The Gambling Act - A Game of Two Halves?

5 Feb 2021

The Call for Evidence to input into the Government’s Review of the Gambling Act (2005) is now at the half-time stage with the final whistle on 31 March.

As the players look to re-energise themselves, it’s worth taking stock on the prospects for this multi-billion pound industry and what lessons it might hold. DRD senior advisor, Steve Myers, takes a look.

The Review of the Gambling Act 2005, and the consequences to an £8.7bn industry

As we approach the mid-point of the UK Gambling Act review, there is plenty of speculation about possible actions that may come out of it. However, one thing is clear: the momentum is not with the industry at present. Despite the efforts of the trade body and individual operators, the anti-gambling lobby is running rings around them and it seems rarely a day goes by without some negative narrative meandering its way through our omni-channelled media.

Gambling may not be everybody’s cup of tea, but it is a legal activity enjoyed by tens of millions of ordinary people across the country each month, and contrary to the assertions of some noisy politicians like Iain Duncan-Smith, the UK industry is well-regulated. That is not to say improvements shouldn’t continue to be made, but at some point, the sector needs to question the wisdom of saying “How high?” each time anti-gambling activists say “Jump!”

An evidenced-based approach?

This supplicant approach to promotion and lobbying may in part be excusable for the relative newcomers of the online industry, who have largely emerged since the passing of the 2005 Act, but land-based operators have been here before. It seems, once again, their positioning relies on the fact that if the UK industry does its bit, they will be left alone, taking at face value promises that the review will be “balanced”. But to many, it appears increasingly obvious that we can expect a knee jerk reaction from Government and the Gambling Commission (GC) rather than actions based on an evidence-based model. Rhetoric, not reality, seems to be everything in this game.

The anti-gambling movement understands this, and its well organised lobby continues to drip feed gambling related horror stories fuelled by emotion that are by no means representative of the industry as a whole or provide a fundamental understanding of the issues involved. The GC’s own evidence is that in the UK less than 1% of gamblers have issues, far fewer than most other countries. This will always be too many, but the industry has significantly funded both treatment and research to help those affected. The top online operators admirably committed to £100m over five years to support those with issues, yet the headlines still criticised the influence the industry had on where the monies would be spent.

Over-reach by the Gambling Commission

Despite this initiative, the GC continues to penalise the industry in terms that arguably go well beyond its own objectives. It has a recent track record of pre-emptive rule making and regulation with little or no consultation with the industry. Measures installed during the pandemic are a perfect example of this.

The GC is still committed to this approach and looks increasingly likely to land another pre-emptive strike with its “affordability” consultation, despite this currently running in isolation from the wider review of the Gambling Act. How can this be? Surely, to enforce further regulation during this period of wider consultation makes no rational sense. Past performance of the Commission, however, points to further intervention and the industry should brace itself.

Additionally, the GC has been critical of a recent PwC report which argues that the UK faces the likelihood of far greater black-market gambling should the UK environment become too restrictive. The Commission has argued stringently that the report findings are exaggerated. On this basis, will the GC perhaps feel less inclined to ask for additional funding for such matters?

An existential threat?

This whole Gambling Act review process feels like a seismic event for the industry with its very survival at risk despite the positive contribution of over £8.7bn to the economy and the support of 100,000 jobs. These are significant tax revenues and employment statistics in an economy that is under severe strain from the COVID-19 pandemic and the aftermath of Brexit.

As the review enters the second half, the industry needs to fight back quickly. It must become better organised, find some star performers, and start landing the right messages. They are 3-0 down at halftime and in need of a positive game plan. What are the odds on that?