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The Lord Bishop of St Albans
To ask Her Majesty’s Government what assessment they have made of the report by Public Health England Gambling-related harms evidence review, published on 30 September.
The Lord Bishop of St Albans
My Lords, I declare my interests as a vice-chair of Peers for Gambling Reform. I thank Public Health England and all those who worked on this review, which sheds light on the health impacts of gambling-related harms and quantifies the direct cost of gambling harms to the Government. The review concluded that 0.5% of our population were considered problem gamblers and 7% of the population of the UK are negatively affected by gambling. This is over 4 million people in England and over 5 million people across the UK as a whole, which is one in 12 people either directly or indirectly affected by gambling-related harms. This is a significant social problem.
One of the striking things are the regional discrepancies, with the north-west and north-east having the highest percentage of at-risk gamblers and the south-west having the lowest percentage. The north hosts some of England’s poorest and most deprived communities and, as a 2021 study from the Standard Life Foundation found, the UK’s most deprived areas have 10 times more betting shops than the more affluent parts of the country. Therefore, I hope that Her Majesty’s Government will not view the current gambling review as a mechanism simply to strike a new status quo compromise between themselves and gambling operators. Instead, it needs to be built into the levelling-up agenda.
This report shows that the current status quo between the Government and gambling operators is a rotten deal for taxpayers. When the gambling review was launched in December 2020, the then Commons Minister Nigel Huddleston set the tone by mentioning the £3 billion a year tax contribution from the industry. The harms caused by gambling, however, were quietly skated over, including the financial costs and suicides. I was absolutely astonished that the Government would laud the tax contributions from the industry without any recognition that gambling was simultaneously costing the Government huge sums and creating huge social damage.
Over 20% of contributions from the gambling industry, equivalent to around £647 million, can be costed directly to the Treasury for gambling-related harms. That is on top of an estimated £619 million in intangible costs stemming from an estimated 409 gambling-related suicides every year. I therefore hope the Government will support my Private Member’s Bill so that more accurate data can be collected on the number of gambling-related suicides.
Based on the polluter pays principle, the gambling industry should pay for the harms it causes. Currently, the Government rely on the good will of gambling companies in the form of a voluntary levy to help fund research, education and treatment. However, rather than the £100 million spread over five years promised by the industry, we need a mandatory levy set at 1% of gross gambling yield, which would bring in about £150 million annually according to the economic research undertaken by NERA. Furthermore, it would remove the industry’s control over the disbursement of funds for research, treatment and education and break the link that makes many academics unwilling to accept funding because their research will not be taken seriously.
At a time when there are such massive calls on the public purse, efforts to reduce gambling-related harm would in turn reduce the direct costs to the Government of criminal activity, unemployment and financial harms associated with problem gambling. Public Health England identified gambling-related debt as a key factor in many other areas as well, including relationship breakdown, mental health problems, crime, bankruptcy and homelessness. Indeed, in the media hardly a week goes by without stories of people being convicted of stealing to fund an addiction. In financial harms and criminal activity, we have an associated direct cost to the Government of about £225 million a year.
Anyone who happened to catch Paul Merson’s BBC documentary on gambling addiction on Monday evening will have heard not only the story of how his life has been dominated by the scourge of this addiction but the tragic story of Joshua, whose parents I met, who in the last three years of his life gambled away his salary, each time on the very day he received it. We do not know how many of those 409 gambling-related suicides, as estimated by Public Health England, were associated with financial debt, but certainly all the anecdotal evidence indicates that it was the vast majority.
A fascinating aspect of this research was the difference in approach identified by Public Health England between commercial and non-commercial stakeholders. Commercial stakeholders thought the focus should be on intervention and treatment rather than on creating a safer gambling environment. They wanted to blame a small group of weak individuals, whom we should pity and give a bit of support to, instead of acknowledging that many of these products are designed to be addictive right from the start when they are put together.
It is significant that, in many instances of gambling-related suicide, gambling operators, far from attempting to intervene on behalf of a gambler’s welfare, are still actively encouraging the person to gamble right up to their death—indeed, sometimes after the person has died they receive calls and offers of free gambling. There is virtually no incentive for operator intervention. The attitude of the operators, as captured by Professor Rebecca Cassidy, highlights the ambiguity of the industry’s position. When one individual attempted to set up a data-sharing network to identify customers of concern, the response was, “Why on earth should we share anything about our best customers with you?” There was not even a tacit admission that problem gamblers bring in the vast majority of income for gambling companies. Interventions need to occur before an individual reaches the point where they gamble away their entire income. Even then, the fact that current regulations allow someone to gamble all their income, bank balance or savings in one session highlights the seriousness of the problem we still face.
