Gambling (Licensing and Advertising) Bill

James Duddridge Excerpts

Tuesday 26th November 2013 Commons Chamber

[James Duddridge (Rochford and Southend East) (Con)]

I beg to move, That the clause be read a Second time.

[Mr Speaker]

With this it will be convenient to discuss the following:

New clause 2—Licence compliance, stipulations and control—

‘(1) Notwithstanding the regulation of spread betting by the Financial Conduct Authority, operators licensed for remote gambling by the Gambling Commission shall, to ensure their continued fitness as such, be obliged to comply with Condition 15.1 of the Consolidated Licensing Conditions and Codes of Practice 2011 (or its equivalent from time to time) in relation to all areas of their gambling operations, including spread betting and any other operations not within the jurisdiction of the Gambling Commission.

(2) In the event of any breach of subsection (1) which the Gambling Commission believes calls into question the fitness of the relevant operator, the Gambling Commission may require the operator to provide an explanation of such breach within one month and may, if not satisfied with such explanation, revoke the operator‘s licence.’.

New clause 3—Kite mark—

‘(1) The Gambling Commission shall require all licensed online gambling operators to display a standard kite mark on all their promotional materials, websites and webpages, to indicate that such operators are licensed by the United Kingdom Gambling Commission.

(2) The Gambling Commission shall design and determine the form of the kite mark, which will provide a link to information and advice on its website for customers.’.

New clause 4—Remote gambling licensees and customer protection—

‘Holders of licences for remote gambling operations shall be required to participate in a programme of research into and treatment of problem gambling in accordance with arrangements to be determined by the Secretary of State in regulations in the form of a statutory instrument approved by both Houses of Parliament, and a levy for that purpose may be imposed under section 123 of the Gambling Act 2005.’.

New clause 5—Reporting of suspicious activities and power to obtain financial information—

‘(1) In order to promote consistency of sports betting regulation, regulation of remote sports spread betting operators and of all sports spread betting as defined herein shall be transferred from the Financial Conduct Authority to the Gambling Commission, which shall thereupon—

(a) have power to require and obtain from its licensees including spread betting organisations information concerning actual or potential suspicious activities in relation to sporting events, and to share such information with the relevant sports governing body;

(b) have power to require and obtain information on financial transactions by licensees which it reasonably suspects might be germane to the investigation of suspicious betting activity, money laundering or other criminal activities, or the protection of vulnerable individuals.’.

(2) “Sports spread betting” shall for this purpose mean spread bets in relation to sports as governed under Schedule 6, Part 3 of the Gambling Act 2005.’.

New clause 6—Consultation on self-exclusion—

‘Having regard to the significance of the remote gambling market in relation to potential problem gambling, the Secretary of State shall consult on a system of standardised self-exclusion for the gambling industry, to include means of addressing exclusion from remote gambling access in the context of other gambling media.’.

New clause 7—Dormant accounts—

‘(1) The Secretary of State shall consult on appropriate ways to require licensed remote gambling operators to disclose (as a condition of their licence) the amounts held by them by way of—

(a) winnings of UK customers unclaimed for a period of more than one calendar year; and

(b) sums in dormant accounts of UK customers.

(2) A dormant account shall for this purpose be an account which has been inactive for at least one calendar year.’.

New clause 8—Discussions between gambling regulatory bodies and sports governing bodies—

‘The Secretary of State shall have power to make regulations, to be laid before and approved by both Houses of Parliament, stipulating the manner and time of regular meetings between any and all of the gambling regulatory bodies and sports governing bodies.’.

New clause 9—Advertising watershed—

‘The Secretary of State shall consult on the current regulatory position concerning advertising of gambling before the nine o‘clock watershed and shall lay before the House a report of the findings not later than the final sitting day before the summer recess 2014.’.

New clause 10—Application of the horserace betting levy—

‘In article 2 of the Gambling Act 2005 (Horserace Betting Levy) Order 2007/2159, for paragraph 3 substitute—

“(3) Subject to paragraph (4), expressions used in sections 24 to 30 of the 1963 Act shall have the meanings given to them by section 55(1) of the 1963 Act (as that provision had effect immediately before 1st September 2007).

(4) For the purposes of paragraph (3), the definition of ‘bookmaker’ as set out in section 55(1) of the 1963 Act (as that provision had effect immediately before 1st September 2007) shall be modified by—

(a) replacing the comma at the end of paragraph (b) of the definition of ‘bookmaker’ with ‘; or’; and

(b) after paragraph (b) of the definition of ‘bookmaker’ inserting—

‘(c) holds a remote gambling operating licence under the Gambling Act 2005 which authorises that person to provide facilities for betting,’.”.’.

