Creative Industries: Apprenticeship Levy
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Lord Foster of Bath (LD)
On behalf of my noble friend Lady Bonham- Carter of Yarnbury and at her request, I beg leave to ask the Question standing in her name on the Order Paper.
Viscount Younger of Leckie (Con)
My Lords, the apprenticeship levy is helping employers in all sectors to make sustainable investment in the skills that they need to grow and is driving up the quality of apprenticeships. We have acted on feedback from employers in our world-leading creative industries about how they can realise the benefits of apprenticeships. That is why this year, we introduced additional flexibilities in how the levy can be used and continue to support employers in building their programmes.
Lord Foster of Bath
I thank the Minister for the response, but it is widely accepted that for the creative industries, the apprenticeship levy is simply not fit for purpose. New figures now show that unless still greater flexibilities are built in, nearly half of the creative industries’ levy money will go unused. Why cannot levy-paying employers give even more of their unspent levy funds to apprenticeship training agencies or for other training purposes? Why can we not introduce an Open University-style credit scheme to help the many would-be creative industry apprentices who cannot meet the current minimum 12-month employment rule?
Viscount Younger of Leckie
The noble Lord alluded to the fact that we have raised the transfer percentage rate from 10% to 25%, and we believe that that is the right approach. Much work is being done regarding the creative industries. For example, the focus, as the noble Lord will know, is on standards rather than frameworks. We have already developed and put through 26 standards in the creative sector, with another 16 on the go. I recognise that the creative sector is more of a challenge, in that it is quite disparate, being made up of a number of small businesses, partnerships and single people working in that sector.
Museums and Galleries
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Viscount Younger of Leckie
I have no doubt that the spending review will look closely at the museum sector. It usually does, but I cannot comment otherwise on that. It is also important for local authorities to feel that they are able to explore new funding and service delivery models. As I said earlier, the Government believe that funding decisions should be made at the local level. Local authorities are best placed to decide how to prioritise their spending, as each individual museum has its own particular issues.
Lord Foster of Bath (LD)
My Lords, since 2012 the museums and schools programme has enabled nearly half a million schoolchildren from highly deprived areas to access museums and benefit from the collections and the skills of the museum staff. However, the former three-year funding regime has now been replaced by a year-on-year regime, which is bringing about uncertainty and difficulty in planning. Will the noble Viscount seek to work with relevant Ministers and the Chancellor to revert to the three-year funding cycle and ensure the continuity of this excellent scheme?
Viscount Younger of Leckie
To echo the words of the noble Lord, learning is at the heart of museums. It is very important that young people visit them and understand the background of the various exhibits. Fifty-eight per cent of children visited a museum or gallery in 2017-18. I take note of what the noble Lord says but in the 2018-22 funding period Arts Council England, through which much money is given by government for museums, is investing £160,000 annually in Kids in Museums. This, along with other initiatives, helps to encourage more young people to visit museums and galleries.
Gaming Machine (Miscellaneous Amendments and Revocation) Regulations 2018
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Viscount Younger of Leckie (Con)
My Lords, the Government’s response to their wide-ranging consultation on proposals for changes to gaming machines and social responsibility measures, published in May this year, set out a comprehensive package of measures that will strengthen protections around gaming machines, online gambling, gambling advertising and treatment for problem gamblers. The Government made it clear that their intention in the review was to strike a balance between socially responsible growth and the vital endeavour of ensuring that the most vulnerable, including children, remain protected from gambling-related harm.
As noble Lords will know, the headline measure in May was the Government’s decision, following consideration of all relevant evidence, to reduce the maximum stake on sub-category B2 gaming machines from £100 to £2. The decision was met with enthusiasm in many quarters. Local authorities, charities, faith groups, interest groups and academics all submitted opinions in favour of a £2 limit. This House was no exception in expressing its emphatic support for the Government’s intentions. We are here today to discuss and debate the regulations that will give effect to that decision.