Public Health England admits that the evidence suggests that gambling should be considered a public health issue, which in my mind implies that we need a public health approach. This will not be achieved by relying on the good will of profit-driven gambling operators to intervene. A firm line on affordability checks is required to prevent individuals susceptible to harm from depositing unaffordable amounts, alongside a comprehensive network of intervention and treatment. Any effective affordability mechanism will require some form of data sharing and greater co-operation between the FCA, the PRA and the Gambling Commission. I hope the Government will review the affordability recommendations made by the Centre for Social Justice in its May 2021 report Not a Game.
The Betting and Gaming Council often falls back on the mantra that loads of people enjoy a flutter in a safe and responsible way. There is some element of truth in that, but anyone who takes the trouble to scroll through the Gambling with Lives “Remembering” page will see countless faces of young men and women for whom a flutter became the start of something that eventually proved fatal. These are the victims of gambling-related harm. As the Government study Public Health England’s excellent evidence review, their mind should be focused on how best to prevent future tragedies, rather than on placating an industry that is complacent or, worse still, almost encourages problem gambling.
Finally, will the Minister give me an assurance that the findings of this review will be taken into account in the Government’s White Paper on gambling reform, which I gather is now to be published next year?
Lord Foster of Bath (LD)
My Lords, I refer to my interests as set out in the register. I congratulate the right reverend Prelate not only on securing this debate but on his very powerful speech.
The landmark evidence review by Public Health England clearly highlights the wide range of gambling-related harms, including homelessness, unemployment, imprisonment, depression and alcohol dependency—and most seriously, as we have heard, suicide. However, the review also highlights the magnitude and long-lasting impacts of these gambling harms. There are more than 400,000 problem gamblers—of whom, staggeringly, 60,000 are children—and millions of others are at risk or impacted by other people’s gambling. On average, there is more than one gambling-related suicide every day. It is a grim picture of the impact gambling has on our society.
Some argue that it is even grimmer, but, as the review acknowledges, there are clear research gaps in the evidence base, so I hope that the Minister—whom I welcome to his new role—will tell us what plans the Government have to fill them. I am sure he will acknowledge that such research requires researchers to have access to data, not least data currently held by gambling companies about their customers. I was delighted that the ICO agreed with the Gambling Commission very recently that gambling companies can share that data with each other without breaching GDPR. However, does the Minister acknowledge that gambling companies should be required also to share such data, in anonymised form, with authorised researchers? What steps will be undertaken to ensure that this happens?
Even without further research, we know that the situation is grim, not just for the individuals impacted but for society as a whole. Indeed, the PHE review estimates the annual economic burden of gambling harm to be over £1.2 billion, and possibly much higher. When Peers for Gambling Reform, supported by over 150 Members of your Lordships’ House and which I have the honour to chair, commissioned NERA to look at the economic implications of introducing the reforms we proposed, it also considered the cost to government of gambling harm. Interestingly, our NERA figures were dismissed as fantasy by the industry, yet the PHE figures are higher than those in our NERA report. So does the Minister accept the PHE figures—which are, after all, from a government body—and will he defend them against attempts to dismiss them by the industry? Is he aware that our NERA report shows that introducing our proposed measures to tackle gambling harm would lead, among other benefits, to increased employment and increased income for the Treasury?
The Peers for Gambling Reform measures range from the introduction of a compulsory levy to fund research, education and treatment and the establishment of a gambling ombudsman to tighter regulation of online gambling and of gambling advertising, but central to the proposal is that, in considering gambling reform, the Government should adopt a cross-departmental public health approach. As the right reverend Prelate pointed out, the gambling industry constantly tells us that many people enjoy a flutter in a safe and responsible manner, yet recent TV programmes such those we have heard about and the excellent video produced by Gambling with Lives show all too clearly how that flutter can lead to something which causes great harm and can sometimes be fatal.
There is no incentive for the profit-driven industry to take serious action. A huge proportion of its profits comes from problem and at-risk gamblers. As the Lords report, Gambling Harm—Time for Action, states, the greater the problem, the higher the profit. The public health approach we advocate would prioritise prevention of harm for the whole population. We have seen this approach taken with drugs and alcohol addiction, where the issues are high profile and highly resourced. The comparable harms caused by gambling addiction have not received the same attention and, frankly, are often forgotten. The Government’s recently announced Operation Courage, for example, which earmarked £2.7 million for expanding services for military veterans with complex mental health issues, physical trauma and alcohol or substance misuse issues, does not provide funding for gambling addiction, despite recent research by the Forces in Mind Trust and Swansea University reporting that 43% of veterans had experienced problem gambling in the last year and were 10 times more likely than non-veterans to experience gambling harms and to gamble as a way of coping with distress. Anyone can experience harm from gambling. The characteristics of some products such as continuous, fast-paced play are well known to be highly associated with harms. Because of this, prevention needs to address the ways in which gambling products generate harms, as well as the wider social, economic and cultural factors which shape how gambling is provided and promoted in society.
