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Gambling: Casino Advisory Panel Report

Volume 689: debated on Tuesday 30 January 2007

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Culture, Media and Sport. The Statement is as follows:

“With permission, Mr Speaker, I would like to make a Statement on the recommendations of the independent Casino Advisory Panel. The panel has today published its report, and I should like to thank Professor Crow and his colleagues for their work.

“Before I turn to the recommendations, I should like to remind the House of the context in which we are allowing new types of casino. Gambling is on the increase. People want to gamble, and technology allows many new forms of gambling. Existing regulation is inadequate and leaves people exposed. So, through the Gambling Act 2005, we have placed the protection of children and other vulnerable people at the heart of gambling regulation for the first time.

“Yet if I believed everything I read in the papers about the Gambling Act, I would never have introduced it. So let me make it very clear: Las Vegas is not coming to Great Britain. British casinos will be subject to new controls, the strictest in the world.

“For example, Las Vegas-style tricks of the trade will not be allowed. There will be no free alcohol to induce more gambling, and there will be no pumped oxygen to keep players awake. It will be a criminal offence to permit a child to enter the casino or the gambling area of the regional casino. All casinos will require staff trained to spot the signs of problem gambling and intervene where necessary. If they do not, they risk losing their licence.

“It was safe in the knowledge of these protections that we took the decision, in response to demand from local authorities, to allow a limited number of new casinos. Sixty-eight local authorities, representing all the main political parties, subsequently made applications to the panel. The Act allows 17 in total: one regional, eight large and eight small. Because the new casinos will be different from those we have seen before, and because we have listened carefully to the concerns of Members and their constituents, we thought it was right to be cautious.

“Now I can say this in 50 different languages, but the message would be the same: we cannot allow and will not even consider allowing any further casinos until a proper evaluation over time has been made of the effect of these 17 casinos on problem gambling, and such a decision would require a debate and vote in both Houses of Parliament in any case.

“We have commissioned a group of academics led by Lancaster University to advise on the methodology for that assessment. The baseline study will be undertaken later this year, once Parliament has approved the new areas. The assessment process will be in place in good time for the opening of the first new casino. The assessment will not be completed until at least three years after the award of the first licence. The work is in addition to the prevalence studies of patterns of gambling, which we are undertaking every three years from 2007. The benchmark prevalence study is currently under way, and the findings will be published this autumn, when the Gambling Act takes effect. The findings of the next prevalence study will not be published until autumn 2010. I therefore wish to make it crystal clear to the House that these safeguards preclude any consideration of further casinos for the lifetime of this Parliament.

“I am required by the Act to make an order identifying the local authorities where the 17 new casinos should go. So, in October 2005, I established the Casino Advisory Panel, under Professor Stephen Crow. The primary consideration for the panel throughout has been to ensure that the areas facilitate the best possible test of social impact. Subject to that consideration, I also asked the panel to include areas in need of regeneration that would benefit in employment terms from a new casino and to ensure that those areas selected are willing to license a new casino. The panel has been operating entirely independently of the Government, and I should like to place on record my appreciation for the rigour and professionalism that Professor Crow and his colleagues have brought to the process.

“This has been an open and transparent process throughout, and the views of local people have been taken into account at every stage. The panel asked local authorities to include evidence of local consultation. Local people were invited to participate in the examinations in public that were held in the seven short listed areas. A number of areas, including Brent, Canterbury, Dartford, Thurrock and Woking, withdrew their applications to the panel in response to local opinion. A number of local authorities, such as Hackney, St Albans and Slough, have also taken advantage of new powers in the Gambling Act to resolve not to license any casinos in their area.

“After 16 months’ consultation, and having considered all the evidence available, the panel has today recommended that the following authorities should be entitled to issue a small casino premises licence: Bath and North East Somerset, Dumfries and Galloway, East Lindsey, Luton, Scarborough, Swansea, Torbay, and Wolverhampton.