New clause 11—Power to extend the horserace betting levy to overseas bookmakers—

‘(1) The Secretary of State may by regulations amend any provision or provisions of the Betting, Gaming and Lotteries Act 1963 (c 2) (at a time when the provisions listed in section 15(1)(a) to (c) of the Horserace Betting and Olympic Lottery Act 2004 (horserace betting levy system) have not been entirely repealed by order under that section), the Gambling Act 2005 and/or the Gambling Act 2005 (Horserace Betting Levy) Order 2007/2159 for the purposes of ensuring that each person who holds a remote gambling operating licence under the Gambling Act 2005 which authorises that person to provide facilities for betting shall be—

(a) liable to pay the bookmakers’ levy payable under section 27 of the Betting, Gaming and Lotteries Act 1963 (c 2); and

(b) subject to the provisions of section 120 of the Gambling Act 2005 (as modified in accordance with the Gambling Act 2005 (Horserace Betting Levy) Order 2007/2159) if that person is in default of such bookmakers’ levy.

(2) Regulations under this section must be made by statutory instrument.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.’.

New clause 12—Financial blocking—

‘After section 122 (information) of the Gambling Act 2005, insert—

“122A (1) The Commission may give a direction under this section if the Commission reasonably believes that a person or organisation who does not hold a remote gambling licence is providing remote gambling services in the United Kingdom.

(2) A direction under this section may be given to—

(a) a particular person operating in the financial sector;

(b) any description of persons operating in that sector; or

(c) all persons operating in that sector.

(3) A direction under section (1) may require a relevant person not to enter into or continue to participate in—

(a) a specified transaction or business relationship with a designated person;

(b) a specified description of transactions or business relationships with a designated person; or

(c) any transaction or business relationship with a designated person.

(4) Any reference in this section to a person operating in the financial sector is to a credit or financial institution that—

(a) is a United Kingdom person; or

(b) is acting in the course of a business carried on by it in the United Kingdom.

(5) In this section—

“credit institution” and “financial institution” have the meanings given in Schedule 7, paragraph 5 of the Counter-Terrorism Act 2008;

“designated person”, in relation to a direction, means any of the persons in relation to whom the direction is given;

“relevant person”, in relation to a direction, means any of the persons to whom the direction is given.”.’.

This New Clause allows the Gambling Commission to prevent a person or organisation without a remote gambling licence from accessing the UK market by financial transaction blocking.

New clause 13—Comparison of codes and technical standards in white listed jurisdiction with UK—

‘(1) The Commission shall review the social responsibility provisions of the codes of practice and technical standards of—

(a) EEA states; and

(b) the places to which section 331(2) of the Gambling Act 2005 has applied.

(2) The Commission shall amend the codes of practice and technical standards issued in pursuance of section 24(2) of the Gambling Act 2005 so that the code and technical standards reflects the strongest social responsibility provisions identified in subsection (1).

(3) In this section “social responsibility provisions” means a provision of the code identified as—

(a) ensuring that gambling is conducted in a fair and open way.

(b) protecting children and other vulnerable persons from being harmed or exploited by gambling; and

(c) making assistance available to persons who are or may be affected by problems related to gambling.’.

This New Clause requires the Gambling Commission to review the codes of white listed jurisdictions to establish which has the most comprehensive and sophisticated provisions to protect problem gamblers and to ensure that the UK codes and technical standards provide as robust standards for consumer protection.

New clause 14—Self-exclusion for remote gambling—

‘After section 89(1) (remote operating licence) of the Gambling Act 2005, insert—

“( ) The Commission shall hold a list of persons who have registered to be excluded from remote gambling.

( ) It shall be a condition of a remote operating licence that an operator must exclude any person who has registered for self-exclusion with the Commission.”.’.

This New Clause would give the power for the Commission to hold a list of those who wish to self-exclude. It would be a condition of a remote operating licence that individuals on the list must be excluded.

Amendment 1, in clause 1, page 2, line 11, at end add—

‘(8) The Secretary of State shall publish a report to Parliament one year after the commencement of this Act, and annually thereafter, on the enforcement activity of the Gambling Commission in respect of unlicensed operators attempting to provide facilities for gambling in the UK.’.

[James Duddridge]

New clause 1 seeks to allow online as well as offline gambling in casinos. In other words, it seeks for casinos to be able to provide people with the type of gambling offered by smartphones and tablets.

