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A date for your diary: Thursday 7th May 2015, the day to sell your retail bookmaker shares.

Why? because that is the day that the new Labour government will start its crackdown on betting shops and fixed odds betting terminals. How do we know? Because on Saturday 12th January 2013, the almost certain soon-to- be Prime Minister, Ed Miliband stated in his speech to the Fabians, that his vision of the new ‘One Nation’ Labour included;

‘practising a new approach to campaigning—through community organising—which doesn’t just seek to win votes but build new relationships in every part of Britain.

For example, taking up local issues from high streets dominated by betting shops to taking on payday loan companies.’[i]

Miliband was intrinsically linking betting shops with pay-day loan companies, such as Wonga, which have become a major bête noire of the Party due to the tireless campaigning of the in-line-for-great-things (and lovely lady) MP for Walthamstow, Dr Stella Creasy MP. Betting shops and their operators have now been designated evil incarnate by the next and future government and as such will undoubtedly suffer its Nanny State wrath.

The beginning of January 2013 has been quite a week for the bookmakers. First, we see a ‘Hitler Diaries’ type affair with the Guardian making a splash over a report linking unemployment to FOBT’s[ii]. Not only was the whole premise ‘baloney’ as unemployment rates are far too dynamic to be linked to betting shop openings, but the data used was amazingly inaccurate. By my reckoning, based on data provided by the Gambling Commission, the Guardian’s data was on average over-estimating FOBT spend by 27 times – for example, the Guardian reported that FOBT spend in Bethnal Green and Bow[iii] was £243.2M, while using the same number of FOBTs and the regulator’s data; a more accurate figure would have been just £7M.

This is hardly surprising when the suppliers of the data are the campaign group Fairer Gambling who could only cite as their sources for their data; an industry survey. Fairer Gambling are rumoured to be funded by the once owner of a poker game that he failed to sell into betting shops and so, it is rumoured, he has it out for them. His organisation is also rumoured to have funded the Liberal Democrats, which could explain the Don Foster MP campaign against these machines. I should stress this is all rumour and supposition, and the usual cut and thrust of gambling politics, with a few campaigning ex-addicts thrown into the mix. What is interesting is a) how little the bookmakers have been doing about it? and b) how this has widened the anti-betting shop and FOBT campaign within the Labour Party.

The Labour campaign against bookmakers began with protests against betting shop clustering (the perception that there are too many bookmakers on a High Street) in 2007 with David Lammy, Labour MP for Tottenham, starting a campaign to clean up the Green Lanes area of Harringay and remove betting shops, estate agents and other ‘undesirable’ premises types. Unable to do this through the current planning system he embarked on a campaign focussed just on betting shop clustering which was picked up on by certain Labour MP’s of the more radical persuasion. Unsurprisingly, as it was a Labour government which had changed the planning laws to allow more bookmakers, Lammy failed to get anywhere while his own Party was in power, even though he got a promise to change the planning laws in the 2010 Labour Manifesto[iv].

With more time on his hands in opposition, Lammy maintained his campaign, securing an adjournment debate in November 2010 and using the debate on the Localism Bill in January 2011 to air his views. By this time he has included FOBTs in his tirade, linking them directly to problem gambling and his perception that the poor were being specifically targeted. When the Culture, Media & Sport’s Select Committee inquiry into gambling started requesting written evidence in June 2011, Lammy makes a lengthy submission, asking ‘whether someone [should] be able to walk off the high street and wager up to £10,000 in an hour, without any robust checks on your age or your mental health?[v] A very salient point considering the current research that suggests that problem gamblers are born that way rather than ‘infected’ by evil gaming machines.

Until Miliband’s recent linkage of bookmakers to ‘evil’ pay day loans companies, the high point of the Labour Left’s campaign against bookmakers was arguably on the 8th November 2011 when the Deputy Leader of the Labour Party, the Rt. Hon. Harriet Harman QC, Shadow Secretary of State for Culture, Media and Sport, MP for Camberwell and Peckham, (Hattie (as in Jacques) to some in the House) published a Lammy written report entitled ‘The Problem of Betting Shops Blighting High Streets and Communities in Low-Income Areas’.