“The following local authorities should be entitled to issue a large casino premises licence: Great Yarmouth, Kingston-upon-Hull, Leeds, Middlesbrough, Milton Keynes, Newham, Solihull and Southampton. And that Manchester should be entitled to issue the one regional casino premises licence permitted by the Act.

“I congratulate Manchester and the other recommended towns and cities on their success and I acknowledge the disappointment of those towns and cities that have not been recommended.

“I received a copy of the panel’s report just this morning. Because I am also conscious of the need to maintain the integrity of the independent process that we have established, it is only fair to all the applicants that I should take the time to consider its contents carefully. I am also required by the Gambling Act to consult Scottish and Welsh Ministers.

“I am therefore announcing today that, following this consultation with the devolved Administrations, I am minded to return to this House at the earliest opportunity with an order which will enable Parliament to consider the panel’s recommendations and vote on the order. The order will be subject to the affirmative resolution procedure and the debate will be held on the Floor of the House. This means that Parliament will rightly determine the outcome of this process.

“Gambling will always be a sensitive issue, and I understand the reservations that some Members and others have about casinos. However, I have always sought to ensure that the Government proceed cautiously, with the strongest possible safeguards and on the basis of the best evidence of public protection in the face of rising public demand. That is what we have done.

“Once again, I thank Professor Crow and his panel for the thoroughness of their work and I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the Minister for repeating the Statement made earlier today in another place. I am sure that the choice of Manchester is a good one, but I find it difficult to join in the general congratulations when the whole concept of dramatically expanding the gambling industry in this country is so flawed. I find it even more difficult to understand why Her Majesty's Government should be so keen on this course of action when organisations such as the police and the British Medical Association have come out so strongly against the expansion of gambling because of the problems associated with it

For those who wish to gamble there already exists a plethora of ways of so doing, from the internet to the racecourse and plenty of stops in between. Casinos such as are proposed will only introduce new punters who might otherwise never have gambled. A proportion of those will become addicts, resulting most probably in the destruction of their and their families’ lives.

I very much hope that Her Majesty's Government will treat this properly as a pilot scheme to thoroughly assess the impact of these casinos, rather than just looking on the pilots as a method of introducing massive expansion of gambling through the back door, in the way that the 1968 Act has been used to give initial approval to 90 casinos.

Her Majesty’s Government’s commitment to a proper evaluation of the effect of the 17 casinos on problem gambling is welcomed. A rigorous set of criteria for evaluating the success or failure of the pilot scheme will do much to restore faith that Her Majesty’s Government have a desire to learn from what happens and to act accordingly.

It would be interesting to hear from the Minister how Manchester came to be chosen when it was ranked only sixth in the original shortlist and whether the preferred bidder will be Kerzner International.

My Lords, I thank the Minister for repeating the Statement made in another place and join in thanking Professor Crow and his team for their work. We welcome the fact that there will be the opportunity to debate the affirmative order. There is clearly some surprise—indeed, shock—in Blackpool and Greenwich at the outcome—

And in Manchester, my Lords, as my noble friends point out.

No doubt the report will repay further reading in the run-up to that debate. I hope that the Minister will be able to tell us a little more about the timing of the debate, so that we will really have the opportunity to examine the grounds on which the decision was made, which has obviously been such a disappointment to many in those two areas.

This House, like the other place, will be surprised by the Secretary of State's statement:

“We thought it was right to be cautious”.

Just before the general election, it was the opposition parties who were urging caution on the Government about the spread of casinos, especially the regional casino concept, not the Government. The Government were very gung-ho for the concept of eight super-casinos.

I very much welcome what the Secretary of State said today about not expanding the number of casinos beyond 17 until their ability to aid regeneration while not increasing problem gambling has been thoroughly tested. I hope that the Minister can confirm that we will be able to debate the methodology to be suggested by the University of Lancaster: how it is judged whether regeneration can take place without increasing problem gambling.