That is why, just as we already do with drugs and alcohol policy, gambling policy must be based on a public health approach. The Government say that that is what they are doing, so can the Minister explain why, based on what I have been told, there has been little or no communication between DDCMS and DHSC as work on the Government’s review of gambling has progressed to date? Will he do all he can to ensure that, as the gambling White Paper is developed, there is real engagement between departments and, as proposed in the excellent PHE review, the adoption of a public health approach?
Lord Sikka (Lab)
My Lords, it is a pleasure to follow the noble Lord, Lord Foster, and I am grateful to the right reverend Prelate the Bishop of St Albans for facilitating this debate.
The harms caused by gambling have been raised on a number of occasions, but this review is very helpful because it brings together lots of studies and information. For example, 13 studies looked at gambling harm resulting in underperformance or poor performance in employment and education. It notes that, from the age of 17 and perhaps even lower, those engaged in gambling underperformed in their academic studies, which has a knock-on effect on their subsequent employment and related capacities. Gambling was also found to be linked to loss of concentration at work, lateness and poor work performance, resulting perhaps in loss of employment or lack of opportunities for promotion and so on.
Child gamblers had considerable difficulties in learning at school. It is illegal for children to gamble, but many websites permit it. I tried one of them and it said: “Are you above 18?” I said no. Click, and I was still in—whether I said yes or no made absolutely no difference. Although such sites say they will monitor it, the software does not care. Children of gamblers also have difficulties at school, because of the chaotic home life associated with gambling parents. Again, it would be helpful to know whether the Government have any proposals for dealing with this.
Some 31 studies mentioned in the review deal with financial harms to gamblers and their families. One study found that an increased number of electronic gambling venues in a local area increases the number of personal bankruptcies in that area, which is a catastrophe not only for the families concerned but for the local economy, because a lot of spending power vanishes. Again, it would be helpful to know how the Government want to control that. I have noted that some of these venues are quite near schools and colleges, and one can see young adults going into them. Gambling causes direct financial harms to gamblers and their close associates. A number of studies identified that gambling-related debts were a huge problem too, because they exert pressure on household budgets. I know that the Government have banned the use of credit cards for gambling. Perhaps they should consider some restraint or ban on the use of debit cards as well. Some individuals had their salary or a loan paid into a bank account and basically used a debit card to squander away their and their family’s income. Such financial harm also affects the children of gamblers.
An issue on which the Government should commission further research is tax avoidance by gambling companies. The data is quite hard to collect. When I look at the accounts of gambling companies, I often find very little information about profit shifting, about trials for pricing policies or about tax avoidance strategies. Most of the online gambling companies licensed by the UK Gambling Commission operate from offshore tax havens. The main attraction is lower tax bills, secrecy and rules avoidance—which some people like to call regulatory arbitrage; I prefer “rules avoidance”. It is known that Unibet’s servers are based in Malta, Alderney and Gibraltar. It is registered and licensed in Gibraltar but makes profit in the UK. Whereas the Chancellor tells us that it is government policy to persuade companies to pay tax where they are based and where their customers are, in these cases the customers are in the UK, the companies operate in the UK, but their revenue is booked in Gibraltar.
It would be helpful to know whether the Government have an estimate of how much tax is dodged. Paddy Power’s owner, Flutter, bet365 and William Hill have subsidiaries in offshore locations such as Guernsey, Gibraltar and the Isle of Man. At least 55% of online gambling in the UK takes place on Gibraltar servers. Are the Government content with this leakage of tax revenues? Companies such as bet365 have been paying an effective tax rate of about 12.7%. William Hill has been paying around 12%. Others such as GVC, which is the parent company of Coral, have been paying around 3%. The Gibraltar-based 32Red is estimated to have paid just £812,000 in corporation tax over 10 years. I urge the Minister to encourage HMRC and others to publish a report on the taxes being avoided by gambling companies.
Lord Smith of Hindhead (Con)
My Lords, I thank the right reverend Prelate the Bishop of St Albans for initiating this important debate and declare my interests as set out in the register. I congratulate my noble friend the Minister on his recent promotion and wish him every success in his new role.
