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Lord Clement-Jones: My Lords, I thank the Minister for introducing the Bill with his customary forcefulness and clarity. Getting to this point has been a long and tortuous process. As a newcomer on these issues in the House, I pay tribute to the quality of the debate and express my respect for the expertise which has been displayed by, in particular, those who have been involved in the scrutiny process, with the Joint Select Committee and the inquiry into the effects of betting on sport carried out by the All-Party Group on Betting and Gaming under the chairmanship of the noble Lord, Lord Faulkner of Worcester. Noble Lords have today revealed much racier pasts, certainly in the case of my noble friend Lord Greaves, than I ever anticipated hearing.
Although over the years I have been involved with some 20 or so Bills in this House to date, I confess that I have never seen a briefing and lobbying process in which the regulatory and commercial realities were more difficult to discern. Even the Budd report at the time confessed the difficulty of deciding on certain issues. It said:
For every point of view on aspects of the Bill, there is an equal and opposite view from all Benches, often based on commercial self-interest—I absolve noble
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Lords from that—from outside lobbyists, with anti-competitive motives occasionally dressed up as moral imperatives. It is very important to distinguish the genuine issues from the special pleading that we have heard.
I believe that the Government have tried to negotiate between the reefs and shoals—notwithstanding the Daily Mail—and it would be easy to criticise them for some initial naivety and—dare I say it?—over-enthusiasm. But they have listened to date, and I hope that they will continue to listen, not least to today's debate. Several issues, however, still need exploring.
One of the most memorable phrases used by the Joint Select Committee was "cliff edge", referring to the sharp differences between the different types of casino and other establishment which it thought existed. There is no doubt that there is still a need to discuss many of those differences, which are enshrined in the Bill, and the reasons for them.
Looking back to the Budd report, I believe that its general approach to regulation was correct. It was, by and large, an enlightened report in terms of its regulatory philosophy, which I share; namely, that the issue of regulation is essentially one of the need to deal with risk, not one of morality. The main aim should be to keep gambling crime-free, be fair to players and ensure protection for children and the vulnerable so that we do not increase problem gambling.
The extension of choice envisaged under the Bill must be seen in the context, as many noble Lords have emphasised, of making sure that there is no increase of risk in these areas. We will have to test the Bill by that very general set of objectives. Seen in that way, the balance of the Bill is still not right.
There are many positive aspects of the Bill. It establishes the Gambling Commission, with wide powers to enforce gambling regulations. It modernises outdated legislation and has the flexibility to regulate new forms of gambling, as many noble Lords have mentioned, including remote gambling and possible forms in the future, such as interactive television.
The Bill provides for the removal of machines from some unlicensed premises. There are tougher laws to protect children and problem gamblers. It improves the powers available to local authorities in respect of licensing gambling premises.
There is also the potential for the regeneration of seaside towns such as Blackpool, mentioned by my noble friend Lord McNally, by not only casinos but additional services such as entertainment, referred to by my noble friend Lord Falkland, and the hotels, shops and cinemas associated with those casinos. Supporters say that this will attract tourists to casino locations, increase land values in and around casino areas and encourage other leisure developments. If there is a demand for such facilities, they will be built. If there is no demand, I am sure that they will not be.
Having said that, I wish to underline, above all, that we need to ensure that the Bill does not increase the risk of problem gambling. I have listened today with great care to my noble friends on these Benches and to other noble Lords. For compulsive gamblers, the
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increased opportunity may impose moral, ethical and social costs on the community and great personal costs on some families. But it is important to remember, as a number of noble Lords stressed, that our problem gambling rates are among the lowest in the world. I do not accept the doomsday scenario put forward by some noble Lords about the outcome of the Bill.
I appreciated the new Labour term coined by the noble Lord, Lord Lipsey, in the context of discussing his gambling experience. The word "investment" was used. I know that it is a much favoured Treasury word. The noble Lord seems to be bringing it into a new context.
Despite extensive discussion of the draft Bill by the Joint Select Committee and in the Commons, there are still aspects which we on these Benches believe must be changed before it leaves this House. There are a number of areas where, quite simply, the Bill gets the emphasis wrong.
First, we have a straightforward issue of definitions in Clause 14. The time to debate the matter in full will be in Committee. Because of the time available I shall not spell out the precise reasons why the definitions are unworkable. But Clause 14(5)(a) aims to define a prize competition. The test set out is aimed at requiring a skill, judgment or knowledge element of a competition to be set at such a level that a significant proportion of active participants gets the answer wrong. The problem is that entrants to a competition are, to a great extent, self selecting. In other words, people bother to enter a competition only if they are pretty confident that they have the correct answer—irrespective of the apparent relative difficulty of the competition.
There are similar objections to Clause 14(5)(b). If those definitions which are now statutory under the Bill, as opposed to being developed under common law, come into effect it could well affect the value of the prize competition market which the Government have acknowledged is an essential part and generator of revenue for media of all kinds, including television and mobile phone operators. I ask the Minister about his approach now in the face of the many objections which have been put forward.
