Consultations required for key changes as UK gambling review reveals few surprises
“The measures set out today will shield players in the grip of addiction from harm and hold gambling firms to account when they fail in their responsibility.”
Those measures are explained in more detail below.
Statutory gambling operator levy
A statutory gambling operator levy will be enforced to ensure that operators help fund treatment services and research for gambling harm and addiction, including through the NHS.
That contribution is currently voluntary and not mandated and was deemed “not fit for purpose” by the government, with some betting companies pledging as little as £1 in RET donations.
The compulsory rate will only be confirmed after further consultations and will take into account business size, operating costs and problem gambling rates. A 1% tax on GGR appears most likely.
The levy will be collected by the Gambling Commission (UKGC) and spending will need to be approved by the Government.
New online stake limit
A new stake limit for online slots will be introduced with the default maximum stake of between £2 and £15 per spin. Again these limits are subject to consultation.
The limits will help to prevent “runaway and life-changing losses” according to the government, while helping to level the playing field between the online and land-based sectors.
As it stands, there is no limit on bets for online slots, whereas in-person slot machines in pubs, arcades and bookmakers have a limit of £2 and casinos have limits of up to £5.
Some of the UK’s biggest licensed operators have already introduced slots limits of between £5 and £15, including Flutter, 888 and Entain, among others.
The £2 per spin stake limit may only apply to under-25s and will be finalised after consultation.
Player protection checks
Note the much-used “affordability checks” phrasing has not been used here by the government.
The white paper states that gambling operators will now be required to do more to protect customers.
Betting companies will be required to conduct player protection checks on the highest spending cohorts to check they are not racking up harmful losses.
The Gambling Commission will consult on two forms of financial risk check. Firstly, background checks at moderate levels of spend, to take place at £125 net loss within a month or £500 within a year.
Second, at proposed thresholds of £1,000 net loss within 24 hours or £2,000 within 90 days, there should be “more detailed” checks for a customer’s financial position.
These thresholds could again be halved for those aged between 18 and 24.
Guidance states these checks should happen instantaneously and should not impact gameplay, unless there are signs of financial harm.
“The checks will be targeted to where there is the most risk of harm,” said DCMS in a statement. “They are not about checking up on people having a flutter on the football or placing the odd bet on horse racing.”
The government has suggested that around eight in 10 gamblers will never reach the threshold for these checks, with around 3% of accounts likely to incur more detailed checks due to high spending.
New Gambling Commission powers
The government has confirmed that new powers will be granted to the UKGC to tackle and block unlicensed black market gambling firms from targeting the UK. This was a major concern of the regulated industry and leading operators will be delighted to see its inclusion in the white paper.
This clampdown will be enforced through court orders requests made to ISPs, which have been carried out with varying degrees of success in other markets, including Australia and Germany, among others.The review has also proposed reforming the fee structure for the regulator to give it “greater flexibility” to respond to emerging risks and challenges posed by the industry.
According to DCMS, those suffering from gambling addiction and harm are at greater risk from certain aggressive advertising practices.
As a result, the UKGC will take a closer look at how bonuses, including free bets or spins, can drive harmful behaviour and trigger people to spend more than they intended.
New industry ombudsman
The government has committed to working with the industry and all relevant stakeholders to create a new independent ombudsman for gambling dispute resolutions.
Around 2,000 consumer complaints per year are registered with dispute resolution providers and the UKGC.
These most often relate to social responsibility breaches, gambling harm and safer gambling.
“At present, customers seeking personal redress currently have no choice but to pursue potentially costly and uncertain court action,” said DCMS.
The new body will adjudicate complaints relating to social responsibility or gambling harm where an operator is not able to resolve the case.
The government expects the new ombudsman to be accepting complaints within one year.
Plans to relax land-based regulations
The UK government plans to reset regulation for land-based gambling while maintaining safeguards to protect vulnerable groups from harm.
Proposed changes include increasing machine allowances in casinos, allowing sports betting alongside other activities, and permitting credit to non-UK residents subject to AML checks.
The government also pledged to work with the Gambling Commission to develop cashless payments on gaming machines, including adequate player protection measures.
The proposed changes for the land-based sector were welcome news for investors. The share price of Rank Group, which generates approximately 70% of its revenue in land-based venues, increased by nearly 6% upon the publication of the white paper.
What they said
UK culture secretary Lucy Frazer: “We live in an age where people have a virtual mobile casino in their pockets. It has made gambling easier, quicker and often more fun, but when things go wrong it can see people lose thousands of pounds in a few swipes of the screen.
“We are stepping in to update the law for those most at risk of harm. This will strengthen the safety net and help deliver our long-term plan to help build stronger communities while allowing millions of people to continue to play safely.”
Gambling Commission CEO Andrew Rhodes described the review as a “once-in-a-generation opportunity” to deliver positive change for gambling in Great Britain.
He added: “Given the correct powers and resources, the Gambling Commission can continue to make gambling safer, fairer and crime free.
“This white paper is a coherent package of proposals which we believe can significantly support and protect consumers, and improve overall standards in the industry.”
Consultations over conclusions
The fact that further consultations are required for most of the major restrictions in the review will anger the strongest proponents for gambling reform.
Tory MP and former party leader Iain Duncan Smith described the government’s plans to continue undertaking consultations as “a cop-out.”
“I just don’t know what we’ve got to consult on any longer. What is there we don’t know about the gambling industry, and their abuses?” he asked.
“If the government does this then it has itself open to the charge that they have caved in to the lobbying. I know this is my party’s government, but you will then have to ask how many ministers have accepted hospitality.”
The published white paper follows a call for evidence and is based on nearly 16,000 written submissions sent to DCMS during a process spanning more than two years.
It can be read in full here.