Mr. Foster: Cannock Chase.
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Mr. Moss: Thank you. The letter was to the hon. Member for Cannock Chase (Tony Wright). That letter stated:
After a thorough analysis of 170 submissions and 17 oral evidence sessions, the Joint Committee found that there was no evidence of a causal link between category D machines and problem gambling. There is a lack of clarity and consistency on the Government's part. They are allowing the machines to continue in family entertainment centres, but they are proposing some changes in the value of both the cash and non-cash prizes.
One key area relates to difference. At the moment, a non-cash prize can be up to the value of £8 and a person can use a crane machine to pick up a cuddly toy that is worth about that sum. In future, though, that will be banned; the maximum value of such a cuddly toy will be reduced to £5. I ask a simple question: do children know the value of the toy that they are trying to grab with the crane? I suspect not. They are drawn to the toy and its attractivenessbe it a teddy bear or something else.
The reasoning behind dropping the figure from £8 to £5 is lost on the industry and, I suspect, most of the Committee. Again, the Minister must explain to the Committee why the difference of £3 in the value of an articlebe it a cuddly toy or something elsewill make all the difference between producing a whole generation of problem gamblers who are hooked on this sort of thing at an early age and the status quo. Both the Secretary of State and the Department seem to indicate that they do not have an issue with that in terms of problem gambling.
Clause 56 allows the Secretary of State, at some future date, to re-examine the issue and, potentially, introduce a ban on category D machines in family entertainment centres. That is the sword that is hanging over the industry, and a clause that gives the Secretary of State immense powers to make future changes that will decimate its businesses is no comfort to it.
Family entertainment centres spend about £100 million a year employing some 8,600 people and they support many more people indirectly in their local economies. They are critical to many of our seaside towns, particularly the smaller ones. They operate on tight margins; the operating profit is about 6.4 per cent. on average. More than 70 per cent. of the 104,000 machines in family entertainment centres are category D. The combination of the reserve power hanging over family entertainment centres and the proposed
Column Number: 254reduction in stakes and prizes will have a serious impact on the viability of many of them. The Henley Centre's economic and social impact study of the Gambling Bill, published in February, found that a third of the centres were likely to close.
The adverse impacts would be two-fold. A blight would be put on any significant new long-term investment in family entertainment centres and the proposed reduction in non-cash prizes would degrade their marketability and customer value. The industry believes that there is a double pincer movement to attack their viability and their future. No one will invest and businesses will decrease in value. No one will be able to sell a business at what was the going rate a little while ago because of the uncertainty of clause 56 and the potential for the Secretary of State to make sweeping changes to the availability of category D machines in such centres.
It is important that the Minister explains to the Committee where the consistency lies in the Government's thinking. We know that they are spinning the Bill as a protection Bill: it is to protect children and the vulnerable. As I have pointed out in earlier debates, that is at variance with their opening up the top end of the pyramid, through regional casinos, and allowing something like 20 to 40 mega-casinos each with 1,250 category A machines, exclusive to them. There is potential for more than 50,000 of those new machines, which, in places such as Australia, have been proven to lead to problem gambling. At that end of the scale there will be problems, but to date there is no evidence of problems with category D machines, which are at the children's end of the scale.
It is illogical for the Government to argue that the main thrust of the Bill is about protection when on the one hand those new machines are coming inand there is no evidence from this country on what will result from that introductionand on the other the Government are bearing down on businesses that have been around for many years and are an integral part of the entertainment and leisure facilities in our seaside towns. Perversely, there is no evidence of any damage to our young people as a result of their playing machines in family entertainment centres.
Common sense ought to prevail on this issue. The Government have to acceptas they have, at the top end of the pyramid, with regional casinosthat common sense indicates that if there is no problem there is no need to legislate to change things. It would be helpful to the industry, which employs an awful lot of people throughout the country, to have a clear steer from the Government at this point. Let us not wait until the Bill goes to the other place for consideration, or even later, for such things to be sorted out. Let us make it clear to the industry now that the Government recognise their problems; that the uncertainty derives from the wording in the Bill, particularly in clause 56; that that is damaging to the industry; and that today the Minister will make a clear statement that he recognises those concerns and is prepared to do something about them.
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Mr. Foster: I have a little difficulty with the lead amendment; it seems somewhat superfluous. Clause 51 already prevents under-18s from performing any functions on premises with category D machines. One has to assume that the hon. Member for North-East Cambridgeshire is using the amendment to probe the Minister and to lead to other discussions as he did, quite correctly, in relation to category D machines.
I put on record my apology to the hon. Gentleman for misleading him because I am reliably informed that I gave him the wrong name of the Member who received the letter from the Secretary of State. It was the hon. Member for Great Yarmouth (Mr. Wright), rather than the hon. Member for Cannock Chase.
We are aware that clause 48 creates an offence of employing children and young persons, with some exceptions, to provide facilities for gambling. Clause 56 gives the Secretary of State powers by order to
The hon. Member for North-East Cambridgeshire drew our attention to his concerns, which my colleagues and I share, about the Government's proposals to remove category D machines from various premises, including fish and chip shops and taxi cab offices. We know, even from the Government's own regulatory impact assessment, that if that action is taken, it could lead to the loss of some 600 of those premises. All hon. Members may wish to think about how happy they would be to see some of those important facilities lost to their local communities as a result of this measure. If there were clear, convincing evidence that that would protect young people, that might be another matter. I shall return to the issue of evidence in a minute.
