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Fixed Odds Betting Terminals

Volume 648: debated on Thursday 1 November 2018

(Urgent Question): To ask the Secretary of State for Digital, Culture, Media and Sport to make a statement on the Government’s new approach to fixed odds betting terminals.

The Government do not have a new approach to fixed odds betting terminals. The reduction in stakes for fixed odds betting terminals is an important change and it is the right thing to do, but there are several factors to consider in determining the date from when it should take effect. The most important, of course, is to do this as soon as possible to prevent further harm. The Government were urged in an early-day motion in June this year and by the all-party group on fixed odds betting terminals not to wait until April 2020 to do so, and we have not done so. But it was also right to consider planning to reduce the effect of job losses for those working in betting shops on the high street and allow time for that planning to take effect.

It also has to be recognised that, right though this change is, money for public services coming from the use of FOBTs has to be replaced, or public services will have less funding. The Chancellor has decided to do that with an increase in remote gaming duty, and it is right that that increase happens at the same time as the FOBT stake change. There also needs to be a proper period of notice after the setting of that new rate before the change to remote gaming duty takes effect. The Government have therefore concluded that October 2019 is the best date to make both changes.

However, the Government have always made it clear that the issue of problem gambling is complex and cannot be addressed through these measures alone, so work has been continuing to strengthen protections around gaming machines, online gambling, gambling advertising and treatment for problem gamblers. The Gambling Commission launched a consultation on protections around online gambling last month. This examined stronger age verification rules and proposals to require operators to set limits on consumer spending until affordability checks have been conducted. There will be tough new guidance from the Committee of Advertising Practice on protecting vulnerable people, with further guidance on protecting children and young people introduced before the end of the year. Public Health England will carry out a review of the evidence on the public health impacts of gambling-related harm and, as part of the next licence competition, the age limit for playing national lottery games will be reviewed to take into account developments in the market and the risk of harm to young people.

While we want a healthy gambling industry that contributes to the economy, we also need one that does all it can to protect players. This is a significant change that will help to stop extreme losses by those who can least afford it, and we are taking decisive action to ensure that we have a responsible gambling industry that protects the most vulnerable in our society.

It was a very good day for both sides of this House back in May when the Minister for Sport and Civil Society, the hon. Member for Chatham and Aylesford (Tracey Crouch), announced this document and that the Government would reduce fixed odds betting terminal stakes. Everyone on both sides of the House was led to believe that that cut would take place in April 2019, at the start of the new tax year. Why was that? Because in answer to a written parliamentary question, the Minister herself said that the enabling statutory instrument would be taken this autumn and verbally confirmed, in a minuted meeting of the all-party group on FOBTs, that that would be the case.

On Monday this week, the Chancellor announced that the cut in stakes would be further delayed by six months. This is extremely disappointing, not least because the Secretary of State’s predecessor also implied to the hon. Member for Inverclyde (Ronnie Cowan) that April would be the date.

Research shows that half of people struggling with problem gambling have had thoughts of suicide. The bookmakers will pocket an estimated £900 million because of this delay. This amounts to a betrayal of the promise made by the Secretary of State’s two predecessors and of the Government’s own three-year review, which was meticulously conducted by the hon. Member for Chatham and Aylesford. When the Government themselves have admitted the social blight of FOBTs, it seems incomprehensible and inconceivable that they would delay a policy supported by many people on both sides of the House and in both Chambers.

Has the Minister resigned? If not, why is she not here answering this urgent question or sitting by the Secretary of State on the Front Bench? She has presumably had time to freshen up since travelling on the red eye from the US.

When did the Secretary of State read the report on gaming machines and social responsibility measures? He failed to answer the question earlier in oral questions from my hon. Friend the Member for Cardiff West (Kevin Brennan). Had he read it when he indicated to the DCMS Select Committee that the policy could be delayed? What discussions did he have with the hon. Member for Chatham and Aylesford before he decided to delay the policy? On what dates—I have informed his office of this question—did he meet the hon. Member for Shipley (Philip Davies), a well-known advocate for the industry, to discuss FOBTs?