Let me turn first to the evidence which led the Government to their conclusions on B2 stakes. Under the Gambling Act 2005, B2 gaming machines have a maximum stake of £100—by far the highest for any gaming machine in Great Britain—and the maximum prize that can be won as a result of a single use is £500. The next-highest limits on the high street are B3 machines, with a maximum stake of £2 and a maximum prize of £500.
Almost 14% of players of B2 machines are problem gamblers, currently the highest rate by gambling activity in England. In addition, the highest proportion of those who contact GamCare, the main treatment provider, identify these machines in betting shops as their main form of gambling. Gaming machines in betting shops also account for one of the highest proportions of all those in treatment for gambling addiction.
In October 2017, the Government published the consultation on proposals for changes to gaming machines and social responsibility measures, which invited views on proposals to reduce the maximum stake for B2 machines. The consultation received more than 7,000 responses and closed in January 2018. The Government published their response on 17 May 2018 and, after giving due consideration to all information and evidence received, they decided that it would be appropriate to reduce the maximum stake for sub-category B2 gaming machines to £2.
In comparison to other gaming machines on the high street, B2 machines are an outlier because of the speed at which it is possible to lose large amounts of money. These machines generate a greater proportion and volume of large-scale losses—for example, more than £500 in a session—and the losses are larger and sessions longer for those who bet at the maximum stake of £100 than for those who play at a lower level.
Even cutting to £10 would have left problem gamblers and those most vulnerable exposed to losses that would cause them and their families significant harm. In particular, the Government noted that more than 170,000 sessions on B2 roulette ended with losses of between £1,000 and £5,000. These sessions persist at average stakes of £5 and £10, but by contrast, none involved average stakes of £2 or below. In addition, the Government considered that the reduction to £2 was more likely to target the greatest proportion of problem gamblers and protect the most vulnerable players, including those in areas of high deprivation.
Having considered these and other factors, the Government concluded that they would reduce the maximum B2 stake to £2. This was supported by the Gambling Commission’s advice that action on B2s should involve a stake limit of between £2 and £30 if it was to have a significant effect on the potential for players to lose large amounts of money in a short time, with any further decrease a matter of judgment for government.
It is fair to say that the date on which these regulations would come into force generated not a little opinion and debate. It was right that those who had strong views and evidence on the issue, including many noble Lords, should have the opportunity to share them. We have said all along that protecting vulnerable consumers is our prime concern, although it has been necessary to take account of the effect that the reduction will have on the gambling industry and those employed by it.
Having conducted the process of engagement with the industry, the Government announced in November that they would implement the stake reduction on 1 April 2019, a date specified in these regulations and which they consider provides sufficient time to allow for relevant changes to be made by industry. Industry has now known about the Government’s intention to reduce stakes to £2 since May this year, and the date announced last month provides further clarity to allow it to continue its preparations.
Noble Lords will also know that the draft Finance Bill was amended so that the increase in remote gaming duty, paid for by online operators, comes into effect in April 2019 alongside the reduction in the stake to cover the negative impact on the public finances and protect vital public services.
I will explain the effect of the draft regulations and the legislative context in which they operate. The Gambling Act 2005 established a new system for the regulation of gambling in Great Britain, with the exception of the National Lottery and spread betting. Section 235(1) of the 2005 Act defines a gaming machine as a,
“machine which is designed or adapted for use by individuals to gamble (whether or not it can also be used for other purposes)”.
The Categories of Gaming Machine Regulations 2007 define four categories of gaming machines, known as categories A, B, C, and D. For the purposes of the 2005 Act, category B machines are divided into sub-categories. These regulations amend the Categories of Gaming Machine Regulations 2007 to reduce the maximum stake permitted for B2 gaming machines from £100 to £2 from, as I said earlier, 1 April 2019. In consequence of this amendment, these regulations also amend the definition of a sub-category B3 gaming machine so that B2 and B3 gaming machines can continue to be distinguished from one another by reference to the different places in which B2 and B3 machines are allowed to be made available.
