A roll of the dice for FOBTs?
by Dr Ben Kirby

The Government is due shortly to publish the outcome of its 12-week consultation on gambling regulation. Media coverage has been dominated by a proposed crackdown on high stakes betting machines. With the prospect of a new regulatory landscape on the horizon, polling helps us understand the major factors driving this debate.

Fixed Odds Betting Terminals (FOBTs) allow customers to bet up to £100 every 20 seconds on games such as roulette. The Gambling Commission reports that there are over 33,500 of these electronic gaming machines in Great Britain, most of which are in 8,500 licensed betting shops. Research shows that denser concentrations of FOBTs are found in areas characterised by socio-economic deprivation and high unemployment rates.

Campaigners have for years cited evidence that FOBTs encourage addictive and compulsive behaviour because of the high intensity gameplay that they offer. As a result, these machines have been dubbed the “crack cocaine of gambling”. The attention that FOBTs have had reflects a growing sense among policymakers that they are a major factor behind problem gambling in Britain.

Problem gambling appears to be increasing in prevalence: figures released by the Gambling Commission show that the number of problem gamblers in Britain rose by a third between 2012 and 2015, to 430,000. Recent ComRes research indicates that the general public is aware of these trends: a majority (63%) consider problem gambling to be a significant issue for the country, and three in ten (29%) report that they know someone personally who has a gambling problem.

Voices within the gambling industry dispute the links between these statistics and the proliferation of FOBTs. That sensitivity should come as no great surprise: FOBTs generate £1.8 billion in gross profit for bookmakers every year. Faced with growing competition from internet gambling and the declining popularity of racing betting, the bookmaking industry has increasingly relied on the turnover that FOBTs generate. Operators warn that the introduction of a £2 cap on stakes would result in betting shop closures across the country.

The current debate around FOBTs is best understood against the backdrop of Labour’s 2005 Gambling Act which first legalised them. That Act marked a “high-water mark” for light touch regulation in the commercial gambling sector. At the time, the Act was met with criticism because it presented commercial gambling as a type of leisure activity and an important regional economic development stimulus. Critics also voiced concerns about whether it provided sufficient harm prevention measures. By the time the Act came into force, widespread opposition compelled the Government to scrap its ambitious plans to develop regional “super casinos”.

The political mood has since continued to swing towards tougher gambling regulation. Given that FOBTs have become synonymous with problem gambling, it is perhaps unsurprising that there is now strong cross-party support for slashing maximum stakes on these machines from £100 to £2: both Labour and the Liberal Democrats committed to this in their 2017 Manifestos, and MPs from across the political spectrum recently signed a letter addressed to Prime Minister Theresa May which spoke of a “rare [...] consensus across our political divides” on the matter. Recent ComRes research indicates that the same is true of the Upper House: huge majorities of both Conservative peers (70%) and Labour peers (83%) favour reducing the maximum stake to £2.

All of this has led commentators to predict that the consultation will endorse a £2 cap on stakes, effectively signing a death warrant for FOBTs. Indeed, some bookmakers have suggested that this conclusion was actually reached before the end of the consultation, leaving open the possibility of challenging the decision through judicial review.

The attention that FOBTs have received has meanwhile distracted from other proposals aimed at promoting responsible gambling initiatives. These include a mandatory levy on gambling operators to fund more research, education, and treatment around problem gambling than they presently do. Recent ComRes research indicates that three out of five people (61%) believe such initiatives should be compulsory for all gambling companies.

Whatever the consultation outcome, it is hard to see political or public opinion swinging back behind the gambling industry in the short term. And, where FOBTs are under the cosh today, online gambling cannot be far behind…