Tuesday, July 30, 2024

What could the new Labour Government mean for the UK gambling industry?

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With Starmer in office and the new Cabinet being appointed, how can we expect the gambling landscape to change under their leadership?

Unless you’ve been living on a distant island, Robinson-Crusoe style, for the last few weeks then you would’ve noticed that the UK just held a General Election. When it comes to the voting totals, some years are close, some aren’t; this was one of them. Keir Starmer was appointed as the UK’s 58th Prime Minister in a political shake-up that sees Labour leading the country for the first time in 14 years.

“Labour is committed to reducing gambling-related harm. Recognising the evolution of the gambling landscape since 2005, Labour will reform gambling regulation, strengthening protections. We will continue to work with the industry on how to ensure responsible gambling.” – Labour 2024 General Election Manifesto

Although, with the gambling industry being such a low priority for many of the parties, this has put the state of the White Paper in a precarious place. It had a lot of momentum after being established by the Conservative Party, but will the Labour Party manage to keep it going?

What are the biggest talking points?

– £5 slot limits- Advertising in gambling- Gambling Ombudsman- Affordability checks- Horseracing- Statutory levy

Labour, Tory and Lib Dem manifestos

Before we discuss where the Labour will take the gambling scene, it’s important to first discuss how each of the respective parties introduced gambling in their manifestos.

Conservative

This one is easy, there wasn’t any mention of gambling in the Conservative manifesto, and the only White Paper was the International Development White Paper that covered Sustainable Development Goals.

Liberal Democrats

The Lib Dems were one step ahead of the Conservatives, in the fact that they brought up gambling at all, however their points were certainly lacking. In the Lib Dem manifesto, the gambling section said the party would “combat the harms caused by problem gambling” by:

– Introducing the planned compulsory levy on gambling companies to fund research, prevention and treatment.- Restricting gambling advertising.- Establishing a Gambling Ombudsman to redress wrongs.- Implementing effective affordability checks.- Taking tough action against black market gambling

Now, if you’ve been following the developments in the industry this past year, then you’ll know that these are all points laid out in the White Paper. None of these are original initiatives by the Lib Dems, even though that might be difficult considering the scale of the White Paper, but it was also disappointing to see these points presented as if they were separate from the regulations that were put in motion over a year ago.

“The BGC had long treated Labour as a Government in waiting, working closely with shadow ministers in recent years, on behalf of our members and their millions of customers. Our work to drive up standards and champion a world leading British industry carries on and we look forward to partnering with Labour – as they have pledged – in this vitally important work.” – Michael Dugher, Betting and Gaming Council Chair

Labour

The Labour Party also mentioned gambling in their manifesto, but they kept it vague.

“Labour is committed to reducing gambling-related harm. Recognising the evolution of the gambling landscape since 2005, Labour will reform gambling regulation, strengthening protections. We will continue to work with the industry on how to ensure responsible gambling.”

While there is a small nod to the White Paper and the Gambling Act 2005 that it’s replacing, there’s not a lot here. It’s even stranger when you consider that every other point in the manifesto is accompanied with points of action.

For example, in the section talking about reducing smoking in young people, the manifesto said: “Labour will ensure the next generation can never legally buy cigarettes and ensure all hospitals integrate ‘opt-out’ smoking cessation interventions into routine care. Labour will ban vapes from being branded and advertised to appeal to children to stop the next generation from becoming hooked on nicotine.”

As you can see, there’s a plan here. Even if it’s not the most detailed strategy in the world, there are still clear steps that can be taken here; meanwhile, the gambling paragraph by comparison brings nothing to the table.

Does this mean that the Labour Party aren’t taking gambling seriously? Probably not. The previous Shadow Minister for Sport, Gambling and Media, Stephanie Peacock, took her role very seriously and was the leading voice in several key discussions in Parliament.

It’s more likely that the industry is a low priority, and the Government is happy to let the White Paper keep progressing at the pace it already is.

