphically depicts the flow of the economic impact of the Macedon Ranges Equine
Sector, based on the expenditure categories defined in section 1.3.

FIGURE 3 EQUINE SECTOR ECONOMIC IMPACT FLOW DIAGRAM

Source: Urban Enterprise 2011

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ASSESSMENT JULY 2011
2. ECONOMIC IMPACT ASSESSMENT

2.1. INTRODUCTION
The section presents the economic impact in the Macedon Ranges Shire from each of the equine
expenditure categories. Assumptions drawn from findings from the Macedon Ranges Equine
Business Survey and consultations with the equine industry are made to construct the estimated
expenditure of the equine sector.

2.2. EXPENDITURE ESTIMATIONS BY C ATEGORY

HORSE BREEDING

Consultations with Stud Book Australia revealed over 537 thoroughbred foals were born in
Macedon Ranges Shire (in 2010) through 70 studs; furthermore, the data revealed that there are
approximately 15 thoroughbred stallions operating within the Shire, which have covered over
1,250 mares in 2010. Data on the number of broodmares could not be obtained from Stud Book
Australia. Utilising anecdotal evidence of the number of broodmares of consulted studs, we will
assume that an average stud consists of 35 mares per thoroughbred stud. Therefore, 2,450
thoroughbred broodmares are estimated in the Shire.

The following are key assumptions of Macedon Ranges Shire horse stud expenditure:

TABLE 2 EXPENDITURE ASSUMPTIONS, HORSE BREEDING

Breeding Expenditure $ Source

Thoroughbred and Arabian

Average Imported Stallion Service Fees $31,952 Australian Stud Book 2010 (NSW and VIC)

Average Local Stallion Service Fees $16,229 Australian Stud Book 2010 (Eliza Park)

Foaling Down Fees $450-$650 Arabian Horse Society of Australia


$700-
Extra Veterinary Medical Expenses Consultations
$1,200
Agistment Fees $80-$85 Consultations
Other Husbandry Services (e.g. farriers,
$650 Consultations
worming)
Castration $400-$500 Consultations

Ponies and Stock Horses

Average Stallion Service Fees $400 Australian Pony Stud Book Society

Handling Fees $50 Australian Pony Stud Book Society

Agistment $20 Australian Pony Stud Book Society

Warmblood

Agistment Fee (Wet Mare) $25 per day CJ Park Warmbloods

Foaling Down Fees $450 CJ Park Warmbloods


warmbloods-australia.com and CJ Park
Average Stallion Service Fees $2,750
Warmbloods

Source: Urban Enterprise 2011

EQUINE SECTOR ECONOMIC IMPACT 32 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
Horse studs primarily produce foals in up to five categories: weanling & yearlings (for sale), adult
stallions (for resourcing stallion fees), geldings (castrated adult males for sale), adult mares (adult
females for breeding) and racehorses (for attaining prize money through racing competitions).

According to consultations with Joe Vella (Wingrove Park), an average total operating expenditure
to produce a thoroughbred foal to an adult costs approximately $20,000, while producing a
yearling costs $12,000. Extra expenses will be incurred for castration (ranging between $400 and
$500); for the purposes of this report, we assume 25% of foals produced will be castrated.

The Macedon Ranges Shire is also a prominent producer of Arabian horses with 18 major Arabian
1
stud establishments . There are currently 211 standing stallions within the Shire (of which 157 are
active) and 465 registered mares (incorporating both purebreds and hybrids). For the purposes of
this report, thoroughbred foal producing costs will be applied to the Arabian stud sector.
2
Furthermore, consultations reveal there are currently 18 pony studs operating within the Shire .
Although data on the existing pony horse population within the Shire is not available; for the
purposes of this report, we will assume that the size of the pony breeding population is equal to the
Arabian breeding population (as both groups have 18 breeders). Further research indicated there
are approximately 50 registered stock horses and there are an existing 4 warmblood studs in the
Shire. Data on the number of warmblood stallions standing is unavailable, however, average
thoroughbreds standing per stud and existing prices of warmblood agistment and stallion service
fees will be applied to the industry.

EVENTS

This expenditure category analyses pony club association and adult riding club association events,
and race meetings held at the NMIT Kyneton Park and Hanging Rock racecourses.

