- Gambling in one form or another has always been part of British life whether sanctioned by the legal and societal norms of the day or not. The latest official review of gambling policy was conducted between March 2000 and June 2001 by the Gambling Review Body, under the leadership of Professor Sir Alan Budd. This review was charged with considering:
- the current state of the industry and how it might change over the next ten years;
- the social impact of gambling and costs and benefits;
- the appropriate regulation for gambling and what new machinery might be needed;
- the availability and effectiveness of treatment programmes for problem gamblers; and
- the impact of any proposed changes on the Lottery and on the income for good causes.
In making recommendations for changes to gambling regulation in Great Britain, the review was directed to take the following into account:
- their wider social impact;
- the protection of children and the vulnerable from exploitation and all gamblers from unfair practices;
- the prevention of crime, disorder and public nuisance arising from how gambling is carried out;
- keeping organised crime out of gambling;
- the desirability of creating an environment in which commercial opportunities, including international competitiveness, maximise the UK's economic welfare; and
- the implications for the current tax system and scope for further development.
- The previous overall review of this field was conducted between 1976 and 1978 by a Royal Commission under the leadership of Lord Rothschild. The Commission's report noted that 94 per cent of over-18 year olds engaged in some form of gambling even if only an occasional bet, raffle or lottery ticket. The report defined gambling in a number of ways: buying the chance to make money; taking a calculated risk because of the potential reward; and engaging in an action or a series of actions resulting in a favourable or neutral outcome. The report noted the difficulty in coming up with a definition which would encapsulate the intuitive distinction between gambling and speculation on the stock market. There was, however, scant reference in the 1978 Royal Commission report to what now seems to be the most significant factor in attitudes to gamblingthat for many people it is good fun. Few of this Commission's recommendations were put into effect.
- Legislative action on gambling in the past seems to have been a matter of trial and error, action and reaction. The philosophy behind legislative action appears to have been two-fold. First, gambling was bad, dangerous or at best neutral. It had to be tolerated but certainly not encouraged. Secondly, it would take place whether legal or not and, if the latter, then it would be the preserve of unscrupulous or downright criminal operators. As the Gambling Review report puts it, "the UK is unusual in that the primary purpose of its existing gambling legislation is social control".
- Prior to 1960 a mix of severe restrictions and outright bans existed on most forms of commercial gambling and gaming. Betting with professional bookmakers was treated somewhat more liberally. However, in 1845 legislation was passed in an attempt to suppress betting on credit terms, then in 1853 legislation attempted to tackle the consequent growth of cash-based betting houses and in 1906 the consequent growth of street bookmakers was outlawed.
- In 1960 the Betting and Gaming Act sought to liberalise the law on gaming to allow those who wanted to indulge to do so. The Act attempted to prohibit commercial exploitation of gaming by preventing levies being taken from the stakes. The 1960 Act also provided for the establishment of licensed cash betting offices. Within five years, however, the development of commercial gaming was out of control as a loophole was exploited that allowed clubs to recover the costs of the facilities they provided. As the Gambling Review report states, "unscrupulous operators were taking advantage of customers, and criminal involvement in gambling was rife 1/4 the Gaming Act 1968 was passed to restore order". It is widely accepted that this legislation and the structures it establishedprincipally the Gaming Board for Great Britainhave been successful in this objective.
- The Deregulation and Contracting Out Act 1994 has given rise to some deregulation of what the Gaming Board described as "outdated controls" but the Board regarded this approach as "piecemeal", revealing inadequacies and leaving inconsistencies. The Board pray in aid the Deregulation Committees of both Houses of Parliament who have commented on the complexity of the present law and the need for simplification and consolidation. In publishing the Gambling Review report, the Secretary of State said:
"Our present gambling laws are badly in need of reform and updating. But reform must go hand in hand with tough practical measures to protect young and vulnerable people. There is no doubt that our current laws, as well as being too complex and out of date, fail to reflect the extent to which gambling has become an everyday part of the way millions of people spend their leisure. But parents have a right to expect that their children will be protected by the law."
Research and evidence
- The Gambling Review describes the existing state of regulation as based on the view that gambling should be tolerated rather than encouraged. We agree. It is equally clear what existing policy and regulation is not based on. It is not based on a significant body of research and evidence on gambling and "problem" gambling (by which we mean gambling by children, other vulnerable people and persistent and addictive gambling by adults). In 1978 the Rothschild Royal Commission report said:
"The conclusion is inescapable, both from the work of this Royal Commission and from that of the Home Office, that there is a serious shortage of reliable and accessible information about gambling in the United Kingdom. 1/4 We therefore believe it both essential and urgent for the Government to establish a Gambling Research Unit to monitor and study the incidence, sociology and psychology of gambling."
- This recommendation was never acted upon. There are excellent centres for studying gambling in Britain and we took evidence for example from Professor Jim Orford, University of Birmingham and Professor Peter Collins, Centre for Study of Gambling and Commercial Gaming, University of Salford. We also had the opportunity for informal discussions with Professor Bill Eadington of the University of Nevada amongst others during our visit to the USA. The consensus was clear that not enough objective data had been collected or analysed.
