Racing and betting interests have been set a July deadline by the Home Office to come up with a workable system to replace the Levy Board.
Officials from the British Horseracing Board met the Home Office on March 13, 11 days after the Government announced plans to remove itself from the system of funding the sport and to sell the Tote to a racing trust.
The BHB was asked for a detailed proposal by the summer of how the Levy Board functions would be replaced by direct negotiations between racing and betting.
Chairman Peter Savill plans to meet major representative associations and interested parties in racing between now and May so that he can canvass opinion in order that the Home Office is provided with a plan that has racing's full support.
He also intends to meet representatives of the betting industry and has already seen Warwick Bartlett, chairman of the bookmakers' committee.
Savill, who describes the Home Office timetable as 'difficult' said: 'This has to be a consultation progress otherwise we won't get a solution which anyone can support.
'The solution must not be Peter Savill's or the BHB's, it should be one from racing and betting, taking in their special circumstances.'
'The situation is not one for confrontation,' added Savill, who has been criticised in the past for his aggressive approach towards the betting industry in his bid to extract extra income from the bookmakers for racing.
He explained that the previous Levy set-up did not allow racing to negotiate commercially and that it was then better to press for an end to the old system.
Now that was close to being achieved racing and betting had to explore their 'mutual interest'.
Savill said: 'Confrontation is at an end, negotiations are beginning. The current situation doesn't call for confrontation.'
The BHB has also been asked by the Home Office to expand on its proposal for a racing trust to buy the Tote, according to Tristram Ricketts, chief executive of the BHB.
Ricketts said the BHB would, in conjunction with the Tote Board, 'put flesh on the bones of the outline,' submitted to the Home Office last November for a racing trust to own and control the Tote.
Ricketts said that legislation necessary for the Government to sell the Tote was likely in the 2001/2 Parliamentary session and possibly earlier, in 2000/1.
'If it was possible to slip in a Bill at an earlier date, we wouldn't stand in the way,' Ricketts said.
