Gerry Sutcliffe
Main Page: Gerry Sutcliffe (Labour - Bradford South)Gambling (Licensing and Advertising) Bill
Gerry Sutcliffe Excerpts
Mrs Grant
At the end of the day, this is about establishing a level playing field. I hope that my hon. Friend will bear with me for a little while, because I shall go into that matter in greater detail.
The Bill aims to regulate remote gambling at the point of consumption. Under the new regime, overseas-based operators will be subject to the provisions of the Gambling Act 2005, its regulations and the Gambling Commission’s social responsibility and technical standards requirements. This will mean, among other things, that all licensed operators will be required to contribute to research, education and treatment in relation to British problem gambling, and to comply with licence conditions that protect children and vulnerable people.
Mr Gerry Sutcliffe (Bradford South) (Lab)
Just to help the hon. Member for Shipley (Philip Davies), may I point out that this is an important part of the licensing objectives of the Gambling Act, and that the Bill is consistent with those objectives?
Mrs Grant
The hon. Gentleman makes a good point.
The Bill will also level the playing field for the advertising of remote gambling. At present, operators based in the European economic area or in a country on the “white list” can advertise remote gambling to consumers in Great Britain. The 2005 Act allows the Secretary of State to designate non-EEA jurisdictions that have strong regulatory systems comparable to Britain, and to give them permission to advertise remote gambling services in Britain. Those jurisdictions form what is informally known as the “white list”, and they include Antigua and Barbuda, the Isle of Man, the States of Alderney and Tasmania.
The Bill will repeal section 331 of the 2005 Act, removing the offence of advertising foreign gambling and, consequently, the distinction between EEA and “white list” countries, and non-EAA jurisdictions. Instead, all operators who hold Gambling Commission remote licences will be able to advertise to British consumers, regardless of where the operators are based. As now, gambling operators who wish to advertise in Britain will need to comply with the advertising codes of practice. Overseas operators that are required to hold but fail to obtain a Gambling Commission licence will be committing the offence of providing facilities for gambling or the separate offence of advertising unlawful gambling. The Gambling Commission is empowered to pursue and bring appropriate action against the operator concerned.
The repeal of section 331 will also have an impact on Northern Ireland, where gambling is a devolved matter. New provisions creating an offence of unlicensed advertising of remote gambling have been included in the Bill to ensure that Northern Ireland continues to have the same protections for the advertising of remote gambling as we have in Great Britain. The Northern Ireland Assembly formally agreed these changes through a legislative consent motion on 17 June. Gambling is a reserved matter with regard to the devolved Administrations in Scotland and Wales. Scotland, England and Wales will all receive the same protection in relation to the advertising and regulation of remote gambling.
Clive Efford
Let me explain to Government Members that the Gambling Act 2005 was a major piece of legislation that has largely stood the test of time. When the legislation was put in place, the then Government said that the issues in the Bill would be kept under review. A number of areas have subsequently come to light, such as online gambling, which has grown exponentially over the last few years, that present some challenges to Government, in respect of which regulation might be necessary.
Mr Sutcliffe
The 2005 Act was the first parliamentary legislation on gambling since the 1960s. Betting changed dramatically between that period and the Budd report of 2000. This Bill represents the first time the present Government have allowed us to discuss gambling as an issue, and it may be the last time before the next election that we have an opportunity to look at the many issues affecting the gambling industry.
Clive Efford
I am grateful for the benefit of my hon. Friend’s knowledge of this issue. As he says, the Bill has been a long time coming. The Department has few opportunities to find time on the legislative calendar, and we should not waste this opportunity to explore all the aspects of online gambling that may need to be addressed.
Gambling is enjoyed by more than 56% of the population, and the figure rises to more than 70% if the purchase of lottery tickets is included. Obviously we welcome the move to create a level playing field between operators who have remained onshore and those who have moved offshore, have based themselves offshore, or have recently entered the market and wish to trade with United Kingdom customers.
However, when we consider legislation on matters of this kind, we tread a difficult path between our wish to promote an industry from which people gain a great deal of pleasure and our responsibility to protect the vulnerable. Online gambling is of particular concern because of its very nature. It is possible for vulnerable adults to indulge their addiction without leaving their homes, and hence to suffer alone while running up debts that they cannot hope to pay. It is our duty as legislators to create a safe and well-regulated environment in which people can enjoy the pleasure that they experience from gambling.