“Although I have only recently been appointed as the shadow Minister with responsibility for gambling, I have already met a number of charities and organisations that work to prevent gambling harms, providing a range of treatment, education and advice.” – Stephanie Peacock, Gambling Minister

How closely linked are the Labour Party and the gambling industry?

Despite the manifesto showing no real feelings towards the industry, the Labour Party is historically close to gambling. Looking at the donations registry, we can link some substantial pledges over the years from people involved in gambling, sports betting and more.

Donations towards the Labour Party from the gambling industry:

– £490,000 from Peter Coates and bet365 to Labour until 2015, before donations focused on pro-EU campaigns- £300,000 from Derek Webb, founder of Campaign for Fairer Gambling- £50,000 from Richard Swann, links to sports data providers- £25,000 from Peter Coates, co-founder of bet365 to Starmer’s office in 2020- £30,000 from Red Capital, associated with Chair of evoke- £35,000 from Richard Flint, former CEO of Sky Betting & Gaming- £10,000 from Neil Goulden, then director of Gamesys

Labour weren’t the only ones either, as the Conservatives received £375,000 from the Done brothers, founders of Betfred.

“It is only through a combination of measures, from giving the Gambling Commission powers to crack down on the black market to restricting bonus and free bet offers, that we will bring our regulation into the modern age and better protect people from harm.” – Stephanie Peacock, Gambling Minister

Speaking of Peacock, her predecessor in Barnsley East was Michael Dugher, who now serves as the Chair of the Betting & Gaming Council (BGC). It seems like the two are on friendly terms, with both parties congratulating one another over social media for their achievements.

(Keir Starmer talking at a BGC event.)

When Starmer won the polls, the BGC were among the first to congratulate the party. Dugher released a statement saying that: “The BGC had long treated Labour as a Government in waiting, working closely with shadow ministers in recent years, on behalf of our members and their millions of customers. Our work to drive up standards and champion a world leading British industry carries on and we look forward to partnering with Labour – as they have pledged – in this vitally important work.”

All eyes on Stephanie Peacock

Although Lisa Nandy was one of the first Cabinet members to be announced, taking the role of Secretary of State for Culture, Media and Sport, it took a little longer to appoint Stephanie Peacock as the Minster for Sport, Gambling and Media. But, who is she?

Peacock is the MP for Barnsley South and has served as the Shadow Minister for Sport, Gambling and Media since 2023. Following Labour’s win, she was then appointed as the Minister.

“It is important to make early interventions if we can—but it strikes me that there is a piece missing, because it is not clear what intervention will take place as a result of the checks.” – Stephanie Peacock, Gambling Minister

She has a good track record of attending parliamentary meetings, including those that cover issues related to gambling. Most recently, she spoke at a debate for gambling advertising in sports, which built on the ban on adverts on the front of footballer’s shirts.

Peacock explained that this wasn’t enough though, as the sheer extent of adverts involved with sports can make it difficult for those with problem gambling behaviours to fully enjoy the sports.

However, the guidelines around advertising in sports remain vague. Because of this, she argued that: “we need the sports sponsorship code of conduct to be published. That code, required by the Government’s White Paper and led by sports governing bodies, would recognise that the relationship between gambling and sports needs to be conducted responsibly in order to prevent gambling harm in both sportspeople and sports fans.”

By approaching it in this manner, and asking for a definite code to be published, this encourages a sense of self-governance from operators, sports teams and other organisations. Rather than asking the Gambling Commission investigate a matter that is ambiguous and create a case file without any legal backing, this would make it easier to nudge any offenders in the right direction with less demand on the Commission.

This is something that she emphasises later on, saying: “It is only through a combination of measures, from giving the Gambling Commission powers to crack down on the black market to restricting bonus and free bet offers, that we will bring our regulation into the modern age and better protect people from harm.”

