According to a report in The Sun, the government’s long-awaited gambling review white paper is set to include proposals for levy reform. The levy, which is currently based on a percentage of bookmaker profits on British racing and yielded £97.6 million in 2021-22, is due to be reviewed by 2024. However, sport’s leadership has been calling for the review to be brought forward and for the levy system to be reformed to extend its reach to betting on all global racing as well as adjusting it to be based on turnover rather than profits to boost income.
The Sun report also stated that betting on horseracing is set to face higher taxes under the new review to ensure proper funding for the sport. The government launched the gambling review in December 2020, and the resulting white paper is expected to be published after parliament returns from the Easter recess on April 17.
The white paper is also expected to include measures such as affordability checks, with operators set to carry out “credit checks” alongside duties to look for signs of unaffordable losses. It is also reported that people under 25 would be unable to gamble more than £2 per spin on online slots, although older punters would be allowed to stake up to £15, a higher figure than expected. Other measures include a statutory levy on operators to pay for problem gambling research, education and treatment, and the creation of a gambling ombudsman to deal with customer complaints.
Culture Secretary Lucy Frazer is quoted as saying that the proposals are “targeted to protect people who are at risk of addiction, catastrophic loss and harm, with minimal disruption to the majority.” However, a spokesperson for the Department for Culture, Media and Sport refused to comment on the report, stating that the government is determined to protect those most at risk of gambling-related harm and is working to finalize the details of the review.
Meanwhile, Conservative MP Scott Benton has had the party whip withdrawn following a sting by The Times newspaper in which he was filmed offering to lobby ministers on behalf of fake gambling industry investors who had offered him a fee of up to £4,000. The Times reported that Benton had told undercover reporters he could leak a copy of the gambling white paper before it was published. Benton is the chair of the Parliamentary All-Party Betting and Gaming Group, although such groups are informal and have no official status in parliament.
The government’s gambling review has been eagerly anticipated by the industry, with calls for reform growing in recent years due to concerns over problem gambling and the impact of gambling advertising. The introduction of tighter regulations and increased taxation could have significant implications for the industry, particularly for online operators who have seen a surge in business during the pandemic.
Overall, the government’s proposals for gambling reform are expected to be far-reaching, with a focus on protecting vulnerable individuals and addressing the wider social and economic impact of gambling. The extent to which these proposals are implemented remains to be seen, but the industry will be watching closely as the white paper is finally published.
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The Gambling Commission denies mandating the gambling industry’s burdensome affordability checks.
The claims that the industry regulator is pressuring bookmakers to impose intrusive affordability checks on bettors, according to Gambling Commission chief executive Andrew Rhodes, are “nonsense.”
Rhodes stated that the commission did not require operators to make such requests, despite extensive evidence of ordinary punters being asked to provide personal financial information in order to continue betting. Additionally, Rhodes stated that the sport could not attribute the decline in horseracing betting to affordability checks.
The government’s long-delayed gambling review white paper is expected to include affordability checks in some form. However, punters have lodged hundreds of complaints with the Racing Post, alleging that they have been required to provide financial documents such as bank statements and tax returns in order to demonstrate that they are able to pay for the amount of money they spend on gambling. This despite Paul Scully’s recent statement that neither the government nor the Gambling Commission should tell people how much they can afford to bet.
Bookmakers claim that Gambling Commission guidelines on customer interaction have forced them to use the contentious checks, but Rhodes stated: “The idea the commission is imposing pressure on the industry to carry out checks for the average punter is nonsense. Operators are currently required to have systems in place which identify people who may be at risk of harm and to take appropriate action. One part of an operator’s approach to managing risk is having proportionate thresholds at which more information is required to satisfy themselves there is no issue with that customer relationship.”
He added: “We do not require operators to get payslips or bank statements, it will be up to the operator how they go about any check they feel they need to make.”
Despite this, Rhodes stated in a speech this week that the commission expected operators to assess risk taking into account the “financial situation for a consumer.” Rhodes claimed that other factors were at play when it was suggested to him that even though the commission may not have explicitly instructed operators to conduct intrusive checks, they were being forced to do so for fear of failing to assess the financial situation of customers.
“There are operators that we know who, as part of their business model, don’t want to be involved in high-staking gambling as much as they would have done in the past,” he said. “The fact that bets are up in the last year among the largest operators and active accounts are up suggests that actually the number of people gambling is pretty stable.”
Rhodes stated in his speech this week that large operators have experienced a decline in gross gambling yield of almost 16% and a rise in total staked of more than 13%. Rhodes responded, “very unlikely to be the first interaction that somebody has,” when asked if it was appropriate to request financial information from bettors. He also stated, “Bookmakers will typically have triggers based on earlier levels of spend, frequency of spend, changes in patterns of play.”
He did, however, acknowledge that punters might be hesitant to disclose financial information. “I think in any walk of life I can understand why people don’t necessarily want to share information,” he said. “It’s something we are all conditioned to treat with caution and to be careful what information we share.”
Scully stated in a speech last month that the government was considering introducing checks that would not require customers to provide their personal information.