The regulations also make consequential changes to other secondary legislation, amending the Gaming Machine (Circumstances of Use) Regulations 2007 and revoking the Gaming Machine (Circumstances of Use) (Amendment) Regulations 2015 to remove requirements that no longer apply as a result of the stake reduction.
Millions of people enjoy gambling responsibly, and the Government are committed to supporting a healthy industry, but we need the right balance between freedom and protections. As I have said, the Government’s intention in our wide-ranging gambling review was to strike a balance between socially responsible growth and protecting the most vulnerable, including children, from gambling-related harm.
I want to be very clear that the review and this legislation do not mark the end of government action. We recognise that harm is not about just one product. We will act where there is evidence of harm and we will always keep issues under review, as is our responsibility. We will also continue to work together with colleagues from other departments, such as the Department for Education, to ensure that we are co-ordinated in our approach to young people, and the Department for Health and Social Care, to improve links between gambling treatment and other services. I am proud that the Government are taking forward this decisive measure, and I commend these regulations to the House.
Lord Foster of Bath (LD)
My Lords, having campaigned against fixed-odds betting terminals for many years, I am truly delighted that this statutory instrument is now before us, reducing the maximum stake from £100 to £2. The Minister has laid out some of the reasons why this is so important. I do not intend to repeat them, other than to remind the House that there are 35,000 of these machines in our often poorly supervised betting shops around the country, with more than twice the number in the poorest boroughs of this nation than there are in the more affluent boroughs. It is also worth reflecting that research shows that 80% of fixed-odds betting terminal gamblers exhibit problem gambling behaviour at stakes in excess of a £13 spend.
The Minister has pointed out that the Government now accept that these machines have wrecked lives, torn families apart and caused enormous damage in our communities, but I have to say that the tone of the Minister’s introduction rather implied that the Government had been keen supporters of change in this area for a very long time. The truth is that that has not been the situation. It was back in 2010 in the other place that I first advocated a £2 stake, and my noble friend Lord Clement-Jones introduced legislation in your Lordships’ House in 2015 that sought to have the stake reduced to £2. Since then many people have been campaigning for change, including local government, the Church of England—I pay particular tribute to the right reverend Prelate the Bishop of St Albans—mental health charities, academics and many others. The All-Party Parliamentary Group on Fixed Odds Betting Terminals, very effectively led by Carolyn Harris MP, has played an influential role in persuading the Government—eventually—to act as they did on 17 May this year when they announced the cuts.
All of us having welcomed the Government’s announcement that the stake was to be cut, we were collectively appalled to hear that they were proposing a delay in its implementation until October 2019. Despite accepting that FOBTs were a social blight that harmed individuals and communities, they were proposing to wait 18 months, with further suicides being predicted and more lives to be wrecked. We found it hard to believe that the Government seemed to take so much notice of the bookmakers with all their arguments about how difficult it was to change the machines, how much money the Exchequer was going to lose and how many jobs were going to be lost. The Government seemed to fall for it hook, line and sinker, yet every one of the arguments that were made has now been discredited. To take one example, we know that changing the stake will actually be of huge economic benefit to this country. We know that gambling and problem gambling cost this country a fortune: £1.5 billion to deal with the problems that problem gambling is causing us. We also know that because people will spend less money on fixed-odds betting terminals, that money will be spent in other parts of the economy, which is infinitely more productive in helping the economy to the benefit of a significant amount added to the gross value added.
So the Government have at last changed their mind and of course that is welcome, but let us not forget that that was after months of campaigning after amendments being tabled to the Finance Bill signed by over 100 Members of Parliament, the threatened resignation of 12 Parliamentary Private Secretaries and then, very sadly, the actual resignation of the excellent former Minister for Sport and Civil Society, Tracey Crouch, who deserves great credit for the stance that she took. Only after all that happened did the Government agree to do the right thing and bring the implementation date forward to April 2019.
