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Regulus Partners: Time for Gambling to wise up. Guestblog by Dan Waugh

Updated: Feb 6, 2021

Alan Alda once said: “Be as smart as you can, but remember that it is always better to be wise than to be smart”.

Ingenuity may have fuelled the growth of the gambling industry in recent years but wisdom has often been in short supply. As the ICE expo – pantheon of gambling smarts - prepares to hit London, Dan Waugh asks whether now is the time for a return to wisdom.

Looking at the state of gambling in Britain at the start of 2015, it is difficult to avoid the conclusion that the ratio of smart to wise has moved a little out of whack. Everywhere one looks one is confronted with problems – many of them the result of industry ingenuity – with no really workable blueprint for resolving them.

First, we have the ‘known knowns’. Most prominent of these is the issue of the FOBT and betting shop clustering – a controversy that is unlikely to go away anytime soon. This is supplemented by a host of other issues which we can expect to grow in prominence over the course of the year – TV advertising for (chiefly remote) gambling services; bingo licensing and fears that Greene King will turn its pubs into gambling dens; the question of how much (if anything) betting companies should pay to the sports that provide them with markets; and sports integrity (albeit that is more of an international than domestic issue).

Then we have the list of ‘known unknowns’, headed by the question of how the Gambling Commission intends to regulate remote gambling once it moves beyond the licensing phase and gets its teeth into the specifics of conduct. Meanwhile, mobile gambling (largely undeveloped at the time of the Gambling Act), seems destined to become much more than merely a subset of remote regulation precisely because it has the potential to blur the neat lines between terrestrial and remote gambling.

To this already long list we should add a couple of latent issues. First of these is the embarrassing fact that a decade on from the Gambling Act, ambitions for destination casinos in Britain remain largely unfulfilled. Genting’s new £200m development at the NEC in Solihull, which opens later this year, will be the first (and possibly last) venue that would meet the expectations of those who framed the reformist legislation. It is perhaps telling that over the last ten years the balance of gambling in Britain has shifted even further towards convenience and away from destination.

Then there is the matter of so-called ‘social gaming’, which so far seems to have evaded legislative scrutiny on the view that acquired credits are not the same as cash. Given the reported spending patterns, the propensity for customers to lose control of their play and the fears that social games are ‘grooming’ future ‘real-money’ gamblers, it seems likely that regulation of this activity has been deferred on the basis of complexity rather than principle. It may just take one of the world’s gambling regulators to show us the way.

Then there are the ‘macro-issues’ from the European Union – its fourth anti-money laundering directive and (potentially significant for the industry’s advocates of ‘Big Data’) the forthcoming data protection directive.

Finally, there are two important questions of responsibility – who is responsible for the minimisation of gambling-related harm?; and who is responsible for enforcement of the spirit and the letter of the legislation?

We may have a Responsible Gambling Strategy Board[1] – but it is difficult to decipher just what this country’s strategy for harm minimisation is amidst the alphabet soup of competing (and sometimes antagonistic) organisations and pressure groups.

Meanwhile, the Gambling Commission could be forgiven for feeling a little unsure of its own mandate following two successful challenges to its authority in the courts since May last year (Luxury Leisure vs Gambling Commission and Greene King vs Gambling Commission). Under its chief executive, Jenny Williams the Commission has done a creditable job under trying circumstances - with little in the way of thanks from any quarter. As Williams prepares to step down later this year, her successor will need to feel confident in the parameters of the Commission’s responsibilities.

The sheer breadth of issues have turned gambling regulation into a game of political ‘whack-a-mole’ - an exhausting and unproductive cycle of opportunism and controversy.

In the absence of a clear blueprint for gambling in Britain, proponents and critics of the industry have a tendency to fall back on either libertarianism or the Gambling Act’s mandatory licensing conditions. This is facile. Freedom always has its boundaries (and very few gambling companies want a truly free market) while the mandatory conditions are intended to describe what gambling should not be (unfair, criminal and predatory) but they do not by themselves provide a vision of what it should be.

For the sanity of all concerned, now is the time to take stock. By taking time to distil clearer views on the role of gambling in Britain, what we want our industry to look like and how gambling might be harnessed to the interests of the nation, we will become better equipped to develop coherent solutions to tactical issues. The real ‘FOBT problem’ isn’t about whether the maximum stake on a betting shop slot should be £2 or a £100; it’s about where gambling sits within society and what expectations we have of different forms of gambling.

This will require creating time and space for wise and independently-minded people to explore the complex issues (economic, societal, sociological, psychological, political) that surround gambling, to reflect and to propose a clear way forward. This was the chance given to the industry at the start of the century, when the British government’s economic big gun, Sir Alan Budd led a year-long review into gambling and Professor Peter Collins ran a highly respected multi-disciplinary gambling studies unit at the University of Salford. In theory at least, gambling policy formation never had it so good.

Since that time, we have had innumerable public consultations on discrete matters of policy but only one period of reflection – the disappointing select committee enquiry of 2012 (whose recommendations, which included increasing the number of FOBTs per betting shop, have been largely side-lined).

Today, even our academics (with a few notable exceptions such as the excellent Professor David Forrest of Liverpool University) have been suckered into trying to prove or disprove theories of harm rather than engaging in systematic and long-term studies of costs and benefits (which might then be used to inform policy).

The problem with all of this is that the scars of the Gambling Bill (and its derailment by the media in the run-up to 2005) run deep. Mention the possibility of new primary legislation and politicians and operators alike turn ashen. Insofar as the country at large is concerned, gambling is sufficiently unimportant for the current unsatisfactory state of affairs to continue. Matters are only likely to change for the better if those who care about the industry – operators, researchers and regulators – can forget about being smart for a while and try to find a little more wisdom.


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