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The Comprehensive Impact of the 2023 Gambling Act Review
After a series of postponements, extensive discussions, insights, and considerable confusion from industry groups, the Gambling Act Review white paper finally appeared on April 27, 2023. This extensive 268-word document was the result of a thorough review process, which involved multiple rounds of public consultations, information gathering and feedback from industry experts. It presents fresh proposals for the gambling sector and encompasses recommendations for enhancements, new policies, and thorough reforms.
What was the Immediate Impact of the Gambling White Paper?
The white paper’s impact was far-reaching, affecting not only online casinos and betting shops but also horse racing. For example, it led to the introduction of stricter age verification guidelines in brick-and-mortar casinos and the implementation of affordability checks for online gambling. Its influence was felt across the entire industry, setting new legislation and responsible gambling standards. The UK Gambling Commission wasted no time implementing the white paper’s recommendations. The first round of consultations began in July and focused on sustainability measures and safer gambling practices. This phase was particularly significant as it addressed one of the white paper’s most stringent suggestions, the financial risk assessments known as affordability checks. According to a report by the Commission, these checks have already led to a 30% decrease in the number of individuals with gambling-related debt.
Within days of the publication of the white paper, Tim Miller, executive director for research and policy at the Gambling Commission, acknowledged that the regulatory body would have very little room to explore and see to policies and gambling laws outside those mentioned in the white paper in the upcoming years.
Given the extensive effort expended over the past year, the question arises: what is the current status of the document’s proposals regarding responsible gambling and sustainability?
The Dynamics Between Operators and Customers
The dynamics between operators and customers are central to the gambling industry’s functioning in the same vein as money being a crucial driver for global economics. Any disruption to this relationship could result in severe repercussions, thus necessitating careful handling.
The introduction of the white paper poses potential challenges to this rather delicate balance. Better Change, founder Victoria Reed contends that regulatory standards within the industry are already stringent compared to other sectors. However, she emphasises the importance of striking a healthy balance by introducing stricter regulations.
According to Reed, numerous operators have already implemented extra measures for individuals aged 18 to 24 and have conducted financial assessments when necessary. She believes that regulations in this area are expected, highlighting the significance of maintaining a reasonable balance between the public’s autonomy and governmental actions aimed at protecting public health.
The Gambling Act Review White Paper: A Recap
At the time of its release, Culture Secretary Lucy Frazer told The Times that the government’s approach in introducing new gambling regulations was “centred around balance”, allowing people to “have a flutter” while also protecting those suffering from gambling harm.
The reality of the UK market, like those in other Western Countries, is that gambling issues are on the rise. This is partly due to the improvement of betting technology and game features, betting on smartphones, and increased marketing budgets of operators.
Evidence from the NHS indicates that 8.7% of the population aged between 18 and 24 have experienced some issues with gambling addiction, with the majority of these problems being related to slot games. This worrying statistic highlighted the need for action from the authorities. It also presented an opportunity for the UKGC and government to reform the role of gambling businesses to help address the problem.
Affordability Checks
It proposed new rules that individuals incurring losses of £1,000 in a single day or £2,000 within 90 days would undergo thorough affordability evaluations. Additionally, operators must conduct “passive” assessments for players who experience a net loss of more than £125 monthly or £500 annually.
Consultation on Stake Limits
The DCMS announced its intention to introduce a stake limit on slot games, planning to consult on setting the bet limit within the range of £2 to £15 per spin. In addition, it was suggested that lower limits would be applied to new user accounts. Moreover, there was a suggestion that the requirements for conducting more thorough checks should be more stringent for individuals aged 18 to 24, acknowledging their higher vulnerability to gambling-related harm.
RET Funding
Operators would be required to contribute to a compulsory statutory levy administered by the Gambling Commission to support the RET (research, education, and treatment) of gambling harms. The DCMS had planned to conduct a consultation on its scope, accessibility, and design during the summer of 2023. Previously, gambling operators could pay any amount they wanted. As you can imagine, there was also a lack of transparency around payments made. Under the new plans, the levy (tax) would be set at 1% of GGY (gross gambling yield) for online operators. Brick-and-mortar casinos and betting shops would pay 0.04%.
Should the new levy come into effect, it will be the biggest increase in financial commitments to tackle gambling-related harm. In addition to the new levy, the government will develop a nationwide prevention approach by funding independent research and studies.
“This consultation brings us a step closer to being able to provide £100.0m of new funding for research, prevention and treatment. This includes ring-fenced investment for the NHS to help gambling addicts.” gambling minister Stuart Andrew said.
Everyone would agree that more gambling reform is needed as well as updates to existing measures.
Ombudsman for Dispute Resolution
It was announced that a gambling ombudsman would be established to handle player disputes and complaints. In collaboration with other industry stakeholders, the ombudsman would be tasked with collecting data that could be used in disputes. New powers would also be granted to allow enforcement action to be taken. Participation in the new ombudsman scheme will not be mandatory. However, it will be strongly advised to make the scheme work.
Supporting the GB Gambling Commission
It was revealed that the Commission would reassess the design guidelines and advice for online gaming, focusing on “intensifying features” that may increase risks. Additionally, putting in place stricter controls on VIP programs would safeguard individuals vulnerable to gambling-related harm.
Furthermore, a review of the Commission’s fees was set for 2024 to guarantee that it has the necessary resources to implement the white paper’s recommendations. The regulatory body would also strengthen the standards for license holders managing white-label casinos under a third-party brand. The regulation of prize draws was also scheduled to be examined.
Land-Based Restrictions and Updated Policies
A prohibition on individuals under 18 from using Category D gaming machines, commonly known as fruit machines, was announced. The ‘Think 21’ policy would also be updated to ‘Think 25’. This measure will help address underage gambling concerns and allow employees to remind players of the wagering limits.
The cap on the number of slot machines in larger casino establishments would be relaxed, adhering to a 5:1 ratio of slots to table games. Smaller casinos may have more machines based on their size and the area designated for non-gambling activities. This will be calculated on a pro-rata basis. In a positive change, sports betting services can now be offered at casinos. Previously, casino players could only bet on a sport via mobile apps, or by entering a betting shop. Potentially, the addition of sports betting at casinos could lead to an increase in jobs.
Advertisement Measures Around Bonuses
In a statement, new measures around advertising content and controls were announced. Such controls include allowing customers to opt-in for bonuses and other gambling products or promotions. Additionally, there would be an effort to amplify the messaging to consumers around the potential harms of gambling, making it more impactful. Current media campaigns often fall flat, so more is needed to highlight the message. This would apply to all media, including paper advertisements, television, YouTube, and other social media.
Addressing the Black Market
Addressing the issue of the black market, there is an existing voluntary pact with payment service providers aimed at obstructing access to gambling sites operating without legal authorisation. As per the white paper terms, DCMS intends to strengthen this arrangement by granting it legal force. Therefore, the Commission would be permitted to seek a court mandate compelling providers to deny access to these illicit sites.
Improvements Moving Forward
Over the past year, the key initiatives proposed in the white paper have made some progress, but is this indicative of an improvement in standards?
According to Reed, the answer is no. In her view, the changes may have even negatively affected the Commission’s ability to implement RET funding over the last year.
Reed points out that the shift towards a compulsory levy has introduced a level of uncertainty that has significantly affected the execution of programs backed by the gambling industry’s voluntary contributions. These programs are essential for researching, educating, and treating gambling-related harm and are run by organisations approved by the Gambling Commission.
She emphasises the need for clear guidance on the mandatory levy to prevent further setbacks. She foresees minimal progress in the coming year unless these issues are adequately addressed.
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