The Gamblers Consumer Forum respond to the conclusions of the DCMS Select Committee report into Gambling

Just before the Christmas break, the DCMS select committee published its report on Gambling Regulation and the response the the White Paper. The Gamblers Consumer Forum having listened to the views of supporters and stakeholders has responded to the conclusions of the report with a series of further questions and comments. We will be sending this response to the Gambling Minister, Shadow Minister and Select Committee Members as well as a number of MP’s who have an interest in Gambling and sport. It will also feed into our briefing to MP’s for the petition debate on Affordability which will be held on the 26th February.

The report is in italics and our responses are in bold.

Implementation of the Gambling White Paper

  1. It is welcome that the Government and Gambling Commission are proceeding with the various consultations on the White Paper at pace, but delivering its main proposals by summer next year will be challenging and at risk from wider political events. We are concerned that no mention of gambling legislation was made in the King’s Speech. In its response to this report, the Government must set out a detailed timetable for the delivery of the White Paper’s proposals, including when relevant primary legislation will be introduced to Parliament. (Paragraph 13)  
  2. Though speed is a necessity, the Government and Gambling Commission must ensure that the White Paper consultations are thorough and receive input from an appropriate range of stakeholders. (Paragraph 15) 
  3. We welcome the forthcoming review of the Gambling Commission’s fees and the proposal to give the Commission the power to adjust its own fees annually. These will be vital to ensure the regulator is properly resourced to implement the White Paper’s reforms and respond to future developments in a rapidly developing online industry. (Paragraph 19)  
  4. We consider that while it will be important to monitor the size of the black market in response to greater regulation, more pertinent is the fact that, right now, a number of easily-accessible illegal sites are targeting some of those who have self-excluded from gambling. The proposed new power for the Gambling Commission to act against illegal operators is welcome, and the Government must ensure legislation establishing this power is brought forward in this Parliamentary session. In response to this report, the Government and Gambling Commission must set out how they will address the growing trend of unlicensed gambling sites targeting the self-excluded. (Paragraph 25)  
  5. While the black market is a risk the Government and Gambling Commission must be mindful of, it should not deter appropriate regulation of the licensed sector. The debate about the threat posed by the black market partly stems from a lack of understanding about its size. The Gambling Commission must continue to work to improve its knowledge of the black market and its ability to monitor the number of British consumers gambling with illegal operators. The Commission should set out its plans to do so in response to this report. (Paragraph 26)

Our thoughts on paragraph one are that we presume that the legislation could not be included in the Kings Speech as their remains no tested mechanism to deliver frictionless checks – a caveat the Minister has consistently promised. There has also been little work undertaken as regards impact assessments on both the industry, sport and those addicted to gambling, as mentioned in a previous Select Committee hearing.

We have additional concerns regarding point 3 and what oversight there will be that the GC fees are proportionate and not simply used to empire- build. Point 4 regarding the black market is an issue we at the GC have highlighted constantly. Our interaction with gamblers demonstrates a significant upswing in those being forced through affordability or in some cases lured into the black market, and was further confirmed by our independent YouGov polling. This is backed up by a recent report by Yield Sec which estimates the black market at 4% (up from 2% in 2019). . Whilst the report notes extra powers being given to the GC to tackle the black market, we would point to the fact that despite gambling is banned in China, an estimated over $60bn flows out of country in black market gambling. If the Chinese State cannot control the black market, then that perhaps illustrates the scale of the challenge for the GC. A closer market to look at is Germany where more regulation has increased the back market to 50% It needs to be understood that blocking websites does not work as IPs just rotate and whatsapp bookies are growing. Emails lists and phone numbers are the key and these cannot be blocked.