The hon. Member for Chatham and Aylesford did the right thing in announcing this policy, and the House supported her, as did those working to eradicate gambling addiction. In capitulating to the gambling industry, the Secretary of State has not just let the victims of gambling addiction down; he has let his own team down, and ultimately he has let himself down.

My hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) is doing an outstanding job as the Sports and Civil Society Minister, and the hon. Gentleman is right that she deserves a large part of the credit for the substantive change the Government are making—a decision, by the way, that the last Labour Government did not make and which now falls to us to make. He asks why she is not answering the urgent question. The urgent question is about a change in Government policy. As I have explained to him, there is no change in Government policy, and anyway I take responsibility for policy made in this Department. The Government collectively make decisions on these matters, as in the case of the decision I have explained to the House.

The issue of the timing is important, so let me try to explain it again. The hon. Gentleman is right that the Government announced in May that their intention was to reduce FOBT stakes from £100 to £2. As I have made very clear, that was the right decision to make, but they did not set out at that time the point at which the change would be implemented. He says that everybody knew it would be in May 2019. That is his argument to the House today. I remind him of the text of early-day motion 1440, dated 20 June 2018—after the announcement in May—and which has 48 signatures on it:

“That this House…notes with equal concern that the stake is not due to be reduced until April 2020”.

In addition, we heard representations—understandably —from the all-party group saying that April 2020 would be too late. We agree, hence the decision taken is not to make this change in April 2020, but to make it earlier. I have heard language twisted to various uses in this place, but the idea that a move from April 2020 to October 2019 is a delay is going a little far. It is not a delay. [Interruption.]

Order. Today is heavily subscribed and there will be a significant number of Members who wish to take part in the final day’s debate on the Budget who will not be called simply on account of time. That is the brutal reality. This matter is important and Members must be heard—and they will be—but the Secretary of State has been called to the House to answer this question and he must be afforded the courtesy of being able to answer it without excessive noise.

The last point I was going to make was in relation to the Government’s response to the review. I reiterate that it was not solely about the reduction in fixed odds betting terminal stakes. Important though that is, the report covers several other issues. The hon. Member for West Bromwich East (Tom Watson) asked whether I had seen it. I have—it is here. It is important for the House to recognise not only the substantive decision, but that there are a number of other things that we need to do together to tackle problem gambling in this country. I have no intention of stopping here. I have no doubt that my ministerial colleagues feel the same. I would not expect any other Members who feel passionately about the subject to do so either.

In May, I was enormously proud of my Government for taking a bold and important decision that put lives ahead of profits. I assumed, after the APPG investigation, that the industry itself recognised that it needed about nine to 12 months to implement this. That would have taken us to April or May next year. The complaints about the delay for another year were specifically about that, not about April next year. I say to my right hon. and learned Friend that it is not too late. For the sake of those people whose lives and families have been destroyed, and many more may yet follow them, I urge him to think again and bring forward the date so that we may end this scourge.

The whole House has respect for my right hon. Friend’s passion on this subject and his commitment to change. Of course, he is not alone and I am sure that many other Members will speak who also deserve huge credit for their consistent efforts. I simply say to him that I have tried in my response to set out the logic of how we balanced out several different factors in making our decision. None includes consideration of the profits of the betting companies. There are considerations about the livelihoods of those who work in betting shops and it is perfectly proper for the Government to make them. He will know that, if we did what the betting companies wanted, the change would not be made at all. We have done this contrary to the strong wishes and consistent argument of the betting companies because we believe it is the right thing to do.

