Memorandum from London First Centre (DGB
122)
1. INTRODUCTION
This evidence is submitted on behalf of London
First Centre, the inward investment agency for London.
London First Centre is the inward investment
agency for Greater London and provides a free and confidential
consultancy service to companies considering London as a business
location. Its roles are to:
— promote London internationally as
Europe's leading location for business;
— assist businesses world-wide on all
aspects of setting up an operation in London; and
— embed overseas investors into London's
existing business networks.
A not-for-profit partnership between the private
and public sectors, London First Centre works with business and
government to provide a focused inward investment service, which
helps to:
— maintain London's position as a world
city;
— contribute to wealth and job creation
in the capital; and
— deliver London's economic development
strategy.
In nearly 10 years of operation, London First
Centre has assisted nearly 700 companies from 35 countries to
locate or expand in London, leading to the creation of some 32,000
jobs.
London First Centre aims to assist organisations,
whatever their size, sector or country of origin, by giving them
a head start in building their business in Europe's most dynamic
economy. Services include:
— access to London's most influential
business network through London First's membership of over 300
companies and further and higher education institutions;
— referrals to specialist advisers
and industry experts from London's leading professional service
providers;
— property information including visits
to serviced offices, commercial premises and industrial sites;
— liaison with local support agencies
in both the public and private sectors;
— information on and access to government
grants and assistance with funding applications;
— regional economic and demographic
data to assist with market research and site location;
— networking with other companies recently
established in London and with the business community at large;
and
— assisting employee relocation including
identifying residential accommodation and international schools
— ongoing long-term support with future
expansion plans.
Our key funding partners are:
— London Development Agency—Working
for the Mayor, investing in new jobs and skills for Londoners,
supporting businesses and bringing derelict land back into use;
— London First—A business membership
organisation of 300 private sector companies, further and higher
education and healthcare institutions;
— UK Trade & Investment—the
United Kingdom Government's lead organisation for supporting UK
companies in overseas business, and attracting inward investment;
and
— Corporation of London—the local
authority for the City of London, a world-class financial centre.
2. THE IMPORTANCE
OF GAMING
TO LONDON
The hospitality and leisure industry is one
of London's largest and most important sectors, generating over
£9 billion in 2002 from `staying' visitors and a further
£5 billion from day visitors. Together this represents nearly
10% of London's GDP and accounts for around 350,000 jobs or approximately
10% of employment in the region. Much of this investment comes
from overseas. Visit London recently announced that London has
become the most visited city in Europe with its share of world
international arrivals predicted to go up from 1.65% in 2002 to
1.72% in 2003, based upon initial estimates from the World Tourism
Organisation. The gaming industry is a vital component of this
sector which, according to the Greater London Authority, is responsible
for some 20,000 jobs and growing.
Within the British context London's casino market
is unique, responsible for supporting more direct and indirect
jobs and generating significantly more tax revenue per head of
population than any city in the UK. A significant portion of this
revenue is drawn from overseas and as such operates as an export
market. The London casino market is larger than the rest of Britain
combined. London has 25% of all of Britain's casinos, accounting
for 60% of all bets placed nationally, worth some £2.8 billion,
a 22% increase since 1997 with 2.8 million people visiting London's
casinos in 2002.
It is vital that successful and growing components
of the leisure sector, such as gaming-led entertainment, be supported
and developed within London to ensure the capital retains its
position as the number one tourist destination in Europe. Not
only is gaming-led entertainment vital to the future development
of London's hospitality and leisure sector, but the proposed gaming
deregulation offers a unique opportunity to stimulate inward investment
and with it associated capital investment and job creation. It
also offers the opportunity to develop and regenerate specific
areas of the city that would benefit from entertainment-led investment,
including for example: Battersea Power Station, Greenwich Peninsula,
Earls Court & Olympia, Wembley Stadium Complex, King's Cross
Central, Canada Water, Stratford City, Croydon Gateway and the
Shell Centre redevelopment to highlight just a few.
