Legislation
UK – Regulatory reform could cost British gambling companies £974m
By Phil - 26 May 2021
A host of regulatory reforms put forward by the UK’s House of Lords, including limits on online betting and banning sport sponsorship from gambling companies, would cost the industry up to £974m whilst boosting taxation and the financing of research into problem gambling.
The claim comes in a report called Peers for Gambling Reform, carried out by Nera Economic Consulting.
It says: “We estimate that the impact of the reforms on the profitability of the gambling industry is between £696m and £974m annually. We estimate that the English Football league could lose £26m and the Rugby Football league could lose £500,000-950,000 in annual sponsorship revenue, equal to 2.5 per cent and 2 to 4 per cent of annual revenues, respectively. We estimate that there would be a net increase of £68-£87m in tax revenues, and therefore no net loss to the Exchequer from the proposed reforms. On the contrary, £68- £87m would be available for new research, education and treatment of gambling-related harm (RET), as recommended in the Select Committee report.”
The reforms proposed in July 2020 by the House of Lords Select Committee on the Social and Economic Impact of the Gambling Industry include structural limits for online gaming, in particular stake limits for online gaming products and an equalisation of play speed to terrestrial equivalents. It also included affordability checks, in which gambling operators would have a responsibility to ensure that players did not gamble more than they could afford. There would be a Mandatory Levy to fund research, education and treatment (RET) of gambling-related harm, with potentially more harmful gambling products incurring a higher rate.
It would classify video game loot boxes as gambling and bring in a ban on direct sponsorship of sport by gambling operators, including on kit or in or near sports venues.
Nera’s report claims that if a £5 limit be applied to online slots, betting levels would be reduced by 14 per cent, to £1.19bn. A £2 limit would see this reduction grow to 23 per cent, reducing stakes to £1.06bn, while a £1 cap would see slot spend plummet to below £1bn, slashing betting levels by 36 per cent to £891m.
Betting and Gaming Counil Chief Executive Michael Dugher said: “We welcome the Government’s Gambling Review and we are confident that Ministers will make sensible decisions for the future that are based on serious evidence, rather than the fantasy figures contained in this report.
“We 100 per cent committed to change and we hope that the White Paper will lead to a package of reforms that continue recent significant improvements in safer gambling. The dream of anti-gambling prohibitionists has always been to somehow force people not to gamble or to gamble less, just because they don’t like betting. A minority of peers may look down their noses at the millions of working people who enjoy a bet, but the truth is that the overwhelming majority do so perfectly safely,” he added.
“And the idea that somehow restricting betting would create more jobs is economically daft and frankly for the birds. This is the theory that if you closed the betting shops there would somehow be a boom in the sale of scented candles.”