I thank the hon. Member for West Bromwich East (Tom Watson) for introducing the urgent question. We know—and the Government have acknowledged—the damage caused by fixed odds betting terminals. It has been accepted that, to reduce the harm, reducing the maximum stake to £2 is required. Until that is implemented, the acknowledged harm continues. For technical and other reasons that we have heard, but that I believe are questionable, the implementation date has been set at October 2019. We have already heard what the original date could have been, but that is to miss the point. Every day we hesitate results in additional debt, increased gambling-related harm and, tragically, the possibility of more suicides relating to these machines. That is not a price worth paying to placate the bookmakers or a handful of Back Benchers. There is cross-party support for an implementation date in April 2019. Any later is tantamount is negligence and will be resisted at every opportunity.

No, I do not accept that it is negligence to take the approach we have taken. It would be negligent not to take into account all the relevant considerations in making this decision. I think I have been as clear as I can be: the profit margins of the betting companies are not one of the relevant considerations. However, it is appropriate for us to think about the economic impact of this decision on those who work in the high street and it is appropriate for us to think about the necessary notice to be given not just for the FOBT change, but for the remote gaming duty change. Although I entirely accept the hon. Gentleman’s passion on this. I know why he argues as he does. There is no monopoly in this House on compassion for those who suffer from problem gambling and its effects. We have had FOBTs in this country since the early 2000s and this is the Government who are taking action against them in order to make the substantive change that he and I will agree needs to be made.

Does the Secretary of State agree that implicit in what he and the industry have said is that there has indeed been a direct correlation between FOBTs on the high street and the proliferation of betting shops on the high street? If this decision on the new £2 stake is to be delayed, will he ask the betting companies to make additional contributions to charities that work with gambling addiction and problem gambling from the additional profits they will make from that delay?

My hon. Friend will have heard me say that I do not accept that this is a delay at all, and as I hope he will have picked up from my other remarks, I think there is more to do on problem gambling. I do not believe that, whenever we implement this change, that is the end of the story. There is a huge amount more to do and that will require action on the part of the industry as well as of Government.

The Minister, the hon. Member for Chatham and Aylesford (Tracey Crouch), is certainly a very principled person, whom I respect enormously, and I would not be surprised if she resigned over this delay. The betting industry is prepared for this change. The machines can be changed in a matter of months, so there is no reason for this other than the fact that the biggest profiteer from the tax from these machines is HM Treasury. The Treasury has won its argument against this Secretary of State because he told the DCMS Select Committee last week that he was not convinced about the reasons for the delay, so why have we got one?

Again, it is not a delay. In relation to the reasons, yet again, I have made the point that I am not convinced by the argument that we should concern ourselves with the profit margins of the betting companies, and I am not doing so, but there are other factors that we need to take into account, and that is what we are doing. This is not just about the ability of those on the receiving end to adapt to the FOBT change; it is also about their capacity to adapt to the change to remote gaming duty. Both of those are important and they come together to make the decision the Government have made.

My right hon. and learned Friend is right in saying that we have had fewer than nine years since the change in Government—these ghastly machines came in in 2001—but early-day motion 1440 does say that April 2020 is too late and asks that the change be made immediately.

A number of MPs have been at this for some time. The Minister, our hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), did help to get the Government to realise that coming down to £50 was wrong, that £20 would be wrong and that £10 and £5 would be wrong, and said she would be grateful for the figure to be £2, but we also share the general concern at the delay for the extra six months.

On delay, I entirely understand that my hon. Friend and others want this to happen as soon as possible, and so do I, but he will know from his experience of Government that there are a number of factors that Governments always have to balance in making these decisions. That is not always easy and it certainly is not always popular, but it is important that we make this decision stick. He is right that it is a long time in coming, but the worst thing that can happen now is that we make this decision in a way that ends up unravelling because we have not made the necessary preparations and done this in a careful enough way. That is the objective here: to make sure that the substantive change that he has worked so hard for and that my hon. Friend the Member for Chatham and Aylesford has worked so hard for does not just happen, but lasts.

We have all heard the Secretary of State’s excuses and explanations, his logic and his fears of the decision unravelling, but does he accept that the suspicion will persist in this House that they are simply excuses, that the delay is unacceptable and that the Government are accepting that lives will be ruined by these gambling machines rather than taking action?

