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Thoughts on the Triennial Review 2016

DCMS: Review of Gaming Machines and Social Responsibility Measures

Call for Evidence

24th October 2016

Summary provided by written statement in House by Tracy Crouch MP (HCWS210):

 The review will be considering robust evidence on the appropriate maximum stakes and prizes for gaming machines across all premises licensed under the Gambling Act 2005; the number and location of gaming machines across all licensed premises; and social responsibility measures to protect players from gambling-related harm (including whether there is evidence on the impacts of gambling advertising and whether the right rules are in place to protect children and vulnerable people).

 The review will include a close look at the issue of B2 gaming machines (more commonly known as Fixed Odds Betting terminals—FOBTs) and specific concerns about the harm they cause, be that to the player or the communities in which they are located.

 In launching this review I want to ensure that legislation strikes the right balance between allowing the industry to grow and contribute to the economy while ensuring consumers and communities are protected, including those who are just about managing.

 The call for evidence period will close on 4 December, following which Government will consider proposals based on robust evidence provided to assist in our decisions.

 Comment 1: First time we have a review that looks at more than just stake and prize limits. This considers number & location, social responsibility measures & advertising

 Comment 2: Intrigued by statement ‘ensuring consumers and communities are protected, including those who are just about managing’. Just about managing implies those who are ‘at risk’ which I find a dubious concept as it implies a linear progress of descent into problem gambling. Which does happen but is not always the case. Far more complex than that. Plus methodology is not robust enough

 Ministers introduction states; I am also keen to receive evidence on the effectiveness of social responsibility measures across industry, including requirements around gambling advertising.

 Comment 3: Closure date for submissions is December 4th or 6 weeks, the minimum requirement for consultations – so do they want good evidence or just any evidence? They could have added a month and no one would have minded

 Gaming machine maximum stakes and prizes:

 this Government invites evidence-based proposals from all interested parties on changes to maximum stakes and prizes across all gaming machines listed at Annex A. (B1, B2, B3, B3A, B4, C, D (all variations)

 B2 Gaming Machines

 The review summarises that the last review made ‘it was clear that reducing stakes on B2 machines would have an adverse economic impact on the betting industry, it was not clear how great an impact a reduction would have on problem gambling, given that problem gamblers typically gamble in a variety of ways’. The last review also required the industry to make data available on player behaviour and implement harm mitigation measures. If this was not done then a reduction of stakes would be implemented as a precautionary measure. The RGT commissioned research and there was follow up research on the £50 journey. Govt. states ‘Whilst the research made clear that problem gambling can occur at all stake levels, there is some evidence to suggest higher stake sizes can increase the risk of gambling-related harm through spending more money or time than intended’. They go on to comment ‘there was a drop in stakes above £50, but a corresponding increase in stakes between £40-50. What the evaluation was not able to tell us was the extent to which the measures had an effect on gambling-related harm or problem gambling rates’.

 Comment 4: RGT Research and Follow up on £50 journey research hampered by only using data from card based play which is 5-7% of punters. Thus not enough data. Bookmakers fault for not doing everything they could to get more data. Complacency obviously the case as at beginning of the year Ladbrokes telling investors that there was no new risk of regulation.

 They then ask these questions:

 Q1. What, if any, changes in maximum stakes and/or prizes across the different categories of gaming machines support the Government’s objective set out in this document? Please provide evidence to support this position.

 Q2. To what extent have industry measures on gaming machines mitigated harm or improved player protections and mitigated harm to consumers and communities? Please provide evidence to support this position.

Q3. What other factors should Government be considering to ensure the correct balance in gaming machine regulation? Please provide evidence to support this

 Comment 5: These are reasonable questions as long as the evidence request is genuine

 Gaming machine allocations

 States: Bingo, adult gaming centres and betting premises in turn offer gambling activity of increasing ‘hardness’ and are consequently subject to increasing levels of regulation. Casinos remain the gambling environment with the ‘hardest’ forms of gambling, with unlimited stake and prize table gaming, and gaming machines including the highest stake and prize limits available in Great Britain. This is the regulatory pyramid, a pre-2005 Act concept but arguably still of relevance. But also arguable that scope for removing stakes and prizes and replacing with card based play so players’ behaviour monitored. This could be done in casinos first.

