It’s not often a story connected to the betting industry is headline news but the decision to cut the maximum stakes on fixed odds betting terminals in betting offices to just £2 has fuelled much debate.
Bookmakers are fearful that the decision, backed by Culture Secretary Matt Hancock, will lead to thousands of job losses in the high street. Many betting offices are only solvent due to the amount of revenue they generate from FOBTs and the big firms are not in the habit of propping up loss-making outlets. The decision to reduce the maximum stake from £100 to £2 will undoubtedly be the death knell for many shops and it will also have an impact on horse racing, which currently receives a percentage of profits in the form of a levy. That could be as much as £60million a year, though the government could partly reduce that loss if it carries through its promise to extend the levy to bets on racing worldwide. There will also be a period of transition to allow the betting industry and racing to adjust to the new legislation. Both industries are resilient and will survive but, perhaps, need to have a look at the way they generate revenue. After all, it is less than 20 years since FOBTs were allowed in betting offices. Racing should never have allowed itself to rely so heavily on such a divisive product and one which is not under its control.
Betting always used to be a battle of wits between bookmakers and punters so could the decision make bookmakers re-assess how they conduct themselves and promote their products?
Problem gambling has become more than just a minor problem. People’s lives are being ruined and lessening the opportunities for some of the more vulnerable members of society to lose money has to be a positive. Recreational betting has been a part of racing for centuries and is an accepted form of entertainment during a day at the races, in front of the TV or on the High Street. However, taking bets comes with social responsibility and you could argue that FOBTs don’t operate on a level playing field with punters. The decision to cut the stake to £2 goes further than the recommendations of a review carried out by the gambling regulator earlier this year, which recommended the maximum stake for FOBTs should be set at or below £30. But the British Government seems to want to wage war with the gambling sector and plans to toughen up regulations around online gambling, such as introducing stronger age verification rules and affordability checks.
An advertising campaign promoting responsible gambling, supported by the industry and GambleAware, will be launched later this year, and the age limit for National Lottery games is under review. Of course, a significant reduction in betting turnover will also lead to a loss for the Exchequer but, surprisingly, the benefits appear to have outweighed the negatives on this occasion, though bookmakers and their office staff won’t agree.
