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1.55 pm

Mr. Caborn: I thank everyone who has contributed to the debate. From my point of view and that of my officials, it has been extremely helpful. As I said earlier, we are in the process of consulting and the debate will help us to refine our proposals before we start to draft the legislation.

The Budd report and the Government's response to it have underlined the approach that will be taken, and we will consider the submissions to the consultation. In the 1960s, the industry was used by the criminal fraternity for all sorts of reasons, particularly the laundering of money. Restrictive legislation and heavy regulation were then imposed and out of that came a transparent industry that had a tremendous amount of credibility. We do not want to lose that credibility because, if we do, it will be a lose-lose situation. Given the modern setting of the 21st century and the public's perception of the changing culture of gambling, if we can legislate to maintain a transparent industry that has the integrity on which people can rely, we will have a win-win situation for the industry.

As I said, this is a big industry. More than 100,000 people are already employed in it, and it could be used to encourage tourism and to assist regeneration if we manage the changes effectively. Change has not taken place in that way in some countries. Australia deregulated and then found it very difficult to reimpose controls. Therefore, we are taking a cautious approach to managing the modernisation of the industry.

Some themes were common to many of the contributions to the debate. My officials will study Hansard and, if I miss any points, I hope that they will respond. We are more than willing to try to give answers.

Several hon. Members raised the idea of a shadow commission. The Gaming Board has put several suggestions to us about how we can create some form of shadow commission. I support the idea, because uncertainty in industry can be very costly. Commerce and finance may not invest in an industry until there is some certainty. If people believe that they are dealing with a shadow commission that will make decisions in the future, they are more likely to move the agenda on investment forward. The basic principle is that uncertainty is normally very costly so, if we can remove it, we should do so. The concept of a shadow commission is therefore right.

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However, we shall have to wait a little before we decide exactly how we will move forward. None the less, I certainly do not dismiss the idea. If anything, I support it.

The role of local authorities in regenerating communities and developing their economies has been mentioned. We believe that making licensing the responsibility of local authorities and thereby linking it to land use, transport planning and regeneration is right. Given that local authorities are not subject to the departmentalisation of 10, 15 or 20 years ago, I think that that move is absolutely correct. It has the bonus, too, of bringing licensing under some democratic control. It is important when making any change to take communities with us. If we do not do so, there might be a backlash and unfortunate things could happen. We therefore decided to link gambling licensing with land-use planning, which is already under local authority control, and liquor licensing, which is about to come under local authority control. We think that that is the way to move forward. To use the jargon, a little bit of joined-up government does no harm.

With regard to crane machines, the Government tried in their response to the Budd report to draw a clear distinction between amusement on one hand, and gambling and gaming on the other. We did so by setting the 10p and £5 levels under category D. Those maximums are not set in tablets of stone. We just wanted to reassure the House and all those who made representations that, should we want to change those levels, it must be done by decree of this House—not by a commission, a quango or anybody else.

The argument about licensed members' clubs and the £250 jackpot—Budd was concerned about this—was predicated on the fear of children playing the machines. If there is such a danger—I do not think that there is—we must ensure that steps are taken to distinguish between amusement and gaming and gambling.

We had to consider, bearing in mind crane machines, whether a 10p price and £5 or a fluffy toy as a prize should be considered gambling. Should that be in a separate category, as a number of hon. Members have argued? I have told the industry, in response to its representations on crane machines and the 30p and £8 limits, that we will reflect on the matter, but I want to make it clear to the House why we have come to our decision. We have taken on board what Budd said and borne in mind public concern about young children gaming. Amusement is one thing, gambling is another.

We rejected Budd's proposal on the amount of time after which the matter should be reviewed. The House will remember that the report suggested a review of the issue of slot machines, but that led to tremendous uncertainty in the industry. We have therefore given the reassurance that if the 10p and £5 limits change, it will be as a result only of a decision by this House, and it will be backed up by research.

A theme of many speeches has been whether we really know what effect such things have on children. The honest answer is no. We must therefore conduct research to find out exactly what effect, if any, gambling or playing the slots for £5 prizes might have on children. In summary, we want, first, to engender certainty; secondly, to reassure the public; and thirdly, to research cause and effect.