Today's announcement of 17 new casinos has hit the headlines, but the Minister may cast his mind back to a programme just this weekend that revealed that 68 new licences have been approved by the Gambling Commission in the past two years. Although some have had premises licences refused, that could lead to another 40 or 50 casinos on top of today's 17. There are even more applications in the offing. How does that square with the statement by the Secretary of State that the Government will not even consider allowing any further casinos until proper evaluation has been made of the 17 announced today?

Why did Mr Richard Caborn say two years ago that,

“we can say with certainty that there will be no more than 150 casinos. There could be fewer”?—[Official Report, Commons Standing Committee B, 11/1/05; col. 718.]

Was that not a complete misstatement? Doesn’t it look as though there will be more than that? What will be the final total of new casinos? I also wonder whether the Secretary of State regrets saying about three years ago:

“If this legislation”—

the Gambling Bill—

“gave rise to an increase in problem gambling then it would have failed and it would be bad legislation”.

She said in a recent “Any Questions” broadcast that,

“every single bit of change in legislation, if it proves to give a rise to harm, will be rescinded”.

Can the Minister confirm that that is indeed government policy?

Then we have the issue of expenditure on problem gambling. Given that we spend £270 million on treating alcohol addiction, should not the gambling industry be paying much more than the current £2.5 million to the main body that helps deal with gambling addiction? Will the Government ensure that the new casinos make a proper contribution to help fund solutions to gambling addiction?

At least in the Statement, the Minister committed to no further growth in gambling opportunities until we test out what we already have and are likely to have following today's announcement. I very much hope that he will confirm that that is rock-solid government policy. We look forward to the debate on the affirmative resolution.

My Lords, I am grateful to the two noble Lords for their comments on the Statement. I must emphasise again in response to the noble Lord, Lord Howard, that this is to be a pilot scheme. He expressed anxiety on that score. We have made it absolutely clear that we have no intention of introducing further legislation that might increase the number of casinos—if it is ever mooted—in this Parliament because we will take time to evaluate the impact of the casinos on their localities. I emphasise that one key feature that came through from Professor Crow's report, which the House will have the opportunity to deliberate more intensively as time goes on, is that he is concerned about the areas in which casinos are located. The impact of the regional casino should be measurable.

I do not want to go into the relative merits of the claims in great detail at this stage, but one relevant factor that Professor Crow considered with regard to Blackpool—I can see one or two noble Lords itching to rise to advance the cause of Blackpool, which we all recognised had some strength—was that quite a large transient population would be participating in casino activities, whereas with the city of Manchester the advantage is that it will be much more locally oriented and therefore give us a chance to examine fully in the pilot scheme the impact of the casino on the locality.

The noble Lord, Lord Howard, was somewhat unfair in his reference to Kerzner and its association with the Manchester bid. Associated with a number of the major bids were some big gaming interests and organisations. That is how those bids could be rendered credible. But that was about constructing the nature of the bid. Manchester and the other authorities now have to engage in a full competitive process and the large companies that have been associated with particular bids have neither an advantage nor a disadvantage. They start in a fully competitive position as far as the local authority is concerned. I understand the anxieties expressed, but decisions on applications are made by the local authority. The panel made absolutely clear that they needed local backing, and the strength of local consultation was that it helped to establish that fact.

The noble Lord, Lord Clement-Jones, says that the announcement has shocked. I am sorry if he is shocked by the outcome. If by that he means that he had already made up his mind where the casino was going, that merely reflects a prejudgment—dare I say, even an element of prejudice—when the panel was going about its job in a dispassionate, evaluative way. It reached its conclusions, which the Secretary of State will put before Parliament in due course after having consulted the Welsh and Scottish devolved authorities. She will put before both Houses the recommendations of the panel, which will be subject to an affirmative resolution and debated.