Again, it is this Government who are acting. That is why this substantive change is being made. It is precisely because of the damage that the hon. Lady describes that we are doing this. The argument we are having this morning is about the point in time at which implementation happens. What I have set out are not excuses but the reasons for the judgment that the Government have taken. Let us not forget that it is this Government who are making the change, and that their predecessors did not do so.

In his Budget statement, the Chancellor referred specifically to wanting to reduce the tragedy of lives being lost to suicide. This is clearly a measure that could be taken; the industry has had ample time to prepare for it. May I urge the Secretary of State to reconsider and to bring forward the date on which remote gambling duty is brought in, so that it can cover the costs that he has mentioned in relation to protecting public services? The tragedy of lives being lost to suicide has to be our absolute priority here, and there is good evidence for this measure. I urge him to think again and to bring it in.

I have huge respect for my hon. Friend’s passion on this subject, and for the approach that she takes to issues such as this. I hope she will accept that there is no lack of enthusiasm on my part for countering the harms that she has described. The reason that we are making this decision is not because we believe it is important to pacify the betting lobby. Had that been the case, we would not have made this change at all. We have made this change because we believe that it is necessary to make it, but it is also necessary to make this decision in the most rational way that we can and to balance out a number of factors that we have no choice but to properly consider in order to achieve the objective that she and I share.

I will not repeat what I have said on delay, but perhaps I should say this. Before we have too many more contributions from the Labour Benches arguing that this Government are bringing about misery that could be avoided, may I gently remind the hon. Gentleman and his colleagues that these machines were conceived when the Labour party was in government? That Government passed legislation in 2005 to allow for £100 stake levels, and in the last three years of the Labour Government, the numbers of these machines increased by 37%. The Labour party in government did not do anything about any of that, so before we have very much more of this conversation, I think it would be appropriate to accept that that was wrong—as, to be fair, the shadow Secretary of State, the hon. Member for West Bromwich East has had the grace to do—and that the mistake we are now correcting was a mistake made by the Labour Government.

Does the Secretary of State accept the point made by the Chair of the Liaison Committee, my hon. Friend the Member for Totnes (Dr Wollaston), that delay could indeed cost lives? The Health Committee’s suicide prevention inquiry was told by Dr Peter Aitken of the Royal College of Psychiatrists that gambling is a

“significant addiction of our day”

and that it

“figures very much in the stories our patients tell us as to why they are in debt and feeling vulnerable”.

We have to put a high cost on the loss of human life.

Of course I agree with my hon. Friend about that, and I pay tribute to him for the way in which he approaches these matters. Again, it is entirely for that reason that we are taking the action that we are taking, and we are seeking to implement it in a way that will ensure that the change lasts and does the good that he rightly describes.

As the chair of the all-party parliamentary group on fixed odds betting terminals, which poked the hornets’ nest and brought us here today, I am incandescent, as are other Members across the House—including, I would argue, the Minister for sport, the Under-Secretary of State for Digital, Culture, Media and Sport, the hon. Member for Chatham and Aylesford (Tracey Crouch). If she does resign, it will be a great loss to her Front Bench, because her integrity and bravery surpass those of anyone else I see in here today. What is happening to the families who are losing children? What is happening to the children who do not get Christmas presents because of an addictive parent? What happens to the people who have to go to food banks because they have an addiction to these machines? Don’t give me warm words—give me action. April 2019! We cannot lose any more lives because of these dreadful, dreadful machines.

Among the many Members who deserve huge credit for bringing us to a place where this change is to be made, the hon. Lady ranks high in the list. She has done a huge amount to help ensure that this change happens. She asks for action, and she will have action. This change will be made. She deserves a large amount of credit for it, but I hope that she will not overlook the fact that it is this Government who are making it happen at her urging. We will deliver this change in a way that makes it stick and realises the benefits that she wants to see.

