New restrictive measures proposed in a UK MPs’ report could suspend gambling advertisement, VIP schemes and introduce a £2 online slot limit in the country.
UK Gambling Industry Threatened with Biggest Shake-up to Date
Gambling in the United Kingdom has come under more barrage after a group of 50 Members of Parliament (MPs) called for a complete shut-down of gambling advertisement in the country. The same group wants to fundamentally change gambling in the UK with the action plan outlined in a report released earlier this year, and a follow-up report published on Tuesday.
Indignation among lawmakers has been mounting with Tom Watson, Tracey Crouch and Carolyn Harris reacting to news earlier this year that FA Cup games had been exclusively streamed via gambling firms, and prompting a regulatory inquiry.
Now, lawmakers have published a new proposal suggesting the biggest re-regulation of the industry worth some £11 billion and proving a valuable source of income for community economies. Given their track record, MPs could be successful once again as they previously introduced a limit on fixed-odds betting terminals (FOBTs), which prompted the closure of hundreds of betting shops in the UK, and introduced a ban on credit cards.
Restricting the Gambling Industry or Modernizing It for Consumer Protection?
First reported by The Guardian, a British daily newspaper, the proposal would trim all gambling ads both TV and online. If successful measures would also suspend all VIP schemes and “inducements to bet,” translating into complete lack of bonuses.
Online slots would see a £2 stake limit set and third-parties would carry-out affordability checks to determine whether players may afford to gamble. The proposal suggests that regulators should have more insight and control over how games are designed and that a new ombudsman must be appointed to resolve conflict between consumers and firms.
In explaining their reasons, Harris and fellow MPs Ian Duncan Smith and Ronnie Cowan from the Scottish National party argued that gambling firms had not learned their lessons.
“They have shown time and again that they will not effectively self-regulate. Urgent change is needed to stop this industry riding roughshod over people’s lives.”
The news comes shortly after the announcement that five BGC members have volunteered $125 million to help tackle gambling addiction.
Suspending All Gambling Advertisement Is Bound to See Pushback
Erasing all forms of gambling advertisement could have far-reaching effects, from football club sponsorships to commercial broadcasters, to gambling firms forced to make an exit. Except for a voluntary pre-watershed ban, the advertising landscape in the UK for gambling has not changed too much over the past years, and since the Gambling Act 2005 was introduced.
MPs have also called into question how VIP programs work, arguing that if a player spend big enough sums, the casino used an algorithm to incentivize them into the loyalty and VIP programs. They concluded that since casinos can find big spenders, there was no reason why the same data couldn’t be used to help reduce problem gambling.
However, high spenders such as VIP players account for the biggest chunk of casinos’ income, meaning that suspending these programs could significantly hurt companies’ bottom lines. Another reason for turning a keener eye to VIP programs is that they incentivize players to play through free bets and cashback calculated on players’ losses, in a bid to keep everyone involved and playing.
By one estimate, gambling penalties are usually the result of a VIP program gone wrong, with 70% of the cases where a penalty to a gambling firm has been issued due to a failure to meet industry standards in a VIP program.
Drastically Reducing Gambling Harm Is Not Enough Say MPs
In outlining possible actions, the parliamentary group led by Harris criticized the country’s gambling regulator, the UK Gambling Commission, arguing that the watchdog had failed to adapt to the new realities and introduce a safer gambling environment.
On its turn, the UKGC responded that it had been committed to “drastically reduce gambling harm,” and that any claims to the opposite were unfounded. However, Harris and her group now wants a new ombudsman to join the regulator and serve as a mediator between firms and consumers.
The group’s reports have been usually associated with a significant blow to the gambling industry. In February, the group published an interim report outlining some of the points it brought up on Tuesday. The previous report in February sent gambling firms’ shares down by a significant margin.
In the new report, the same concerns have been outlined. MPs now demand a reduction of the “spin speed” in online roulette and revision of the “near misses” policy that leaves players with the impression that they have just almost won and participating in a betting contest again might just secure them a win.
The BGC for its part cautioned that what mattered to the gambling industry in the UK now was for over-regulation not to drive consumers offshore where no safety and protective measures existed.
“Illegal operators do not have safeguards”, the BGC said and reminded that the regulated gambling industry in the country supported 100,000 jobs and paid over £3 billion in tax, notwithstanding fees it contributed to tackle problem gambling, voluntary donations, and more.
NHS northern gambling clinics Michael Gaskell argued that the MPs report was indicative of the fact that everyone involved can and should be doing more to tackle gambling-related harm.