Debates between Stephanie Peacock and Philip Davies during the 2019-2024 Parliament

Financial Risk Checks for Gambling

Debate between Stephanie Peacock and Philip Davies
Monday 26th February 2024

(9 months, 4 weeks ago)

Westminster Hall
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Stephanie Peacock Portrait Stephanie Peacock (Barnsley East) (Lab)
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It is a pleasure to serve under your chairship, Sir George. I refer to my entry in the Register of Members’ Financial Interests.

The fact that over 100,000 people have signed the petition on financial risk checks in less than a month shows the strength of feeling on the topic. I pay tribute to my hon. Friend the Member for Neath (Christina Rees) for leading this important debate. This issue is important to everyone who offered their signature, as well as to the gambling and racing industries, which want to be sure that the checks are truly frictionless before they are rolled out. It is also crucial for organisations and families who are concerned about gambling harms and want confirmation that the updated regulation in the gambling White Paper will be going ahead. The Government must be able to strike that balance, as they have promised.

I would like to set out the context for introducing financial risk checks as part of the gambling White Paper more broadly. Half of adults across the UK gamble each month. The vast majority do so safely, moderately and in a way they enjoy. I remember my nan going to bingo every week when I was growing up, and I have always enjoyed going to the races—I was pleased to attend the St Leger last year. For some, however, gambling can become a more serious problem: 300,000 people across the country experience problem gambling, and 1.8 million are considered to be at elevated risk.

The last time gambling laws were updated was back in 2005. Since then, the landscape has changed dramatically. Thanks to our tablets, laptops and phones, most people now have the potential to carry a casino in their pocket, meaning that they can gamble anywhere and make huge losses in a very short time, as my hon. Friend the Member for Swansea East (Carolyn Harris) outlined; I really appreciate the work that she has done over many years in this area. Because of that rapid growth in technology and our growing awareness of the impact of gambling harms, changes to our gambling regulation are now long overdue.

In my time as shadow gambling Minister, I have met those who are recovering from addition, as well as family members who have suffered the unimaginable pain of losing a loved one. For those people, it is absolutely clear that gambling harm has the potential to be devastating, and that more must be done to ensure that families are protected, as my hon. Friend the Member for Sheffield Central (Paul Blomfield) spoke powerfully about.

Affordability checks form part of the new, modernised system of gambling regulation that is fit for the future. Accompanied by other measures such as online stake limits, data sharing between gambling firms and a crackdown through the regulator on black market activity, they will ensure that the law does more to protect children and adults who are vulnerable to harm.

The right hon. Member for Chingford and Woodford Green (Sir Iain Duncan Smith) spoke about how early intervention in the form of checks can make a difference and change the course of addiction. That may well be the case—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. This is perhaps not an issue that we can solve here today, but it needs to be considered in the wider context of the White Paper.

As colleagues have outlined, it is also important that our regulation recognises that many people enjoy betting safely and without harm; the hon. Member for Shipley (Philip Davies) outlined that point robustly, as always. The Government must therefore be clear on how they will actually go about ensuring that affordability checks are accurate, frictionless and non-intrusive for consumers, as they have promised. I will conclude my speech with a number of specific questions for the Minister, but I will first speak briefly about why, in this context, the racing industry in particular is concerned about the nature of the checks.

Many Members have spoken about the impact that racecourses have in their constituencies, and I will try to list them. We had the hon. Member for Bath (Wera Hobhouse), the right hon. Member for West Suffolk (Matt Hancock) with Newmarket, the hon. Member for Windsor (Adam Afriyie) and the hon. Member for Tewkesbury (Mr Robertson) with Cheltenham. The hon. Member for St Helens North (Conor McGinn), who is a huge champion for the industry, spoke about his racecourse, Haydock. The hon. Member for East Lothian (Kenny MacAskill) spoke about Musselburgh, and the hon. Member for Waveney (Peter Aldous) spoke about the economic benefit of racecourses in such areas. Apologies if I missed anyone out.

Last week, I hosted a roundtable with representatives from the racing sector, including those who started today’s petition. They shared their thoughts on the potential unintended consequences of the checks, which the hon. Member for Mid Norfolk (George Freeman) spoke about very powerfully. Racing and gambling have a naturally symbiotic relationship, with the success of each industry somewhat dependent on the other. With more than 5 million spectators enjoying a trip to the races each year, it is clear that many people enjoy the combination too, making it the country’s second favourite sport. However, as a result of the partnership, the Government predict that the White Paper will cost the racing industry £14.9 million, with the British Horseracing Authority saying that that could rise to almost £50 million a year when considering the impact of the levy, media rights deals and overall funding.