The hon. Member for North-East Cambridgeshire rightly mentioned his astonishmentwhich, again, I sharethat the Government are saying that category D machines will be removed from premises such as fish and chip shops and taxi cab offices, but will continue to be used in motorway service stations and bowling alleys. That is slightly odd, bearing it in mind that there would, one suspects, be greater supervision in the first category of premises than in the second. Nevertheless, we will have an opportunity to return to that matter and discuss it in more detail during debates on later clauses to which I have tabled amendments.
The Chairman: We will not be getting there today.
Mr. Foster: At the rate we are going, I doubt it very much.
The hon. Member for North-East Cambridgeshire also mentioned the Government's plans to change the prizes and stake money for category D machines. That is surprising and I find little evidence to back up the measures that the Government intend to introduce. It is particularly surprising when we hear that the triennial review, which would have been a more appropriate time to consider the evidence and make
Column Number: 256decisions on this matter, is to be postponed for at least several years. Again, we have an opportunity to return to those issues a little later.
I have two concerns about this group of amendments. First, clause 56 is a huge sword of Damocles hanging over many machine operators, family entertainment centres, seaside resorts and the type of facilities provided by organisations such as Butlins. Secondly, I am concerned about the categorisation of category D machines. We need to consider whether there ought to be a sub-category.
Clause 56the sword of Damoclesis important for many organisations in this country. The Government are right to say that it is vital to protect young children. That is clearly enshrined in the licensing objectives in clause 1. However, where we reserve powers like those in clause 56, we must be certain of the likely impact of exercising them. The sector that I am describing is important: it employs 82,000 people, generates £1.76 billion in tax revenues and owns approximately 1,000 family entertainment centres, 850 adult gaming centres and many businesses that supply, operate, manufacture and distribute gaming machines, and it has already been hard hit by foreign competition. We know, for example, that some of the British gaming machine manufacturers have lost their business to America. There are real concerns in that sector.
The Secretary of State must have powerful arguments to justify why she should hold on to the reserve powers described in clause 56. As the hon. Member for North-East Cambridgeshire rightly said, it is odd that the Secretary of State is retaining powers in respect of category D machines, but does not have similar reserve powers for category A machines. Category D machines are well tried and tested in this country. There is a fairly wide body of research evidence on those machinesalthough it has produced rather mixed resultswhereas category A machines are totally untried and untested in this country, and many Committee members have serious concerns about the impact that they will have on the increased number of people affected by problem gambling.
The Secretary of State's reserve powers would have made much more sense to me if they applied to category A, rather than category D, machines. We already know from that letter to the hon. Member for Great Yarmouth that the Secretary of State is clear that the Government are committed to taking an evidence-based approach to all gambling issues. She went on to say that low-value gaming machines have been available in amusement arcades for many years, and there has never been any compelling evidence that it is harmful, either immediately or in later life, for children to play them.
That said, I accept that we must look carefully at the evidence as to whether there could be any harm from category D machines. Unless that is convincingly demonstrated, I see no reason for the Secretary of State to hold on to the reserve powers. If she does, she will place in serious jeopardy many of the businesses
Column Number: 257that I referred to earlier. If they are not certain that they will be allowed to carry on, because the Secretary of State might use the reserve powers at some point, they will have difficulty in asking their banks for money for the additional investment that they wish to make. That will make it extremely difficult for them to continue.
The evidence is mixed. I am sure that all Committee members have looked with considerable interest at the wide range of evidence that was made available to the Joint Committee and at that in the Budd report, and at research including that by Sue Fisher in 1998 and Professor Jim Orford in 2003. Some will even have done as I have, and gone back to the 1987 Home Office research, which suggested that there was ambivalence about the amount of harm that category D machines would do.
The hon. Member for North-East Cambridgeshire said that he was waiting with anticipation for the Government to publish their detailed review of all the research. I am pleased to tell him that they have already done so, and it makes fascinating reading. The hon. Member for West Ham (Mr. Banks), who accuses me of spending my time sitting up reading Coin Slot International night after night, will be delighted to know that last night I found even that not quite as riveting as ''Young People and Gambling in Britain: A systematic and critical review of the research literature relating to gaming machine, lottery and pools coupons practice by children and young people under 18''. I know that he will have read it as wellit is fascinating.
That document tells us that there is a lack of substantial data on the prevalence of gambling and problem gambling among the under-18s in the United Kingdom. It goes on to say that it is not possible to give reliable prevalence figures on problem gambling in childhood, but that studies with the most rigorous design, using large national random samples and recent coverage, find the lowest rates. Some, it says, believe that the younger the onset of play, the more serious gambling problems are likely to become, although there is insufficient evidence to make definitive judgments about that hypothesis. It suggests that a detailed longitudinal study is required.
The evidence is mixed, but it is increasingly clear that there are differences between the category D machines from which people get money and those from which they win prizes. The evidence, limited though it is, seems to suggest that those on which people gamble for pocket money are more addictive than the grabbers and the amusements with prizes. If that is the case, and if the Government are most concerned about those that give money, it might be sensible for any sword of Damocles that there is likely to be to hang over the category D machines about which there is the greater concernthose that give cash prizes. In that category, I refer particularly to the machines that emulate the fruit machines that are played by adults''fruities'', as they are sometimes called. It is on those that there is the greatest evidence. Our amendment in this string gives the Government an opportunity to consider whether they will retain some
Column Number: 258form of sword of Damocles, as covered by clause 56. That should relate only to category D machines, about which there is greater concern than the others.
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