The noble Lord, Lord Clement-Jones, also said that we did not know the final number of casinos. Of course we do not because, believe it or not, the Government do not dictate the final number. We provided in legislation for the “one plus eight plus eight” formula for this group of casinos, but there are local decisions under the 1968 Gaming Act on which local authorities are deliberating. That is the right of local authorities. Several of them have given permission for casinos to be developed in a much more limited way than the ones described in the Act, which is the issue that we are considering today. Of course we cannot say how many local authorities will agree that a casino is of value to their neighbourhood. That is for them to judge, and it is not fair to criticise the Secretary of State.

I hear what the noble Lord says about the gambling industry making its proper contribution to GamCare and to tackling problem gambling. We will scrutinise that most closely. Sufficient resources are being devoted to GamCare and to other bodies that tackle problem gambling. We have reserve powers to insist that a contribution is made, but we expect the gambling industry to show the right level of responsibility.

My Lords, what possible justification can there be for the Government to produce legislation to increase opportunities for gambling at a time when individuals throughout society are plunged into record levels of debt? What moral or social justification is there for that? Can we at least draw some comfort from being spared the ultimate degradation of a casino at the unfortunate, disastrous Dome?

My Lords, I hear what the noble Lord says, but he has probably not cast his mind back to one significant increase in debt in this country, when the Conservative Government decided that they would turn regular weekly rent payers into mortgage holders with accumulated debt. That was a decision of the Conservative Government at that time. Mortgages are a significant part of household debt, but we also recognise that the British people can manage their debt effectively because they understand the true costs of that debt and the fact that we can sustain low interest rates and low inflation. Consequently, the debt is manageable.

I did not mention the Dome. I am sorry if the noble Lord is disappointed that the Dome does not feature significantly in this Statement, but it does not.

My Lords, the Millennium Dome is in my diocese, and I am anxious that a good long-term use be found for that remarkable building. Nevertheless, I am relieved to hear that the first super-casino in Britain is to be in Manchester, as such a casino will inevitably bring new problems of gambling and I am pleased that those problems will be tackled in Manchester rather than in south London. However, the people of Manchester have my sympathy. I hesitate to say that these problems will be faced first in Manchester, as media reports suggest that the Government are planning to accelerate the number of super-casinos to be authorised.

I thank the Minister for repeating the Statement. I was relieved to hear him give such a clear assurance that the rumour has no foundation and that the lessons to be learnt from the pilot super-casino will be carefully pondered and examined before future super-casinos are planned. We on these Benches will certainly be looking to see that promise fulfilled.

My Lords, I am grateful to the right reverend Prelate, although he re-introduces the issue of the Dome, on which I was slightly dismissive in my response to the noble Lord, Lord St John of Fawsley, for which I apologise. The right reverend Prelate will take some joy from the fact that one of the features of the Greenwich application, on which the panel commented, is that there is a great deal of redevelopment in the Greenwich area at the moment, to the great benefit of the locality. The panel sees that position being enhanced. The casino would not have added sufficient value to that development. As he will know, there are several proposals for the development of the Dome within that framework, many of which have exciting aspects. A great many of London’s facilities will be enhanced in preparation for the Olympic Games in 2012, and we anticipate that the Dome will be utilised then.

The right reverend Prelate says that he feels slightly sorry for the city of Manchester, which will be subject to the pilot study. That is not the view of Manchester or its people, who are delighted with the outcome of today’s deliberations.

My Lords, there will clearly be some enthusiasm for this announcement, no doubt not least from the Chancellor of the Exchequer—quite apart from Manchester and the other local authorities, as we have heard from the Minister. No doubt they will have negotiated other benefits for their area in addition to extra jobs. However, as noble Lords have already heard, there is considerable concern among Members on these Benches and people throughout the country. In a YouGov poll, 56 per cent of citizens were worried that this would lead to more addiction and more social problems. Of course we are glad to hear that the Government are committed to monitoring seriously the likely effect of these casinos. With that in mind, however, can the Minister tell us what assessment the Government made, before embarking on this rash of casinos, of the cost of supporting—and, one hopes, reforming—each additional addict and their family, including the vulnerable children who will be affected, and the local community, which, as we have heard, is likely to be subjected to extra crime? Will the Minister also assure this House that at least this cost will be the first charge on the profits of every casino company involved?