I think we all want to minimise or, better still, eradicate the harm caused by gambling, but I hope we can achieve this while not hampering those who are able to gamble happily and without harm, and without demonising an industry which, certainly in recent years, has taken the role of intervention and social responsibility a little more seriously than in the past. We know that much more than money is lost when a person is negatively affected by gambling: a person’s mental health is at stake; indeed, in some cases, their life is at stake. The mental health of those around them is adversely affected and it is particularly tragic when we hear reports of children suffering from either their own gambling addictions or those of their caregivers.
I am pleased that GambleAware recently decided to widen its data-sharing pool within the research community by sharing its annual treatment and support surveys. I hope this will shed more light on the composition of those who are involved in such programmes and whether there were any steps that prevented their participation in such treatments. I hope others will follow suit—better decisions can be made when more information is available. If the Government want an evidence-based review, then clearly there must be evidence.
I note the report uses the terminology
““Estimated … costs … associated with gambling”,
but it is not possible to say that these costs were caused by gambling. A big part of the total estimated costs of gambling health harms in the report
“is based on the direct costs to government of treating depression, alcohol dependence and illicit drug use”
and other complex areas. Does the Minister agree that it would be good to try to get this figure of the costs of gambling harm to a position where there could be more accuracy? Does he also agree that we need to be very careful not to confuse the two issues?
The report says that the National Lottery is the most common type of gambling across all age groups, except among younger people, where scratch cards are more common. The report also points out that the proportion of children and young people who participate in gambling has been reducing, which is positive news, and that the most common forms of children’s participation are playing the lottery, including online lottery games, using scratch cards or placing private bets with friends. I have never understood why the National Lottery is always singled out from other forms of gambling, both in this report and in most others which are published, including those by the Gambling Commission. There is a reported total amount of gambling spend and then a different figure which includes National Lottery spend, giving the impression that the National Lottery is somehow removed from gambling activities. The National Lottery is gambling.
Just to be clear, I am no more anti-National Lottery than I am anti-gambling. I appreciate that the National Lottery supports many good causes and can create social cohesion but let me give one simple example of the mixed messages we have become involved with. Those of us who have an interest in this subject have been debating and considering the gamblification of sport and the potential harm, mainly to young men, of gambling companies’ advertising, particularly at Premier League football. Yet earlier this year, we were bombarded with adverts giving patriotic encouragement to get behind Team GB and buy £5 and £10 scratch cards. Camelot makes around 43% of its profits from instant-win online games and scratch cards. A huge part of its business is indistinguishable from other gambling companies, yet it remains untarnished by the normalisation of gambling. There have been many reported cases where people have said that playing the National Lottery was a gateway into gambling addiction. I think this area of gambling activity deserves more research.
Finally, there were aspects of the report I was pleasantly surprised to read, such as that the proportion of young people participating in any gambling has reduced by 23%, and that, based on the 2018 data, the number of people with a problem with gambling has remained fairly constant and has not increased since 2012. It is encouraging that, even during lockdowns, there seems to have been an overall reduction and only a very slight increase in online activity. According to recent Gambling Commission reports, the proportion of gamblers assessed as being at medium risk of harm has halved from 1.4% of the adult population to 0.7% since the end of last year. I hope this shows that, in some areas, effective work is being carried out by both the gambling industry and bodies such as GamCare to combat gambling harms. I also hope that quality, evidence-based research can continue to be pulled together as we move closer to reforming the 2005 Act and that the continuing trend to drive up standards in the regulated industry will go even further in tackling problem gambling.
Lord Robathan (Con)
My Lords, I pay tribute to the right reverend Prelate the Bishop of St Albans for his tireless concentration on problem gambling and for continuing to raise the issue. I do not agree with everything he says, but I think he has done extremely well, and I am delighted that we have this debate.
I shall start with a confession, or should I say a declaration of interest, in that I gamble: I bet. In April, I won on the Grand National; Rachael Blackmore, on Minella Times, was the first female jockey to win the race, and I was delighted. I won quite a lot on the Cameron leadership campaign, on the referendum result and on the 2015 election, although sadly I have not yet recouped the rather large loss—a very large loss—I made on the only spread bet I will ever take part in, which was on the 2005 election; I learned my lesson. We did not do frightfully well. My wife, I am delighted to say, has now forgiven me.
