Memorandum from Littlewoods Gaming Ltd
(DGB 69)
1. Littlewoods Gaming operates across the
gambling spectrum, including football pools and football games,
sports betting, charity lotteries and casino and entertainment
games. Our products are available on-line, on interactive television,
via telephone and the post, and through a UK-wide network of collectors
who visit customers in their homes.
2. Having submitted evidence at all stages
in the development of the Gambling Bill, starting with the original
investigation by Sir Alan Budd's review team, we welcome the opportunity
to do so again for the attention of the Joint Committee reviewing
the recently published Draft. This memorandum addresses only those
aspects of the Draft Bill with which we have issue or on which
we want to comment.
3. The Gambling Commission (GC)
3.1 As a self-financing body, the GC will
recover its costs through licence fees. The GC will no doubt identify
the activities it considers it has to perform in order to meet
its obligations, both generally and by specific sector. That,
of course, has then to be seen in the context of what the target
sector can afford. We can't reach a position where forms of gambling
deemed acceptable by the Bill are avoided by operators because
they can't afford the cost of funding the regulator.
3.2 As to whether the GC should regulate
the National Lottery, we believe that as the public perception
is undoubtedly that it constitutes gambling, albeit "soft",
it should be regulated by the GC, in the same way as football
pools and society lotteries. The reason given for keeping it separate,
that it funds good causes, applies equally to society lotteries.
4. Protection
4.1 We fully support the proposition that
the gambling industry should bear responsibility, morally and
financially, for the damage it causes to individuals and families,
as should operators of other legal activities which can cause
problems. It is accepted that certain types of gambling are more
prone to inducing problems than others, as the commonly used differentiation
of "hard" and "soft" implies. It is important
that the responsibility to be borne is commensurate with the potential
damage caused by the respective types of gambling, as indeed is
the intensity of the proposed regulations themselves.
5. Remote Gambling
5.1 We believe that the Draft Bill proposes
a generally sensible framework for remote gambling, with clearly
much of the detail still to be worked through. No matter how good
the legislation is, however, the intention to encourage internet
gambling operators to licence themselves in the UK will be thwarted
if the associated tax rates are unattractive when compared to
those applying off-shore.
6. Society Lotteries and Prize Competitions
6.1 The Gambling Review Body, led by Sir
Allan Budd, recommended that while a specified minimum proportion
of income from society lotteries should be retained by the good
causes running them, all other limits applying to such lotteries
should be removed. This was roundly welcomed by charities, those
operating lotteries on their behalf and, not least, the Gaming
Board.
6.2 Following a full-scale assault on the
proposal by Camelot, claiming a potentially adverse effect on
National Lottery proceeds which was unrecognisable in its extremity
to any other organisation involved in raising money for good causes,
the Government chose to reject Budd's recommendation.
6.3 Camelot's research indicated that relaxation
of society lotteries could impact National Lottery sales by anywhere
between £500 million and £900 million. In 2002-03, Camelot's
sales were £4,574 million while those of lotteries registered
with the Gaming Board were £121 million, or 2.6 per cent
of the Camelot total. Sales of National Lottery scratchcards were
£577 million in the same period; those of Littlewoods Gaming,
its nearest competitor, were less than one per cent of that. The
Scrutiny Committee will understand the astonishment which greeted
Camelot's findings, and the frustration felt when they were accepted
by the Government.
6.4 Secondary legislation has recently been
used to double the existing society lottery limits. Although a
welcome development, it still places a distinct and unnecessary
restriction on finding imaginative ways to fund-raise. At a time
when significant changes are being welcomed by many in the wider
gambling industry, it is iniquitous that a sector which is agreed
to be of "low risk" to the vulnerable, while at the
same time raising much-needed funds directly for readily identifiable
good causes, should continue to be constrained by out-moded regulation.
The Bill should revert to the scenario envisaged by the Review
Body, and remove the limits on stake, size and prize in society
lotteries. Whilst preserving the minimum twenty per cent of sales
for good causes, it should abolish constraints on the proportion
of sales to be paid in prizes or taken in costs.
6.5 The Government has clearly been keen
to outlaw rapid draw lotteries. From Budd onwards, the proposal
has been to limit draws to no more than one in a 24-hour period.
Our concern with that proposal has always been that it has to
avoid the unintentional trapping two or more non-rapid, eg weekly,
lotteries which are drawn at the same time.
6.6 The method for dealing with this issue
at Clause 77 (2) in the Draft Bill, however, is critically flawed.
Its stated intention is "to limit the possibility for repetitive
play", which it undoubtedly would, by imposing a gap of 24
hours between the sale of the last ticket and the draw itself.
If it traps non-rapid draw lotteries, however, it ruins their
commercial viability. For example, a significant proportion of
chances in the National Lottery main draws on Wednesdays and Saturdays
are sold in the 24 hours before the draw. It is essential that
regulations seeking to restrict repetitive play in rapid draw
lotteries do not unintentionally trap non-rapid draw lotteries
in the process. As currently presented, the Draft Bill would do
so.
6.7 Society lotteries are also adversely
affected by the lack of clarity in the area of prize competitions.
Those of us operating legitimate lotteries, with the associated
constraints and costs, are frustrated by the lack of control and
regulation applied to competitions which appear to be lotteries
in every way but name. We await the sections of the Draft Bill
addressing these issues with interest.
7. Other Issues
7.1 The football pools companies are pleased
to see the retention of the minimum age for sale and purchase
of coupons of 16 years and other relaxations granted in the 1990s.
In addition, we are keen to take advantage of modern communication
methods for the collection of pools entries. As well as enabling
retailers to pay out winnings on the pools, the Draft Bill also
permits them to send the coupons they collect to the pools companies
by post. It is important to our future plans that retailers should
be able to use electronic methods of transmission for pools coupons
and entries to other types of competition. We have been advised
by DCMS that by its silence the Draft Bill enables this, but feel
that positive permission would put the matter beyond doubt.
December 2003
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