The Government’s response to the consultation noted that B2 gaming machines are frequently located in areas of high deprivation and that, frankly, they are ruining lives. Does my right hon. and learned Friend not think that he is engaging in pure semantics when he says that a period of time from April to October next year is not a delay when every Member of this House can see that it is?

I do not accept that. I do not believe that this is about semantics. My right hon. Friend is a distinguished lawyer and knows perfectly well that it is important for the Government to approach their decision making in a way that is defensible and takes all the necessary considerations into account. That is exactly what we are seeking to do.

May I express my concerns and my constituents’ fears about the delay in bringing forward the FOBTs legislation and what that will mean for those with addictions and their families? We cannot forget about the families. I simply and honestly urge the Secretary of State to introduce the legislation earlier. My constituents demand that and so do I.

I am grateful to the hon. Gentleman for his commitment to this cause. Again, he is one of those who have made the case for change consistently and should share in the credit for it happening. However, it is important, as I have said several times, that the change happens in a way that is defensible and delivers the benefits that he and I both want. It would be quite wrong to characterise this argument as one between those who want the change and those who do not. An overwhelming majority in this House want the change, and I am very much among that majority. However, it is important that it sticks, and that is what we are trying to ensure.

I draw the House’s attention to my entry in the Register of Members’ Financial Interests. Having been heavily involved in discussions on this issue, I can confirm that not only the betting industry but the racing industry, which is supported by bookmakers, fully expected the change to be implemented in April 2020, so the change is in fact being brought forward.

FOBTs are not the most dangerous form of gambling; they are the fifth most dangerous. I suggest that my right hon. and learned Friend takes into account the losses that will be suffered on the high street in terms of the jobs of men, women and young people, who will also suffer poverty, and the losses to the horse racing industry. I therefore suggest that he allows both the bookmaking and horse racing industries sufficient time to make the changes that might mitigate those losses.

I understand what my hon. Friend says, but I would argue that we are allowing sufficient time for those industries to adapt. He is right that we need to consider such issues, but we have done that, and our approach properly allows those industries to adapt as they ought to and also allows the Government to do whatever we can to mitigate any economic harm that might arise from this measure—necessary and right though it undoubtedly is.

With household debt at record levels, why are the Government delaying the implementation of a measure that would go some way towards mitigating one cause—problem gambling?

Again, there is no delay here. We are attempting to bring forward these measures and implement them in a way that balances a number of factors. The most important factor, beyond question, is the wish to minimise the harm that the hon. Lady describes, and that is what we are doing. Were we not interested in that, we would not be making this change at all, and were the charges I have heard from Opposition Members right, we would not be talking about it at all, because there would not be the implementation of a FOBT stake change to discuss.

In March 2018 the offshore gambling company GVC bought Ladbrokes, which is based in my neighbouring constituency, for £3.7 billion. Part of that package was £700 million in compensation to shareholders who would lose out as a result of FOBT stakes being reduced. However, that option ceases if the statutory instruments are put through this place and the other place before midnight on 27 March 2019. When will my right hon. and learned Friend introduce the SIs for this House and the other place to implement?

We will do that as soon as we can. My hon. Friend, although I do not doubt what he says, will recognise that I do not think it proper for Government to take account of such commercial arrangements, which need to be made in view of whatever risks the market believes there will be. We will make this decision based on the criteria I have set out so that we can make this change in the most defensible way.

We have heard from Members on both sides of the Chamber that lives are being lost and families are being affected. Last year, according to the NHS, record numbers of people were hospitalised through gambling addiction. Does the Secretary of State think that mental health provision for problem gamblers is adequate?

As I have said, I think there is a good deal more to do. The hon. Lady is right to say that the problem of gambling addiction, with all its negative consequences, is not limited to these machines. There is something particularly pernicious about these machines because of the way they operate and the way people use them, but there is a broader problem here. She is also right to say that, at least in part, a response needs to come from the health service. That is why I am so pleased that my right hon. Friend the Secretary of State for Health and Social Care is looking carefully at what we might do in his field and that the chief medical officer is also considering this matter. As I have said, I believe there is more to do, and I am interested in options for how we might pursue that. If there is more action we can take, I intend to take it.