I am not opposed to what I might term traditional, social gambling—far from it—be it on the racecourse, physically in a casino or even online. However, there has always been problem gambling: one can mention, relatively recently, the case of Lord Lucan, and many Members of this House in this past gambled away huge estates—I cannot even contemplate why they did so, but they did. Now, we have a completely different scale of gambling, largely because of the internet, and public policy has yet to catch up with this.
As this report makes clear, gambling profits were £14.2 billion in 2020. To put it another way, that is £14.2 billion of losses to punters. We have heard about the harms: financial, relationship, mental, physical, suicide, self-harm, depression, employment, educational, criminal and antisocial. There are huge costs to society, estimated at a total of £1.266 billion. How anyone can arrive at that amount is anybody’s guess; nevertheless, it is huge. I noted the right reverend Prelate said that the so-called commercial stakeholders, surprisingly, were not of the view that tackling gambling-related harm required a public health approach; rather, they would like to concentrate on individuals who are problem gamblers.
If anyone wants to look up online gambling sites, as I did this morning, they will find all sorts of interesting things. The 10 best, for instance, include Bet365 and Virgin Bet. You get an up to £200 welcome offer from Admiral Casino and you will discover, if you look into it, that the owner, or half-owner, of Bet365, Denise Coates, paid £99 million in tax in 2018. Put another way, even if the noble Lord, Lord Sikka, who talked about tax avoidance, is not entirely correct, she must have made a stonking fortune if she paid £99 million in tax in one year—probably well over 100 times more than most people in this country will ever pay. The money she made, and that all companies make, is other people’s losses and other people’s money—people who gambled and lost.
I have only one point to make. I am not in favour of banning things; I prefer to rely on individual responsibility. But I urge the Government to look very closely at online casinos and slot machine sites, where people sitting at home are pouring money down the drain—money which they can often ill afford. I particularly mention the ghastly adverts that are seen on television—and, I am sure, on social media, which I do not see so much—that encourage people, with any number of gimmicks, to lose money. The All British Casino gives you, it says, “Always 10% Cashback!”. That is interesting. Betway gives you £10 in free bets, and Paddy Power gives you £50 in free bets and 100 free spins, et cetera, et cetera. These are all financed by organisations that make £14.2 billion out of losses—losses that, very often, ill-advised punters like me have made. Will the Government please look at banning these advertisements, which can only be described as misleading and are designed to encourage people, often fairly poor people, to become poorer?
Baroness Bennett of Manor Castle (GP)
My Lords, I join others in welcoming the Minister to his new role and thanking the right reverend Prelate the Bishop of St Albans for securing this important debate.
I joined your Lordships’ House after speaking at a medical conference. I mentioned to a senior doctor there where I was heading next. He said, “I bet to myself that whenever I switch on the television I will see a gambling advert.” He was not just making a joke but expressing concerns about the public health aspect of the gambling industry, particularly gambling advertising, which so many noble Lords have already mentioned.
I was talking at the conference about the pharmaceutical industry, quoting a former editor of the New England Journal of Medicine who described it as being like an 800-pound gorilla in its political impact. That might be quite a good metaphor for the lobbying power of the gambling industry too. If we set the two against each other, it might be quite close and we would probably see quite a bit of betting on the result.
The noble Lord, Lord Smith, said that the industry is becoming a little more responsible. “Little” seems the right word when you look at the list of annual donations to GambleAware, the industry-funded addiction charity, published in April 2021. There are a number of remarkably small donations from very large groups. To pick out one, the Philippines-based W88, a shirt sponsor for a major football team, which is operating through the controversial white-label system, donated £250. That sum was succeeded by quite a large list of donations from local hospices and Red Cross groups, which had done things such as hold cake stalls to raise money to help problem gamblers. Yet here was a very large company from the industry putting in £250.
Slightly to my surprise, I find myself agreeing with what the noble Lord, Lord Robathan, said about advertising. I direct Members of your Lordships’ House to an article by the Hampshire cricketer Chris Wood just published in the Times. He has spoken with great bravery about his problem with gambling addiction, identifying that he has lost around £200,000. Gambling has massive impacts on poorer communities, but it is a problem right through all areas of our society. Chris Wood explicitly identifies advertising, particularly during football games, as something he found very hard to fight against.
Looking at what is happening around Europe, Sweden is proposing restrictions on gambling parallel to its tight restrictions on alcohol advertising. Portugal has just brought in a ban on advertising on TV and radio between 7 am and 10.30 pm. Being new, the Minister may not yet have acquired the yellow sticky note that I am sure is on all Ministers’ computer terminals which says, “Must say ‘world-leading’ in every sentence”. If he has, I strongly suggest that he does not use that phrase here, as we are definitely trailing on the global scale of controls on this out-of-control industry.