Online gambling protections

  1. While we support the principle of financial risk checks, the Government must ensure they are minimally intrusive, and that customers’ financial data are properly protected. The Government and the Gambling Commission must also establish what level of “friction” involved in these checks is acceptable for most online gambling customers. The Gambling Commission should oversee a pilot of the new system Gambling regulation 59 of checks before it is fully implemented. This should aim to determine customers’ willingness to be subject to the checks, and whether they apply at suitable thresholds. (Paragraph 36)  
  2. Financial risk checks will only be fully effective in preventing harm when they work across all online operators with whom a customer has an account. In its response to this report, the Government and the Gambling Commission must set out progress in the work to develop a single customer view mechanism. (Paragraph 37)  
  3. We support the White Paper’s proposals to make online gambling products safer by design. Improving understanding of what affects products’ risk of harm should be a priority, and Government should keep its position on a safety testing regime under review in light of further research. In the short term, as part of its work on safer gambling messaging, we recommend that the Government consider what point-of-sale information should be provided to customers about the risk of specific products and their design features. (Paragraph 44)  
  4. The high degree of accessibility of online slots negates the additional protection provided by account-based play. Setting a limit for online slots at the same level as Category B gaming machines, at between £2 and £5, takes account of the risk of harm and will impact only around 1% of gamblers. We recommend that stake limits for online slots should match those for electronic gaming machines in landbased venues and not exceed £5. (Paragraph 49)  
  5. We welcome further work on proactive tools. Operators should be compelled to proactively encourage customers to set online deposit limits. Where potential harm of financial vulnerability is indicated, online deposit limits should be mandatory. (Paragraph 51) 

We have concerns in paragraph 6 over the term ‘minimally intrusive’ and ‘level of friction that is acceptable’ (A step change from the ‘checks will be totally frictionless’ promise.). We also have significant concerns about the protection of data, given that many of those who have self excluded, are being targeted by the black market  (and VIP scheme lists). In all likelihood their details have leaked from bookmakers. Reference is again made to a pilots and customers’ willingness to be subject, many gamblers are already being subjected to financial checks and many operators are suggesting non compliance with checks is in the region of 80%. Many of our supporters have been subjected to checks and refuse to send in data which as demonstrated with the self excluded, is open to abuse. The protection of data is even more of a concern to us following a meeting with a DCMS official who confirmed the checks would be undertaken by “third parties”. 

Paragraph 7 mentions single customer view. Information we have received suggests those participating in the trial are using the information to identity those customers who are unprofitable for operators and excluding them. This is obviously a concern. 

Paragraph 9 references slots, it should be noted that in the past 3 years, slots activity has increased 50% in the last 3 years from £2 billion to £3 billion whilst sports betting has declined as demonstrated in the operator profit reports. This would indicate that those addicted to casino products haven’t been supported by policy, and therefore need targeted clinical treatment.

Children and young adults

  1. Social casino products are the latest example of the convergence between video games and gambling. Though it has responded to the specific issue of loot boxes, the Government must address this wider trend to ensure harms, particularly to children, are prevented. It will be more difficult to do so if gambling continues to be defined solely on the basis of whether a prize from a game can be cashed out. The Government should review the case for banning children’s access to social casino games. (Paragraph 62)
  2. We support the proposed introduction of enhanced online gambling protections for young adults aged 18–24. The Government, Gambling Commission, and gambling operators must ensure these measures do not unintentionally lead to more adults in this age group giving a higher age at account-creation. (Paragraph 65)

We agree that the area of loot boxes needs more research. We have concerns regarding the 18-24 year olds age bracket, and the effective redefining of adulthood. This appears to run contrary to the arguments made by those who, for example, seek to bring down the age to vote, and there is countless neurological research that suggests risky behaviour in this time period is not only normal, but an essential part of healthy brain development. 

