Further memorandum from Professor Neville
Topham (DGB 129)
1. THE AIM
OF THE
BILL
The Bill provides no clear assertion of its
aims. Clause 15 requires the Gambling Commission to promote the
licensing objectives before granting it permission to allow gambling
that "is consistent with the pursuit of the licensing objectives"[13].
Other than problem gamblers, consumers are never mentioned. However,
DCMS have stated that—
The broad policy objective is to replace the
piecemeal provisions in current gambling legislation with new
provisions which reflect the changed status of gambling as an
acceptable leisure activity albeit one giving rise to specific
risks of harm [Advertising and gambling, Policy Note 6,
February 2004, para 6].
In other words, the policy aims to achieve a
market optimum, subject to the licensing objectives[14]
at clause 1 of the Bill not being compromised.
2. INFANT-INDUSTRY
ARGUMENT
The infant-industry argument is normally used
to support the maintenance of protective measures to promote the
creation of a local industry. A new industry in say a developing
country will always be in vulnerable position compared with an
established industry in an advanced country.
The application in this case is that the normal
growth of British firms in the highly regulated and restrictive—eg,
no advertising, unstimulated demand, the 48- and then 24-hour
rules—casino sector has been stunted in the past, leaving
them at a disadvantage with for example those US firms preparing
to enter the market that have been able to flourish in less constrained
markets.
3. EXISTING MINI
CASINOS
Partly as a consequence, three quarters of British
casinos are below the minimum size for a new-entrant Small casino.
They are to be grandfathered. Although the clauses of the Bill
dealing with these casinos are yet to be published, the DCMS competition
assessment for casinos, issued in February 2004, indicates (see
para 12) that their licences will be renewable and transferable.
The industry understands that this refers to transfers within
a local jurisdictional area.
It is difficult to understand why this local
restriction is to be imposed. The concerns of the government associated
with proliferation are understood and accepted. But in this case
they are not relevant. There will only be about 95 mini casinos
in existence when the Bill comes into force, and under the provisions
of the Bill that number will never be increased. And since—
permitted areas are to be abolished,
the overriding aim of the Bill (see 1 above)
accepts gambling as a normal leisure activity, subject where possible
to market forces, and since
the licensing objectives cannot be compromised
by a proliferation of mini casinos,
it is far from clear why grandfathered mini licences
cannot be freely transferable nationally, subject to normal local
planning requirements.
4. SMALL CASINOS
Some situations may justify a Large casino for
parts but not all of the year. At other times of the year a Small
casino might be viable. Examples include the season in seaside
towns, and say a casino at a racecourse that would want to be
Large at a festival such as Cheltenham, but Small for the rest
of the year, with appropriate adjustments for machine numbers.
The additional facilities on race days could readily be shipped
in using pantechnicon-vans. Such responses to market forces that
would not compromise the licensing objectives should be permitted.
5. LARGE CASINOS
A casino with a 10,000 square feet table-gaming
floor is not large to the man in the street. Such a facility might
be about 50,000 square feet overall; it might have 41 tables,
500 slots, restaurants and some entertainment; and would expect
to attract 2,000 to 3,000 visitors per day for which about 500
car-parking spaces would be made available. It would have the
footprint only of a normal out-of-town store such as PC-World
or Comet.
Large casinos of this kind are certainly not
regional facilities, and therefore issues of regeneration and
RDA approval should be waived. However, nor is there any justification
for permitting unlimited slots for such normal-sized facilities,
which could readily be established and in aggregate could endanger
the licensing objectives. Before long, the Commission could find
itself faced with massive slot halls on the ground floors, with
casinos, restaurants, and changed dress codes above. This is not
the kind of development envisaged.
6. REGENERATION
AND RESORT
CASINOS
It is not clear why gambling, with its new status
as a normal part of the leisure industry, should be asked to contribute
inordinately to regeneration. Regeneration is not an aim of the
Bill, and reinvigorating local economies is not justified as a
reinforcing measure of the licensing objectives. Large casinos
bringing prosperity back to a town would be an indirect effect
of the Bill rather than its raison d'être, which
is to modernise gambling laws.
Attracting 12,000 to 15,000 visitors per day,
resort casinos are a different proposition. What are envisaged
at Blackpool and elsewhere are indeed major developments. They
are of a size that could alter the character of a town, and therefore
should be subject to strict local protocols and regional planning
guidance.
Paragraph 5.17 of the DCMS document Draft
gambling bill: the policy (November 2003) points out that
existing planning arrangement "enable local authorities to
ask for contribution towards any area that has more than a trivial
connection to the proposed development". However, regional
authorities should operate with a light touch. The aim of the
Bill is to provide, where they want them and so far as the licensing
objectives permit, modern leisure facilities for overseas and
domestic consumers. And the optimum locations of resort casinos
so far as their potential customers are concerned are not necessarily
congruent with regional regenerational and spatial objectives[15].
If resort casinos alone are to be subject to
regional-planning guidance, there is a case for a quid pro
quo is appropriate. And provision of slots should be permitted
only for resort casinos.
But on the basis of (2) and (3) above, the argument
for affording a degree of protectionism to resort casinos is uneasy.
Protectionism does not satisfy the aim of the Bill, and more importantly
given EU law is anti-competitive. The competitive and exclusive
advantage of unlimited slots for resort casinos, and with the
concomitant and attractive benefit of large progressive jackpots,
makes such additional assistance superfluous.
February 2004
13 Contrast clause 9 of the Horserace Betting &
Olympic Lottery Bill, where in considering whether or not to issue
a pool-betting licence the Secretary of State has to consider
the best interests of punters as well as the Bill's licensing
objectives. Back
14
Aimed to ensure the industry remains free of crime, trading is
fair, and the vulnerable are protected. Back
15
I believe Manchester's bid for the Olympic Games failed in part
because economic regeneration objectives took precedence over
creating a world-class sporting attraction. Such lessons should
be learned. Back
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