Rhodes said: “What we would like to see for the future, and it is something that the now prior minister spoke about recently, which we have been working on is the ability to try to have frictionless checks that avoid people needing to present evidence.
“What we are not trying to do is create an unnecessary level of friction for people who are gambling and have no reason to necessarily stop, it is well within their means, they understand what they are doing and that is their choice to make. We have always said that.”
Martin Cruddace, chief executive of Arena Racing Company (Arc), claimed last year that affordability checks were to blame for a decline in horseracing betting of £800 million, which could result in a £40 million annual revenue loss for the sport.
Rhodes stated that it was too difficult to attribute that decrease to a single factor, citing figures indicating that only one percent of accounts were responsible for seventy percent of horseracing betting customers’ profits. He asserted that the behavior of the most prolific racing bettors could be influenced by other factors, including the aging of the racing audience, the economic situation, and the small field sizes.
Rhodes, on the other hand, stated that he had met with the BHA and was scheduled to meet with them again. Additionally, he had visited Chepstow and was scheduled to meet with Arc, the track’s owner. “The dialogue obviously continues. We completely understand, as we would with any industry, any sport, any group of people betting, that we should have a sensible dialogue with them about what we see going on.”
The Racing Post has received inquiries about affordability checks from a number of individuals who have admitted to either having bet with operators of the black market or considering doing so. The Betting and Gaming Council has also recently released figures that claim there was a spike in black market gambling during the World Cup in Qatar last year, and they warn against getting complacent about the situation.
Rhodes said: “I don’t think you can argue that improving things in the legitimate market shouldn’t happen because that might drive people to illegal gambling. I don’t accept that and I do think there has been some lazy argument about this.
“When you talk to operators in other countries, and many of those operators also operate here, they point to Great Britain as the example of how to reduce the risks of illegal gambling by having a very liberalised market.”
The white paper’s recent reshuffle by prime minister Rishi Sunak is expected to cause additional delays.
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Blow to horse racing as Paul Scully, the gambling minister, moves in the government reshuffle.
With the announcement that gambling minister Paul Scully will be moving to a different department as part of prime minister Rishi Sunak’s reshuffle on Tuesday, the direction of the government’s gambling review, including controversial proposals regarding affordability checks, has been further thrown into question.
Because he had demonstrated a willingness to listen to the concerns of both industries, Scully’s departure will be a blow to both the racing and gambling industries. They will have hoped he would remain in his position.
If the gambling review is implemented, invasive affordability checks on bettors could wipe out tens of millions of pounds from the revenues of British racing, according to the sport’s leaders. However, Scully stated at the Betting and Gaming Council (BGC) annual meeting last month that ministers preferred “frictionless” checks rather than the government or the Gambling Commission deciding how much people could afford to gamble.
Michelle Donelan, who was ultimately in charge of the long-delayed gambling review, has been named secretary of state for science, technology, and innovation.
Scully, who had been the fifth person to hold the gambling brief since the government’s review was announced, is set to join her at the new department, according to the government. His replacement has not yet been announced.
Lucy Frazer, the Conservative MP for South East Cambridgeshire, has taken Donelan’s place at the streamlined DCMS. The appointment of Frazer will be viewed favorably for British racing. She is regarded as a sport supporter, and her constituents include the July course at Newmarket and the National Stud.
She joined fellow local MP Matt Hancock and Newmarket racing community members in opposing a 2,800-acre solar farm that could be next to the Limekilns training grounds in the previous year. In the past 13 years, Frazer will be the 12th individual appointed as culture secretary.
BGC chief executive Michael Dugher said: “We warmly welcome the new secretary of state to her position, even though we have had more ministers at DCMS than there are runners in the Grand National.
“We hope that she will listen to the millions of punters and other important voices in racing who have expressed their deep concern about blanket, intrusive and low-level so-called ‘affordability’ checks that only drive people to the unsafe unregulated black market online. These pose a massive threat to racing as a world-leading British sport, one that makes a huge contribution to our economy and national life.”
He added: “Millions of people enjoy a bet and the overwhelming majority do so perfectly responsibly and safely. The problem gambling rate is 0.3 per cent and low by international comparisons. Future changes to gambling should target problem gamblers and the vulnerable – and leave everybody else alone to choose how they spend their own hard-earned money and leisure time.”
Following the announcement of Frazer’s appointment, Labour MP Carolyn Harris, one of the most prominent advocates for gambling reform in parliament, tweeted: “One of her first tasks will be to publish the white paper on much-needed and long-overdue gambling legislation reform.”
Although an official announcement has not yet been made, the gambling and racing task appears to be staying at the DCMS and moving to one of the department’s other ministers, with sports minister Stuart Andrew being a likely candidate.
The government’s gambling review began in December 2020, but the specifics of its reform proposals have continued to be put off.
The white paper was anticipated to be available before the end of March, and Scully has stated that it will be available “in the coming weeks.” However, given that it had been anticipated that it would occur following the publication of government proposals to alter football regulation, additional delays may now occur.
The publication of that white paper, which had been anticipated for this week, has reportedly been postponed until at least the end of this month.
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