Gambling Bill

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Mr. Whittingdale: The Minister lays great stress on the fact that the Secretary of State gave no indication of the number. Will he therefore explain why the ''Today'' programme was precise, and correct, about the number? Was it a piece of mind reading or a lucky guess by the journalist?

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Mr. Caborn: I remind the hon. Gentleman that throughout the wide consultation I have taken people into my confidence and that of the Government to try to resolve the issue. I am sure that he will acknowledge that I have tried to include the Opposition parties in that. I do not lay any blame on anyone here, but, the day after my discussions with Opposition parties, it appeared that there had been a humiliating climbdown by the Government and a figure was mentioned. That may well have come from the same people who put it in today's papers—I do not know. Wide discussion has taken place to try to develop a consensus, and information appeared in the newspapers the day after my private consultation with the official Opposition. I am not blaming the official Opposition, but that is what happened.

Mr. Whittingdale: That is extraordinary. Is the Minister suggesting that we made the policy and leaked it? He has announced this morning that there will be eight casinos. I had not heard that number until I heard it on ''Today'' this morning, and the suggestion that we might have somehow briefed the radio programme about what the Government would do is palpably absurd. Somebody who was a part of that decision briefed the media so that they were able to report it this morning, and I can tell the Minister that it was not us.

Mr. Caborn: If the hon. Gentleman reads Hansard, he will find that I said that when there is wide consultation there is always the possibility of people putting information into the public domain. I am explaining first what happened last night and, secondly, that on a number of occasions after my wider consultations with many people to try to ensure that we returned to the House with a consensus, information appeared in the press the following day. The Secretary of State made a statement to a private meeting of the parliamentary Labour party last night. She did not mention figures. Where eight comes from, I do not know, but it has obviously found its way into the public domain. I also do not know how it appeared in the press after my private discussions with the official Opposition.

Bob Russell (Colchester) (LD): Can we move on from who said what and when? The Minister says that the Government are listening and that the number arrived at is eight—

It being half an hour after the commencement of the proceedings on the motion, The Chairman put the Question, pursuant to Sessional Order C relating to Programming of Bills.

Question accordingly agreed to.

The Chairman: Order. It has been indicated that matters may be raised on the Floor of the House. Mr. Speaker has made it plain that he deprecates statements being made outside the Chamber before they have been made to the Chamber. He has also made it plain that he deprecates attacks on Members on the Floor of the House without notice being given to the Member concerned that such an attack is

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intended. Could I therefore caution any Member who seeks to raise those issues on a point of order later in the day that they should observe the normal courtesies, and inform Mr. Speaker and any Member to whom they wish to refer of their intention?

We turn to clause 7. It has been indicated that various amendments to the clause are to be withdrawn. Amendments now appear on the selection list and cannot be withdrawn; they can be, however, not moved. As I call the amendments in any right hon. or hon. Member's name, if they are not to be moved, the Member should state, ''Not moved''.

Clause 7


Question proposed, That the clause stand part of the Bill.

Mr. Caborn: I have given the reasons why we reflected on the consultation on clause 7, and I repeat that my statement this morning was made in good faith. Even though, as you rightly say, Mr. Gale, there will be reference to the House, I want to put on record the fact that the Secretary of State's integrity has been upheld by the Committee's proceedings. I have reported back to the Committee this morning, as I said I would.

Some hon. Members indicated that they thought my statement cobbled together, and some said that it was made in haste, but I assure the Committee that the consultation has been wide. We have come to the decision to add another lock, capping the number of casinos at eight. We believe that, as the desire for that principle was clearly expressed on Second Reading, we should follow it through. However, as members of the Committee have said, a number of consequences flow from that. That is why I said in my statement that I believe it is important to consider the context as we bring forward new clauses. There are still a lot of questions to which answers are being found, in discussions in the Department and after wider consultation with the industry.

We are consulting, and shall continue to consult, on how regional casinos in Scotland and Wales will be affected. As I said in my statement, there will be potential consequences, which we have not worked through yet, for large and small casinos. We shall come back with a statement and considered amendments. I do not believe that it would be right this morning to go into all that detail, because we would be accused of cobbling proposals together. This is an important issue, which should be considered in detail, and we shall come back with a considered statement and considered amendments to deliver what I set out in principle to the Committee this morning.

The Chairman: Order. Before we proceed, I should like to place on record something that I intended to say before I called the Minister. Clearly, there has been some discussion this morning, as a result of which all the amendments to clause 7 were not moved. It is not in my gift to determine which amendments, if any, will be selected for consideration on Report, but I propose

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to make it absolutely plain to the Chairman of Ways and Means that, given the procedure that has taken place this morning, any amendments to clause 7 tabled on Report should be treated with a very open mind.

Mr. Whittingdale: Thank you, Mr. Gale, for that very helpful comment.

This is a slightly curious debate, because we are now debating clause stand part in the knowledge that the clause will certainly not survive in its present form when the Bill is enacted. We have heard the Minister's statement about the Government's intentions, but inevitably, it was a little sketchy. We shall want to return to those issues as soon as the Government table detailed amendments. However, even though they indicated their acceptance of the concerns that have been expressed, and their proposals about how best to meet those concerns, it is perhaps worth at this stage setting out why we have those concerns, and why we concluded that a pilot scheme is necessary.

