Photo: Getty
Show Hide image

We can’t let fixed-odds betting terminals keep ruining lives

The goverment must cap maximum wagers at £2.

I know how addictive and harmful fixed-odds betting terminals are – they nearly cost me my life. Since 2012, I’ve been campaigning for a reduction in the maximum stake, which is the amount the machines allow you to bet in one 20-second spin.

Permitting the current stake of £100 on easily accessible machines in betting shops has been an unmitigated disaster. Machines in all other venues on the high street are capped at £2 a spin, but bookies introduced higher stakes by exploiting a loophole in the law, which allowed them to claim these weren’t machines but “betting terminals” – as the server determining the result of each spin is located outside of the premises, similar to a race or sporting event.

Labour’s Gambling Act later legitimised fixed-odds betting terminals, or FOBTs, calling them “B2 machines”, but capped the number allowed in each betting shop to four. So what did the bookies do? Opened more shops in clusters, leading to the phenomenon of an operator opening two shops within a stone’s throw of each other.

In London, each machine generates around £1,500 profit a week, so for every betting shop there is £6,000 is sucked out of communities every week by those machines alone. Alarming when you consider that there are more than twice the number of betting shops in deprived areas compared to the most affluent.

The government today announced a consultation on reducing the maximum stake, offering options of a cut to £50, £30, £20 and £2. This will run for 12 weeks, with a final decision due in the new year.

It is the roulette and casino games on FOBTs that are the most addictive, as they are played up to five times faster than the live table game in a casino. A reduction to anything other than £2 a spin would mean roulette remains on the bookies’ machines, a game which entices players into staking up from the minimum of £1 a spin to the maximum of £100 every few seconds.

The impact of higher stakes goes beyond simply the speed with which people lose money. While one fifth of FOBT users wagering up to £2 a spin were identified as problem gamblers, this rises to two fifths for those who gamble at £20 a spin or more. Stake reduction has been shown time and again to be the most effective means for protecting players.

However, it’s not just gamblers who have experienced harm, but staff in betting shops who have lost their jobs due to automation driven by FOBTs. The bookies have driven down wages in the betting industry, made thousands of staff redundant while opening more shops, and forced the ones who are left to work alone.

This carries huge health and safety risks, particularly when staff are told to “interact” with customers who have lost more than they can afford. There has already been a murder of a betting shop worker and a serious sexual assault since operators moved to a policy of lone working.

Paddy Power’s CEO has noted the toxicity of FOBTs, calling for a reduction in the maximum stake to “less than £10”. As £10 is not an option, presumably Paddy Power will be joining the Campaign for Fairer Gambling, the Labour Party, 93 councils, the Royal Society for Public Health, the Church of England Synod and the All Party Group on FOBTs in backing a £2 cap.

Matt Zarb-Cousin is a former spokesperson for Jeremy Corbyn, now spokesperson for the Campaign for Fairer Gambling

Getty
Show Hide image

Labour’s renationalisation plans look nothing like the 1970s

The Corbynistas are examining models such as Robin Hood Energy in Nottingham, Oldham credit union and John Lewis. 

A community energy company in Nottingham, a credit union in Oldham and, yes, Britain's most popular purveyor of wine coolers. No, this is not another diatribe about about consumer rip-offs. Quite the opposite – this esoteric range of innovative companies represent just a few of those which have come to the attention of the Labour leadership as they plot how to turn the abstract of one of their most popular ideas into a living, neo-liberal-shattering reality.

I am talking about nationalisation – or, more broadly, public ownership, which was the subject of a special conference this month staged by a Labour Party which has pledged to take back control of energy, water, rail and mail.

The form of nationalisation being talked about today at the top of the Labour Party looks very different to the model of state-owned and state-run services that existed in the 1970s, and the accompanying memories of delayed trains, leaves on the line and British rail fruitcake that was as hard as stone.

In John McDonnell and Jeremy Corbyn’s conference on "alternative models of ownership", the three firms mentioned were Robin Hood Energy in Nottingham, Oldham credit union and, of course, John Lewis. Each represents a different model of public ownership – as, of course, does the straightforward takeover of the East Coast rail line by the Labour government when National Express handed back the franchise in 2009.

Robin Hood is the first not-for-profit energy company set up a by a local authority in 70 years. It was created by Nottingham city council and counts Corbyn himself among its customers. It embodies the "municipal socialism" which innovative local politicians are delivering in an age of austerity and its tariffs delivers annual bills of £1,000 or slightly less for a typical household.

Credit unions share many of the values of community companies, even though they operate in a different manner, and are owned entirely by their customers, who are all members. The credit union model has been championed by Labour MPs for decades. 

Since the financial crisis, credit unions have worked with local authorities, and their supporters see them as ethical alternatives to the scourge of payday loans. The Oldham credit union, highlighted by McDonnell in a speech to councillors in 2016, offers loans from £50 upwards, no set-up costs and typically charges interest of around £75 on a £250 loan repaid over 18 months.

Credit unions have been transformed from what was once seen as a "poor man's bank" to serious and tech-savvy lenders where profits are still returned to customers as dividends.

Then there is John Lewis. The "never-knowingly undersold" department store is owned by its 84,000 staff, or "partners". The Tories have long cooed over its pledge to be a "successful business powered by its people and principles" while Labour approves of its policy of doling out bonuses to ordinary staff, rather than just those at the top. Last year John Lewis awarded a partnership bonus of £89.4m to its staff, which trade website Employee Benefits judged as worth more than three weeks' pay per person (although still less than previous top-ups).

To those of us on the left, it is a painful irony that when John Lewis finally made an entry into politics himself – in the shape of former managing director Andy Street – it was to seize the Birmingham mayoralty ahead of Labour's Sion Simon last year. (John Lewis the company remains apolitical.)

Another model attracting interest is Transport for London, currently controlled by Labour mayor Sadiq Khan. TfL may be a unique structure, but nevertheless trains feature heavily in the thinking of shadow ministers, whether Corbynista or soft left. They know that rail represents their best chance of quick nationalisation with public support, and have begun to spell out how it could be delivered.

Yes, the rhetoric is blunt, promising to take back control of our lines, but the plan is far more gradual. Rather than risk the cost and litigation of passing a law to cancel existing franchises, Labour would ask the Department for Transport to simply bring routes back in-house as each of the private sector deals expires over the next decade.

If Corbyn were to be a single-term prime minister, then a public-owned rail system would be one of the legacies he craves.

His scathing verdict on the health of privatised industries is well known but this month he put the case for the opposite when he addressed the Conference on Alternative Models of Ownership. Profits extracted from public services have been used to "line the pockets of shareholders" he declared. Services are better run when they are controlled by customers and workers, he added. "It is those people not share price speculators who are the real experts."

It is telling, however, that Labour's radical election manifesto did not mention nationalisation once. The phrase "public ownership" is used 10 times though. Perhaps it is a sign that while the leadership may have dumped New Labour "spin", it is not averse to softening its rhetoric when necessary.

So don't look to the past when considering what nationalisation and taking back control of public services might mean if Corbyn made it to Downing Street. The economic models of the 1970s are no more likely to make a comeback then the culinary trends for Blue Nun and creme brûlée.

Instead, if you want to know what public ownership might look like, then cast your gaze to Nottingham, Oldham and dozens more community companies around our country.

Peter Edwards was press secretary to a shadow chancellor, editor of LabourList and a parliamentary candidate in 2015 and 2017.