IEA - New rules risk pushing gamblers to unregulated websites

27 Apr 2023 12:05 PM

Christopher Snowdon, Head of Lifestyle Economics at the Institute of Economic Affairs, commented on the Government’s gambling white paper

“The government’s gambling reforms are a mixture of the good, the bad and the indifferent. 

“Allowing more machines in casinos addresses a genuine problem with the existing law and is long overdue. A direct levy on the industry to fund NHS treatment can be justified but it is essential that the money goes towards treatment and does not become a slush fund for anti-gambling activists and academics. 

“Affordability checks and online stake limits risk pushing gamblers from reputable UK websites to unregulated parts of the internet. Although affordability checks are sometimes necessary, routine checks could become arbitrary and set a worrying precedent for personal privacy. Lower limits for adults under 25 are patronising and could create a two-tier society.”

Notes to Editors

• In March 2021, the Institute of Economic Affairs published A safer bet: Gambling and the risks of over-regulation.

Affordability checks

• Online gambling companies already use sophisticated technology to intervene when they see problematic play patterns. It would be better to make those safeguards mandatory than introduce affordability checks when players exceed arbitrary spending thresholds.
• The proposed spending thresholds are too low for many players and there are concerns about how ‘affordability’ will be defined and verified. Plenty of gamblers can afford to spend £2,000 in 90 days and people who place relatively large bets should not be treated as if they are taking out a mortgage.

Stake limits

• There is no objection in principle to a limit on stakes (and therefore on prizes), but these must be internationally competitive not to drive gamblers to unregulated websites. Under existing laws, British gamblers have little reason to use unregulated websites. Still, Institute of Economic Affairs research previously highlighted that five per cent of UK online gamblers have used an unlicensed operator in the past twelve months, and nearly half of them are aware of at least one unlicensed gambling website.

Mandatory levy

• The gambling industry used to give millions of pounds to the NHS for problem gambling services. This ended last year when NHS mandarins decided to place the burden on taxpayers instead. Treatment is highly effective. A one per cent levy on industry profits would provide world-class services, but it is essential that the money goes to therapy and does not become a slush fund for anti-gambling activists and academics.

Casinos

• There was never a good reason to limit the number of gambling machines in casinos. The arbitrary limits mandated in the 2005 Gambling Act are clearly too low. The government is right to raise the limit, but it should also amend the law to make it easier for new casinos to open as Christopher Snowdon wrote in a 2012 paper published by the Institute of Economic Affairs.

CONTACT: media@iea.org.uk / 07763 365520

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.

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