Despite the absurd process that we have had to go through to see the stake cut delivered, I am genuinely pleased to be welcoming the change that is to take place in April next year, earlier than the Government originally planned. However, since the Government began consulting on fixed-odds betting terminals three years ago, a staggering £3.6 billion has been lost by people in this country, often the poorest in our society. For me and for many others, ending the harm caused by these toxic machines simply cannot come soon enough.
Lord Foster of Bath
On this point, referring to the question asked by the noble Lord, Lord Alton, the Minister is correct to say that the Gamble Aware target is being met, but he will be aware that it is only one of the providers of help and support to people with gambling problems; there are many others which need funding. The reality is that there are 435,000 people in this country with gambling problems. Currently only 2% of them are getting support; clearly more is needed. I hope the Minister will agree.
Viscount Younger of Leckie
I agree but I fall back to the point that we still have a considerable amount of research to do. At the moment we are quite content to take the regulatory approach on the voluntary angle. My noble friend Lord Ashton and I continue to keep this under review. If there is a need to legislate, we will have no hesitation in doing so because this is an important area.
The noble Lords, Lord Alton and Lord McCrea, asked whether I agreed with the example of Ladbrokes voluntarily reducing stakes in Northern Ireland. As the House might predict, and as the noble Lord acknowledged, gambling is devolved in Northern Ireland. I cannot comment further except to say that action taken by industry to improve protections and social responsibility measures is very much to be encouraged—
Apprenticeship Levy: Creative Industries
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Lord Foster of Bath
To ask Her Majesty’s Government what plans they have to amend the working of the apprenticeship levy to take account of the concerns of the creative industries.
Viscount Younger of Leckie (Con)
My Lords, we introduced the levy to fund a step change in apprenticeship numbers and quality. This is putting funding on a sustainable footing while improving the technical and professional skills of the workforce. We recognise that some sectors and employers, including in the creative industries, have challenges in taking advantage of these reforms. We continue to work closely with employers in this sector to inform them about the benefits and to encourage apprenticeship take-up.
Lord Foster of Bath (LD)
I am grateful to the Minister for that reply but, rather more than challenges, does he not accept that the apprenticeship levy is fundamentally unsuited to delivering the skills that the creative industries need? It does not align with the sector’s own voluntary training, there are only a dozen approved apprenticeship standards for a sector with thousands of different job roles, and there is insufficient flexibility to share training vouchers with the SMEs that make up 95% of the sector. The Creative Industries Council and the Bazalgette report have made a clear business case for an industry-specific training model that is better suited to provide the skills and the apprenticeship needs of the sector. Will the Government accept those recommendations to ensure that the success story of our creative industries can continue?
Viscount Younger of Leckie
My Lords, we will certainly look at the recommendations and we recognise that the creative industries sector comprises a workforce that is different—it is more diverse, and largely made up of freelance and sole-trader businesses. However, if an apprenticeship linked to the levy is not suitable, then the apprenticeship training agencies could provide a solution for this important sector. ATAs recruit, employ and arrange training on behalf of employers, which includes the 20% off-the-job training. A further solution is for the major levy-paying employers to transfer up to 10% of their levy funds to help the sector.
National Lottery
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Viscount Younger of Leckie
Indeed. Some points have been raised on that issue and I will come to it later, but if I do not manage to address it, I will certainly write to the noble Lord.
The recently launched consultation, which has been mentioned today, outlines measures aimed at finding the right balance between enabling the sustainable growth of society lotteries while protecting the National Lottery’s unique position. I invite noble Lords with an interest to engage with the consultation before its closing date of early September. I echo the noble Earl in saying that we welcome all views on this matter. The noble Earl raised some important points about the contributions and this debate will be taken account of in the consultation.
In conclusion on the matter of falling sales, we believe that Camelot’s revised strategy will go a long way to address this issue, supported by the distributors and, of course, DCMS.