It is interesting that so many nations are tying together alcohol and gambling advertising, because this review demonstrates that alcohol consumption is strongly associated with gambling. The noble Lord, Lord Robathan, talked about leaving it to individual responsibility, but that is obviously a problem when you combine gambling opportunities with alcohol.
I want to build on the comments of the noble Lords, Lord Foster of Bath and Lord Sikka, who talked about the impacts on children and young people. The review tells us that the rates for gambling, which is often technically illegal, are higher than those for using e-cigarettes, smoking tobacco cigarettes or taking illegal drugs. In some cases, we have very tight legal restrictions on those three activities, which are harmful to young people, so surely our controls on gambling, particularly as it affects young people, should be on a similar scale.
Talking about young people, I raise the issue of loot boxes. We have talked about this quite a bit in your Lordships’ House, but we have failed to see any government action. I looked at some figures on the FIFA Ultimate Team games. Research has shown a robustly verified link between loot boxes and problem gambling. A UK consumer survey which looked at the players of this game suggests that 31% of 13 to 15 year- olds had played the title. This really is a public health issue, particularly for children and young people.
Finally, I mention a comment made by the right reverend Prelate the Bishop of St Albans about how this ties in with the levelling-up agenda. There are reasons why problem gambling and poorer areas are associated. Many people in our society cannot see a way forward for themselves financially. They are trapped in low-wage jobs or on zero-hours contracts. They look for hope—a tiny spark to suggest that things might get better. They know that the odds are terrible but cannot see anything better. We need many more changes to address the issues which sit behind those covered in this debate.
Baroness Merron (Lab)
My Lords, I am grateful to the right reverend Prelate the Bishop of St Albans for securing this important debate. It comes at a particularly timely point, given the Government’s ongoing review of gambling regulation and the recent ministerial changes at the department. I am pleased to welcome the Minister to his place on the Front Bench.
I also add my thanks to Public Health England and everybody involved in producing the report which has informed this debate. The report shows that there is so much more at stake from gambling than simply individuals losing money. It can take its toll on the mental health and life chances of the gambler, as well as impacting deeply on those around them, which is a very important point.
The evidence sets out that harmful gambling is a public health issue. There is no movement away from that; it is absolutely clear that this needs addressing on many fronts. The emphasis must be on preventing these harms occurring, as well as having help readily available for those directly and indirectly affected by the wide-ranging and long-lasting negative impacts of gambling, a point very clearly made by the right reverend Prelate.
The review also shows that people at risk from gambling harms are concentrated in areas of higher deprivation, who may already be experiencing greater health inequalities. As we have heard, if levelling up is to mean anything, it has to take account of this. I would be grateful if the Minister could address this crucial aspect.
A significant proportion of the population engages in one or more forms of gambling and for many it is an enjoyable and occasional hobby. However, for a worrying number of people, it can lead to harm. The data in the report shows that, while overall participation levels are broadly stable, some significant changes are occurring. First, online gambling, which many researchers believe carries a higher risk of harm, was on the up even before the Covid pandemic and the lockdowns that it brought, which then created circumstances for increased online gambling.
Secondly, while gambling by children and young people appears to be decreasing, it is important to note that it remains too high. That is a real point of vulnerability. My noble friend Lord Sikka spoke about the impact on achievement at school and the issue of those who are underage having access to gambling sites, which should not be the case.
In recent years, there have been fierce debates about the future of fixed-odds betting terminals. We are pleased that the Government eventually adopted Labour’s position of limiting individual stakes to £2. However, gambling harm presents itself in a number of different ways and, as the research and this debate note, comes with a weighty and uncertain cost to the public purse. There are many public health aspects. It is worth noting that the review found a clear link between higher levels of alcohol consumption and harmful gambling, including for children and young people. In addition, the evidence shows that people with gambling problems are at least twice as likely to die from suicide compared with the general population. This is a complex and connected picture of behaviours, circumstances and effects.
Earlier this week, the BBC aired a very relevant documentary featuring an ex-professional footballer, Paul Merson, who bravely told his own story in the hope of encouraging others who struggle with gambling-related issues to seek help. The programme was particularly interesting because football has been, and remains, an interesting case study. I hope that the Minister will take a particular interest in it. As we know, many top-flight teams are sponsored by gambling firms, either in the form of shirt sponsorship or the advent of official gambling partners. The English Football League’s three divisions are sponsored by Sky Bet, with sleeve badges and stadia prominently displaying the firm’s logo. Many televised matches display gambling adverts, either on pitch-side displays or during half-time as viewers are offered live odds.