- In 2001, over 20 years after the Rothschild Commission, the Gambling Review Body led by Professor Sir Alan Budd was again "struck by how little is known about either normal or problem gambling" and conceded that it had very little in the way of hard evidence to guide its discussions. In consequence the Gambling Review recommended that research is carried out to understand and evaluate:
- the nature of normal, responsible, gambling behaviour;
- the development of, and risk factors for, problem gambling; and
- which forms of treatment for problem gambling are the most effective.
The Gambling Review report also recommended that the gambling industry, with its estimated annual turnover of £42 billion, should be given an opportunity to come up with a voluntary scheme to produce about £3 million a year. We return to this below.
- As noted above, existing gambling policy is based on the principle that gambling should be "tolerated". The Gambling Review report described the position thus: "the general public should not be faced by unlimited opportunities to gamble and by uncontrolled inducements to do so (e.g. by unregulated advertising)." In other words demand for gambling should be "unstimulated", a principle enshrined in the 1968 Act. The Gambling Review report tackles head on the question to whether the public's attitudes to gambling have changed.
- The Gambling Review Body commissioned a survey from the Office of National Statistics (ONS) and complemented the results with conclusions drawn from a number of other pieces of work including submissions to the review itself which posed this very question to respondents.
Notes: Gambling Review Report, using ONS unless otherwise stated. 1. BACTA, BALPA 2. A similar study by the NCSR had similar figures to this ONS study except with bingo at only 7 per cent
- In the UK the average family spend on gambling per week is £3.50. The total industry turnover, amount wagered, is estimated to be in the region of £46 billion with £7.2 billion gross profit for the operators. The Rt. Hon. Mr Richard Caborn MP, Minister for Sport, told us that the gain for the Exchequer was £1.5 billion per year and that the industry employed over 100,000 people.
- The Gambling Review report concluded that: "Attitudes about the acceptability and seriousness of the various forms of gambling do not lead us to believe that there is a public desire for unrestricted access to gambling 1/4 we interpret the survey data as encouragement for our view that there should be a cautious approach to relaxing the controls on gambling." In particular the Review Body was keen to see whether the advent of the National Lottery, with its cash for good causes, had caused a radical change in public opinion on the acceptability of gambling more generally. The Gambling Review report concluded that it had not.
- Therefore where regulation is aimed at reducing the risk of criminal involvement in gambling or children's access to gambling and gaming, the Gambling Review report aims generally at tightening rather than relaxing regulation. The Gambling Review identified what it described as "a widely held view" that "the state should respect the right of the individual to behave as he or she wishes provided there is no harm to others".
- To identify how to protect society, and individuals within it, from freedoms exercised by others, the Gambling Review rests on the Gaming Board's objectives: gambling should be crime-free and honest; punters should know what to expect and be confident that they will get it; and there should be protection for children and vulnerable people. The Government's response to the Review's report added another objective; that of ensuring that the British gambling industry becomes "successful" in the domestic and global marketplace and increases its contribution to the UK economy.
- This goes a long way beyond toleration and shows the Government's clear view that gambling is a mainstream leisure and tourist industry to be promotedas indicated by the Gambling Review's terms of reference summarised above. Mr Caborn told us that: "it has been significant in discussions that gambling has effectively now become part of the mainstream leisure industry and we believe the law should reflect that." The Gambling Review report relies, in the final analysis, on Parliament having the final say, and getting it right. It is to assist Parliament to have its say, and to get it right, that we have produced this report.
22. The Government's response to the Gambling Review report was published in March 2002 entitled "A safe bet for success". The Gambling Review made 176 recommendations which the report characterises as a recipe for cautious reform. In response the Government accepted the bulk of the Gambling Review's proposals with a few significant exceptions. The key plans for change are sketched out below and dealt with in more detail later in the report if relevant to our terms of reference.
A new legislative framework
23. All gambling legislation will be consolidated into a single Act covering all categories of gambling activity. The Act is intended to be a model of legislative drafting: simple, clear, and flexible.
Proposals for regulating the industry
24. To wrap up the existing responsibilities of the Gaming Board, licensing magistrates, local authorities, the Horserace Betting Levy Board and the Tote and create a new single statutory regulator, "the Gambling Commission".
5 Gambling Review Report Back
6 Royal Commission on Gambling, Cm 7200, July 1978 Back
7 Gambling Review Report, p. 69 Back
8 Ibid Back
9 Gambling Review Report, p.12 Back
10 Ev 90 (Vol III) Back
11 A safe bet for success, March 2002, foreword Back
12 Gambling Review Report, p.69 Back
13 Royal Commission on Gambling, Cm 7200, July 1978, p.20 Back
14 Gambling Review Report, pp.5, 85, 173 Back
15 Gambling Review Report, pp.176-7 Back
16 Gambling Review Report, p.7 Back
17 Q 342 Back
18 Gambling Review Report, p.71 Back
19 Ibid Back
20 Gambling Review Report, p.8 Back
21 A safe bet for success, page 1 Back
22 Q 341 Back
23 Gambling Review Report, p.10 Back
24 A safe bet for success, March 2002 Back