I believe that action should come sooner rather than later—I refer Members to my entry in the Register of Members’ Financial Interests—but what is the Department’s estimate of the number of job losses? What will the Department do to make sure that those who lose their job are helped to get another one?

It is difficult for anyone to be specific about the figures, because it depends, of course, on how the industry responds to the position we present to it. On the second part of my right hon. Friend’s question, we seek to work across Government, including in my Department, the Department for Work and Pensions and others, to ensure that if there are to be job losses as a result of this right and necessary decision, we do all we can to mitigate their effects on the people who work in betting shops. This is not about company profits; it is about the economic wellbeing of the people who work in those shops. They also deserve consideration, and we will make sure they get that consideration in how we approach this decision.

Has the Under-Secretary of State for Digital, Culture, Media and Sport, the hon. Member for Chatham and Aylesford (Tracey Crouch), threatened to resign over this delay?

I have made it quite clear what I think about my hon. Friend the Member for Chatham and Aylesford as a Minister. She is doing a great job, but in the end this decision on FOBTs has to be taken, and is being taken, by the Government collectively. I am very happy to come to the House to explain the logic for the decision, which is what I have done this morning. It is a joint decision for the Government to make.

This is a hugely important reform. Does the Secretary of State agree that we have to get it right and make it stick? Will he look at further measures to restrict the gambling industry such as those taken in Estonia, including measures to restrict gambling advertising in and around sports events?

I agree with my hon. Friend; there are examples we can look at around the world, and we will want to do that. The point he makes about advertising is important; there is a good deal we may be able to look at in the advertising field, and we intend to do that.

At the end of this month, universal credit is being rolled out in my constituency, so I hope the Minister will inform my constituents that the decision to implement this legislation will come sooner rather than later, so as not to compound the poverty and aggravation that his Government are causing them.

I do not accept the hon. Gentleman’s premise, but he has just heard me say that mitigating the effect of these changes is a cross-Government process, and the Department for Work and Pensions is fully engaged in it.

Many times it is right to come to the House to criticise a Secretary of State, but it is entirely unfair to do so today. The Secretary of State has come to answer an urgent question and Opposition Members are demanding a junior Minister, which is very strange. In addition, he is doing what the House wants and introducing something, yet he is criticised. On the point he raised about advertising, does he think the Government should work with the industry to remove advertising in live sport before the watershed? I think such advertising has a lot to do with problem gambling.

I am grateful for my hon. Friend’s remarks, and I understand the point he makes. He will recognise that significant progress has been made on this. For example, gambling advertising targeted at young people can no longer happen. We are looking at further ways in which we can tighten up advertising, as indeed are the other responsible bodies. I shall be considering what he says, along with many other possibilities.

Order. I am sorry, but we have a lot of business to get through—we have the business question and then the debate on the Budget—so we really must now move on, but the Leader of the House is not here, and she does need to be here.

No, there are no points of order now. I am sure the Leader of the House is not far away. The hon. Gentleman is a very co-operative fellow, and I know he is always keen to help the Front Benchers with his points of order—not. I am sure the right hon. Lady will be here momentarily, but there is huge pressure on time and I have to make a judgment as to whether the relevant issues have been covered. [Interruption.] Well, the hon. Member for Glasgow Central (Alison Thewliss) wins brownie points for what I shall call “interrogative entrepreneurialism”.

The Evening Times reports that there are more than 800 FOBTs and 200 betting shops in the city of Glasgow alone, and that £31 million a year is lost to these machines. What does the Minister say to my constituents, who are losing out every day to these machines?

I say to the hon. Lady’s constituents what I say to everyone’s constituents: it is this Government who are prepared to do something about it.

The Leader of the House is here, and we are grateful, so we can now move on to the next business.