 The review then lists the number and type of machines in each sector, identifying how various type B machines are the most profitable in each. Then asks the question:

 Q4. What, if any, changes in the number and location of current gaming machine allocations support the Government’s objective set out in this document? Please provide evidence to support this position.

 Comment 5: This is a good question as a) it will hopefully highlight how reducing the number of B2 machines won’t reduce the number of problem gamblers as the two variables are not linked. Unless evidence isn’t an issue! It will also, hopefully, show up the need for parity in 1968 Act licence casinos which are allowed 20 machines and 2005 Act casinos which are allowed 80 (small licence) and 150 (large licence) machines – while still being the same gambling venue.

 Social responsibility measures

Review states ‘Some progress has been made on these issues, including industry codes on social responsibility which introduced: improved staff training on social responsibility issues; measures on marketing of gambling products, specifically gaming machines; improved age verification testing; cross industry self-exclusion schemes; and enhanced player monitoring, including time and spend limit options for players of B2 gaming machines. The Gambling Commission also introduced a number of new social responsibility requirements in May 2015 which all licensed operators have to meet.

Then asks: we would be keen to hear evidence as to how effective these measures have been in achieving their objectives,6 and whether consideration should be given to further measures in this area.

 Comment 6: 6 weeks to submit results of research which probably hasn’t started or even been commissioned yet?? Also how do you measure what hasn’t happened? Only way that you could see how effective these measure had been would be to do a before and after test. Unless bookmakers warned of this requirement how could they?

 Review uses the wonderful stat about gambling advertising on TV. ‘The number of gambling adverts on television increased from 90,000 in 2005 to 1.4m in 2012’. 2005 Act didn’t come into force until 2007, what there was in 2005 was under a highly restrictive regime. So very misleading.

 Then asks questions:

 Q5. What has been the impact of social responsibility measures since 2013, especially on vulnerable consumers and communities with high levels of deprivation? Please provide evidence to support this position.

 Q6. Is there anything further that should be considered to improve social responsibility measures across the industry? Please provide evidence to support this position.

 Q7. Is there any evidence on whether existing rules on gambling advertising are appropriate to protect children and vulnerable people from the possible harmful impact of gambling advertising?

Comment 7: As said before – not entirely sure how people are supposed to magic up research in 6 weeks.

 Comment 8: Also concerned about the terminology ‘communities with high levels of deprivation’. This harkens back to Victorian moralism of poor people should not gamble as they can’t afford it and should be spending what little money they have on more worthy activities. Also sets up the conflict of working classes being culturally the main gambling participants. Sounds like sneery middle class moralising.

 Comment 9: Also concerned that unless we have sufficient evidence to prove that the measures in place have failed then why do we need more measures?

 The review then considers supporting evidence and states:

 That future reviews must be informed by evidence of the likely impact, both socially and economically, of the changes recommended. It also made clear that it was incumbent on the industry to provide this data to enable consideration of future proposals and that if industry were unable to do this, there would be no guarantee of any changes

 and

In the absence of any progress made on this data framework, it is of the utmost importance that we receive the relevant data in the format that we require, as well as the underlying assumptions and methodology used to support these figures. Without this, we cannot guarantee that proposals will be considered as part of any proposals following this call for evidence period.

 Comment 10: Yet again I cannot work out how, unless the industry was warned beforehand, how this desire for substantial amounts of data can be provided in just six weeks?

 Overall comment: The cynic in me thinks that by asking for vast amounts of data and research in just six weeks they are setting up the industry, specifically the bookmakers and their B2s and TV advertising with a reduction in stakes and prizes and an advertising ban on the basis that they would not be able to provide the evidence in time and thus a precautionary principle would be invoked. However, the rationalist in me thinks that not even DCMS could think that invoking the precautionary principle for two years running fulfils the objective of evidence based policy making. What is apparent is that there is a dearth of data and the only way that can be rectified is by making high stakes machines card based. Considering there is no hard evidence of harm it would be unfair to impose this without compensation and the fair compensation would be a removal of stakes and prizes. This could be trialled in casinos first as there would be an obvious political impact of doing this. However, it should be noted that currently every adult has access to unlimited stakes and prizes gaming machine style games on their smart phone in every location.