Again, while there is no problem with gambling per se, issues undoubtedly arise when regulation is inadequate and consumers are not adequately protected. With this in mind, and with a new ministerial team in place, can the Minister update us on the ongoing review? Who has formal responsibility for overseeing the process? When can we expect to see some output beyond the initial call for evidence? We understand and welcome the additional resources into specialist NHS gambling addiction clinics, as well as the expansion of mental health provision more generally, but does he agree that we need to prevent people developing problematic habits in the first place?
Finally, can the Minister also comment on recent events around the introduction of a single customer review, following the Information Commissioner’s Office’s advice that such a system need not be incompatible with data protection law? Will this require legislation? If so, how will that come about?
The Parliamentary Under-Secretary of State, Department for Digital, Culture, Media and Sport (Lord Parkinson of Whitley Bay) (Con)
My Lords, it has been a pleasure to listen to the debate this afternoon. I thank the right reverend Prelate the Bishop of St Albans for securing it. One of the first things I did when I joined your Lordships’ House was join the Select Committee on the Social and Economic Impact of the Gambling Industry, along with him, the noble Lord, Lord Foster of Bath, and my noble friends Lord Smith of Hindhead and Lord Mancroft. I am pleased to have the opportunity early on in my new role to debate this issue, which I know continues to interest a great number of people in your Lordships’ House.
Public Health England’s review is a valuable contribution to our understanding of gambling-related harm and the forms it can take. It is also especially timely. It was an important commitment made following the last gambling review in 2018, and I am happy to assure the right reverend Prelate that its findings will be carefully considered in the Government’s ongoing review of the Gambling Act.
The landscape of gambling, as in many areas of life, has changed significantly since 2005, but the objective of the Act to protect children and vulnerable people from being harmed or exploited remains fundamental to the Government’s vision for the sector. Our Gambling Act review will ensure that our regulatory framework is fit for the digital age. Its objectives include making sure that all those who choose to gamble in Great Britain can do so in a safe way.
The Gambling Commission’s work to strengthen protections is continuing alongside the review. As noble Lords noted, gambling is a leisure activity for most, but it is also clear that many people and their families have their lives devastated by gambling-related harm. The Government are clear that gambling harm is a public health issue, as a number of noble Lords rightly noted, and we treat it as such.
Gambling legislation and Gambling Commission regulation are designed to keep gambling safe for the population as a whole. However, we have more specific measures and targeted interventions to give appropriate protection to children and vulnerable adults. The report shows that the problem gambling rate among adults is 0.5% and has remained stable since 2012, but it is essential that those suffering harm receive the help they need. Our National Health Service has committed to opening 15 new treatment clinics for problem gamblers by 2024, and the industry has committed £100 million for treatment over the same period.
A number of noble Lords, including the right reverend Prelate and the noble Lord, Lord Foster, mentioned the costs of gambling harm. PHE reports found that the annual economic burden of harmful gambling is approximately £1.27 billion but, as my noble friend Lord Smith of Hindhead noted, the report makes it clear that the analysis presented estimates the costs associated with, not caused by, gambling. There are complicated interactions between gambling and mental health problems and, as the report makes clear, alcohol use. Nevertheless, the costs associated with gambling harm are stark, so there is clearly important work still to be done.
As the noble Lord, Lord Foster, said, the report identifies gaps in the evidence base. One of the aims of our review is to make sure that we have high-quality evidence to support regulation. We will work with the Department of Health and Social Care and key parties to address the knowledge gaps identified in the evidence review and improve data collection. He asked whether that would include data from companies. The Gambling Commission is taking forward work on a national data repository with the aim of collecting data for use by researchers; I am pleased to say that it will include data directly from gambling operators.
One area where there is an evidence gap, as was noted by the right reverend Prelate and the noble Baroness, Lady Merron, concerns regional disparities. He will not be surprised to know that my eye alighted on the fact that the north-east had the highest prevalence of at-risk gamblers. However, I also saw that the PHE report was clear that, because of the small numbers it studied, it was not possible to determine those levels with any statistical significance, so that is one area where further evidence is needed and further research needs to be undertaken.
A number of noble Lords including the noble Lord, Lord Sikka, and my noble friend Lord Smith mentioned children. I am pleased to say that children’s gambling participation is in decline. In 2011, 23% of 11 to 16 year-olds said that they had gambled in the past seven days, while in 2019 it was 11%. However, we cannot be complacent. This is why, as my noble friend Lord Smith alluded to, we have increased the minimum age limit to buy National Lottery products to 18. We are also considering other potential measures to protect children and young people as part of our review. If the noble Lord, Lord Sikka, would like to tell me about the website he mentioned, I would be glad to look into why he was able to get through and discuss that with him in further detail.