My Lords, I am grateful to the noble Baroness for raising this issue. This gives me the opportunity to correct a slight slip that I made a moment ago. Local authorities organise the bids for super-casinos in their areas, but the decisions to create casinos under the 1968 Act are taken by local licensing magistrates, not by local authorities, and I apologise for that slip.

The noble Baroness mentioned the Gambling Act 2005. The motivation behind that Act was not to create casinos—the casinos are a by-product of that Act—but the fact that our gambling laws dated from 1968 and were woefully misplaced to deal with modern gambling, not least the development of online gambling, which presents a real challenge for regulating authorities. The development of new forms of gambling meant that we had to address the fact that the 1968 Act was out of date. That was the principle behind the Gambling Act, which was also the background to decisions about the casinos, as the noble Baroness rightly recognised. Concern was expressed throughout our consideration of that Act that the nation should balance the obvious increase in the participation in gambling of our fellow citizens who, with increased disposable income, are both entitled and in many cases expected to use that income for gambling, from which they derive a great deal of innocent and proper pleasure, against the necessity of dealing with problem gambling and addiction, in particular the impact on children. The Gambling Act sets out to reach that balance. It was the result of very considerable deliberations in the other place and this House. We think that we have reached the right balance.

My Lords, it is very nice to hear people congratulating Professor Crow and his committee. However, I do not congratulate him on the regional casino: it should not be in Manchester. I spent a very long time on the pre-legislative Select Committee looking at different areas and all the things that I assumed Professor Crow was looking at. Blackpool would be a resort casino; the Dome would be a destination casino; and Manchester would be a city casino. The Select Committee said that the casino should not be in a city. I went to Australia and saw the damage caused by having a casino in a city.

The Minister mentioned regeneration around the Dome. What regeneration has there been in Blackpool? The answer is none. What has there been in Manchester? There has been a lot. Blackpool needed this: it was waiting for it and will need it still. Why do we hand over to an academic committee something that should be decided by this House and the elected Members in another place? Can the Minister answer that?

My Lords, as I have indicated, the final decision will rest with the other place and this House. When the order is considered, I have no doubt that very similar speeches to that which my noble friend has hinted at today will be made here and in the other place. Indeed, she may be a participant in that debate. Therefore, all these issues will be aired. The House will have the opportunity to look carefully at Professor Crow’s report. I can merely report that the judgment that my noble friend reached is different from that reached by the professor and his panel.

My Lords, I assure the Minister that I have never been prouder that I took the title Lord McNally of Blackpool, especially with the town’s dignified and resilient response to today’s news. The Minister mentioned Professor Crow’s report. As the noble Baroness, Lady Golding, has just indicated, the report dismisses with almost cavalier economic illiteracy the Blackpool economic case. I sometimes think that if Blackpool was a steel, coal or cotton town, the impact of declining tourism would be greater appreciated.

As the noble Baroness, Lady Golding, also pointed out, the Minister gives a smooth government decision-making process. I wonder what the royal commission set up to look into this matter thinks about this or what the Joint Committee thinks. The wheel has turned many times and it is unfortunate that this one has turned against Blackpool when the strongest arguments were in Blackpool’s favour.

Two points really worry me. We have suddenly found that this inner-city casino has the merit of being able to test social gambling—quite so. Every study at home and abroad has warned against “door-step gambling”—gambling on the door step. Professor Crow says that,

“most of the social effects”,

as would affect Blackpool,

“would be exported”.

He means that people would go to places like Blackpool for two weeks for holiday enjoyment of gambling. At a door-step casino like Manchester, they will stay with the problem and will create the problem. In many ways, it is the most perverse decision that could be made and is against all the warnings of research.

