Examination of Witnesses (Questions 1340
- 1359)
TUESDAY 3 FEBRUARY 2004
SIR DAVID
DURIE AND
PROFESSOR JONATHAN
WOLFF
Q1340 Lord Donoughue of Ashton: Following
up what Alan Meale has said, I note your reluctance to accept
a strong link for your institution between the role of dealing
with problem gambling and the role of raising money in order to
deal with it. I understand that and I am sure your position would
be inclined the same way but I am not sure it would necessarily
survive full scrutiny. In this area the Lords Minister, Lord McIntosh,
has commented that it is not "the end of the world if there
are a few free-riders". In your experience to date how great
has the free-rider problem been within particular sectors?
Sir David Durie: The Trust is
not well informed about the situation within each of the sectors
which contribute. We have already discussed the situation in the
Association of British Bookmakers. Some sectors have been more
successful than others in encouraging all their members to contribute.
I think that in some cases they have succeeded in getting all
their members to contribute and, as I have said on two occasions,
the wider the base the happier the Trust is about this. It is
not that we are indifferent to the problem but our aim is to get
the money to do the things which we believe need to be done and
for us it is a secondary problem that not everybody is contributing.
Q1341 Lord Wade of Chorlton: Are
the targets of £1.8 million for the next financial year,
rising to £3 million in 2006/2007, realistic estimates of
what is needed and, if not, what amount would you suggest?
Sir David Durie: Let me start
with where we will be next year. We expect to raise at least £1.8
million next year, which is a 50 per cent increase over the current
year, which itself was about 50 per cent increase over last year,
so that is a pretty large rate of expansion. Given that the money
should be spent effectively, we need also to consider the question
of the capacity of the various service providers and of the researchers
whom we are funding to provide us with value for money. In terms
of the short term, even up to the £3 million in two years'
time, I think that we will be able to raise all that we can effectively
spend. Whether £3 million is the right figure for the medium
term or indeed the longer term I think can only be a matter of
speculation. I think the £3 million figure was originally
suggested by the Budd Committee and when it did so it recognised
that there was no particular magic to that figure. It is certainly
something which the Trust itself intends to keep under review
but at the moment it is not an immediate problem for us.
Q1342 Lord Wade of Chorlton: Considering
the information we have had, that we are talking about what is
now an £8 billion business, maybe rising to a £12 billion
business in the next few years when the Bill goes through, do
you not think these are very small figures in relation to the
size of such an industry (if we are relying upon those conclusions)
to deal with these issues?
Sir David Durie: Indeed. There
is no doubt that those figures are small in relation to the turnover
(and indeed the profits) of the industry, but the question is,
are more funds needed and, if they are, can they be used effectively?
Nobody has come forward yet with convincing arguments that either
of those is the case. The Trust will seek from the industry whatever
funds the Trust believes are necessary for it to fulfil and implement
its published strategy effectively.
Q1343 Lord Wade of Chorlton: May
I just ask a further question? On the basis that you are saying
you would prefer a voluntary system, what kind of a fund-raising
organisation are you going to need, do you think, to raise even
£3 million out of that £12 billion or £8 billion
industry, which is what it is now?
Sir David Durie: In the past the
Trust has worked through the trade associations. For the forthcoming
year we have worked with a mixture of the large companies and
the trade associations and that has proved effective in raising
the target which we had for next year. Whether that will always
prove to be the case I do not know, but I think it will for the
next couple of years or so, at any rate. The Trust works through
others. We do not employ vast numbers of people. We have got two
part-time paid people working for us at the moment and so we are
operating on a shoestring even though we are being quite effective
in raising the money, and effective too, I believe, in spending
it.
Q1344 Lord Wade of Chorlton: But
you do not have your own professional team of fund raisers?
Sir David Durie: No.
Q1345 Lord Brooke of Sutton Mandeville:
How much would be too much?
Sir David Durie: Too much would
be more than we could usefully spend. I am sorry—I am not
deliberately being obscure, but we are not in that business at
the moment. If we were, say, to get £10 million for the coming
year we would not be able to spend it effectively.
Q1346 Janet Anderson: My question
is linked to Lord Brooke's. You are saying £10 million would
be too much and if you had that amount of money you would not
know what to do with it, but you did say earlier that you were
operating on a shoestring. If you did have an increase in funding
is there anything that you would do that you are not doing now
because you cannot afford to do it?
Sir David Durie: Sorry—when
I am talking about a shoestring I mean a very small proportion
of our budget is spent on our own expenses as opposed to funding
research or education.
Q1347 Chairman: You are not extravagant?
Sir David Durie: No; that is what
I mean. I think the £1.8 million that we will have available
for next year will be enough for the things that we can usefully
spend on next year.
Q1348 Janet Anderson: So there is
nothing else that you feel you could be doing which you cannot
afford to do at the moment?
Sir David Durie: Not at the moment,
no. We have not got into discussion yet with our service providers
about their requirements going into the second half of this year
but from what I know I think it would be very difficult.
Chairman: We look forward later on this
afternoon to asking GamCare how they might want to spend £10
million, but I will leave them to answer that.
