During the April recess, the Government proposed two inadequate sticking plasters for the festering sore of FOBTs - the casino-style gambling machines in betting shops with stakes up to 50 times higher than those allowed in other high-street adult gambling premises.
One of these was the recommendation to allow more powers to local authorities, a move prompted by requests in Parliament from politicians who care about their communities, but more importantly prompted by action from local authorities supporting Hackney’s proposal under the Sustainable Communities Act to force the issue. Over 60 councils had signed up demanding more power over betting shops to curb their clustering on high streets.
The consequence is a recommendation for more powers to be granted, which is the subject of a
current consultation, to which the Campaign response will be submitted shortly. A summary of our response is that the move, whilst in the right direction, is just too little too late.
One local authority that must agree with that summary is Newham Council, which recently published a new proposal under the
Sustainable Communities Act. It is requesting a reduction in the FOBT maximum stake from £100 to £2, exactly the position held by the Campaign.
The process is that once a certain number of local authorities have signed up in agreement with Newham, the proposal will be submitted to Government. There is then an opportunity for a review period and a negotiation period. Even if Government is reluctant to help satisfy local demands, there will have to be some action. Taking the timescale into account, this is likely to be by the end of 2015 at the latest.
There are multiple reasons for Newham to bring this action forward. Newham is a deprived area - ranked third in the Index of Multiple Deprivation - but has around 80 betting shops with over 296 FOBTs, taking an estimated £18 million per year out of the local economy and leading to a reduction of
234 jobs annually across the wider local economy.
Newham knows that the primary gambling activity in betting shops is FOBTs, machines which generate over 80% of turnover (the activity) and result in over 50% of betting shop profits. They were unable to use this position in court to support their refusal of a Paddy Power licence application.
A 2011-2012 Gambling Data report on UK Betting Shops:
Over the counter versus machinesshows the extent of losses on FOBTs compared to other betting opportunities available in a shop. Aggregated averages when the less frequent gamblers were stripped out show that regular over the counter race and sports gamblers lost £427 whereas regular FOBT gamblers lost £1,209 per gambler that year.
When considering difference in losses, Gambling Data also notes “the distribution of FOBT bettors is heavily weighted toward younger players” and after analysing the annual reports of William Hill and applying to BGPS data they conclude “
this result supports the prevalence survey finding that FOBTs nurture frequent gambling”. Combine all these factors and add in that analysts at JP Morgan say FOBT players are young, with the “
highest proportion of C2DE customers (70%)”.
The Gambling Commission would not support Newham by taking a rational view of what constitutes primary gambling activity. But as arcade operators
Luxury Leisurediscovered, the Commission keeps moving the goalposts on their interpretation and may now have to overhaul their policy completely.
Paddy Power fought Newham with expensive lawyers and paid “expert” witnesses ready to argue against Newham, to their commercial benefit. Newham had insight into the level of FOBT problem gambling based on 2CV research in the area which showed that
86% of betting shop customers found the machines addictive.
Sadiq Khan MP said the “
rug was pulled” from under local residents, following a central planning inspector reversal of a Council refusal to allow another betting shop in Wandsworth.
Yet in Scotland,
Inverclyde Council was backed by the Holyrood governmentin its refusal of yet another betting shop in their town centre. But Scotland rightly still wants more powers, as evidenced by the
Scottish Government devolution proposalin the event of a NO vote. Regardless of the independence vote, it will eventually be YES to more powers over bookies and NO to the growth of FOBT gambling addiction in Scotland.
It looks as though Newham should soon get the support they need to enable the Sustainable Communities Act to deliver similar standards for England to those that will eventually apply in Scotland.
To find out why the bookies have never published the Gambling Data report and to learn more about FOBTs visit
usat party conference exhibitions as follows:
Labour Party Conference: 21st – 24th September, stand 52
Conservative Party Conference: 28th September – 1st October, stand 90
Lib Dem Party Conference: 4th – 8th October, stand B4