Gambling advertising

  1. There is an urgent need to better understand the effects of gambling advertising on the risk of harm. The evidence for a link between advertising and gambling harm currently appears much stronger than evidence indicating there is a risk of displacement to the black market if gambling advertising were restricted. The 60 Gambling regulation Government must commission independent longitudinal research on the link between gambling advertising and the risk of gambling harm, including specifically for women and children. (Paragraph 78)  
  2. While the existing evidence base does not show a causative link between gambling advertising and harm, it seems clear that advertising encourages participation in gambling and that this effect is more pronounced for children and those vulnerable to gambling harm. Though the White Paper’s proposals regarding direct marketing and promotional offers are welcome, the Government should have taken a more precautionary approach to gambling advertising in general—particularly to minimise children’s exposure. We do not consider that a complete ban on gambling advertising would be appropriate, but this still leaves scope for further regulation beyond that proposed by the Government. (Paragraph 84)  
  3. The withdrawal of gambling sponsorship from the front of Premier League players’ kit is welcome, but it will not significantly reduce the volume of gambling adverts visible during top-flight matches. The Government must work with the Premier League and the governing bodies of other sports to ensure that the gambling sponsorship code of conduct contains provisions reducing the volume of gambling adverts in stadia. The Code should also require that a higher proportion of gambling advertising in stadia is dedicated to independently-developed safer gambling messaging. (Paragraph 85)  
  4. The publication of the Code has been delayed repeatedly which is highly regrettable. The Government should require the relevant sporting bodies to publish the Code, incorporating the committee’s recommendations, without further undue delay. (Paragraph 86) 

We have great concerns regarding the future of advertising in respect of legislation being discussed in Ireland, which threatens to devastate the racing industry. Paragraph 14 contains a sentence which causes particularly concern: ‘it seems clear that advertising encourages participation in gambling and that this effect is more pronounced for children and those vulnerable to gambling harm.’ The same could be said of any number of addictive products from alcohol to food to even sex. The entire basis for this argument is that humans are at the complete mercy of what is advertised to us, and that the only thing required to cause addiction is exposure. If this was the case, why aren’t we all addicted? 

It should also be noted that a reduction of advertising for legal operators will be lead to more black market as users cannot tell difference between legal and illegal brands. Italy can be used as an example where adverts banned 2019 and there is now a 1bn black market – )

Land-based gambling

  1. We support the introduction of cashless payments for electronic gaming machines, provided they are subject to an equivalent level of friction to cash payments. We recommend that customers who prefer to pay on electronic gaming machines using cash should continue to be able to do so on all machines following any introduction of cashless payments. (Paragraph 97)  
  2. The accessibility of online gambling means that some of the supply-level restrictions on the land-based sector are less relevant than when the Gambling Act 2005 was passed. The Committee therefore considers that the White Paper’s proposed reforms to modernise land-based gambling are appropriate. However, in its response to this report, the Government must set out how it and the Gambling Commission will be monitoring the impact of these changes, particularly the increased availability of Category B gaming machines in high street venues, on the risk of gambling harm. (Paragraph 100)  
  3. We welcome the proposal to allow local authorities to use cumulative impact assessments (CIAs) in handling gambling premise licence applications. The Government must ensure councils are given guidance on how CIAs can be applied to gambling premises. It must also ensure this new power is reviewed in during the next Parliament to ensure it is having the intended effect. (Paragraph 103) Gambling regulation 61  
  4. The Government must ensure that the new settlement arising from the review of the Horserace Betting Levy mitigates the impact of the White Paper’s reforms on the racing industry and ensuring British racing’s future. We support the proposal for a distinct approach gambling sports sponsorship and advertising for horseracing and greyhound racing, given both sports’ close and long-standing relationships with betting. (Paragraph 108) 

We would welcome reassurance around paragraph 19 and that CIAs be based on evidence and free from political interference. Paragraph 20 is of particular interest to our supporters. With the lack of meaningful impact assessments on horseracing which will arise from affordability, it’s very difficult to assess the increase that would be needed to make up the lost revenue to the levy. An industry that is unable to grow is on a slippery slope and this could represent a greater share of nothing. There can never be enough extra funds to make up for affordability check loses. If operators make less from racing there will be less to pay racing whatever metric is used for the levy. We do welcome the recognition that the relationship with advertising for racing is protected. 