3. THE PROVISION
OF THE
BILL
Policy Objectives
The government has clearly outlined and addressed
the social policy rationale in the draft legislation but has been
less clear in expressing its overriding economic rationale. Is
the government's objective to create economic development throughout
the UK or is its objective to use the gambling deregulation to
create targeted entertainment-led regeneration in certain specific
localities as defined on a national or regional basis. The economic
rationale behind the legislative change must be clarified to outline
the true market potential and to allow all parties involved to
identify the planning issues sooner rather than later. For the
record London First Centre's preference would be to allow for
economic development throughout the UK rather than restricted
or targeted regeneration initiatives as predetermined by government.
Tax
From the perspective of inward investment, there
are many issues that will influence the success or failure of
gaming deregulation but none more so than the setting of an appropriate
and effective tax policy. Overseas investors are already incurring
vast sums of money prior to gambling reform, proof in itself of
their intention to invest further hundreds of millions of pounds
into the UK economy once deregulation has occurred. This investment
is sure to stimulate many regional economies and create many thousands
of jobs. However, the `make or break' issue of tax policy, which
will determine the viability of any business model, still remains
a mystery. London First Centre urges the Joint Committee on the
Draft Gambling Bill to recommend that the Treasury sooner rather
than later should both outline its proposed tax policy, and set
a rate designed to stimulate investment.
Location and Size Issues
The issue of where casinos are to be developed
is of key interest to London First Centre. Together with its key
stakeholders, including the London Development Agency, regional
partners and London First member companies, we have specific locations
in mind that would be suitable for casino development within the
region. LFC is keen that these locations should be allowed to
compete for investment on their merits and on a level playing
field with other locations throughout the UK. The draft legislation
appears to be unclear as to whether it allows for a free market
system to determine location with planning authority delegated
to local authorities, or whether regional planning bodies will
have the right to determine the location of the (as yet undefined)
"casinos of regional significance". What happens when
local authority and regional planning body policies differ? Further,
will a finite number of "casinos of regional significance"
be set nationally for each region, and if so by whom? In addition,
the fact that the allocation of responsibilities for gambling
reform and planning are handled by different government departments
appears disjointed. It is our view that the planning policy with
regard to size and location of casinos needs to be clarified for
inward investors to be encouraged to take the leap into the UK.
LFC also believes it is of crucial importance
for the legislation to maintain a generous minimum gaming floor
size to avoid the proliferation of "convenience gaming"
on the high street. A smaller number of large casinos within each
region would be more desirable and prove easier to regulate and
critically lead to the creation of a wider variety of non-gaming
entertainment and facilities, which would be highly desirable
from an economic development perspective.
The role of Regional Planning Bodies
There is some confusion at the moment as to
what is meant by regional planning bodies and what role they are
to be given in planning. The Draft Gambling Bill—supplement
to regulatory impact assessment published in February 2004 outlines
that: "In England, Regional Planning Bodies, once they are
established, will play a part in deciding the locations of the
largest casino developments which may also include hotels, restaurants
and entertainment. The procedures that will be adopted by Regional
Planning Bodies for this purpose are not yet clear. Nevertheless,
it is believed that very few leisure developments will be of sufficient
regional or sub-regional importance to require specific mention
in regional planning guidance... In Scotland and Wales, the planning
of casinos will be a matter for the Scottish Parliament and the
Welsh Assembly."
London, unlike any other English region, already
has an elected regional planning body in the form of the Mayor
of London and the Greater London Authority (GLA). Therefore, does
this mean that the Mayor and the GLA will be given authority to
decide on the location of regionally-significant casino planning
as the Scottish and Welsh Assemblies have? And is the creation
of regional planning authorities in other UK regions dependent
on `yes' votes being achieved in referenda planned for regional
assemblies? And if so how would the inevitable delay in this process
impact London?
Summary
In summary London First Centre would like to
see early clarification of the economic rationale for deregulation
with specific clarity as to possible restrictions and proposed
decision making process as to where new casinos (particularly
those of "regional significance") might be allowed to
locate. London First Centre also urges for the setting of a sensible
tax policy with a rate attractive to inward investors.
February 2004
| 