The online industry has grown to be worth more than £2 billion a year in a relatively short time, and with that has come a relative increase in the capacity of online gamblers with an addiction to lose money before anyone becomes aware of their problem. Unlike codes of conduct in other jurisdictions, the Bill contains no requirement for licensed operators to monitor the behaviour of their customers and intervene if they think there is a problem.
Mr Whittingdale
The hon. Gentleman anticipates the next two words on my notes, which read “Full Tilt”. He is, of course, correct. Something went badly wrong with Full Tilt Poker, which was regulated by the Alderney gambling control commission. It is right that there should be a review of how that happened and I understand that lessons will be learned. There have certainly been concerns about some incidents in white list countries, and for that reason there might be some advantages to consumer protection of bringing the entire remote gambling industry under the licensing rules of the UK Gambling Commission.
The hon. Member for Eltham (Clive Efford) spent some time on match fixing and licence condition 15.1. He is quite right that the Select Committee received evidence on that and there is no doubt that all the major sporting bodies support the Bill, because they have expressed concern that some of the other regulatory authorities outside the UK have not always been particularly good at reporting suspicious activities. Indeed, if we consider the statistics, we can see that there have been far more reports of potential suspicious gaming activity from UK-licensed operators than from offshore operators. If licence condition 15.1 is applied to all those offering online gambling facilities to UK customers, I hope that that will result in more attention being given to the issue.
I was also interested to hear the hon. Gentleman’s suggestion about spread betting. As my hon. Friend the Member for Shipley (Philip Davies) points out, there is difficulty in drawing a line between where sports betting stops and financial transactions begin. If it were possible for the Financial Conduct Authority to require suspicious activity to be reported to the relevant regulatory body, that would seem to be a sensible move.
Mr Sutcliffe
Would not having sports betting rights be a good idea, so that we could sort out the definition of financial transactions related to the market? If sports had their own betting rights and the ability to sell their sports to the betting operators, that would clarify any problems with the definition.
Mr Whittingdale
I think that would go rather further than defining sports betting and financial speculation and would have other implications that would need further consideration. I am not sure that I am convinced by the hon. Gentleman's suggestion, but I would certainly be happy to debate it with him later.
Let me return to the issue raised by my hon. Friend the Member for Shipley. The Government have made it very clear that the purpose of the Bill is to strengthen consumer protection and, of course, the Committee accepted the evidence given to us by the Minister on that point. It is important that that is its purpose, because if it had other purposes the Government might, as has been pointed out, be vulnerable to legal challenge. However, it seems entirely acceptable to argue that those people who sell gambling services to UK consumers should be required to pay UK tax. Although that might not be the purpose behind the Bill, if the consequence is that they come within the tax net, that would benefit the Exchequer and create a level playing field, which it is important we should have.
Some operators might even choose to return to the UK once the new licensing regime comes in. I realise that the level at which the tax is set is not an issue for my hon. Friend the Minister, but that is what will determine whether they return. Many of the remote gambling operators in Gibraltar and other jurisdictions have expressed concern that there is a danger that the tax will be set too high, which will have an impact on their operations and create an incentive for consumers to look elsewhere—to go outside the licensed operators to the black market. That is a serious threat, which I want to talk about.
Mr Gerry Sutcliffe (Bradford South) (Lab)
It is a great pleasure to follow the Chair of the Select Committee. I refer Members to my declaration in the Register of Members’ Financial Interests. I am a trustee of the Responsible Gambling Trust, a great organisation that promotes research, education and treatment for problem gamblers. The entire gambling industry contributes to the fund on a voluntary basis. As the former Minister, I threatened that if it did not do so voluntarily, we would introduce a compulsory levy, but I am happy to report that it agreed and has raised over £5 million for research, education and treatment.