In relation to the clubs and association sector, there are over 741 members in pony and adult
3
riding clubs in the Macedon Ranges Shire . Flow on expenditure occurs mainly through eventing,
dressage, show jumping, show horse competitions and monthly rallies. Approximately 180 rallies
and 84 competitions were held in the Macedon Ranges Shire last year. Consultations reveal that
primary expenditure on items includes:

Judges - an average of $150 per 8 pony club riders and $1,642 per adult riding club event;
most judges are sourced locally.

Canteen food and beverages costing over $5 per participating rider (sourced locally);

Ribbons costing an average $550 per event (sourced locally);

Horse Floats assumed to be an average of $99 for float hire (with tack box and breaching
gates). Expenditure will be allotted according to the number of estimated participants.
Purchases of horse floats have been accounted for in the Other Equine Services expenditure
category;

Instructors costing approximately $1,467 per adult riding club event and $150 per 9 pony
riders in pony club events. Expenditure on instruction and private riding lessons outside of
competition occurs as well (and these will be allotted into the Horse Training / Coaching
Expenditure Category); consultations reveal that over half of the members undertake
consistent weekly training (including private lessons);

1
Arabian Horse Society of Australia (AHSA) Stud Book
2
Australian Pony Society (APS) Stud Book
3
Pony Club Association of Victoria (PCAV) and Horse Riding Club Association of Victoria (HRCAV)

EQUINE SECTOR ECONOMIC IMPACT 33 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
Maintenance, equipment and capital expenditure steel poles costing $80 a pair and clubs
usually spend on 5 pairs per event (we assume these are sourced through local distributors).
An average of $1,000 is necessary to maintain arenas and consultations reveal that an
average of $8,000 is spent annually on other maintenance expenditure of grounds per club;
and

Insurance an average cost of $70 per rider in insurance fees is made to state bodies for
local pony and adult riding clubs;

Through data provided by Mark Graham (CEO of Kyneton and Hanging Rock Racing Club) and
the 2006 Economic and Social Contribution of Thoroughbred Horse Racing in Country Victoria
(prepared by Victoria University), over $12.7 million was spent on hosting country racing in the
Macedon Ranges Shire; expenditure was allocated into items based on industry estimates
provided by the ABS Sports and Recreation Services 2004-05 Report. Application of cost growth
rates at 3% p.a. will be applied to these figures to allow for adjustment to an estimated 2010
expenditure figure.

TABLE 3 ESTIMATED EXPENDITURE ASSUMPTIONS, HORSE RACING EVENTS

Estimated Thoroughbred Racing Event Expenditure $

Wages & Salaries $3,401,411

Super Contributions $273,300

Compensation Costs $171,788

Fringe Tax Benefits $48,413

Payroll Tax $142,116

Prize money $5,664,332

Liquor $440,403

Food $271,738

Animal Feed $412,292

Animal Medicines $42,166

Other $452,897

Payment to Broadcasting $188,967

Advertising $593,451

Sponsorship $121,814

Rent leasing $174,912

Total $12,400,000

Source: 2006 Economic and Social Contribution of Thoroughbred Horse Racing in Country Victoria, allocated according to
industry proportions provided by ABS Sport and Recreation Services 2004-05 Report.

Furthermore, horse racing events in the Macedon Ranges have attracted over 30,000 visitors to
4
the Shire per year . Using event industry estimates from another Victorian regional shire, an
estimated expenditure of $281 per day from overnight visitors and $163 per day from day trip
5
visitors occurs .

4
http://kyneton.countryracing.com.au/
5
Bass Coast Shire Council and Economic Impact of Events Study 2011 (Draft) Urban Enterprise

EQUINE SECTOR ECONOMIC IMPACT 34 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
LEISURE HORSE RIDERS

According to consultations with the Pony Club Association of Victoria and Horse Riding Club
Association of Victoria, there are approximately 1,292 horses (an estimated 720 horses and 572
6
ponies) used for adult riding club and pony club activities within the Shire . However, anecdotal
evidence reveals that the figures may be significantly higher than this, as many households (who
are not members of clubs and associations) own at least one horse. Riding club managers
estimate that over one quarter of households own horses on their properties; according to ABS
2006 data, there are over 8,003 separate houses in Macedon Ranges Shire (excluding the urban
centres of Woodend, Gisborne and Kyneton). Assuming a third of these residential properties own
an average of 1 horse, there are approximately 2,667 leisure horses in the Macedon Ranges Shire
(of which 1,292 are for pony club and adult riding club activities and the remaining 1,376 as
paddock companions, or for leisure riding and other recreational uses). Furthermore, research
through the Australian Stock Horse Society Stud Book revealed that there are approximately 50
7
stock horses registered . Expenditure on ponies and adult riding horses, stock horses, paddock
companions / other recreational horses will be accounted into the economic impact analysis.

