The white paper on the Gambling Act Review was released almost one year ago. The review was a landmark document which promised to completely overhaul the gambling regulations in the UK. It marked a new direction for industry. Has the review raised standards in twelve months?
The Gambling Act Review White Paper was released on April 27, 2023, after much discussion, delay and industry lamentation. This 268 page document detailed new industry proposals, from improvements to new policies and complete overhauls.
Aftershocks from the white paper have impacted every sector of industry. The white paper reverberated through the industry, especially in online gaming, horse racing and land-based gambling.
The GB Gambling Commission deserves credit for implementing the recommendations of the review in consultation rounds. In July, the first round of consultations began and focused on sustainability and safer gambling. The white paper included the most important proposal – affordability and financial risk assessments.
Tim Miller, executive director of research and policy at the Commission, acknowledged that the Commission would have “very little room” to examine non-whitepaper policies over the next couple years. Where are we now, after all the manpower spent over the past year on the proposals in the whitepaper for sustainable gambling and safer gaming?
Relationship between the operator and player
The relationship between players and operators is like the money that makes the world turn. Any action that could disrupt this dynamic can have disastrous consequences.
The white paper is a document which could easily inflict such consequences. Victoria Reed, the founder of Better Change, says that industry standards for regulation are high. She adds, however, that it is important to strike a balance when it comes to adding new regulations.
Reed has said that the standards in this industry are high compared to other industries. Reed says that the technology of today’s business and consumer trends are constantly changing. “There is no time for us to think we know it all.”
Balance is important, especially when it comes time to ensure sustainable play.
Reed continues: “Many online operators already conduct additional checks for those aged 18-24 and others carry out financial verifications if they have any reason to be concerned.” It is only logical that some sort of regulation will apply to these services, but the right balance must be struck between the public’s freedom of choice and government intervention in the interests of public safety.
The clear frontrunners in sustainability
Matt ZarbCousin is the co-founder of Gamban and Director of External Affairs. He says that players will not be the only ones to benefit from this change. He thinks operators will be more efficient under stricter standards. Sustainability is the prize.
He explains, “I think some of the things [in the white paper] will fundamentally alter relationships between operators and customers. To that end, operators will need to rethink their approach, and how they are represented.”
The operators who are structured in a way that is sustainable will be the ones to benefit the most from a new system that has a stricter compliance bar and where it is no longer possible for people with gambling addictions to generate as much income.
Reed believes that promoting safer and more sustainable gambling is best done from a prevention standpoint. She believes that the whitepaper does not adequately address this issue.
We define “safer gambling” as gambling in a safe manner. “Safer gambling” does not include the acts of restricting or limiting gambling, nor banning it, blocking, stigmatizing gambling, etc. We see little in the White Paper that we consider safer gambling. Instead, we believe measures like stake limits and financial risk checking are better aligned with player protection.
Better Change’s role is not to pull people from the river but rather, prevent them from falling into it in the first instance.
Industry’s top priority is affordability of checks
Better Change is a company that believes in supporting Positive Play by educating and reforming. The goal is to reach players early, before problems arise. The white paper’s most striking features, like the affordability check, are a claim that this is what they want.
These proposals, if implemented properly, would encourage a safe, sustainable level of gaming before the players reach a critical point. The industry may have finally found the answer to its sustainability problems.
In its current form the affordability check would apply to those who lost more than £1000 in 24 hours, or £2000 over 90 days.
The industry’s opposition to affordability tests is hard to understate. The petition against the implementation of affordability checks reached over 100,000 signatures, and was discussed by parliament in February 2020.
Melanie Ellis is a partner and gambling regulation lawyer at Northridge Law LLP. She says these proposals for affordability checks “represent an improved position over the current situation”.
She says that there is confusion about the steps operators should take to determine their affordability or financial risks and when to do so.
The proposals will only replace the current operating procedures of operators, but they are still relatively small in scale.
Benefits for everyone
Both operators and players will suffer if players gamble in an unsustainable way.
Zarb-Cousin states, “The higher your losses are, the greater chance you have of becoming addicted to gambling.” Everyone benefits if there are mechanisms that prevent harm.
Even the industry benefits because customers don’t lose the entire amount of money that they had access to at that time, and self-exclude. They never return.
The implementation of affordability checks could present a new and unexpected set of challenges. The Commission is ready to test the scheme of affordability checks, so the results could come very quickly.
Reed emphasizes the need to implement affordability on a per-case basis.
She stresses that a framework to assess financial risks should be based on individual circumstances, rather than a one-size fits all approach. We must be cautious of stigmatising our industry because of prejudices against gambling and other forms of leisure spending.
This will have a negative impact on trade, and will also prevent people who need assistance from getting it.
The proposed 1% tax on gross gaming yield, as well as affordability checks and the proposed statutory levies could be a game changer for people who have suffered gambling damage.
Zarb-Cousin says that if the affordability checks are done correctly, as well as the levies, they will have a significant impact. The amount of resources and quantity that can be put into prevention and treatment campaigns will have a huge impact.
Assure improvements moving forward
Over the past twelve months there has been a lot of progress on the major proposals in the White Paper. Does this mean that standards have been raised?
Reed says no. It may even have been harmful to the Commission in its rollout of Research, Education and Treatment funding last year.
The uncertainty created by the change in the mandatory levy proposal has seriously affected the delivery of programs funded by organizations on the Gambling Commission list of approved organisation, to receive voluntary funds donated from the gambling industry for Research, Education and Treatment of gambling harmful effects.
She notes that if she wants to avoid further damage, it is important to clarify the issue of the compulsory levy.
The white paper is already having a major impact on Research, Education, Prevention and Treatment (REPT) in our industry. I’m sorry to say, but I don’t see much progress this year unless we deal with it.
The white paper has it contributed to the raising of standards?
Zarb-Cousin hopes that the most important aspects of this white paper can be implemented in September or in October. The pilot for affordability checks is expected to be completed around that time, according to his estimate.
He is even more optimistic, projecting that by the end of next year the new levies system will be in place. It would also be an appropriate timeline to mark the two-year anniversary of the release of this white paper.
Ellis believes that the controversial elements of the whitepaper could drive players towards black market providers, which is the opposite of raising standards.
She explains that “there is a danger that certain proposals such as a stake limit on online slots or restrictions on incentives and bonuses could result in a substantial increase of the number of clients turning to non-licensed operators where they might not receive tools to help them control their gambling, nor interventions if there are signs of harm.”
Even if it is only by generating discussion on how the industry could do better, the white paper of the Gambling Act Review has helped to raise standards.
Sustainability must be at the top of the list in these discussions to ensure that the whitepaper is implemented so both players and operators can reap the benefits. If sustainability is not given priority, the industry may find itself right back where it started.
