Gambling

Written evidence submitted by the London Borough of Haringey (GA 59)

1 The London Borough of Haringey would like to take the opportunity to raise the following matters for consideration by the Select Committee in its review of gambling. In summary our areas for submission are as follows:

1.1 That crime and disorder in relation to betting shops is a significant concern and that the Act and guidance needs to be strengthened so that responsible authorities can use available powers,

1.2 That Fixed Odds Betting Terminals are having a disproportionate impact on crime and the viability of high street betting shops.

1.3 That more should be done to ensure children are protected from gambling in betting shops and that local authorities should take a greater lead through Primary Authority agreements.

1.4 That the Gambling Commission needs to be more active and responsive as a responsible authority.

1.5 That Licensing Authorities need to have discretion and powers to prevent the clustering and over development of gambling premises, so that when local concerns are raised by residents and agencies, the Licensing Authority have proper regard to them

2 Our detailed responses to the Select Committee’s areas of interest and our general comments are given below.

3 Introduction from Haringey’s Cabinet Member for Neighbourhoods, Cllr Nilgun Canver

3.1 As Haringey’s Cabinet Member for Neighbourhoods I have responsibility for licensing matters, and I have held this role since the introduction of the Gambling Act 2005. Our experiences in Haringey demonstrate to me that the Act and associated guidance is failing to provide us as a Licensing Authority with sufficient powers to deal with the impact of gambling premises and the problems they bring. These problems include those we can see and record such as increase crime and disorder, and those problems where more study is required such as their impact on the viability of our high streets and well being of vulnerable communities.

3.2 In our experience the removal of the demand test that previously allowed magistrates to regulate clustering, and the introduction of the requirement that we must ‘aim to permit’, means that there almost no restriction on how many gambling premises operate in an area.

3.3 I believe that it is wrong that the licensing process creates a route for consulting with local communities, but effectively provides no option but to ignore objections even if they reflect the very narrow policy objectives that are available for consideration when determining premises licences. This does not support our attempts to empower communities and give them greater control over their neighbourhoods and it weakens local governance arrangements

3.4 I have lobbied for change with a succession of ministers and the only area where guidance has been provided is an encouragement to use Article 4 Direction. This places the cost of control with the local authority to evidence, declare and maintain and order. Planning control will not deal with all the issues that betting shops create but a better control would be to make betting shops a sui generis use class so that the creation of any new development would require planning approval and issues such as impact on amenity could be considered.

3.5 Haringey would be happy to assist the Select Committee further and would be available to assist with any further study or testing of improved working arrangements.

4 How effective the Act has been in its core objectives to - ensure that gambling is maintained crime-free and conducted in an open and fair manner.

4.1 The licensing objectives set by the Gambling Act 2005 (the Act) includes the objective of preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime. Haringey’s experience is that betting shops are a source of increased crime and disorder but that the Act and guidance is unhelpful.

4.2 In July 2010 we established a joint problem solving group with the police because of evidence linking betting shops to crime and disorder. We identified that betting shops in Haringey had resulted in 262 crimes over a 1 year period; equating to 5 crimes a week. Due the tendency for betting shops to cluster, this meant that crime was noticeably increasing in an area that already had significant crime issues.

4.3 This data showed that criminal damage accounted for 74.4% of offences reported and ‘Gaming Machines’ were damaged in 80% of reports for criminal damage offences. Rowdy / Inconsiderate Behaviour was raised in 42.4% of incidents

4.4 The data indicated significant inconsistency in the reporting of crime and there was reason to believe that some operators failed to report low level crime and disorder or were discouraging their managers from reporting it. This may have been to avoid the scrutiny of responsible authorities.

4.5 We are aware of the ‘Safebet Alliance’ and the voluntary code entered into by the industry to tackle crime in betting shops. However, low level crime was not adequately covered by this code and we feel that this represented a missed opportunity for the industry to establish robust measures for tackling low level crime.

4.6 Guidance on low level crime to the police is also unhelpful because it limits action being taken by them as responsible authorities to only circumstances where the "crime and disorder is linked to an offence under the Act or to the actual gambling facilities". Disorder outside of premises may therefore be interpreted as not a relevant matter for licensing review.

4.7 There is clear evidence that the betting industry targets areas of deprivation and communities where addictive gambling behaviours can be cultivated. We believe that the installation of Fixed Odds Betting Terminals (FOBTs) in these locations is a specific approach taken to draw in and retain to those customers likely to display addictive gambling behaviours. Because it is the industry norm to cluster, the impact is that targeted locations will suffer disproportionately from any impact on crime or disorder.

4.8 Haringey therefore believes that the Act is too narrow in its regard to crime and fails to have regard to the increase in crime that betting premises can bring to an area. This includes low level crime and disorder and increases in criminal damage.