I mention that because I think the gambling industry is a very fair industry. Before I set out the context of the Bill, I notice that the deputy Chief Whip, the right hon. Member for Bath (Mr Foster), has arrived in his place, so I put it on the record that the Bill had its origins in my time as the Minister with responsibility for gambling and sport, on the prompting of the right hon. Gentleman. It was his idea to tackle the anomaly of remote gambling, so I place on record my thanks to him for his support during that time, when we were considering these issues.
I welcome the Minister to her position in the best job in government—the Minister for sport. It is unfortunate that it comes with gambling, tourism and other things on top, which is a bit of a problem. I am pleased that she has been able to get the Bill to the House today for its Second Reading; notwithstanding the comments that my hon. Friend the Member for Eltham (Clive Efford) made about the time that that has taken, at least we are here today.
We seldom have opportunities to discuss gambling in such a context. There is a lot of hysteria about fixed odds betting terminals and the proliferation of betting shops—topics that I am sure we can discuss in a quieter environment sometime soon—but gambling contributes a lot to our economy in jobs, taxation and betting companies’ support for sport. In our efforts to protect the consumer, we should not lose sight of the context of where the industry is and how good it is. Those are the principal points around the licensing objectives of the Gambling Act 2005—to protect the vulnerable, to provide consumer support, to keep crime out of gambling and to give a fair and open opportunity for the industry.
The 2005 Act came about following the Budd report in 2000. As I said in an intervention, the previous piece of legislation was in the 1960s. To those of us old enough to remember that, betting and gaming was seen as something dodgy—something associated with crime. It was illegal to advertise it. Betting shops were behind closed doors and frosted glass windows, and it was a very male-dominated environment. Gambling has changed tremendously over that period. One needs only to look at the success of the national lottery to see how gambling has become part of the psyche of people in the UK.
We need to ensure that people who have a problem with gambling are supported. The last prevalence study showed that 0.7% of people had problems with gambling. I say that to the Minister, because I remember from my time No. 10 and No. 11 saying, “Keep gambling off the front pages.” They were worried about the Daily Mail; they were worried about the anti-gambling media. Sometimes, that does not help us to have a legitimate debate about some of the issues that flow from the development of gambling.
I am delighted to be a member of the Select Committee. The former gambling Minister, Richard Caborn, was brave enough to tell the Committee that we did not get it quite right in the 2005 Act. What he meant was that the Act had got caught up in the wash-up at the end of the Session, where deals are done to try to get Bills through. The deal on numbers of fixed odds betting terminals and shops was not a worked-out formula—it is just that that was the debate at the time—so it is right and proper that we look at all the issues around the Gambling Act 2005. Although her officials will be guiding the Minister to view the detail of the Bill in terms of online issues, I urge her to look at wider issues and to try to put right some of the wrongs in the 2005 Act. The Minister will be waiting to hear the outcome of the research by the Responsibility in Gambling Trust, which will be ready next year and should give a detailed solution to the problems associated with fixed odds betting terminals.
I return to the subject of casinos, which the Chair of the Select Committee raised. The problem of the portability of the licensing of casinos has been around for a while. There are 68 licences, some of which have not been taken up, but buildings are maintained because the licence applies to the building. I hope the Minister will accept some amendments relating to casinos and the unfair treatment that casinos have received as a result of the Gambling Act. Casinos are some of the most highly regulated places in the gambling sector and consumers are well looked after by the casino operators. I hope there will be some flexibility on the issues of portability and online opportunities.
The Bill puts consumers at the heart of gambling. We considered the issue in 2008, with the support of the right hon. Member for Bath, now the Comptroller of Her Majesty’s Household. There was a need to make sure that consumers were protected. I know that the hon. Member for Shipley (Philip Davies) is concerned about taxation and he is right to be concerned about the level of that taxation, but that should not take away from the fact that the Bill needs to be enacted for consumer protection.
One of the things I did as Sports Minister was look at sports betting integrity, which is a parallel issue. My hon. Friend the Member for Eltham (Clive Efford), speaking from the Front Bench, raised the issue of the Pakistani cricketers. There have been numerous problems in relation to cheating, match fixing and so on, so we set up the sports betting integrity panel chaired by Rick Parry, which produced a report calling for education in sports for players of all age groups to make sure that they were aware of the risks from the type of gambling that could take place. Some footballers, for instance, think it is not cheating to kick the ball out to get two corners or two throw-ins, because some people bet on that, but it is cheating and we have to make sure that people are aware of that.