This document is one of the most malicious attacks on bookmakers that has been seen for some time. In the report, Lammy triangulates betting shop clustering, with B2 machines and problem gambling and then takes the emotive leap to accuse bookmakers of preying on the poor, full of factual inaccuracies, it is worth quoting the more controversial statements;

  • ‘This is predatory profiteering which is destroying our high streets, pushing many families further into poverty and creating a dangerous synergy between welfare dependency and gambling that threatens the fabric of our communities’ ,
  • ‘The proliferation of bookmakers is damaging the look and feel of our high streets making them feel less safe and less welcoming, and making our high streets less diverse’ ,
  • ‘A survey shows that problem gambling is highest amongst men, the young, the unemployed and in deprived areas. The bookmakers know this; that is why deprived areas have significantly higher numbers of bookmakers than affluent neighbourhoods.’ ,
  • ‘Betting shops increase the likelihood of anti-social behaviour and have replaced well- used local amenities like post offices and banks’ ,
  • ‘The gambling takes place in an easily accessed high street shop with no door control, no money laundering controls, no licensed staff or staff trained to deal with problem gamblers.’
  • ‘13% of people receiving treatment from Gamcare have said that, amongst other activities, they use FOBTs. The main users of B2 machines appear to be young, unemployed men and further studies show that there is an association between problem gambling and disadvantaged groups.’
  • ‘The bookmaking industry is targeting low income areas. Haringey Council is one of a number of local authorities to raise their concerns. Residents and Traders associations in Haringey have highlighted that the East-West divide of the 66 betting shops in the borough is 85%-15%. They state that “this is because betting shops are located in key geographical areas: poorer areas of the borough and those with a known demographic which is more likely to gamble’
Space does not permit a rebuttal to these statements which have the air of Chemical Ali about them, needless to say they cemented the myths about FOBTs into the minds of many a Labour MP, even their own spokesman on gambling, Clive Efford MP.

The campaign continued with numerous questions in the House, a 10 Minute Bill presented by Joan Ruddock and an Early Day Motion by Margaret Hodge. However, all of this could arguably have been ignored as just ‘low level insurgency’ by the Left, fulfilling their Brownian desires to Nanny the State and ensure the Working Class have no fun and spend their time focussing on protesting the cuts until now.

Why I’m calling the Guardian story as the pre-cursor to the demise of British betting shops is because the story was picked up by Labour MP’s who are not of the radical persuasion, the old ‘loony left’ or die-hard Brownites. Trawling the twitter feeds of Labour MP’s it was possible to see who had been inspired to get on their soapboxes and it was a broad church; from ambitious Ed Milibandites like Rachael Reeves MP (Leeds West) and Lucy Powell MP (Manchester Central) to David Miliband fans like Willie Bain (Glasgow NE) and Meg Hillier (Hackney S & Shoreditch) and of course, old Labour lags like Richard Burden (Birmingham Northfield). Condemnation of FOBTs and bookmakers was now across the board (and being taken into TV studios and local newspapers) in the Labour Party and the fact it was based on spurious data and false information just didn’t matter.

But, this is irrelevant, I hear you cry, as just a few days later, the Minister responsible for Gambling, Hugh Robertson MP, would state in the House, when Kelvin Hopkins MP (Lab, Luton North) called FOBT’s ‘crack cocaine of gambling’;

‘the Government are seriously concerned about problem gambling. This is one of those quite tricky areas where common sense suggests that it is a major problem but there is a lack of evidence to back that up.’[xiii]

The debate would be widely reported as the Minister stating there would be no clamp down on FOBT’s (BBC News 11th January 2013[xiv] ‘High-stakes gambling machine crackdown rejected’) as the evidence didn’t warrant it. He also mentioned the research that the Responsible Gambling Trust had initiated into Category B machines and problem gambling[xv].

But much more ominously for the industry was the comment by Harriet Harman MP;

‘I completely agree with the point made by my hon. Friend the Member for Luton North (Kelvin Hopkins). Concern is shared across the House, so we want to see the Government doing something about it. We all know—there is bags of evidence—that gambling is blighting people’s lives, and blighting our high streets too, given the prevalence of betting shops. We need only look down our own high streets; we do not need a research project to see what is going on. The Government say that they want localism and that they are in favour of local people having a say, so will they change the planning laws so that local people have the power to prevent any more betting shops from opening up on their high streets if they do not want them?’[xvi]

By stating ‘we do not need a research project to see what is going on’ she is making the point I have been making for nearly two years now, to bookmakers, politicians and the Association of British Bookmakers, that while you are in government you usually have to apply the principle of evidence-based policy making. But when you are writing your election manifesto, you can promise anything you like, based on whatever misperceptions and urban myths that you think will sell to the voters. The Labour Party Manifesto 2015 is the biggest threat to bookmakers and FOBTs.

