Immediate gains for major operators’ share prices upon the release of the Government’s report suggested that the market considers the Government’s proposals to be broadly less damaging than they could have been, or at least represented the postponement of bad news.
The report’s key recommendations include:
- The proposed reduction of the maximum stake on Fixed Odds Betting Machines from £100 to anywhere between £2 and £50. Upper limits of £2, £20, £30 and £50 are all suggested, with the £50 option thought to be the most unlikely due to the report’s recognition that “this option represents a minimal change to the status quo”, as “there is minimal play above £50”, and 46% of those gambling on these stakes are problem gamblers. The outcome of the further consultation on this issue may depend, to a large extent, on how effective additional social responsibility measures are seen to be (see below).
- In combination with the options to reduce the maximum stake, changes to other requirements aimed to improve player control, including the tracking and monitoring of play, spin speed (on roulette games) and nudge type measures. The Gambling Commission currently sets a standard of 20 seconds per spin for roulette games, but the report suggests that a spin speed of 1 minute would “better reflect roulette in a casino”. It is suggested that a change in this direction could help reduce large session losses and the Government also suggested that there is a case for the introduction of similar measure on other gaming machines (such as category B1 and B3).
- On harm minimisation in the online sector, the Government noted that the pace of change in the industry “has not been fast enough”. It pointed to the introduction of the Commission’s updated enforcement strategy, and indicated that this will act as a strong deterrent to those who do not take their social responsibility obligations seriously. DCMS also mentioned the ongoing initiatives by the CMA (looking into unfair terms and misleading practices around online gaming sign-up promotions and free bets) and the Gambling Commission (expected to make further changes to the Licence Conditions and Codes of Practice in due course). However, the Government expects the industry to accelerate its work wherever possible in this area, and doesn’t think it is good enough for operators to passively wait for the introduction of further measures.
- This pressure on operators to up their game in respect of social responsibility is nothing new, but this report signifies the Government’s clear backing of the Gambling Commission’s work in this area and the imposition of strong sanctions for any operators failing to make the grade.
Research, Education and Treatment (RET)
- The report indicates that the Government expects the gambling industry to do more voluntarily in terms of research, education and treatment in order to minimise the risk of harm from gambling. The LCCP currently require gambling operators to contribute to an organisation that mitigates against gambling related harm, with the majority contributing to GambleAware. However, GambleAware currently raises roughly £8m a year, shy of its £10m target. The Government stated in its report that it will consider introducing a mandatory levy if the voluntary system does not improve. With the increasing cost of compliance generally, this would not be welcome news for operators.
However, the report is just as notable for what proposals it appears to have rejected, including:
- Much to the disappointment of Labour (who have been calling for a ban on gambling advertising on football kits), the report rejects wholesale changes to gambling advertising regulation, despite widespread calls for further regulation. The Government referred to a report by Dr Per Binde published by GambleAware in 2014 which found that the impact of advertising on problem gambling was “likely to be neither negligible nor considerable, but rather relatively small”. As a result, no major change was announced – although CAP will produce new guidance to protect those at risk of problem gambling, and the Gambling Commission will consult on making compliance with the CAP/BCAP codes a ‘social responsibility requirement’ of the LCCP, meaning that breaches would be subject to the Commission’s full regulatory powers.
- Local authorities’ proposition to introduce cumulative impact assessments to give them more powers to manage gambling at a local level. This was rejected by the Government, who said that local authorities already have sufficient powers in order to manage gambling via licensing.
- The Government rejected the gambling industry’s calls for increasing the current limitations on stakes, prizes, permitted numbers and allocations of all betting machines other than Fixed Odds Betting Machines.
- A request to permit a new high-stakes machines for ‘high-roller’ international gamblers in Mayfair casinos with £50 stakes and £100,000 prizes was rejected due to a lack of evidence in support and the challenge of limiting any legislation to the casinos envisaged.
- The Government rejected industry’s calls to allow the introduction of contactless payments, saying that this would “be a backward step in the protection of vulnerable players”.
The consultation process will now continue until 23 January 2018, with interested parties invited to send their responses and evidence to email@example.com.
This post was written by Phil Gwyn and Elizabeth Dunn