I hope that when we go through the detail of the Bill in Committee we will look at bodies such as the Sports Betting Group that were set up after the Parry report. Such bodies included people from football, cricket, rugby union, horse racing and many other sports, who have followed some of the recommendations of the Parry report. One of their great concerns is spread betting, a topic that has been raised. The issue of how spread betting is defined needs looking at. The Chairman of the Select Committee did not take up my offer of looking at sports betting rights, but I hope the Minister might consider including that in her discussions with the sports.
One aspect of the Bill that concerns me is the inability to pursue the online gambling organisations for a contribution to the horse racing levy. I was delighted when the Minister was able to announce the agreement reached between the betting companies and the horse racing industry on the levy. Online operators should contribute to the levy as well.
As I said, research, education and treatment are important, so I would welcome opportunities to increase support for the trust in promoting that.
The Minister should look at the European directive on money laundering. Although we are all agreed that money laundering is undesirable, the directive affects on-cost bookmakers and the limits on what they are able to pay out on bets. We require some flexibility on the directive, which went through 27-0 on its last reading. I urge the Minister to speak to the Federation of Racecourse Bookmakers about how the money laundering regulations might affect them.
The Bill is welcome. It is important that we have the opportunity to protect consumers and to do the necessary tidying-up in the gambling industry. I found the gambling sector to be mindful of its responsibilities to consumers and of its contribution to employment and our economy. I support the Bill and look forward to its Committee and remaining stages.
Mr Robert Syms (Poole) (Con)
I rise to support the Bill, although I am a little disappointed that it is so narrowly drawn as I think that major issues need considering. Gambling is very much part of modern life in Britain. We all cheered the Olympians in 2012, and a lot of that success was built on the national lottery. One needs only to look at the various books produced at Budget time to see how much the industry generates in taxation to pay for the things we want in this country, such as health, education or law and order.
Gambling is an important industry, and it is also part of our offer as a country that many people come to visit. We need only look at casinos in London to see that a high percentage of people in them are visitors to this country who have come to take advantage of the facilities and what we have to offer. Progress was clearly made in the Gambling Act 2005, but given the way the internet is developing, it is difficult without a crystal ball to work out what the future will bring. It is clear that we have lost a large slice of the industry to abroad because of the tax system, and it is therefore perfectly sensible for the Government to look at ways and means of tempting people back to the UK to make a bigger contribution.
We ought to be aware of concerns that we might load too much on the Gambling Commission because it might then load higher fees on to domestically based businesses. Many of those businesses found that the size of the commission compared with the old gambling board, and the number of people it employs, has put their fees up substantially over several years. Many issues must be considered and this Bill is part of the solution. I suspect that the other part of the solution, as we discussed earlier, will be in the Finance Bill following the Budget.
A number of important issues have been raised, include how we tempt offshore companies to come back. Do we tempt them back by setting a competitive rate? My hon. Friend the Member for Shipley (Philip Davies) made a strong argument for that, but there are a number of competing concerns. The domestic industry is clearly upset that people offshore can set better odds and therefore take customers, but we must also consider the rate we set, as that could ensure many more illegal sites in the UK, which raises the issue of problem gambling.
I think we have a responsible domestically based industry that, as I said, generates a lot of tax. It has codes and practices that it sticks to, and it is part of our offer as a country. It also expects a degree of fairness. When we talk about a level playing field, we must take into account the millions of pounds of investment, the thousands of people who are employed, and the tax they generate. The rate we set for remote gambling operations will be important, but the Gambling Commission and Treasury must also consider whether sufficient assets are deposited in the UK, or whether any entity subject to action by UK regulators or the authorities has assets in the UK that can be picked up. They must also consider whether people from remote companies have locally based directors who are responsible for what they do—that is important.
The hon. Member for Newcastle-under-Lyme (Paul Farrelly) asked whether there ought to be sanctions against individuals or businesses that provide facilities for offshore remote gambling companies. That is a difficult area and an absolute minefield, and there are tricky issues for the Government to consider, which means setting out a balance. In reality, however, because we are not getting tax from the remote industry, the UK has probably lost £1 billion or £2 billion in revenue over the past few years, and it is an area in which any sensible Government would look for reform.