I think in all candour that the Department for Culture, Media and Sport has an old-fashioned view of the world—one that was once true and where there was a clear division between on and offline gaming. I suspect there is also an element of divide and rule involved. The gambling industry is a powerful body and it would be attractive to regulate both forms of gaming separately and get them to compete actively against one another.

The reality is different: online and physical provision of services have been merged in many industries. It is possible to order a product online from Asda and then collect it from a bricks-and-mortar store. It is possible to visit the clothing department at Marks & Spencer and order boxer shorts online for delivery. The on and offline worlds have merged in a number of environments. I hope that my examples are not an advertisement for those two institutions.

[Mr Speaker]

I would not accuse the hon. Gentleman of advertising for one moment. It is always of great interest to the House to learn about his personal arrangements.

[James Duddridge]

Thank you, Mr Speaker. For a moment, I feared that I was getting my knickers in a twist.

My constituency of Rochford and Southend East is home to three, soon to be four, casinos, which are bricks- and-mortar or physical ones. Such establishments employ thousands of people nationally. Locally, 277 people are employed in the existing three casinos, which will go up to about 400 when the fourth casino is launched. About 80% of the staff have been issued with personal licences by the Gambling Commission, while 100% of them receive annual training in responsible gambling, so they are well qualified.

Reports, such as an excellent one from GamCare, have outlined the details of the significant work that the industry is already doing, with much greater protection of vulnerable individuals being provided in casinos than online. I do not necessarily want more gambling, but I want more of the existing gambling to take place in such licensed and heavily regulated environments.

I am glad to say that new clause 1 is supported by my hon. Friend the Member for Maldon (Mr Whittingdale), the Chair of the Select Committee on Culture, Media and Sport, who did an awful lot of work with the Committee on pre-legislative scrutiny of the Bill; by the hon. Member for Bradford South (Mr Sutcliffe), an ex-Minister with responsibility for gambling, who is well respected, particularly in relation to gambling problems and the care of those with such problems; by the hon. Member for Manchester, Withington (Mr Leech), which shows that all parties support this cross-party issue; and by my hon. Friend the Member for Shipley (Philip Davies), who is a guru of all things gambling.

Bricks-and-mortar casinos are highly regulated. They are at the top of the regulatory pyramid in gambling. They are one of the safest places to be in Southend because of the security; they are certainly one of the safest places in which to gamble. I therefore find it hard to understand why casinos are restricted from offering a full range of products to their customers.

A bricks-and-mortar casino can advertise online products inside its premises, but it is not allowed to provide a remote gaming machine for customers to play inside its walls. That anomaly certainly needs to be corrected. Bizarrely, if it had a small area outside, customers—rather like having a fag at the back of a pub—would be able to gamble there, but they cannot do so inside.

[Mr David Nuttall (Bury North) (Con)]

Given that the Government have told us that the Bill’s whole rationale is to protect gamblers, can my hon. Friend think of any reason why they would not want to support his new clause?

[James Duddridge]

In an ideal world, I would hope that the Government supported new clause 1, or tabled a suitable amendment in the House of Lords or, in the broadest sense, took note. The argument against the new clause is one made against several others in the group, which is that it will add complexity when, for good reason, we want to move quickly. New clause 1 is quite tightly worded, however, and for a little complexity, it would give a lot of benefit.

Some people have been critical of my speech on Second Reading and my contributions in Committee, fearful that I was promoting irresponsible gambling, but that is a lazy and incorrect interpretation of my view and new clause. I am not attempting to liberalise regulation within casinos—that could not be further from the truth—but to get a level playing field to allow online customers to play online games in casinos with proper protection.

[Mr John Leech (Manchester, Withington) (LD)]

I pay tribute to the hon. Gentleman for tabling the new clause. Does he agree that making online gambling available in casinos is far better than people spending hours and hours in the completely uncontrolled environment of their own bedrooms?

[James Duddridge]

I could not agree more with the hon. Gentleman, who makes his point eloquently. That arrangement is better for those who have a developing problem, because they have the support of professionals who are there to monitor their behaviour. There is nothing to stop someone sitting in their bedroom and gambling away a fortune while drinking half a bottle of Scotch, but that would not be allowed at a roulette table. Under my new clause, someone gambling in that way would be stopped by staff within the casino, so the hon. Gentleman’s point is absolutely true.

[Paul Farrelly (Newcastle-under-Lyme) (Lab)]

We have tried to avoid complexity in the Bill because there is the prospect that it might be challenged. However, it will not be challenged on the grounds that it clears up a simple anomaly, which is what new clause 1 would do. I thoroughly support the new clause. Does the hon. Gentleman agree that it is odd that we have gone through extensive pre-legislative scrutiny, but the Government have ignored this central recommendation of the Culture, Media and Sport Committee?