The history of casino regulation in this country has been one of caution, and that is entirely correct. The Gaming Act 1968 was brought in to deal with a number of concerns about the way in which casinos operate, and since then, the UK casino industry has operated in a responsible manner, without many problems of criminal activity or a significant problem of gambling addiction. We are keen to preserve that.

Over the years, there has been liberalisation; for example, the last Conservative Government gradually lifted some restrictions, such as reducing the delay in membership from 48 to 24 hours and allowing the use of debit cards. We support further liberalisation and, as I said on Second Reading, we accept that there is probably no longer a need for the 24-hour delay and that there is a case for allowing advertising. Those are liberalisation measures that would apply to the existing industry.

The development of regional casinos or, as we prefer them to be called, destination casinos, is an entirely novel concept—a leap in the dark. Regional casinos are a concept unlike anything that exists in the UK. Over the past few weeks, my colleagues and I have spoken to a number of the operators of huge international casinos that are anxious to establish similar facilities in the UK. To take one example, Caesars Wembley sent an attractive brochure setting out its proposals for a vast enterprise. It says:

    ''It will be a 'stand-alone' resort with 1,250 slot machines and 110 gaming tables, complemented by a luxury 400-room hotel, spa, shops, restaurants . . . in all occupying 13 acres of . . . development.''

One can see the attraction for the Government of the prospect of hundreds of millions of pounds coming into many cities across the country. People have asked what on earth the Government think they are doing, but it is simply that. I accept that such regenerative benefits offer real advantages. However, we should not throw open the door.

These enterprises represent hundreds of millions of pounds. One operator that we spoke to yesterday was talking about up to 20 facilities, which calls into

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question the Government's estimate of 20 to 40 casinos in total. Each facility would have been of the value of about £100 million, which would make £2 billion of investment by just one operator. If operators invest that amount, they will obviously expect a return. They would not be doing it unless they were convinced that there would be a demand for casino gambling unlike anything before in this country.

There would be a gigantic leap in the number of people gambling on slot machines in casinos. In itself, that may not be a problem, but the truth is that we do not know. That is why we have always felt it sensible to proceed cautiously and assess the impact before moving forward. We can examine the experiences of other countries in which there has been liberalisation.

It has been said that the Government's first sign of cold feet—or perhaps I should say concern—stemmed from a visit by the Minister to Australia. What took place in Australia is not what the Government propose. The massive proliferation, particularly of category A machines, not just in casinos, but in bars and clubs across the country, has undoubtedly been the major cause of the massive increase in problem gambling. It is estimated that 2.5 per cent. of the Australian population have gambling problems. There was an enormous increase in gambling, not just in casinos, but across the country, with millions of dollars being spent. Australia is a warning that we should heed. Equally, Atlantic City is a warning of what can happen if there is a proliferation of casinos.

10.15 am

When the Secretary of State first talked about the Bill she said that the Government would have failed if there was an increase in problem gambling and she indicated her confidence that that would not be the case. However, I do not think that any outside observer believes that there will be no increase in problem gambling. If there is a huge increase in the number of people participating in gambling—that must be the case for companies to stand any chance of making returns on their investments—problem gambling will inevitably increase also.

Given the independent studies into the issue that have been conducted and the estimates that have been made, it is not possible for the Secretary of State to say that there will be no increase. For instance, the Henley Centre has said:

    ''The impact of the proposed Bill is expected to increase''

the number of problem gamblers

    ''by a further 200,000 . . . due to the growth in the number of casinos and the introduction of unlimited stakes and prizes machines.''

However, in the regulatory impact assessment the Government have sought to cast doubt on the Henley Centre's analysis. They say that there are serious doubts about how the analysis has been conducted and that

    ''the methodology employed . . . cannot adequately model the radical change in market conditions that the Gambling Bill will allow.''

That may be correct and it may not be.

At the same time, however, NERA Economic Consulting has produced a similar study that says:

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    ''Under a scenario of 60 regional casinos . . . we estimate that there could be up to 500,000 casino-related problem gamblers in 2010, approximately 400,000 more than at present.''

Of course, that might be wrong as well. Also, the Royal College of Psychiatrists has said:

    ''The Government's assertion that, while expanding the gambling market in the manner proposed, it will be possible to control the inevitable large increase in excessive gambling, is naive and totally unjustified. It is also inconsistent with the experience in other countries where gambling has been deregulated.''

Perhaps all those bodies are completely wrong and the Government are right. Perhaps we can experience a huge increase in gambling in this country without any significant increase in gambling addiction. However, in looking at the two sides of the argument and deciding which one I am more likely to believe, I find that the combined evidence of the Henley Centre, NERA, the Royal College of Psychiatrists and many other outside observers weighs more than the assurances of the Secretary of State that there will be no increase. That is why we suggest proceeding cautiously, with a limited number of casinos and an assessment of their impact. We obviously welcome the fact that the Government have finally accepted that argument.

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Prepared 16 November 2004