4.9 We believe the Select Committee should consider whether addressing the following areas would strengthen control of crime and disorder under the Act.

4.9.1 That the Act should be amended to replicate the Licensing Authority Act 2003 responsibility to prevent public nuisance and crime and disorder.

4.9.2 That clear statutory guidance should be issued by the Gambling Commission (GC) to direct the industry on the steps they must take prevent their premises being a source of crime and disorder and the mandatory reporting of crime and disorder.

4.9.3 That guidance to responsible authorities should clarify that disorder outside of a premises are crimes associated with betting shops and these are relevant crimes for responsible authorities to consider.

4.9.4 That the GC should commission research that investigates the impact of high street gambling premises on local levels of crime, and specifically to investigate the impact of clustering and use of FOBTs.

5 How effective the Act has been in its core objectives to - protect children and vulnerable people from the adverse effects of gambling.

5.1 In 2009 the GC reported that a programme of test purchases at all the major betting operators in Great Britain showed that in 98 of the 100 shops visited a 17 year old was allowed to place a bet at the counter. This reflects an appalling record for the industry and whilst improvements are said to have been made, there remains concern that much more needs to be done

5.2 In Harringay Green Lanes, the case for rejecting a cluster of applications was partly based upon concerns raised that there are three primary schools and a mental health care facility in the area. Concerns were heard by the appeal court that vulnerable people and children would be affected by a concentration of gambling premises in the area , and this was supported by both a local General Practitioner and the Director of Public Health. However, the courts did not accept that these concerns were sufficient to demonstrate that any new single outlet would be a problem.

5.3 The existing responsibilities for checking underage sales are confusing and whilst placing a shared responsibility on the GC and Local Authorities, the Gambling Commission is tasked with leading on all coordinated activity. In reality there seems to be little evidence that there is significant coordinated activity.

5.4 Local Authorities have a strong record of delivering effective underage sales test purchase programmes and for taking appropriate enforcement action where there is failure. In addition local authorities are now taking responsibility for delivering Primary Authority agreements which provide a focus for advice and national enforcement coordination where agreements with a company are in place.

5.5 We believe the Select Committee should look consider whether there is potential for local authorities to be given a clearer and stronger role in the delivery of programmes of underage sales test purchasing. This should specifically reflect how the Primary Authority scheme could be used to coordinate activity.

6 The effectiveness of the Gambling Commission since its establishment, and whether it represents good value for money.

6.1 Haringey has a good relationship with the GC and our local Compliance Officer. We believe that the work of the GC is of significant value and that the guidance and support that it offers to industry and local authorities is essential.

6.2 However we believe there is room for improvement. We have had occasions where the GC has failed to act as a responsible authority where we believe it was appropriate to do so, and has failed to act quickly and with appropriate leadership where the industry has sought to exploit loop holes or re-interpret accepted good practice.

6.3 For example the Commission failed to respond when a major operator sought to set a new standard for not supplying layout plans for licensed premises; and they were slow to respond and when Adult Gaming Centres sought to divide premises and double their allocation of B3/B4 machines.

6.4 We believe the Select Committee should look consider whether further guidance is needed to ensure the Gambling Commission responds to premises applications and makes appropriate representations where an issue will have wider repercussions.

7 The effectiveness of the classification and regulation of gaming machines under the Act;

7.1 Currently a premises can install four FOBTs on a licensed premises. FOBTs provide a very different form of gambling experience to normal track and field type gambling. They are designed to be addictive and they generate a disproportionate percentage of the profit for average high street betting offices.

7.2 As shown above are particularly susceptible to criminal damage in part because they also can result in very large accumulative losses for the player.

7.3 We believe the Select Committee should look consider whether FOBTs should be restricted and not automatically permitted as ancillary to a premises licence. The facility should exist for a Local Authority to limit or refuse to allow FOBTs where there is a record of relevant crime or disorder linked to a premises.

8 Additional Comments from the London Borough of Haringey

Aim to Permit

8.1 The Act says that in exercising its functions relating to premises licenses the Licensing Authority must aim to permit the use of premises for gambling in so far as it thinks it is in accordance with relevant code of practice, guidance and policy. In addition a Licensing Authority may not have regard to the expected demand for the facilities, and may not consider the likelihood of obtaining planning or building permission.

8.2 As the Act grants only a very narrow discretion, a policy which supports a wider discretion is likely to be held unlawful.

8.3 At an early stage of administering the Act Haringey’s Licensing Sub committees has had reason to refuse 3 applications in the Harringay Green Lanes area. These applications received a substantial number of representations from local residents, as well as from the police, health practitioners and ward councillors. Evidence from the Council showed that the area already had high levels of betting shops and that the location already suffered from high levels of crime and disorder.