A number of other issues have been raised, including why we have to wait until December 2014 before we bring in a new rate. By some estimates, the UK may well lose £200 million or £300 million by having that delay. The issue raised by the Culture, Media and Sport Committee is also important. Someone can gamble remotely on an iPad in the street, but when they go into a casino, which is safe, regulated, taxed, and where people have a duty to look after their general welfare, they are not allowed to. I was pleased after my earlier intervention when the Minister said that the Government might consider that issue during the passage of the Bill.
A number of points in the broader industry need addressing. The hon. Member for Bradford South (Mr Sutcliffe) mentioned the portability of casinos. A lot of our—very successful—industry still runs under the Gaming Act 1968, which is nearly 50 years old. Certain issues need looking at if we are to modernise the industry and for it to continue to be a success.
Mr Sutcliffe
That is why it is important to consider issues that have been wrong for some time and put them right in the Bill—I hope the Minister will win that battle. The temptation is to get the Bill through with its core values, but not to look at the wider issues. Perhaps this will be the only time we have to get it right.
Mr Syms
The hon. Gentleman raises a good point. We are dealing with a specific problem, and as my hon. Friend the Member for Shipley said, the driver is clearly the Treasury which sees an issue it needs to deal with to raise money. That does not mean, however, that no other aspects of the whole industry need considering and modernising. When the hon. Gentleman spoke earlier he mentioned the Daily Mail test, and I suspect all of us in politics get a little wary when talking about the gambling and casino industries and all those other industries. In reality, however, if the Government cannot amend the Bill, there is a good argument for introducing, certainly early in the next Parliament, another Bill to cover the broader gambling and casino industry, to make it a little more responsive to modern demand.
I was interested in comments by the hon. Member for Newcastle-under-Lyme about how bet365 had provided regeneration for Stoke. We should not underestimate the fact that the gambling industry is a factor in regeneration. It certainly was in Atlantic City, and one needs only to look at what is happening in the United States to see that many local governments and other areas have deliberately attracted and promoted that industry because it can help local areas. A Government who want certain areas of our country to prosper and regenerate could do a lot worse than looking at the gambling industry as a potential source of regeneration for some areas that are struggling in the modern world. I broadly support the Bill. I am a little disappointed with its scope because there is unfinished business in the broader gambling industry, but I look forward to the passage of the Bill. I hope that the clever people— the bright people with towels round their heads in the Treasury—will find a good way of generating money to help the public services that we all want.
James Duddridge (Rochford and Southend East) (Con)
I thank the hon. Member for Islwyn (Chris Evans) for the timely completion of his speech, which allows me to leap to my feet. The hon. Gentleman gives my hon. Friend the Member for Shipley (Philip Davies) a run for his money as the champion of betting, and particularly of betting at bookmakers. I am not saying that out of bitterness because my hon. Friend called me idle—I should have been faster on my feet.
The hon. Gentleman makes a bid for being the champion of betting shops, rather like the hon. Member for Newcastle-under-Lyme (Paul Farrelly) made a bid for being the champion of online betting. I rise to identify my constituency as perhaps the epicentre of bricks and mortar casinos. Three of the 142 casinos in the UK are in my constituency, all within a mile and a half along the seafront. I will go on to talk in detail about a fourth that is opening up on those golden couple of miles.
Reflecting on the Minister’s introductory comments, it is brilliant to see her in her new job. I was a little worried in the first week. Most Ministers are instructed to hit the ground running, but, looking at comments from journalists, the Minister seemed to be flexing her sporting credentials in karate and throwing journalists around her private office. I am not sure how well that will work out for her in the long run, but if she ever needs me to do anything I will certainly think twice before disagreeing. Having said that, I would love to serve on the Public Bill Committee and will be in negotiations with her on one or two amendments I would like the Government to table if the Chair of the Select Committee does not table them.
I criticised the hon. Member for Eltham (Clive Efford) for the enormous list of measures he wants included in the Bill, so I hesitate to ask for more provisions—I want my little bit, but not necessarily his. The Bill is small, but I suspect that if the hon. Gentleman got everything he wanted, I would need a hand to get out of my seat and lift the Bill.
