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The Gaming Act 1968 - Executive Summary

THIS IS AN EXECUTIVE SUMMARY OF AN ESSAY TO BE PUBLISHED SHORTLY

Many thanks are given to Dr Seamus Murphy for his help and use of his PhD thesis - full references are in the essay

Precursors to the 1968 Act

  • World War II saw an explosion in illegal gambling to service the troops. Illegal slot machines were pervasive and casino gaming took place at ‘floating gaming parties’, so called because they regularly moved location to circumvent the 1854 Gaming Houses Act which made habitual use of a premises for gaming illegal.
  • Gaming parties for private gain were made illegal by Defence Regulation 42CA (emergency wartime regulations) in 1942. Police had to prove that games of chance were being played, that they were being played for private gain and that ten or more people were present, so it became difficult to enforce.
  • The Royal Commission on Betting, Lotteries and Gaming 1949-51, chaired by Henry Wilink, described the state of the then current gaming legislation as overly complex. They recommended new legislation that would outlaw gaming if a game had unequal chances for the bank or had a levy on the stakes. They were not against private gaming and would allow a minimal charge to play, enough to cover the costs.
  • The main thrust of the Royal Commission’s report was about the need do something about betting. Off-course betting had been illegal since the middle of the 19th Century, yet the demand for it was endemic and illegal bookmakers were everywhere. Unlike the previous Royal Commission of 1932-33, this Royal Commission recommended the legalisation of betting shops, which was supported by both the Home Office and the Police.
  • In 1958 John Aspinall, Lady Mary Grace Osborne (his mother) and John Richard Burke (his friend and business associate) were arrested and charged with keeping a “common gaming house”. The case was eventually dismissed with all charges dropped, the law being found inadequate. While it is arguable that this case spurred the government on to bring forward legislation, the consequences of the court’s ruling were that private gaming parties were now considered legal and the press began to question the government.
  • The Betting & Gaming Bill was introduced by the new Tory government in 1959 to sort out the abuse and corruption due to the mishmash of the existing laws. Unfortunately the debate was almost entirely focussed on the legalising of betting shops and so the elements that concerned casino gaming, arguably didn’t get the scrutiny they deserved.

The Betting & Gaming Act 1960

  • The Betting & Gaming Act 1960 was meant to outlaw commercial gaming but allow private gaming. It is argued that if the principles put forward in the Royal Commission Report (no bankers games – all players having equal chances) then the Act would probably have succeeded in outlawing commercial gaming. However, the addition of Section 32 (1) (a) (ii) of the Act, instead of simply stating that gaming would be legal only if the chances in the game were equal to all players now stated that it would be legal where “…gaming is so conducted that the chances therein are equally favourable to all the players”. The legislators had disastrously added a variable to the law. This variable (the term favourable) would provide justification for “banker’s games” and resulted in the establishment of a large unexpected gaming industry in the United Kingdom.
  • This was exacerbated by what would become known as the ‘Vicar’s Charter’. This was intended allow small scale gaming in members clubs or not for profit societies for worthy causes. Unfortunately there was no definition of what a members club was, just that a member had to have applied for membership at least 24 hours before commencing gaming or was a bona fide guest of a member. This meant that many commercial clubs turned themselves into members clubs so they could charge what they liked for partaking in gaming.
  • Basically two types of strategies were employed by operators to get round the poorly written law; one where players would be offered the bank but also informed (sometimes threateningly) of the financial liabilities that go with being the banker (having to pay out) and thus most would defer on their opportunity and so the operator would remain banker for the majority of game play. The other most common approach would be for the operator to charge for each session of gambling, sometimes for even just one spin of the roulette wheel (roulette having been made equal chance gaming by the removal of the zero). Some of these approaches would eventually be found illegal, some even found legal, but new variations or devices to get round the law would be continually invented

The impact of the 1960 Act

  • The impact of the Betting and Gaming Act 1960 was to see, by 1961, off course betting now legal in licensed betting offices, with bookmakers being personally licensed and paying tax and a levy to horseracing. The juxtaposition was gaming, with hundreds of commercial gaming clubs around the country offering casino gambling as well as alcohol and entertainment.
  • Since the legislation hadn’t meant to legalise commercial gaming there were no legal restrictions upon it. Thus the number of gaming establishments mushroomed, with there being an estimated 1,200 by 1968 and the criminal element infiltrated the industry, meaning crooked games, money laundering and associated criminal activity (e.g. prostitution, protection rackets)
  • Even though the public, press and Parliament were getting increasingly concerned about the growth in casino gaming and the criminal activity associated with it, the poorly written legislation hampered the police’s efforts to prosecute.
  • The Labour Government had too smaller majority to do anything in 1964 but when elected with a workable majority in 1966 it became interested in the opportunities for gambling taxation. It would clean up the abuses of the 1963 Betting, Gaming & Lotteries Act (the 1960 Act with some minor amendments) and impose taxation.

The Gaming Act 1968

  • James Callaghan MP, Home Secretary launched the Second Reading of the Gaming Bill on the 13th February 1968 by laying out the problem; “the origin of this Bill is the failure of the Betting and Gaming Act, 1960, to achieve its purpose. That purpose was to prevent the exploitation of gaming by commercial interests. The 1960 Act was a thoroughly well-intentioned Measure and the authors must be astonished to find that the consequences of their actions are so different from their intentions. For the Act precipitated the very evil it was meant to prevent.”
  • The new law would be based on the concept of licensing and registration by local licensing magistrates on conditions to be enforced by the Police. The Home Secretary of the day determining the qualifications to be fulfilled by those seeking registration or a licence and the conditions that they must then observe.
  • The industry would be regulated and inspected by a Gaming Board who could object to licences being issued or maintained
  • Members clubs where gaming was incidental would have to be registered and commercial gaming establishment would have to be licensed.
  • Before any licence would be issued the operator would have to prove to the licensing magistrate that there was local demand for it
  • There would be a ban on all advertising for gaming – so casinos would be there to only fulfil ‘unstimulated demand’
  • All operators were required to be ‘fit and proper’ persons – a vague notion that allows a substantial margin for regulators to exclude those considered undesirable
  • So the number of gaming establishments could be reduced, casinos would only be allowed in ‘Permitted Areas’. Originally these we 30 local authority areas (the main cities and towns) proposed by the Gaming Board. Many members of Parliament were upset that their constituencies had not been included and on the 1st January 1972, the Board added to the existing gaming areas, any county borough in England or Wales outside Greater London with a population of 125,000 or more and any county of a city in Scotland (The new regulations refer to the counties of cities in Scotland as a class without qualification because they all have populations of 125,000 or more and there are no burghal areas in Scotland which meet that population standard). Also added were a number of towns that had been vigorously campaigned for by their MP’s. This meant that from 1972 until the law was changed in 2007 (when the Gambling Act 2005 came into force), casino could only be located within 52 permitted areas.
  • By 1972 the number of casinos had dropped to 125
  • In a survey conducted in 1968, no more than 3½ per cent of men and 1½ per cent of women participated in casino gaming at least occasionally and of that total, the majority in each case did not do so regularly: these amount to 1 in 500 of the population which, of course, if generalised nationally, would mean some 80,000 regular participants in casino gaming. This compares with 9% of men and 2% of women who played casino games in the last year as provided by the British Gambling Prevalence Survey 2010 which included online casino gambling as well (which they estimate has a prevalence of 3%)