Literature review and consultations with clubs and associations have been used to estimate
industry expenditures of the leisure horse rider expenditure category. According to the 2010 report
on the Contribution of the Pet Care Industry to the Australian Economy, an average of $5,010 is
spent on horse and riding equipment per horse; these costs will be accorded to leisure horses
utilised for pony and adult riding clubs.

TABLE 4 EXPENDITURE ASSUMPTIONS, LEISURE HORSE RIDERS

Horse and Riding Equipment and Products Indicative Costs (Range)

Helmet $99.00 - $695

Boots $49.95 - $350

Chaps $44.95 - $225

Saddle $449.00 - $5,995

Rug $59.95 - $230

Reins $20.00 - $85

Halter (leather) $23.95 - $150

Leads $5.95 - $17

Bridle $39.95 - $220

Bit $36.95 - $47

Stirrup irons $24.95 - $90

Brushes $12.95 - $30

Clippers $99.00 - $689

Coat care and polishes $15.95 - $34

Grooming kits $19.95 - $30

Hoof picks and scrapers $2.95 - $6

Hoof polish / oils $10.25 - $34

Shampoo (1 litre) $10.95 - $20

6
720 adult horse and 572 ponies, assumption of 2 horses per club member as anecdotally provided by consultations.
7
99 stock horses registered in the postal code regions 3200 to 3499 (detailed data for the Macedon Ranges was not available; as such, we
will assume half these stock horses are located in the Macedon Ranges Shire).

EQUINE SECTOR ECONOMIC IMPACT 35 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
Horse and Riding Equipment and Products Indicative Costs (Range)

Flyveils $12.95 - $35

Source: Contribution of the Pet Care Industry to the Australian Economy, 2010

Furthermore, the cost of veterinary and grooming supplies (including wormers and shampoos)
ranges between $200 and $1,000 per annum. Consultations with pony club and adult riding club
managers reveal that an average of $5,200 is spent on fodder per horse per year. In summary,
approximately $10,010 is spent per annum on pony and adult riding horses, while approximately
$6,000 will be spent on paddock companions.

HORSE TRAINING / COACHING

Existing equine education also encompasses horse training, particularly race horse training within
the NMIT Kyneton Park racecourse (facilitated by the club) and other training establishments such
as Macedon Lodge and Wadham Park. Research shows that between 100 to 120 horses are
8
training daily within NMIT Kyneton racecourse . Consultations with the Kyneton & Hanging Rock
Racing Club show that costs of training racehorses are $70 to $100 a day. Other expenditure
includes an average of $10 per week on supplements, rugs costing $133 annually per horse and
veterinary fees at an average of $100 per month. Anecdotally, wages and salaries are the primary
source of expenditure; other economic impacts occur outside the Shire including transportation
fees (particularly for interstate horses), retail expenditure on fodder and grain and some husbandry
services.

OTHER EQUINE SERVICES

Other assumptions drawn from findings of the equine sector include the following:

FODDER AND RETAIL


Horses consume an average of 5kgs of feed / hay per day; 3kgs of fodder is sourced from retailers
and 2kgs consists of hay which is sourced locally. Furthermore, consultations show over 90% of
local horse owners source their fodder from local retailers within the Macedon Ranges Shire.
Consultations with local feed suppliers show that over 75% of fodder supplied is sourced from local
feed wholesalers and manufacturers. Some raw materials for fodder cannot be sourced within the
Shire e.g. vitamin & mineral supplements. As such, a large part of the fodder supply chain takes
place outside the Shire, with key elements of retailing and wholesaling services occurring within
Macedon Ranges.

Furthermore, purchases of horse floats have been accounted through an assumed expenditure of
$35,000 per item / per club member in the Shire (as an assumed estimated population of persons
owning a horse float); the purchases will be amortised across a 10 year usable life period, whereby
depreciation expenses per annum will be accounted into the economic impact of horse float
purchasing in the Shire.