I want to focus on the interaction between online betting and bricks and mortar casinos. This is important not just in relation to deregulation or taxation—my hon. Friend the Member for Shipley hit the nail on the head; this is a much greater part of the process—but in what can be done online compared with what can be done offline in a bricks and mortar casino. As I said, there are 142 casinos in the UK, which means that 3% are in the constituency of Rochford and Southend East. While I am bragging—if you will allow me a brief diversion, Mr Deputy Speaker—I will say that 8% of UK piers, by metre, are in the constituency too. It is a wonderful place to go for entertainment, with the Genting Club, Genting Electric and Rendezvous casinos, and the soon to be opened Park Inn Palace hotel.
My hon. Friend the Member for Poole (Mr Syms) made many good points, but I picked up in particular on his comments on regeneration. At a difficult time for the economy when high streets are not doing so well, Southend high street is doing well and the seafront is being regenerated. When I arrived in Southend more than 10 years ago, there was a beautiful but derelict 19th-century hotel, the Palace hotel. The Government used it to house asylum seekers on a temporary basis, before they could be found more suitable accommodation. That made the area, to a degree, a no-go zone. It is now a four-star hotel, and the company will be opening another casino. It may even be a five-star hotel; it certainly should be, given the quality of service I received. The gambling industry can be of significant benefit to constituencies, whether in Newcastle, from betting shops or from online casinos.
Genting casinos employ more than 170 members of staff in Southend and the company has invested millions in the economy. It supports the broader community through mayoral charities. All three casinos have been fantastic on responsible gambling. Governments always ask for more and more. I often wonder what more the industry can do, but as Governments tinker with taxation and regulation they feel they should ask for more without understanding fully what that could be. There is a tacit understanding, which is in many ways false, whereby the industry says, “We are trying to do more; what more can we do?” and the Department and Ministers do not have a hit list of what they want, because so much is already being done.
Mr Sutcliffe
The hon. Gentleman will recognise that Governments can sometimes apply pressure, which is what we did with the responsibility in gambling levy. That voluntary levy—voluntary donations from the gambling industry—is now worth more than £5 million, which shows that the industry does consider the problems that problem gamblers face.
James Duddridge
Absolutely. I have had a number of discussions about individual gamblers in Southend who have put themselves on the register and, as a result, have been protected. The protections are not, as a number of hon. Members have said, in the online arena and I am deeply concerned about that. While the Government are, to a degree, looking at online and bricks and mortar together, the two are still too polarised. I can put that down only to the Government wanting to divide and conquer the industry by setting up slightly different regulations, rather than operating en bloc, but they are disadvantaging one of the more high-performing sectors and that is ludicrous.
My hon. Friend the Member for Maldon (Mr Whittingdale) described the Essex sea breeze. In his penultimate point, he talked about online gambling in bricks and mortar casinos. It is ironic that a casino is able to advertise outside the Rendezvous casino, but games cannot be played online inside it, even if one takes in one’s own iPad or iPhone. Quite how we could stop people gambling on their own devices I do not know, but it would be much better to allow casinos to have gambling online within their own premises. That would bring it into the family that has greater protection for problem gamblers and into the tax net. The current position is ludicrous.
The Minister indicated that she was sympathetic to the point. I am interested to hear, in her concluding remarks, how that sympathy will play out. Does she expect Back Benchers, on limited resource, to start tabling probing amendments, or will the Government table a new clause that we can all consider? The latter would be my preference, rather than the unfair process of the Select Committee coming up with an idea, an hon. Member pushing it forward in the Bill Committee, the Government considering it, the consultation perhaps not coming back on Report, and then, quietly, the Select Committee’s work coming out as a Lords amendment at the end of a long day, and the Government saying it is just an additional tidying-up matter. There should be a greater degree of transparency. I would like the Minister to introduce a new clause which we can all look at, rather than relying on us to write one up on the back of a fag packet—be it plain or with pictures.
It has been a pleasure to contribute to the debate. I hope to have the pleasure of being a member of the Bill Committee, where I can talk more about Rochford and Southend East and the value of bricks and mortar casinos.