There is another extraordinary thing in the report. It states that,

“Manchester … is one of England’s eight ‘Core Cities’”,

which drives,

“national and regional economic growth”.

When and where from did the committee get this information and why were the other applicants not told that this special privilege would be given to core cities as against places like Blackpool?

I should like to make one further comment to opponents of casinos. We have all watched James Bond and George Raft films and the problem with casinos is that they are a nice, emotive issue. In fact, while opponents are obsessing about casinos, the real problem gambling will go on tonight on ITV when people can spend 75p a minute on television quizzes from their beds or make bets from their telephones. The most regulated and most easily controlled problem gambling is at a destination casino. The worst kind of casino is in an inner city where problems are waiting for it and where those problems will fester.

My Lords, perhaps I may reply to the noble Lord, Lord McNally, who deserves a response to his powerful contribution. He has been unwavering in his advocacy of Blackpool as the location and will get the opportunity for further debate on whether this recommendation should come into effect across the country. He will have the chance to make that advocacy. The noble Lord has presented the great strengths of the Blackpool case. There were great strengths among all bidders in the final group which were considered for the super-casino. Earlier, I reflected in the briefest way possible with regard to the report some factors which were considered by the casino panel.

Of course, there will be disagreement with its conclusions. By definition, there would always be more disappointed towns and bidders than successful ones, which is in the nature of this kind of exercise. However, in one respect, the panel was absolutely clear: a crucial aspect of the Manchester bid was that it gave the best possible circumstances for considering problem gambling in the pilot location. That is the basis of its recommendation. We will in the future have the chance to deliberate on those points.

My Lords, I declare an interest. When the Gambling Bill last came before the House, I was the non-executive chairman of Stanley Leisure. Since then, it has been sold as the result of a takeover and I am now life president. Stanley Leisure had 45 casinos, including three in Manchester, so I, living in Manchester, welcome the casino being situated there.

The decision was difficult and, as a result, I hope that there will not be a series of judicial reviews which will halt the process even further. Some of the more hysterical newspaper reports say that the whole thing is a disaster. I put it to the Minister that Great Britain has the lowest rate of problem gambling in the world. I am proud to be a founder member of GamCare, an organisation that helps to look after problem gamblers. To my knowledge, casinos here keep a tighter control on problem gambling than those in other countries. I commend that and long may it continue. I hope that the comments about crime, prostitution and money laundering are all basically figments of journalistic licence. We have never had a case of problem gambling. We have never had a case involving crime or prostitution. I hope that the Minister will continue that record.

However, I have a few questions—

My Lords, I hope the noble Lord will forgive me for intervening. This is a Statement and it is not intended that speeches should be made.

My Lords, I understand what the noble Lord is saying. I have the following questions for the Minister. Will he give an undertaking that the current opening hours for casinos will remain the same? Will he give an undertaking that advertising will not be broadcast on television or radio before 9 pm? Will the Minister also try to deal with online gambling, which is becoming an extremely difficult problem? I hope, with my years of experience, that I have been of some help to the Minister.

My Lords, the one point on which the noble Lord and I agree strongly is that this was a very difficult decision. Everyone recognises that the bids put in had enormous strengths, and of course several noble Lords have sought to identify the strength of certain cases.

We have the best regulated gambling industry in the world. We have the lowest rate of problem gambling, as the noble Lord indicated, and we intend to keep it that way. However, we cannot avoid the fact that there are now many new activities which involve gambling or something very close to it. Even the noble Lord, Lord McNally, referred to that when he commented on the development of quiz games on television, which are now causing concern in terms of the nature of gambling. It is because of that that we needed the Gambling Act 2005. It will stand us in good stead to guarantee that we keep a high level of regulation. I want merely to emphasise that within that level of regulation, the issues raised by the noble Lord, Lord Steinberg—there are far too many for me to respond to at the end of our debate on a Statement—are covered.