The noble Lord, Lord Berkeley of Knighton, spoke about disabled access. He made an important point that all areas of visitation must have the correct disabled access. The point has been noted.
As has been mentioned, we will be celebrating the 25th anniversary of the National Lottery in a little over a year’s time. Work is under way to ensure that we make the most of this opportunity to further showcase the National Lottery’s singular ability to deliver life-changing outcomes, both in the awards it makes to good causes and in the value of prizes that can be won by lottery players. To reassure the noble Earl, the Government are looking forward to celebrating this important anniversary. Working together with Camelot and the distributors, we will make everybody aware of what this great institution has made possible over the past 25 years. Detailed plans are being advanced and further details will be announced in due course.
The National Lottery has had an unparalleled impact on 21st-century Britain. Across the country the lottery is not just well known but has a recognised brand name, as the noble Earl said. This is not surprising if you stop to consider that the majority of National Lottery money goes straight to the heart of our communities, locally and nationally. Some 71% of the grants made are for £10,000 or less; in other words, small amounts of money going to community-led projects that make a big impact. Less than 1% of the grants awarded exceed £1 million.
Furthermore, as the noble Earl said, this week is National Lottery in Parliament week. As the noble Earl did, I encourage noble Lords to visit the Upper Waiting Hall, where one can learn more about the Lottery and its history, and participate in a range of competitive activities—to keep noble Lords on their toes before we break up for the Summer Recess.
More seriously, we must ensure that we retain the warmth of public sentiment for the National Lottery among existing players and attract new participants. It is critical to ensuring that income is maximised to continue delivering awards across the breadth of this country and to the widest array of good causes. There are some questions that I still have to answer and I will write to all noble Lords. Noble Lords can be assured that this is a clear imperative of the Government and is a core objective in the department’s single departmental plan—
Lord Foster of Bath
I think there is some confusion in your Lordships’ House. I will read the Minister a quote from the Gambling Commission, which said:
“The relatively low prizes and generally limited distribution footprint are key factors that have traditionally differentiated”,
the society lottery sector from the National Lottery. Do the Government still believe that that distinction should be maintained?
Viscount Younger of Leckie
That is a question that should be put to the consultation. This debate will allow these sorts of questions to be put to the consultation. I reassure the noble Lord that that will be taken into account.
To conclude, we hope to see the National Lottery continue to flourish, both now and for the next 25 years.
Tourism
Debate between Viscount Younger of Leckie and Lord Foster of Bath
Lord Foster of Bath
To ask Her Majesty’s Government what plans they have to provide additional support for the tourism industry.
Viscount Younger of Leckie (Con)
My Lords, the UK has a strong visitor offer and a thriving tourism industry, supported by the Government’s tourism action plan. Initiatives such as the £40 million Discover England fund develop new and innovative products to offer both domestic and inbound visitors. We are working hard to support our first-class business visits and events sector. The industry, in close collaboration with VisitBritain, has proposed a tourism sector deal, which the Government are considering.
Lord Foster of Bath (LD)
My Lords, I thank the Minister for his positive response, but the Government recently announced that they are considering a cut in tourism VAT for accommodation and attractions in Northern Ireland—no doubt a response to a DUP request. But why just Northern Ireland? Out of 36 European countries, only three, including the United Kingdom, have failed to reduce VAT for tourism, yet if a cut of 5% took place, over 10 years tourist businesses in this country would be hugely boosted, 120,000 additional jobs would be created and £4.6 billion would go into the Treasury coffers. So why do the Government not get on with this measure and do it for the whole country, not just consider it for Northern Ireland only?
Viscount Younger of Leckie
The noble Lord is correct that the call for evidence is focused on tourism in Northern Ireland, but of course responses from other parts of the UK would be very welcome, and there is still time: the consultation closes on 5 June. The Government are certainly aware of concerns about the impact of VAT on tourism and that is why at the Spring Statement the Treasury launched a call for evidence on the impact of VAT.