“I also ask the Minister for an update on what the Department is doing to ensure that money paid by gambling firms for racing media rights is actually benefiting the sport. For example, what meetings has the Minister had specifically with media rights companies to ensure that money is moving from betting to racing in a way that positively impacts the sport?” – Stephanie Peacock, Gambling Minister

It’s not just advertising that’s been a key issue for Peacock though, as she’s also tackled the concerns over affordability checks head on. Rather than simply discussing the point as being one of contention, she asked the Government to expand upon some vague points that would clear up a lot of discourse around the matter.

For example, she pointed out that “it is important to make early interventions if we can—but it strikes me that there is a piece missing, because it is not clear what intervention will take place as a result of the checks.”

If the ‘interventions’ or points of action were properly explained in regards to the affordability checks, then perhaps there would be less panic around them. An ‘intervention’ could be as light as a pop-up asking if the customer is playing responsibly, but the natural instinct to jump to the worst case scenario has some people worried that a poor affordability check could result in account closures, bans or even a dreaded intervention itself!

Another major point for Peacock, which will no doubt prove popular with many, is her affinity for horseracing. She has spoken in support of the industry many times, not just in the recent debate, the Future of Horseracing.

Here, she encourages the statutory levy to support the sport, which is struggling in terms of prize pools on an international stage. She’s also questioned how the money currently being paid towards the sport is being spent: “I also ask the Minister for an update on what the Department is doing to ensure that money paid by gambling firms for racing media rights is actually benefiting the sport. For example, what meetings has the Minister had specifically with media rights companies to ensure that money is moving from betting to racing in a way that positively impacts the sport?”

Overall, with Peacock at the helm of all things gambling, it seems like real changes could be made. She’s shown a passion for the industry, has put effort into learning what impact it has, and she’s already met with several charities and organisations dedicated to reducing gambling-related harm.So, what changes will be made?

Well, after looking at all the information, we can make some fairly strong predictions.

£5 Slot limits

Despite this regulation being passed under the Conservative Party, the new slot limits will be one of the first major changes to occur during Starmer’s leadership. The maximum stakes for online slots will be £5 for those aged 25 and over, or £2 for players aged between 18-24.

It’s likely going to be a popular change though, with both regulators, charities and the Gambling Commission. It’s one of the first steps of reining in the online gambling world and aligning it with the standards enforced with in-person casinos.

Advertising in gambling

With how strongly Peacock has addressed this, especially with her wanting a sports sponsorship code of conduct to be published, we can expect steps to be made towards restricting advertising in gambling.

However, we don’t anticipate any major changes to be made right away. The ban on gambling sponsors on the front of football shirts won’t be enforced until the start of the 2026/27 season, so it’s reasonable to expect things to ramp up then, although not necessarily before this.

Gambling Ombudsman

With how this has already been mentioned in the White Paper, it’s likely that a Gambling Ombudsman will be introduced under a Labour government. However, with the criticisms around the timeline of this, with some demanding it be enforced sooner while others are protesting that it takes time to establish a proper Ombudsman service, we don’t anticipate a full introduction to be made any time soon.

We’ll likely get some updates, or some major steps being made in this regard, but it’s unlikely that the Gambling Ombudsman will be put in place before 2025.

Affordability checks

Unless the Gambling Commission themselves step in, the widely contested affordability checks will probably be instigated to some degree soon. However, Peacock has been wary of these, so it’s likely that there will be several more debates held on them before they’re set in motion with operators.

Horseracing

This is an aspect of the industry that has received major support from Peacock, and the Labour Party at large. Peacock has argued for large prize pools and the ability to make the UK horseracing scene competitive compared to the international calendar.

It’s likely that horseracing will receive more funding and more support from the Labour Government, at least at the beginning.

“To conclude, the Labour party acknowledges the huge contribution that horseracing makes to both our culture and our economy.” – Stephanie Peacock, Gambling Minister

Statutory levy

The statutory levy will be introduced, but it will be interesting to see how it’s handled after the fact. There has been some arguments made that charities could receive less under this scheme than they did through voluntary donations, although with how much Peacock engages with the organisations and charities which will be affected, it’s likely that this will be addressed swiftly if it does happen.

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