[James Duddridge]

I agree with the hon. Gentleman. It is disappointing that more has not been taken on from the pre-legislative scrutiny. Otherwise, what is the point of having it? However, the Government have been right to resist the obvious temptation to tag too many things on to the Bill. There is a balancing act to be done, but some kind of enabling legislation in the Bill would allow the tinkering to take place later and with more consultation.

Customers should be allowed to choose what they want to do and where they want to do it. Customer choice is moving in favour of gambling in casinos and the legislation should not stand in the way of that. In many ways, the new clause is deregulatory.

[Robert Neill (Bromley and Chislehurst) (Con)]

My hon. Friend is making a powerful case. I hope that the Minister listens to it sympathetically. His experience corresponds to my experience of speaking to organisations in my constituency that deal with the problem of gambling. It is much better if gambling happens in a regulated environment. Does he agree that his approach is consistent with the approach that the Government have adopted in promoting drinking in pubs because they are a safe and controlled environment in which to indulge in a practice that is lawful, but that can be abused? It is better to do such things in a controlled environment than at home.

[James Duddridge]

My hon. Friend draws a strong parallel and teases out the point that if something is done in the open in society, there is greater protection than if it is done in private, whether it be drinking or gambling.

The Minister has been exceptional in listening to the concerns that have been raised. There has been a strong dialogue with the industry and the Culture, Media and Sport Committee. I hope that she reflects on the debate and is able to assist us. The ideal response would be for her to say that new clause 1 is absolutely perfect and fabulously crafted, that there are no errors whatsoever, and that the Government are desperately thankful for all our work and will accept it immediately. I suspect that that will not be the case. It is not normal practice for a lowly Back Bencher to craft a perfect amendment that takes all points into consideration.

If the new clause is flawed, perhaps the Minister will consider bringing forward a consultation on the issue and setting a time scale for it. It would be unsatisfactory if consultation was offered, but it did not happen for several years and the report sat on the shelf for several months afterwards. In addition to considering a timed consultation, will she go into a bit more detail about what will happen if the consultation shows that the substance of the new clause is needed? We will not have another gambling Bill in the next couple of years, so if primary legislation is required, it needs to go into this Bill. That might not happen today, but it could happen in another place. There is significant concern in the industry that there is no mechanism for making this change through secondary legislation if a consultation shows that it is the right change to make.

I look forward to hearing the Minister’s comments. I will be happy if she restricts herself to commenting on the Bill, rather than my shopping habits. I thank hon. Members for their help in drafting the clause and for their support.

[Mr Gerry Sutcliffe (Bradford South) (Lab)]

I will speak in support of new clause 1 and other new clauses in the group. I refer colleagues to my declaration in the Register of Members’ Financial Interests, which states that I am a trustee of the Responsible Gambling Trust.

I support new clause 1 for the reasons set out so ably by the hon. Member for Rochford and Southend East (James Duddridge). The Culture, Media and Sport Committee discovered that the Gambling Act 2005 had been the first piece of legislation on this matter for more than 40 years. It was controversial to say the least. The provisions on the casino industry were messed about with a bit in the final stages of the passage of that Act. I have always felt that there has been a problem with how casinos have been treated. The former Minister for Sport, Richard Caborn, admitted in evidence to the Select Committee that we did not get everything quite right in the casino legislation. That was a brave thing for him to say, but he was right.

As the hon. Member for Rochford and Southend East has said, we are unlikely to see another gambling Bill in the next two years or even longer. It has taken three years for this small Bill to reach this stage. Although I accept that the Government do not want to widen the Bill’s remit, it is important to put things right that have been wrong. The Government want better regulation and to help businesses to create more jobs. The hon. Gentleman was right to point to the impact that the casino industry and the gambling industry in general have on the economy and on jobs. Gambling is an important industry, but it attracts unwelcome attention from the likes of the Daily Mail, who do not want to see people enjoying gambling. Gambling is an integral part of our way of life. One need only look at the people who bet on the national lottery and at how people enjoy horse racing and sports betting in general.

New clause 1 sets out what needs to happen in casinos. Casinos are the most regulated and, I would argue, the safest environments in the gambling sector. I hope that the all-party support for new clause 1 will give the Minister some cover in arguing elsewhere that it is important to put this anomaly right. The hon. Member for Rochford and Southend East said that we might not press the new clause today, but there is a strong feeling among Members that something must happen during the passage of the Bill. That is a strong message for the Minister. I hope that she will hear it and support the proposal. We look forward to hearing what she has to say about the timetable of meetings that she will have with the casino industry and what she intends to do during the passage of the Bill through the other place.