In turn, as we have heard today, such losses could lead to lower prize money, decreasing participation, job losses in the rural economy and an overall decline in the sport. It is important for racing that the Government and the Gambling Commission work with the industry to ensure that financial risk checks are truly frictionless, targeted and accurate.

Philip Davies Portrait Philip Davies
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The hon. Lady is being very generous, and I commend her on being knowledgeable on the subject. I have a lot of time for her, as she knows. Based on what she said, would she support the calls that we have heard from many hon. Members today that perhaps a distinction should be made between games of skill and games of chance? I took from what she said that that would probably deal with the two separate issues she referred to.

Stephanie Peacock Portrait Stephanie Peacock
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I understand that argument, and I have some sympathy for it. However, I do not think that we can carve out horseracing in particular as being free of harm; I simply do not think that is the case. Of course the harm for the horses is less than some, but it is greater than others. We need to strike a balance. I am sympathetic to the argument made by the hon. Gentleman, and I am sure that the Minister will pick it up when he speaks. That is also why it is right that we should work to find a future-proof settlement on the horseracing betting levy, which contributes about £80 million to £100 million to the sport. I hope therefore that the Minister can update us on how the review into that is progressing.

Let me move on to the specifics of how the checks will be conducted. The Minister must be clear on how friction will be removed from the system. Indeed, in those rarer cases where it is proposed that bank statements or payslips might be needed as part of an enhanced check, it is unclear just how frictionless the process could possibly be. Concerns have also been raised with me about the value of using net losses alone without combining them with other markers of harm to prompt an affordability check. As a result, it would be helpful if the Minister could set out in full the latest thinking on how the checks will be conducted, so that they are accurately targeted and have limited user input. In the absence of that, can he let us know when we might expect a full response to the consultation?

The Gambling Commission confirmed late last week that the lower-level checks will use only publicly available data and will run on higher thresholds to start with. It also said that for enhanced checks there will be a pilot to test the details of data sharing. Can the Minister confirm the pilot to the House today and outline how the Department will work with the commission, credit agencies and the gambling industry to ensure its smooth running? Further to that, it would be reassuring if the Minister could set out how the pilot and higher threshold period will be evaluated. For example, what issues will the commission look out for, and what criteria will define success? It is important that we get that right. If the checks are not frictionless or are more disruptive than genuinely useful to those who are at risk, there is a risk that customers will be driven from the regulated industry to the black market, where there are no safer gambling protections whatsoever. That is a real concern, as has been spoken about today.

There is consensus on the need to update our regulation so that vulnerable people are better protected from gambling harms in the modern age. However, at the same time the punters, racing and the gambling industry deserve some clarity about how the Government will ensure that affordability checks are carried out with accuracy and in a way that does not cause unnecessary friction for those gambling responsibly. I look forward to hearing from the Minister how the Department plans to strike that balance.

Future of Horseracing

Debate between Stephanie Peacock and Philip Davies
Wednesday 25th October 2023

(1 year, 2 months ago)

Westminster Hall
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.

Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.

This information is provided by Parallel Parliament and does not comprise part of the offical record

Stephanie Peacock Portrait Stephanie Peacock (Barnsley East) (Lab)
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It is a pleasure to serve under your chairmanship, Mr Hosie, and I congratulate the right hon. Member for West Suffolk (Matt Hancock) on securing this important debate. I refer to my entry in the Register of Members’ Financial Interests. Indeed, just a few weeks ago, I attended Donny races along with many others from Barnsley, South Yorkshire and across the country.

Horseracing is our country’s second largest sport—second only to football. Each year, races attract over 5 million spectators across the country, but it is not just people who attend the races that benefit from the sport. Horseracing supports 80,000 jobs and generates more than £4 billion a year for the country, giving it a wider economic importance, as the hon. Member for Broadland (Jerome Mayhew) and many others said. That is without mentioning the impact the industry has in generating a positive view of our country across the world, with events like Royal Ascot attracting international competitors and spectators. With that in mind, the future of racing must be protected for generations to come.

In recent years, however, horseracing has been at risk of decline. Further to the pandemic, which cost millions in lost revenue, trainers are now also bearing the brunt of the cost of living crisis. That has impacted everything from the price of feed to the cost of transportation, but British horseracing was facing serious concerns even before these challenges. The UK has experienced a drop in the percentage of grade 1 races that it holds, as well as a crisis in equine talent moving abroad.

