The announcement was made by Racing Minister Winston Peters at the Mercedes Thoroughbred Awards dinner at Mystery Creek in Hamilton.

"This year's Budget contained a $9 million, three-year scheme to significantly lift prize money for key New Zealand races," said Peters.   

"This initiative is designed to help our clubs compete with money on offer overseas, to encourage greater bloodstock investment in New Zealand, and to help ensure our best horses stay in the country. 

"As a result, four top thoroughbred races will this season join the Kelt Capital Stakes ($2 million) and Karaka Million ($1 million) in offering stakes of $1 million or more. 

"Leading the way will be the $2.2 million New Zealand Derby, while the Auckland Cup, the Telegraph and the 2000 Guineas will all carry stakes of $1 million."

The biggest single increase is for the Gr I NZ Mercedes Derby, which goes up $1.5 million from the $700,000 total prizemoney offered when C'est La Guerre raced away in the Ellerslie feature last March.

The Auckland Cup goes up $300,000 from $700,000, while the increases for the Telegraph Handicap and NZ 2000 Guineas are $750,000 and $675,000 respectively.

"High stakes races will attract top contestants from Australia and further afield," said Peters.

"That in turn will raise our international profile, and capture the New Zealand public's imagination. 

"Big-money races are the bedrock around which highly successful racing carnivals can be built, bringing proven economic benefit not just to the industry, but to the economy as a whole, and local communities in particular. 

"This is an exciting time for racing, and the challenge now is for the industry and sponsors to build on a raft of recent initiatives to ensure that New Zealand racing begins to fulfill its considerable economic potential. 

"If we can move forward in this spirit, there is no reason why more marquee races cannot break the $1 million barrier, and really set New Zealand's racing scene alight." 

Peters sees recent changes as a foundation for a bright future for racing, but he pointed out there is still more to be done if New Zealand racing is to realise its full potential.    

"The initiative to reduce gaming duty has restored equity after years of grossly unfair treatment and it has increased funding for thoroughbred racing," said Peters.    

"As a result stakes have increased from $39 million in 2006 to an expected $60 million this season - a 50 per cent increase over just three seasons.   

"Racehorse owners are the lifeblood of racing and they should be suitably rewarded for the risk of ownership. 

"Therefore it is very pleasing to see that Thoroughbred Racing has introduced a number of extra initiatives to reduce owners' costs such as the free racing programme, travel subsidies and the payment of jockeys' fees.