Q1349 Lord Mancroft: Could I ask
you to turn to the issue of the independence of the Trust? I accept
fully that those who pay money have a certain interest in where
it is being spent and properly spent. How independent of the industry
is the Trust? I go further. How far should that independence go?
What future steps are you proposing to make sure that it becomes
more independent, if that is right, and is also seen to be more
independent? On the other side of the coin, what are the benefits
of having representatives of the trade associations involved in
the Trust? How can you balance that?
Sir David Durie: First of all
let me say that the present position is that the Trust has ten
trustees, four of whom, including myself as Chairman, are independent
and six of whom are industry trustees. We have started the process
of looking for, and I am confident we will find, three more independent
trustees. We have recently in our newsletter said that the kinds
of people we are looking for are people with experience of counselling,
education, finance or law, other forms of addiction and treatment
and problem gamblers. Clearly, we will not with three people get
all of that but those are the kinds of people we are looking for.
We will then have seven independent trustees as a majority over
the industry. The current way the Trust is set up follows precisely,
with one exception, the recommendation that the Budd Report made.
The exception is that we have not sought to put on the Trust any
of the service providers, anybody connected with the service providers
of the fund. We think that that would cause a very difficult conflict
of interest. The Budd Committee did not recommend that there should
be a majority of independent trustees. It was the industry trustees
themselves who decided that the Trust would be better with that
independence. The spending decisions the Trust makes go first
to a committee of the independent trustees who examine the proposals
that are being made and make recommendations to the full Trust,
so they are not influenced in those recommendations by the industry.
I think that the Trust is being set up in a way that it is able
to operate reasonably independently of the industry. On the other
hand, as Lord Mancroft has recognised, there are real benefits
to the Trust in having people from the industry present, both
in terms of—and I am stealing Professor Wolff's thunder—a
reality check on what the Trust is about but also in terms of
assuring themselves that the Trust is spending their money wisely
and, indeed, one of the things that we must continue to do better
is to ensure that the Trust does convince the industry that it
is spending their money wisely. My own experience of the Trust's
activities is very recent and if you want further information
about how the Trust operates in practice Professor Wolff, who
has been a Trustee for much longer, can add to that.
Q1350 Lord Donoughue of Ashton: Can
I just link back to the contributions? Some of the main beneficiaries
of this legislation may be the large overseas companies which
have given evidence to us and have spoken of their worth being
five billion, six billion, seven billion a year. Are any of those
currently giving? Have any of those promised to give and, if so,
what are the sums involved?
Sir David Durie: I cannot give
you the sums. My present position is that we have three of them
who have agreed to contribute very significant sums next year.
If you want a note about it I can let you have a note.
Chairman: That would be helpful.
Q1351 Lord Faulkner of Worcester:
Continuing the independence theme, Sir David, presumably, as you
are spending money on treatment and helping people with problems,
it is likely that you will come across common factors in forms
of gambling which will cause you concern. There may well be a
new game or a new form of gambling activity operated by one of
the contributors to the Trust which is giving rise to an inordinately
high proportion of problem gamblers compared with other games.
Would you see it as your duty to tell that operator that he should
stop operating that sort of game and, if you did, what would happen
to your contribution?
Sir David Durie: I do not think
it is for the Trust to tell somebody what to do or what not to
do. I think on the other hand if we came across a situation where
the Trust was sure that a particular innovation was harmful in
terms of significantly adding to the issue of problem gambling
the Trust has a duty, going back to what we are about, to draw
attention to that both publicly and to the Gambling Commission
and, indeed, to our contributors. Whether they would go on supporting
us is for them but I do not think it is something which the Trust
would or should shirk from.
Q1352 Chairman: But it brings us
back to the role of the Gambling Commission in what you do, does
it not, because it would be for them presumably, as the people
who license these various activities and permit them to take place,
to pass judgment on whether or not they were suitable or whether
there elements of what was going on that needed to be addressed,
and I still cannot quite understand why you seemed so reluctant
in your earlier answer—and forgive me if I misunderstood
you—to say that the contributions to your Trust ought not
to be part of the "fit and proper" test that the Commission
will apply.
Sir David Durie: No, I did not
say it should not be. I said that I saw difficulties about making
it. Either we are a charity funded by voluntary contributions
or we are a quasi-state body, it seems to me. At the moment we
are the former rather than the latter and that is the way that
certainly the Trust prefers it to be.
Professor Wolff: Can I add something
on this now that you have mentioned the "fit and proper"
test? It seems that one possible way forward would be that the
contribution to the Trust would be seen as one way of meeting
some obligations under the "fit and proper" test.
Q1353 Chairman: That is what we had
in mind.
Professor Wolff: But that is very
different from saying that that is the only way we can meet the
"fit and proper" test.
Q1354 Chairman: Oh, no, I was not
making that suggestion at all. I was simply making the point that
it is less draconian and less of a public body route, which you
have mentioned, if simply the Commission, as part of its overall
assessment of fitness and properness, took into account whether
people were voluntarily giving you money.