I will briefly mention some of the other new clauses. The purpose of the Bill is consumer protection. I fully agree that it is important that there is consumer protection. There is a school of thought which says that the Bill is about raising tax revenues. I hope that that is not the case. I know that the hon. Member for Shipley (Philip Davies) will speak about tax revenues and what would be a fair rate of tax.

There is an important relationship between sports and the betting industry. That is why I support new clause 5, which was tabled by my hon. Friend the Member for Eltham (Clive Efford). It relates to the reporting of suspicious activity and the power to obtain financial information. The relationship between sports and gambling is unique. The problem is that there is no sports betting right. Sports governing bodies have no control over the bets that gambling companies offer on their sports. For instance, in football, there might be betting on the number of times the ball goes out of play or on the number of corners. The concern is that such bets can lead to match fixing and betting irregularities. The Government need to consider this issue, with regard to the scandals in cricket and football that have emerged in recent months and years.

New clause 7 relates to dormant accounts. The Minister heard people’s feelings on that matter loudly and clearly in Committee. There is money on the table that could go into sports or into research, education and treatment. I look forward to hearing what she has to say about that.

I also wish to consider the advertising watershed. I was the Minister responsible for introducing the clauses on advertising and advice about betting and gambling, and our view was that such advertising would be shown around horse races and sports matches. We did not envisage so much advertising for sports betting before the 9 pm watershed. As I said in Committee, I am a big fan of Ray Winstone, but he almost pressures people into betting in those adverts. There is a need to consider advertising in terms of the watershed and gambling, as in new clause 9.

--- Later in debate ---

[Mrs Grant]

I think I have made it clear to the shadow Minister that I am happy to look at this; I will consult on any workable proposal that is put to me which is sustainable, enforceable and legally sound, but we have to do it properly. I am not prepared to cut corners—we owe that to betting and to racing. We have waited 50 years; we now have a four-year opportunity and I am determined to make the most of it.

Horse racing is enjoyed by millions of people and is the second most attended sport in Britain after football. It supports 85,000 jobs across the country and contributes to local economies both through employment and by attracting a considerable number of visitors. We owe it to racing and the betting industries to get this right, and hon. Members will have repeatedly heard my determination to do exactly that. That is why it is important to get levy reform right and not to accept either of the new clauses, which could so easily set limits on what can be achieved.

For all the reasons that I have stated, I cannot accept any of the new clauses or amendment 1.

[James Duddridge]

While I am clearly disappointed that new clause 1 was not accepted, we have had an interesting debate and moved things forward a little. The Minister will continue to have discussions with the industry. I was concerned about how long those would take, and the Minister has assured me and other hon. Members that this process will come to a conclusion in March 2014. I expressed some concerns about whether we would be able to take this forward in secondary legislation. The Minister has asserted that that would not be a problem. Time did not permit her to go into detail, but I take her at her word. Perhaps she will look at how it will happen again, and reflect on the suggestion made by the hon. Member for Bury North (Mr Nuttall) that an amendment should be tabled in the House of Lords that would permit her to make this change if at the end of the consultation the Minister believed it was the right thing to do.

I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 11

Power to extend the horserace betting levy to overseas bookmakers

‘(1) The Secretary of State may by regulations amend any provision or provisions of the Betting, Gaming and Lotteries Act 1963 (c 2) (at a time when the provisions listed in section 15(1)(a) to (c) of the Horserace Betting and Olympic Lottery Act 2004 (horserace betting levy system) have not been entirely repealed by order under that section), the Gambling Act 2005 and/or the Gambling Act 2005 (Horserace Betting Levy) Order 2007/2159 for the purposes of ensuring that each person who holds a remote gambling operating licence under the Gambling Act 2005 which authorises that person to provide facilities for betting shall be—

(a) liable to pay the bookmakers’ levy payable under section 27 of the Betting, Gaming and Lotteries Act 1963 (c 2); and

(b) subject to the provisions of section 120 of the Gambling Act 2005 (as modified in accordance with the Gambling Act 2005 (Horserace Betting Levy) Order 2007/2159) if that person is in default of such bookmakers’ levy.

(2) Regulations under this section must be made by statutory instrument.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.’.—(Clive Efford.)

Brought up.

Question put, That the clause be up added to the Bill.