One of the underlying causes of the decline is the level of prize money available to British competitions. Despite reaching record highs in 2022, British prize levels are still significantly lower than rival competitions in France, Ireland, the USA, Australia, Japan and Hong Kong, as the hon. Member for Tewkesbury (Mr Robertson) mentioned. A poor prize pot means poor incentives for everyone in the racing industry—from owners to spectators—to compete and take an interest in British competition.

The racing industry has gone to great efforts to prevent decline and to see the sport grow. For example, as part of their new long-term industry strategy, the BHA has worked hard to secure a boost to prize funds and to publish a 2024 fixture list that includes 170 premier race days. Likewise, the betting industry has continued to foster its relationship with racing, including spending £125 million on marketing to promote racing. Despite that, more must still be done to ensure the future of British racing. For many, that change will start with the horserace betting levy.

Currently, the horserace betting levy is funded directly by bookmakers at a fixed rate of 10% of the gross profit made on British horseraces. Since its introduction, the levy has delivered around £80 million to £100 million of funding annually for the sport—a level that has been maintained in recent years despite declining turnover. Compared with other countries, however, the overall percentage of return that racing receives from the betting industry is on the low end of the scale at 3%. It is welcome, therefore, that the Government have committed to reviewing the levy to ensure that it delivers an appropriate level of funding for the sector. That review must answer the many questions being asked about the levy’s current structure.

I ask the Minister for a clear update on the progress of the review, including whether the Department has made any judgment on whether the levy should be raised, linked to inflation or adjusted to cover all bets by British customers, including those on international races. It is essential that the review looks to protect racing and its relationship with the gambling sector in the round. In that vein, 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?

Concern has also been raised about the impact of the gambling White Paper and particularly—as has been mentioned a number of times in the debate—affordability checks on horseracing. 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. Although there is, of course, a spectrum of gambling harm, I have seen at first hand that gambling addiction can have a devastating impact on the lives of individuals and their families. It is therefore important that gambling regulation is updated. Indeed, the last Gambling Act was introduced back in 2005, long before the huge growth in online and mobile gambling opportunities. An update to that is well overdue, and the Government must waste no further time in introducing a modern system of gambling regulation that is fit for the future. Affordability checks will form an important part of that and must be set independently, rather than by the industry. These checks must be accompanied by online stake limits, data sharing between gambling firms and a crackdown on black market activity funded through the regulator.

However, as well as ensuring that the law protects children and adults vulnerable to gambling harms, it is important to ensure that the regulation recognises that millions of people enjoy betting safely and without harm. The Government must therefore be very clear on how they will go about ensuring that affordability checks are frictionless for consumers, as they have promised. The hon. Member for Shipley (Philip Davies) used the word “proportionate”, which I think is a good one. That is important for the sustainability of the gambling industry, which we know racing relies upon, and for ensuring that customers are not incentivised to leave the regulated market and turn to the black market. The safety of racehorses is also fundamental.

Philip Davies Portrait Philip Davies
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I welcome the hon. Lady to her post. I agree with the overwhelming majority of what she has said, and I commend her for it. I wonder what she thinks of the issue that a number of Members have raised about whether games of skill should be treated differently from games of chance when it comes to gambling regulation, whether it is affordability checks or any other measure.

Stephanie Peacock Portrait Stephanie Peacock
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That is a very valid point, and it is one for the Minister to address. A balance needs to be struck. We have to recognise that gambling, whatever form it is in, can devastate lives. I have acknowledged in my comments that there is a spectrum and that not everyone who gambles has a problem, but we need to ensure that the regulation is fit for the modern day.

I want to talk briefly about welfare. When I was at Doncaster races, the British Horseracing Authority showed me round and explained some of the vital measures that were in place to maximise the welfare of racehorses. I was really interested to hear the contribution from the hon. Member for Penrith and The Border (Dr Hudson), who spoke with great experience and knowledge of the issue.

Following the tragic events at this year’s grand national, which left many distressed, it is welcome that the industry has come together to implement a package of safety measures before next year’s race, including reducing the maximum number of runners, investing in course infrastructure and ensuring that participating horses are in good enough condition to compete. I welcome that. Equine care must be at the forefront of the industry’s concerns, and the hon. Member for Newbury (Laura Farris) spoke about the veterinary centre in her constituency.

To conclude, the Labour party acknowledges the huge contribution that horseracing makes to both our culture and our economy. I have a number of personal memories of the races, in particular of attending the Yorkshire cup last year, where I watched the super stayer horse under Frankie Dettori win. I was there with my very good friend, the late Jim Andrews, who passed away not long after that. It was one of the last days we spent together, and it is an incredibly fond memory of mine. I know that people across the country will have similarly fond memories, and that is why it is really important that we protect the future of the industry.