AGISTMENT
The agistment services industry is relatively smaller within the Macedon Ranges Shire (compared
to other local government areas closer to Metropolitan Melbourne); this is mainly due to the
availability of relatively larger parcels of land for households to accommodate their own horses.
Agistment services are also a relatively larger industry in Shires closer to Metropolitan Melbourne,

8
http://kyneton.countryracing.com.au/

EQUINE SECTOR ECONOMIC IMPACT 36 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
providing city dwellers with easier accessibility to their horses. However, there may be
opportunities to facilitate the provision of more agistment services in areas of the Shire with
accessible linkages to Metropolitan Melbourne e.g. Gisborne and Romsey. Within Macedon
Ranges Shire itself, agistment services are typically offered as secondary services by studs and
horse training schools, as value-added services to sustain their businesses.

EQUINE HEALTH
Interviews show that horse studs are able to source general, on-going health services through the
local veterinary, dental and equine health services; however, there is a lack of specialist horse
services e.g. embryonic transfer services, some ultra sound scanning and major surgeries. Horse
breeders must transport their horses primarily to veterinary hospitals at Werribee and Shepparton
for such services, which contributes to outside expenditure of transport and specialist medical
treatment.

HUSBANDRY SERVICES
Expenditure by husbandry services such as farriers and barehoof trimmers, equine therapists,
masseurs, chiropractors and naturopaths has been accounted for in the economic impact
assessment.

CONSTRUCTION
Expenditure on new buildings, renovations, plant, machinery and other capital expenses relating to
equine properties and infrastructure has been sourced through the Equine Sector Business Survey
and the Macedon Ranges Shire Council Building Approvals Database. Data in the 2009/10
financial year was sorted according to category to account for the economic impact of this
expenditure.

EQUINE SECTOR ECONOMIC IMPACT 37 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
3. ECONOMIC IMPACT FINDINGS

3.1. S UMMARY
In 2010, the Macedon Ranges Equine Sector had an estimated economic impact of $140 million in
the local Macedon Ranges Shires economy, of which $96.3 million was sourced from direct
expenditure of the equine sector.

The Macedon Ranges Equine Sector also spent an estimated $72.2 million outside the Macedon
Ranges Shire (on goods and services from other regions of Victoria and New South Wales).
Comparative data on the expenditure leakages outside the Shire was difficult to source, due to the
lack of available small regional area studies on the equine sector. However, the 2008 Economic
Impact and Review of the Equine Industry in the City of Greater Bendigo may offer some
perspective. The report notes that for every $1 dollar spent by the local equine sector, an
estimated $0.51 was spent outside the City of Greater Bendigo to support its operations. This is
compared to the Macedon Ranges Equine Sector, whereby a $1 dollar spent by the local equine
sector will allow for $0.42 to be spent for goods and services outside the Shire.

The following table is a summary of expenditure by category (refer to Appendix C for full details).

FIGURE 4 ESTIMATED EXPENDITURES BY EXPENDITURE CATEGORIES (MILLIONS), 2009/10

$27.6

$22.0 $22.6
$21.3
$19.2
$17.5

$13.7

$11.1
$8.4

$5.1

Breeder Events Leisure Horse Horse Training Other Equine


Industry Activities
Expenditure in Macedon Ranges Shire
Expenditure Outside Macedon Ranges Shire

Source: Urban Enterprise 2011

EQUINE SECTOR ECONOMIC IMPACT 38 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
TABLE 5 ECONOMIC IMPACT OF EQUINE SECTOR, 2009/10

Economic Impact $

Direct Expenditure of Equine Sector $96,359,215


Total Economic Impact $139,997,646
Estimated Shire Employment 772

Source: Urban Enterprise 2011

The study has found the Macedon Ranges Equine Sector has contributed over $140 million in total
economic impact to the Shire. The on-going operations of the industry supported over 772 jobs in
the Macedon Ranges Shire economy in 2009/10.

HORSE BREEDING

Consultation with the local equine sector suggests that the breeding sector is of significant value to
the Macedon Ranges Shire economy. The combination of soil rich in mineral content, proximity to
Melbourne and its international airport and linkages to the broader horse racing industry has
enabled the Macedon Ranges Shire to become a prime producer and international exporter of high
quality thoroughbred horses.

