The right way to regulate the betting industry

History teaches us that appropriate regulation can be good for the gambling sector. 

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With the government’s review of the Gambling Act now in full swing, gambling, and what to do about it, is back on the political agenda. As a member of the 2020 House of Lords Select Committee on the Social and Economic Impact of the Gambling Industry, excellently chaired by Lord Grade – in effect our own little review – I am following this debate closely. What struck me last year was that although the challenge for policymakers is how we ensure that regulation is fit for purpose in the age of the smartphone and online betting, the political battleground hasn’t changed all that much over the years.

Last year was also the 60th anniversary of betting shops being legalised in the UK. Rab Butler, the then home secretary, described it at the time as a “new social experiment”. But when I was a kid growing up in working-class Liverpool long before betting shops were legalised, everybody knew where they could go to have a bet on a horse race. The “bookie’s runner” was as much a feature of working-class communities like mine as the milkman or publican.

In the run-up to 1960 there had always been a debate about what to do regarding gambling. Whether it was dealing with illegal bookies in the 1950s, or the middle-class civic concerns in the 1850s that led to the increased arrests of working-class youths who preferred to keep the Sabbath by playing “pitch and toss” rather than going to church, there’s always been a political battle between those who disapprove of gambling and others – shall we call them realists? – who believe betting is simply part of the culture for many working-class people. Gambling cannot (and should not) be curtailed, but it can and should be properly managed and regulated, like any aspect of activity in society.

Looking at the debate today, you would be forgiven for thinking that not a lot has changed. In 1857, the newspaper the Birmingham Journal launched the “Crusade Against Street Gambling”. Today’s Daily Mail has its “Stop the Gambling Predators” campaign. (Although I note that the Daily Mail’s campaign seems not to apply to itself. As Private Eye pointed out last year, while the paper calls for urgent action on problem gambling, it also provides racing tips for its readers). 

One of the biggest critics of gambling sitting in the House of Lords today is the Bishop of St Albans Dr Alan Smith, a distinguished clergyman who served with me on the gambling select committee. However, even he endorsed our recommendations as a balanced way forward. Another vocal anti-gambling critic is that grandest of Tory grandees, former Conservative leader Iain Duncan-Smith, who claims to understand what is in the best interests of the working class. Others who strongly disapprove of gambling often hail from parts of the country with strong non-conformist traditions, reminding me of what Harold Wilson once said of Labour politics – that “it owed more to Methodism than to Marx”. 

I am not particularly a gambler. But like around 30 million people in Britain who occasionally have a flutter, I enjoy a day at the races and I have in the past bought a ticket for the National Lottery. As an MP for many years in St Helens, I recognised the legitimate and important role betting shops and bingo halls play in providing leisure and entertainment in many working-class communities, as well as much-needed jobs and tax revenues. I am most definitely not a prohibitionist, but I am a reformer (just a realistic one).

Following on from our Lords select committee and as a member of Peers for Gambling Reform, which encompasses very many members of the House of Lords, I very much welcomed the Gambling Act Review launched by the government in December. I welcomed in particular how the government framed the argument. When Sports Minister Nigel Huddleston launched the government’s Call for Evidence in the House of Commons, he pointed out that nearly half the adult population gambles each month and that for the majority of people “gambling is a fun and carefree leisure activity”. The government assesses that the rate of problem gambling is around 0.5 per cent of the population and has been stable for 20 years. 

Huddleston put it well when he said: “This review will seek to strike a careful balance between giving individuals the freedom to choose how they spend their own money, while protecting vulnerable people and their families from gambling-related harm.”

That’s the right approach. This is far from a black-and-white issue. Listening to the evidence presented to the select committee, it became abundantly clear that this is a complex subject with no easy or single solution, and it needs to be handled very carefully by the government.

We held 20 evidence sessions over a period of nine months, taking evidence from renowned experts in problem gambling, charities, the Gambling Commission, DCMS officials, the gambling industry and banks. The report we produced, at over 200 pages, seeks to address the changes needed to secure the long-term future of an industry employing more than 100,000 people and paying £3.2bn a year in tax.

I absolutely support the calls for more work to tackle problem gambling, but there is a vitally important balance to be struck between protecting the vulnerable and not spoiling the enjoyment of the vast majority who bet perfectly safely. The government’s review should be evidence-led and it should seek to make significant changes, but it also should acknowledge that the industry has already made long-overdue improvements.

The advent of the internet has made it much easier to place a bet – and it also increased the onus on the regulated industry to put in place the necessary measures to protect the vulnerable and promote safer gambling tools. From strict ID and age verification checks, and encouraging deposit limits and time-outs, to increased safer gambling messages and millions of pounds more for education and treatment, the industry has begun to get its act together.

Further regulation of the betting and gaming industry is necessary, but the government must avoid the temptation of being too heavy-handed in an effort to assuage the anti-gambling lobby.

Reflecting on the legalisation of betting shops 60 years ago, I believe there are clear parallels to be drawn between the back-street bookies of 1960, often run by gangsters and organised crime, and today’s illegal, unregulated, black market online operators who prey on the vulnerable. Get regulation wrong – for example, by making affordability checks too onerous rather than targeting those most at risk – and we risk driving gamblers into the arms of the black market. 

If the internet and smartphone era means anything, it means that gamblers online have got somewhere else to go other than safer, highly regulated operators. And if history teaches us anything, it is that appropriate regulation can be good for the industry as well as society as a whole.

Dave Watts is a member of Peers for Gambling Reform and a former chair of the Parliamentary Labour Party.

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