Mr. Boris Johnson: I am still not quite sure from the Minister's explanation whether he thinks that crane

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machines constitute amusement or gambling, and whether he believes that children will be lured into gambling more merely by the prospect of winning a fluffy dog worth £8 rather than £5. I still do not understand the logic behind the reduction.

Mr. Caborn: The hon. Gentleman misses the point. Our position on amusement is clear: it falls within the financial limit of 10p and £5. If we allow the 30p and £8 prize to be introduced, those who want the machines to be removed will argue that we have created two categories for amusement of 10p and £5 and 30p and £8. We have rejected the 30p and £8 prize. We need that proposal to be researched because people are concerned about children gambling. The hon. Gentleman might not accept that argument, but as a Minister I have to reflect on the 5,000 contributions to the Budd inquiry and the consultation. We do not dismiss those lightly. We have gone a long way to meet the industry's concerns, especially those voiced by the resorts, by rejecting the Budd report recommendation. However, we will manage change so that we reassure the general public and do not unduly alarm the industry.

Dr. Ladyman: I am grateful for the Minister's comments on crane machines. I would not have expected anything more at this stage. However, it would be easy to create a different category for them, because people play them to win a prize. As they do not win cash, a distinction can be drawn.

On the 10p and £5 category, I understand why the House needs to consider that, but will my right hon. Friend reflect on the possibility of instructing the new gambling commission to consider the level, say, every three years, and make a recommendation to Ministers so that the industry knows that it is under review?

Mr. Caborn: My hon. Friend misses the more important point. We want to know whether there is a cause and effect aspect to gambling, but we do not want to put the cart before the horse. I want to put in train research so that we can prove or disprove that. It is important to do that so that we reassure those members of the general public who are worried about the link between the machines and problem gambling. We want sound findings on that, which can be achieved only through sound research. We have distinguished between amusement and gambling: amusement is for children; gambling is for adults. It will be for the House to decide whether we move away from that principle.

My hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth) and others were worried about protecting the lottery. We have taken the political decision to protect it and have given our reasons for that. I accept that if we protect the lottery, which is a monopoly, it has to take its responsibilities seriously. We have a choice: if we release the lottery on to the marketplace, do we let the marketplace participate in the lottery? Camelot wrote to us outlining the damage that that would do.

We want to be fair. If we protect the lottery, which some would call an institution, it must take its responsibilities seriously because it is in a privileged position. It is a monopoly within the sea of competition, and we need clear dividing lines. I heard what hon. Members said about the new product that it is bringing on to the marketplace and realise that they are concerned that

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that could overstep the mark. The advice that I have received is that that will not happen, but I take the general principle that the lottery must respect the fact that it is in a privileged position and not move into other areas.

I hope that the trust will carry out the necessary research. The industry knows what Budd said and the £3 million that we want to raise. The trust marks an important commitment by the industry to take its responsibilities seriously. If the money is not raised over a period of time, we have reserved powers to introduce legislation to ensure that it is. We will work out a formula to determine how that can be fairly raised across the industry.

We are in contact with the Department of Health regarding the development and composition of the trust. It must be independent, and we are striving to achieve that, and it must take account of the various constituencies that will be affected by gambling deregulation. We are giving that matter comprehensive consideration, and I hope that we will be able to make further announcements in the near future.

I take on board the remarks of my hon. Friend the Member for Aberdeen, South (Miss Begg) about the need for legislation. The present consultation process does not debar consideration of the type of product to which she referred, and I shall closely examine any submissions made on the subject. There is a general feeling in the House that such schemes are neither investment nor gambling; they are a complete rip-off and a sham, and therefore unacceptable. My hon. Friend graphically described the way in which the matter has been knocking about between two Departments, and that is also unacceptable. I assure her that we will consider the issue very carefully.

During the break from the debate between 11 and 11.45 am, when a statement was made to the House, I asked my officials to give me a definition of "gambling". They said that they are still trying to arrive at a definition. If my hon. Friend's question is to be answered and if we are to legislate effectively, we need clear definitions of the terms involved, so I assure her that we will consider the matter. I hope that she will respond to the consultation document.

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