The breeding sector contributed an estimated $27.6 million in expenditure in the 2009/10 financial
year. Furthermore, horse breeders spent $22 million outside the Shire. Consultations suggest that
leakage in expenditure outside the Shire is primarily due to:

Fees from covering mares by high quality stallions located within other Victorian regions and
New South Wales;

The purchase of raw fodder materials sourced from outside the Macedon Ranges Shire is the
primary component behind these leakages.

Specialist health care services e.g. specialist surgeries and procedures at Werribee, Ballarat
and Shepparton; and

Husbandry services including some farriery, chiropractic and therapeutic services.

EVENTS

The events industry contributed an estimated $13.7 million in expenditure in 2009/10. A large
contributor can be attributed to thoroughbred racing events held in the NMIT Kyneton Park and
Hanging Rock racecourses. The race meetings attract over 30,000 visitors to the Shire every year,
also contributing a large portion of local tourism expenditure.

Dressage, eventing, show jumping and show horse competitions by local pony clubs and adult
riding clubs also contribute a portion to the events expenditure.

Consultations indicate that expenditure outside the Shire occurs through horses visiting for events
that source husbandry services, transport, equipment and fodder supplies from outside the Shire.
Expenditure by Racing Victoria and local racecourse facilities through purchases of broadcasting,
advertisements, equipment, wholesale liquors, food and beverages also contribute to expenditure
outside the Shire.

EQUINE SECTOR ECONOMIC IMPACT 39 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
LEISURE HORSE RIDERS

This report finds that the leisure horse rider expenditure category contributes an estimated $22.6
million in expenditure to the Macedon Ranges economy through direct expenditure. The
availability of appropriately sized and zoned residential land has allowed households to maintain a
number of horses on their properties, increasing the number of horses in the region and
associated expenditure.

HORSE TRAINING / COACHING

The horse training sector provides an estimated $21.3 million of local expenditure within the
Macedon Ranges Shire. The economic impact of this sector is mainly due to the thoroughbred and
harness training at NMIT Kyneton racecourse and other major horse training establishments e.g.
Macedon Lodge and Wadham Park. This training draws in a large number of horse trainers,
jockeys and stable hands from across Victoria, and provides employment opportunities to the local
community. The Shire also has a number of horse riding schools, trainers and instructors that
provide key educational opportunities to the local equestrian competitors and other riders.

The sector has also generated over $19.2 million worth of expenditure outside the Shire (sourced
primarily through purchases of fodder and horse transportation fees).

OTHER EQUINE SERVICES

Other equine services have an estimated $11.1 million in direct expenditure to the Shire. The
expenditure is primarily driven by purchases of equipment, feed retailers and wholesalers. Local
equine health and husbandry services, e.g. equine dentists, farriers, chiropractors and masseurs
also generate local expenditure as well as maintaining an important role in servicing the general
horse population of the Macedon Ranges.

Raw fodder materials purchases contribute to the large $17.5 million spent outside the Shire.

EQUINE SECTOR ECONOMIC IMPACT 40 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
APPENDIX B

INPUT-OUTPUT MODEL

INTRODUCTION

The following section provides the description of use and methodology of the economic impact assessment
through a regional input-output table.

WHAT IS AN INPUT-OUTPUT TABLE?

An Input-Output (I-O) table fulfils two key functions; it is a descriptive framework for showing the relationship
between industries and sectors and between inputs and outputs in an economy. It is also an analytical tool for
measuring the impact of autonomous disturbances on an economys output, employment and income.
Utilising the Leontief Inverse and several other augmentation methods, the economic impact of expenditure in
Macedon Ranges Shire can be depicted through the I-O model.

INPUT-OUTPUT MODEL METHODOLOGY

As regional input-output models are not readily available, top-down techniques drawing and modifying direct
import coefficients from the most recent 2006-2007 Australian National I-O tables are necessary to study the
economic affects within small regional areas.

The report will further utilise input-output model technique from Flegg and Webber (2000), the Augmented
9
Flegg Location Quotient (AFLQ) adjustment technique to construct a Macedon Ranges Input-Output Table.
The AFLQ adjustment technique will allow for accounting the regional industry mix of the Shire, the relative
size of the Shires economy and cross industry relationships.