Sir David Durie: Certainly there
is no difference between us on that. The Trust is very strongly
in favour of that. It is the difference between voluntary and
compulsory.
Professor Wolff: I think everyone
would accept this and it is one way of meeting the free-rider
problem. Should some organisation have developed very bad relations
with the Trust, for whatever reason, we would not want that to
be enough for them to lose their licence if they did not contribute.
There should be other ways of meeting a "fit and proper"
test as well if it ever came to that.
Q1355 Lord Mancroft: Do you think
it would help to redress or eliminate the perception that there
might be some bias in the sectional interests if the organisation
responsible for raising contributions was somehow separated from
the body that recommends the allocation of funds?
Sir David Durie: If I may I will
ask Professor Wolff to comment on that. I would just say that
I have seen no evidence of the problem in my short time as Chairman,
but perceptions are important, which is why the Trust is going
for a majority of independent trustees and is working in the way
in which I have described, which gives predominance to the views
and actions of the independent trustees. Professor Wolff has been
at it longer than I have and I am sure can talk about how the
Trust has been operating in recent months.
Professor Wolff: I see no bias
or sectional interest. I have been very impressed with the way
in which the trustees have adopted a responsible perspective and
there has been no sectional interest at all, though we do accept
that perception is very important here and this is the main reason—it
has got nothing to do with money—why we wanted the Commission
to undertake the prevalence studies rather than the Trust, because
if we funded the prevalence study and they told us that problem
gambling was falling, the idea that this would be believed by
anyone when it was funded with industry monies would be ridiculous.
The prevalence study has to be independent from the funding source,
but for other forms of research, other forms of treatment, there
seems to be no reason why there should be a perception problem
there.
Q1356 Mr Meale: The Committee has
received evidence suggesting a wide variety of areas into which
the Trust should fund research, for instance, Quaker Action on
Alcohol and Drugs have suggested research on alcohol consumption
and gambling and also, bearing in mind the change of name of your
own charity, they have also suggested that "the effectiveness
of the Codes of Responsibility in promoting responsible practice
and reducing problem gambling should themselves be the subject
of research and audit", and can you explain to the Committee
the research that the Trust has chosen so far to fund and why
it has prioritised these particular areas?
Sir David Durie: The initial research
which the Trust funded was the work of Professor Collins, which
I have referred to on a number of occasions. That report noted
that the academic literature relating to problem gambling is substantial
but the research does not produce very much in the way of definite
conclusions. The Trust has set up an independent panel to advise
us on the funding of research and we have made an initial allocation
to it of £250,000. Those experts were chaired by one of our
trustees, Dr Guy of the Economic and Social Research Council,
and the panel, which includes representatives from the Department
and from the Gaming Board, has recommended that the Trust's first
priority should be to commission systematic reviews of world-wide
research on the subject areas relevant to the Trust's priorities
to ascertain whether available research already provides any adequate
answers to clarify areas requiring, and the priorities for, future
research. The Trust has accepted that advice and, as I mentioned
earlier, it has now advertised for tenders for that consultancy,
so basically over the coming months we will be seeking (and I
am sure getting) reports on the adequacy, the content and the
nature of, I hope, most of the research that has been done across
the world. The key elements of this research review are to identify
the development of risk factors for problem gambling, the intervention
options for the treatment of problem gambling and the effectiveness
of those options, the impact of alternative approaches to public
education, and awareness raising about the risk of gambling and
the assessment of those approaches. We are asking the researchers
to look not only at UK research but, also, from across the world.
The aim of this will be to guide the Trust in its further activities,
both in terms of what further research we commission but also
in terms of what activities, both educational and treatment, we
should be supporting.
Q1357 Mr Meale: So we have a wide
variety of research that you are looking at, not only in this
country, which has been done, but also what further research should
be done here and from abroad. So it is a fairly substantial task
you have set yourself. Who in the Trust decides what you are going
to do first and the services that are actually to be funded?
Sir David Durie: As I say, we
have put out today this request for tenders. The research panel
will assess those requests with a view to making recommendations
on them by the end of March, and for this initial research to
be carried forward, basically, through the summer. It is in the
light of that (we will be asking for both interim and final reports
in July and September) that we will decide how to take matters
forward beyond that.
Q1358 Mr Meale: So that will be the
Trust itself; the members of the board will actually decide.
Sir David Durie: The Trust itself.
However, we have got two separate things: one, we have a research
panel which is drawn from outside the Trust as well as from
the trustees, and then we have a committee of independent
trustees who make recommendations on spending research. In the
end, it is the Trust as a whole that will take the decisions.
Q1359 Mr Meale: It is a substantial
and significant task you have just outlined—the research
which is needed from here and abroad. Final question: bearing
that in mind, what you have outlined in your financial needs—£1.8
million to £3 million ultimately—represents .001 per
cent. Do you really think you can deliver that with that kind
of minimal funding?
Sir David Durie: Research is relatively
inexpensive. The problem with research is making sure that we
have got properly qualified, good quality researchers. They are
in short supply.
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