8.4 At appeal the case of the appellant was that there is no evidence that one extra betting shop will in any way impact on the area in a way which is contrary to the licensing policy objectives.  This position was supported by evidence of proposed management controls, socially responsible policies and expert evidence. As a consequence the Magistrates ruled that the Licensing Authority had acted improperly and upheld the appeals.

8.5 Haringey has sought Counsels opinion on what steps it might take to put itself in a better position to resist appeals against its decisions to refuse premises licenses for gambling premises under the Act and thereby bring about an element of control over the proliferation of such premises. This advice is to prevent any additional licensed gambling premises for an area we would have to carry out substantive research that demonstrates a clear link to crime or the exploitation or harm to vulnerable persons. This research would have to show the impact that any further gambling premises will have on the area in relevance to the licensing objectives.

8.6 If such research demonstrates a valid position, we could vary our policy statement to show locations in the borough where there is evidence of risk from further gambling. Market soundings we have undertaken shows that this approach is cost prohibitive for any individual local authority.

Lobbying of Government

8.7 Haringey’s Cabinet Member for Neighbourhoods, has lobbied Government for a change to the Act and guidance that will redress the balance in favour of the protection of areas which may be harmed by gambling.

8.8 On the 19th August 2008 the Cabinet Member wrote to the then Secretary of State for Culture Media and Sport, the Rt., Hon., Andy Burnham MP, expressing concern that local authorities have no effective controls to limit the number of gambling premises opening in their boroughs.  Initially the response from the Department of Culture Media and Sport (DCMS) was that it was too early to make changes, but further lobbing through the Local Government Association resulted in an announcement on the 2 December 2008 by the then Prime Minister that he would ensure that "local communities and their authorities have sufficient powers to prevent the clustering of betting shops in areas where this is a problem."  This commitment was subsequently confirmed as a Government priority in the Queen’s speech.

8.9 It was understood that there would be an early review of the powers available to local authorities and a published report of the findings and proposals.  To date no report has been published.

8.10 In February 2010 The Cabinet Member wrote again, this time to Rt., Hon., Ben Bradshaw MP the then Secretary of State for Culture Media and Sport, seeking confirmation of whether the review of powers to deal with the clustering of betting shops had been undertaken, and the date by why the findings would be published. 

8.11 Officers also supplied submissions to the Head of Regulation at DCMS to support the need for change in the legislation and guidance, and for DCMS to sponsor a study into the impact of betting shops.  A detailed specification for this study was also provided.  Although DCMS accepted no guidance had been issued they did identify that the they believed Local Planning Authorities could effectively use Article 4 Directions to control problems.

8.12 The review of powers undertaken has never been published and no guidance arising from it has been issued.

8.13 In July 2010 the Leader and Cabinet Member wrote again, this time to the Rt., Hon., Jeremy Hunt MP, Secretary of State at DCMS.  In this letter they sought an explanation of the Government’s position, provided an explanation for why Article 4 Directions are an inappropriate power for dealing with the clustering of betting shops, and highlighting the increasing concern that betting shops are linked to crime and low level disorder.

8.14 In response the John Penrose MP, Minister for Tourism and Heritage wrote to confirm that he believed that Article 4 Directions under the Town and Country Planning Act are appropriate where there is a "real or specific threat".  He further confirmed that there was discussion being undertaken on how guidance could be improved so that where there is a link between crime and disorder and specific premises, action could be taken.

8.15 We are not aware of any improved guidance being issued.

8.16 We believe the Select Committee should look consider whether the Act could be strengthened by the following changes.

8.16.1 That Licensing Authorities should be permitted to determine saturation policies based on impact.

8.16.2 That Licensing Authorities should have discretion to refuse new applications and the "aim to permit" requirement should be repealed.

Planning Control

8.17 As indicated above we have given evidence to Government that the use of Article 4 Direction is an inappropriate and expensive mechanism to resolve overdevelopment and clustering of betting shops. Notwithstanding our view that the Licensing Act and guidance etc should be amended to provide for more effective control, we believe that the Select Committee should consider the following matter which lies outside of the Act.

8.18 That consideration is given to the reclassification of betting shops from A2 (financial and professional services) to Sui Generis. This will allow for applications to be determined on their merits but without the expensive recourse to Article 4 Direction.

Scrutiny Review of Licensing

8.19 Haringey’s Scrutiny and Overview Committee have undertaken an extensive review of betting shops and their proliferation in Haringey and has taken evidence from a wide range of sources including residents, ward councillors, the industry, police and Gambling Commission. At the time of writing this report it is still being finalised, but it is expected that the report will echo the concerns raised here and that this will receive all party support.

June 2011

Prepared 1st August 2011