Gambling research, prevention and treatment

  1. We reaffirm our recommendation for the Government to set out a timetable for the delivery of each of the White Paper’s main proposals, including implementation of the statutory levy, in response to this report. The Government should set out how it will minimise disruption to services currently funded under the voluntary system during the transition to the statutory levy. (Paragraph 113)  
  2. We support the proposed structure of the statutory levy. This gives due consideration to the higher overhead costs of land-based operators and the lower rates of problem gambling associated with the sector as a whole, while also ensuring a substantial uplift in funding available for gambling research, prevention and treatment. (Paragraph 116)  
  3. We support the proposed governance structure for the statutory levy. However, the Government must ensure that levy funds are clearly ringfenced for the purposes of understanding, preventing, and treating gambling harm. It must also use the levy to improve the integration of gambling treatment services across the NHS and third sector. To these ends, we consider that a new national strategy for reducing gambling harms will be warranted. Following the implementation of the statutory levy, the Levy Board should develop a new national strategy to reduce gambling harms. This strategy should include clear, measurable targets for harm reduction over a defined period. (Paragraph 121)  
  4. We recognise that much of the data relating to gambling is contested, misapplied, or entirely absent, and welcome that actions from the Government’s White Paper and changes to the Gambling Commission will mean that more research evidence can be commissioned. It is vital that any such research is accurate, representative, and understood. (Paragraph 125)  
  5. We recommend that the Government and the Gambling Commission should work with UKRI to explore how a study similar to the Patterns of Play research could be conducted on a regular basis. (Paragraph 126) 
  6. Alongside its new gambling survey, the Gambling Commission should publish clear guidance about the interpretation of official gambling statistics. (Paragraph 127)  
  7. We welcome that the Government’s suicide prevention strategy for England recognises the role harmful gambling can play in suicide risk. In its response to this report, the Government should provide us with a clear action plan on what it and the Gambling Commission will do to continue to develop understanding of the relationship between gambling and suicide. (Paragraph 130) 

We retain concerns regarding the use of the statutory levy. An industry is being created in flawed anti gambling research and that will be exacerbated by the many millions that will be on offer. We believe the priorities for funding should be providing education about the potential risks and identification and treatment of addicts and potential addicts. We also have concerns about the way statistics around suicide have been used by certain anti gambling groups. Suicide is a highly complex and multi-faceted issue which we would welcome further independent research into. Campaigners should be excluded from research funding as there is a pre-determined bias.

A Gambling Ombudsman

  1. The intention to establish a gambling ombudsman is welcome. However, the Government will not be in a position to judge the effectiveness of the new ombudsman until summer 2024 at the earliest, assuming the process of establishing it remains on track. With the limited time remaining in the current Parliament, it is highly unlikely that the Government will then be able to legislate to create a statutory body if the industry-led ombudsman is not suitably effective or independent. The Government and Gambling Commission must therefore ensure that the new body set up by the industry is fully independent and seen to be such by consumers. We recommend that the scope of the gambling ombudsman should include all disputes between gambling operators and their customers, replacing the existing gambling ADR providers. (Paragraph 136)

The creation of an ombudsman which has the trust of gamblers will be a tough task, given the recent unprecedented behaviour of the Gambling Commission. Existing arbitration services have a mixed reputation. Indeed IBAS recently ruled in favour of a bookmaker after they withheld payment by asking for bank statements and using them to identify what they dictated were third party funders, which they again stated breached terms and conditions. The fact IBAS allowed this with the information coming from a bank statement which, it could be argued, the bookmaker it could be argued was not entitled to, has dented trust amongst many gamblers. An ombudsman must be there to see fair play, and not merely oversee dubious clauses in bookmaker terms and conditions. Someone needs to take responsibility for ensuring terms and conditions are ‘fair’ as the Gambling Commission appears to have given up this since 2019.



Share this post:

Related Posts
Please subscribe to our regular newsletter detailing the progress we are making with our campaigns.