A number of noble Lords have put forward points about the production of identity and membership of casinos which will no longer be required after the passing of the Bill. The Budd report recommended retaining the need for ID cards for casino entry. It appears, however, that when the Government introduce regulations to implement the Draft Third EU Money Laundering Directive these will not follow previous regulations and require ID on entry but will require ID only on purchases of a certain denomination of chip.
Currently, every customer entering a casino must either be a registered member, having registered at least 24 hours earlier, or the guest of a member who can provide satisfactory evidence of identity. Such ID checks have enabled the casino industry to remain relatively crime free since 1968 and have ensured that children and young people cannot gamble in a casino and have allowed for the effective operation of self-barring schemes for problem gamblers.
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Under the new regime, there is no proposal for identity checks for customers entering casinos. I believe that on social grounds it is important for all casinos to retain ID requirements. It would ensure that age of entry is controlled to protect children and under-age young people and that problem gamblers can be excluded.
Although some aspects of the Bill on planning and licensing are welcome, we need further clarification. The nature of the commitment given by the Government on the question of a separate use class for casinos is not clear. Will casinos be sui generis with their own use class, as promised by the Secretary of State at Second Reading in the other place?
Correspondence between Keith Hill of the Office of the Deputy Prime Minister with the Evangelical Alliance has been far more equivocal. I very much hope that the Minister can give greater clarity in that respect. There seems to be much vagueness around the edges of the original undertaking by the Secretary of State.
Even then it may be that local authorities have power either to allow casinos or refuse them all. Local authorities should have the power to decide whether or not to allow particular types of casinos. They should also be allowed to take social factors into account when granting planning consent, otherwise an artificial situation will be set up where licensing authorities assume that as planning consent has been granted they should give a casino licence without examining social factors.
Many noble Lords have referred to the issue of what regional casinos really are. The change of name from resort or destination to "regional" casinos was rightly questioned by the Joint Select Committee and mentioned by my noble friend Lord Falkland and the noble Lord, Lord Walpole. What does this mean? Can regional casinos be in town centres? If not, why change the name? Will there be direct competition with traditional casinos in town centres?
How exactly will the advisory committee operate? Will there be adequate consultation with the local community when the pilots are being agreed?
Turning to the thorny issue of machines, the availability of particular types of machines is at the heart of the debate about whether the Bill is operating correctly in relation to children and with fairness to all operators. My first memories—my noble friend Lord Roberts may approve of this—are of going to arcades in Rhyl and Prestatyn. But that does not alter my view, which conforms much more closely to that of the noble Lord, Lord Pendry, and the noble Baroness, Lady Golding, than it does to that of the right reverend Prelate and my noble friend Lord Roberts.
I believe that there is no evidence that it leads children on to problem gambling if they are allowed to play category D machines. Much has been made of the so-called "giant teddy bear" issue—and, of course, it is a serious problem that needs to be addressed—but I
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believe that the case has been made by the seaside resorts and I very much welcome what the Minister said in that respect.
Indeed, I believe that the Secretary of State's reserve power to ban children from using category D machines should be introduced through an affirmative resolution of both Houses; it should be debated on an evidence basis and we should look at the research at the time we do that.
The thorniest issue is the inter-relationship between category A and category B machines. Is the granting of rights to install category A unlimited prize machines for regional casinos and new large and small casinos disproportionate in that context? Is it right that regional casinos should be allowed, possibly in town centres subject to the Minister's reply, to set up in direct competition with existing casinos without any percentage cap on unlimited prize category A machines of which they will have a monopoly?
There is a strong view that this is undue discrimination against tried and tested UK operators in favour of US operators. My answer is not to give the UK operators of existing casinos the right to operate category A machines; that would lead to proliferation, which would be highly undesirable. However, it would be fair for those UK operators to have the ability to operate additional category B machines to give them something extra in the face of the competition they will face from the other casinos. At the same time we have to be mindful of the knock-on effect of any changes.
Much has been made of the 888 formula introduced by the Government in December. How the evaluation will work is absolutely crucial. How exactly will it operate? Will there be piloting for three years after the first licence has been granted? Surely that may mean that only one casino is in operation. The evaluation should operate when we have a critical mass of casinos actually up and running.
Time is running out. I am glad that the issue of greyhound racing has been addressed by the Minister in terms of the betting pool which will in future be operated by greyhound racing operators. However, it is not clear whether that is a short or long-term solution. We also believe that it would be right to have an affirmative resolution for any regulations that would change the winter opening hours for betting shops. I very much agree with those who want to see a ban on any form of betting on Christmas Day and I am very pleased with the Minister's assurance on that.
We obviously have a substantial game of poker ahead of us in Committee. I look forward to hearing the Minister's reply but I believe that we shall need to make many changes in Committee to improve the Bill.
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