The report will utilise the ABS 2007 Input-Output Industry Groups (IOIG) consisting of 111 industry sectors for
the economic impact analysis (refer to Appendix C Summary of Expenditure). The Total Economic Impact of
the equine sector is constructed through three categories:

Initial Output Effects the estimated initial expenditure of the equine sector on the general
Macedon Ranges Shire economy. This will be sourced through the interviews with major
stakeholders in the local equine sector supplemented by findings of the Macedon Ranges Equine
Business Survey;

Production Induced Effects this is the estimated impact of the Initial Output Effects on the general
economy. The Production Induced Effects are made up of two components:

The First Round Effects is the amount of output required from all industries of the economy
to product the Initial Output Effect; and

Industrial Support Effects the effects of the second and subsequent rounds of induced
production; and

Consumption Induced Effects the induced production of extra goods and services as a result of
private final consumption expenditure of households affected by the equine sector.

Figure 5 graphically depicts the flow of the economic impact of the Macedon Ranges Equine
Sector.

9
Flegg. A.T., Webber, C.D., and Elliot, M.V., 1995, On The Appropriate Use of Location-Quotients In Generating Regional Input-Output
Tables, Regional Studies, Vol. 29, No. 6,

EQUINE SECTOR ECONOMIC IMPACT 41 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
FIGURE 5 EQUINE SECTOR ECONOMIC IMPACT FLOW DIAGRAM

Source: Urban Enterprise, 2011

EQUINE SECTOR ECONOMIC IMPACT 42 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
APPENDIX C

E STIMATED EXPENDITURES BY C ATEGORY AND INDUSTRY


Note that the following table excludes a further 95 Input-Output Industry Groups (ABS 2006) that did not
10
generate any expenditure .

TABLE 6 ESTIMATED EXPENDITURES BY CATEGORY (MILLIONS), INPUT OUTPUT INDUSTRY GROUP ABS 2006

Horse
Input Output Leisure Other Total Total
Training / Total Local
Industry Group Breeder Events Horse Equine Imports Industry
Equestrian Expenditure
ABS 2006 Industry Services Expenditure Expenditure
Coaches
Sheep, Grains,
Beef and Dairy $0.0 $0.0 $0.0 $0.0 $4.3 $4.3 $22.9 $27.2
Cattle
Poultry and
$8.5 $0.0 $0.0 $0.0 $0.0 $8.5 $18.6 $27.1
Other Livestock
Retail Trade $7.5 $4.9 $7.5 $1.2 $0.0 $21.1 $1.8 $22.9

Road Transport $0.9 $0.2 $0.0 $3.1 $0.0 $4.2 $16.1 $20.3
Sports and
$0.0 $4.0 $0.0 $12.4 $0.4 $16.7 $0.0 $16.7
Recreation
Non-Residential
Building $0.3 $0.2 $11.5 $1.5 $0.2 $13.8 $0.0 $13.8
Construction
Agriculture,
Forestry and
$4.8 $0.0 $0.5 $1.2 $0.0 $6.5 $1.8 $8.3
Fishing Support
Services
Health Care
$3.6 $0.0 $0.6 $0.2 $0.0 $4.5 $3.4 $7.9
Services
Other Food
Product $0.0 $0.0 $1.3 $0.0 $5.9 $7.3 $0.0 $7.3
Manufacturing
Gambling $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $5.7 $5.7

Accommodation $0.0 $3.5 $0.0 $1.7 $0.0 $5.3 $0.0 $5.3


Auxiliary Finance
and Insurance $1.9 $0.0 $1.1 $0.0 $0.2 $3.2 $0.4 $3.6
Services
Food and
Beverage $0.0 $0.8 $0.0 $0.0 $0.0 $0.8 $0.7 $1.5
Services
Professional,
Scientific and
$0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.6 $0.6
Technical
Services
Broadcasting
$0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.2 $0.2
(except Internet)
Wholesale Trade $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.1
Ceramic Product
$0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Manufacturing
Total $27.6 $13.7 $22.6 $21.3 $11.1 $96.4 $72.2 $168.5

Source: Urban Enterprise, 2011

10
Table 8: Industry by Industry Flow Table (Indirect Allocation of Imports);
http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/5209.0.55.001Final%20release%202006-07%20tables?OpenDocument

EQUINE SECTOR ECONOMIC IMPACT 43 MACEDON RANGES SHIRE COUNCIL


ASSESSMENT JULY 2011
MACEDON RANGES SHIRE COUNCIL
PO Box 151
Kyneton Vic 3444
Australia
T: +61 (3) 5421 9616
F: +61 (3) 5422 3623
E: ecodevadmin@mrsc.vic.gov.au
W: mrsc.vic.gov.au

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