The noble Lord also talked about online protections more generally. Significant progress has been made in recent years to make online gambling safer, including a ban on gambling on credit cards and new rules to reduce the intensity of online slot games. However, we recognise that more can be done to protect those who gamble online. Our review is looking closely at the case for greater protections for online gamblers, including protections on products and for individuals. The Gambling Commission is also working to improve how operators use data to identify customers at risk of harm and intervene.
The noble Lord, Lord Sikka, asked about the tax arrangements of gambling operators. All companies selling gambling to customers in Great Britain pay UK gambling duties wherever they are based; the remote gaming duty is 21% of gross profit.
The noble Baroness, Lady Bennett of Manor Castle, and my noble friend Lord Robathan mentioned advertising. PHE’s evidence review did not find evidence that exposure to advertising and marketing is a risk factor for harmful gambling. However, operators must advertise responsibly. We are committed to tackling aggressive practices.
Lord Robathan (Con)
I should have congratulated my noble friend on his new post, by the way. If advertising does not encourage people to gamble, why are companies spending so much money on it?
Lord Parkinson of Whitley Bay (Con)
It is a competitive market and, if people choose to use their money in this way, operators are encouraging them to do it with their specific companies; as private enterprises, they are right to do that. But, as I say, operators must advertise responsibly and we are committed to tackling aggressive practices where we see them. We have called for evidence on advertising and sponsorship specifically as part of our review, and we are looking closely at the issue of sports sponsorship as part of it.
More broadly, on marketing and inducements, we have called for evidence on promotions and offers. One of the things I learned about when sitting on your Lordships’ committee was that the number of customers in VIP schemes has fallen by over 70% since the industry started following new rules on how the schemes should be run from September 2020. Gambling Commission and advertising rules already prohibit inducements which encourage customers to gamble more intensely, and operators are not allowed to market directly to those who have self-excluded or customers showing signs of vulnerability, but this is one of the areas we want to look into in the review.
The noble Baroness, Lady Bennett, asked about loot boxes. The Government are delivering on their manifesto commitment to tackle the issue of loot boxes in video games. We ran a call for evidence last year to understand their full impact and received over 30,000 responses. We are reviewing those responses and continuing to engage with the industry to determine the most robust and proportionate solutions, and our response will set out the next steps that we intend to take.
The noble Lord, Lord Foster, and others mentioned problem gambling in the Armed Forces. The Government are vigilant to the emergence of problem gambling among those serving in our Armed Forces, which includes providing welfare support and financial awareness training. The Ministry of Defence also blocks gambling websites on its networks to reduce their accessibility. PHE’s evidence review found no association between exposure to combat situations and problem gambling, and there is a lack of longitudinal evidence to clarify whether trauma is a risk factor for harmful gambling. However, we welcome further evidence in this area as well, and are taking a close interest in the results of a recent important study from Swansea University looking at gambling participation among ex-service personnel.
The right reverend Prelate mentioned the troubling estimate of over 400 gambling-related suicides per year in the PHE studies. Of course, any suicide is a tragedy. It is important to note that the figure in the PHE report is an estimate based on two overseas studies; we do not know how many suicides in the United Kingdom are linked to gambling. The Department of Health and Social Care is working to improve our data collection and address other evidence gaps on this most important of issues. NHS England is also investing £57 million in suicide prevention through the NHS long-term plan. Investment in all areas of England by 2023-24 will support suicide prevention plans locally and establish bereavement support services. We know how serious these impacts can be.
While the gambling review is ongoing, the Government and the Gambling Commission are not waiting for it to end to take action where it is needed to make gambling safer. In the last 18 months, we have: banned gambling on credit cards; tightened restrictions on VIP schemes; raised expectations of online operators during the Covid pandemic, with increased monitoring and intervention throughout; introduced new rules to limit the intensity of online slot games; and launched a consultation on new rules for customer interaction to protect people who gamble online. The Public Health England review is therefore a timely contribution to our ongoing efforts to prevent gambling harm. It will be considered very carefully as part of our thorough review of the Gambling Act, together with all the other evidence we continue to receive. We will publish a White Paper setting out any proposals for reform and our vision for the sector in the digital age in due course.
I give my thanks again to the right reverend Prelate and all noble Lords who have spoken in today’s debate. I know they will continue to contribute to the debate in this important area.