They are relatively safe while we have the Conservatives at the helm (and as a Labour Party member that really rather hurts to say so). Traditionally they don’t change things without a reason and now, we have had two gambling Ministers state that change will only happen if there is hard evidence to prove it.

There will be a review of FOBTs and problem gambling as part of the Stakes and Prizes consultation kicking off shortly and there is the RGT’s massive research project into Category B machines, due to finish just before the election. Neither of which, I will bet a month’s salary, will prove conclusive one way or the other. I say this because looking at problem gambling from a device perspective is fatuous, high stakes gaming machines don’t create problem gamblers, they are just used by problem gamblers, in the same way alcoholics like vodka, it doesn’t make you an alcoholic, it just is great if you are one. So there will be no hard evidence to condemn B2 machines.

The danger is in the writing of manifestos, where as I’ve said, fact and evidence play a minimal role. At the moment the Labour Party looks dead set on doing something about betting shops and FOBTs and I would bet my next month’s salary on there being a suis generis planning class introduced for the shops and the maximum stake for the FOBT’s reduced from £100 to just £2.

This will undoubtedly cause a number of betting shops to close, their workers to become unemployed and the tax take to government to reduce. But, as the bookmakers have consistently failed to understand – as these outcomes have been their defence against the Labour onslaught – no-one in the Labour Party really cares.

This is not value-lite New Labour who was gambling friendly. This is a resurgent moralistic Labour Party who believes in dealing with the market in a high-minded manner. Remember at the Labour Party conference, in the session hosted by the philosopher and author of the book, The Moral Limits of Markets, Michael Sandel, working in a casino was considered akin to prostitution!

And most of all, slamming the bookmakers plays well at grass roots level (especially with the activists), it costs nothing to implement (important in austerity times) and it fills some of the policy vacuum the Party is suffering from. An average urban constituency has roughly 25 betting shops in it – that’s less than a hundred jobs, lose 30% and no MP is going to rebel about it.

What really needs saying though, without naming names or organisations, is that if my predictions come true then the bookmakers have really fumbled the ball on this one. It’s not just that they don’t have the level of political relationships they once had under the heady days of Chris Bell and John O’Reilly, it’s that at the senior levels, there is a lack of understanding of just how important politics and lobbying are to the gambling industry and a at times, a certain degree of complacency and amateurishness from those tasked to undertake it. If I was a major shareholder in a retail betting firm, I would be demanding that some of the effort put into acquisition started being put into public affairs.

References

  1. http://www.fabians.org.uk/ed-milibands-speech-to-the-fabian-society-new-year-conference-2013/
  2. http://www.guardian.co.uk/uk/2013/jan/04/fixed-odds-betting-terminals-poorest-communities
  3. http://www.guardian.co.uk/news/datablog/2013/jan/04/5bn-gambled-britian-poorest-high-street?intcmp=239
  4. http://news.bbc.co.uk/1/shared/bsp/hi/pdfs/12_04_10_labour_manifesto.pdf
  5. David Lammy submission http://www.publications.parliament.uk/pa/cm201012/cmselect/cmcumeds/writev/gambling/m47.htm
    Ladder Community Safety Partnership
    http://www.publications.parliament.uk/pa/cm201012/cmselect/cmcumeds/writev/gambling/m08.htm
    Other supporting submissions can be found at GA07, GA10, GA11, GA18, GA 25, GA26, GA31, GA55, GA59, GA78
  6. http://www.harrietharman.org/uploads/d2535bc1-c54e-6114-a910-cce7a3eff966.pdf
  7. Ibid
  8. Ibid
  9. Ibid
  10. Ibid
  11. Ibid
  12. Ibid
  13. http://www.publications.parliament.uk/pa/cm201213/cmhansrd/cm130110/debtext/130110-0001.htm#13011036000719
  14. http://www.bbc.co.uk/news/uk-20981962
  15. http://www.responsiblegamblingtrust.org.uk/PDFs/pr0126.pdf
  16. http://www.publications.parliament.uk/pa/cm201213/cmhansrd/cm130110/debtext/130110-0001.htm#13011036000719