Policing and Crime Bill

Lord Beecham Excerpts

Committee: 4th sitting (Hansard - part two): House of Lords
Wednesday 9th November 2016 Lords Chamber

Moved by

[Lord Beecham]

214: After Clause 122, insert the following new Clause—
“Premises licence under Gambling Act 2005: gaming machines
(1) After section 172 of the Gambling Act 2005 insert—“172A Gaming machines: conditions on availability and use(1) The conditions which a licensing authority may attach to a premises licence under section 169 include a condition—(a) that no gaming machines for which the maximum charge for use is more than £10 may be made available for use on the premises, or(b) that the number of gaming machines of that description which may be made available on the premises must not exceed the number specified in the licence.(2) The conditions which a licensing authority may attach to a premises licence under section 169 also include conditions relating to the use of gaming machines; in particular, the conditions may include—(a) a condition that a person may not use a gaming machine unless he establishes his identity by the means and in the manner specified in the licence;(b) a condition that each payment for the use of a gaming machine must be made by the means specified in the licence and must be processed or approved by a person who, when the payment is made, is on the premises where the machine is situated and is acting in the course of the business carried on there. (3) The number of machines which may be specified for the purposes of subsection (1)(b) must be lower than the number of machines which is at that time authorised under section 172(8); but where the number of machines so authorised is subsequently varied—(a) the number of machines specified (or treated as specified) for the purposes of subsection (1)(b) is to be treated as varied by the same amount, and(b) the licence is to have effect accordingly.(4) A condition of the kind set out in subsection (2) may apply to gaming machines generally or only to gaming machines of a description specified in the condition.(5) In deciding whether to attach a condition of the kind set out in subsection (1) or (2), or whether to exercise the power under section 187 or 202 to add, remove or amend a condition of that kind, a licensing authority may give particular weight to the impact of the following on the promotion of the licensing objectives—(a) the number of other premises in the locality where the premises concerned are situated in which gaming machines are available for use,(b) the levels of crime and disorder in that locality,(c) the extent of social or economic deprivation in that locality, and(d) the proximity of the premises concerned to places habitually attended by children or other vulnerable persons.(6) In the case of a betting premises licence in respect of premises in Scotland other than a track, the licensing authority may add, remove or amend a condition of the kind set out in subsection (1) only if the licence was issued before 23 May 2016 (the day on which section 52 of the Scotland Act 2016 came into force).”(2) In section 172 of the Gambling Act 2005 (gaming machines), after subsection (11) insert—“(12) Subsections (8) and (10)(a) are subject to section 172A.”.”

[Lord Beecham (Lab)]

My Lords, this amendment stands in my name and that of the right reverend Prelate the Bishop of St Albans and the noble Lords, Lord Clement-Jones and Lord James of Blackheath. There are also two slightly different amendments in the group in my name and that of the right reverend Prelate.

Fixed-odds betting terminals are gambling machines housed up to four at a time in betting shops in high streets and other streets, especially in poorer areas. Here people have been able to wager up to £100 on a machine every 20 seconds. While this has now been reduced to £50, unless the gambler in question has opened an account with the gambling company, if different machines are used it is still possible to stake as much as that in such a short time. Moreover, Ladbrokes alone revealed in its last half-year report that it had given away £3.7 million in free plays on fixed-odds betting terminals in just six months, nearly twice as much as for over-the-counter betting, clearly using this device to promote this particularly addictive form of gambling.

These terminals were authorised, I regret to say, by the Labour Government in 2005 and, by 2013, there were more than 33,000 machines, generating profits to bookmakers of £1.5 billion a year. Ladbrokes alone declared a profit of more than £1,022 per machine per week. In January 2014, my right honourable friend Ed Miliband sought to promote legislation giving councils the power to reduce the number of machines in shops, and increase the time between bets. At this point I should refer to my interest as a councillor in Newcastle and an honorary vice-president of the Local Government Association. Despite expressions of sympathy and concern at the time by David Cameron, a Labour Motion on the issue was defeated by 314 votes to 282 in the Commons. During the debate, the then Minister, Helen Grant, said that the Government were waiting for the findings of a study into how the machines were used and the real impact on players before deciding whether action was needed. We are approaching the third anniversary of that statement.

There are now 35,000 machines, with a concentration in less well-off areas, to the extent that the 55 poorest boroughs have, in proportion to population, four times as many as the best-off 115. Newham, whose council is in the forefront of calling for action and is one of the most deprived boroughs in the country, has no fewer than 87 shops with these terminals. Together with 92 other councils, Newham applied two years ago to secure, under the Sustainable Communities Act, the power to license gaming premises of this kind. I understand that the Government are woefully behind schedule with a determination of that appeal, indicative perhaps of their failure to address problems occasioned by this form of gambling. Perhaps the Minister could inform us, if not today then in writing, when they will publish their decision on that application—these applications arise under legislation enacted by the coalition Government.

In addition to the economic impact on households that can least afford it, there are other troubling issues associated with this essentially exploitative industry. Betting shops take up prominent space in high streets and, even more troublingly, in addition to the impact on the finances, health and well-being of their customers and their families, they have led to a significant increase in crime. The number of times police were called to incidents in betting shops rose by 51% in 2014 from the previous year. In Newham, police are called out, on average, once every day in the year.

I raised the issue of crime in these shops in an Oral Question on 5 September, pointing out that betting shops accounted for 97% of all police calls to gambling establishments and, even more alarming, for 40% of serious crimes against all businesses. I pointed out that no fewer than 7,000 machines a year in these premises are destroyed by gamblers, and that violent assaults on staff are increasing.

In that context, it is telling that in some shops with fixed-odds terminals the staff member—it is usually only one person now in many of these shops—is not permitted to leave what is called his or her “cage” until 6.30 pm. They are confined to that space. That is supposed to enhance their security. Your Lordships may think it is a peculiar way of doing so, and an unsatisfactory one.

It is significant that, as I have been informed today, Ladbrokes is now purchasing chairs to go into these shops weighing 35 kilogrammes, making them too heavy to be used by customers to damage the premises or injure the staff. To some extent it is recognising in that particular and rather—one might have thought—peculiar way that there is a risk of violent crime on the premises.

--- Later in debate ---

[Baroness Chisholm of Owlpen]

My Lords, as the noble Lord, Lord Beecham, and the right reverend Prelate explained, these amendments would have the effect of devolving power over licence conditions for gaming premises and gaming machines to local authorities. The number of gaming machines authorised under a gambling premises licence is regulated by the Gambling Act 2005. Licensing authorities do not currently have the power to change this limit, and cannot impose licence conditions on gaming machines that relate to stakes or prizes. However, they do have licensing powers in respect of gambling premises. These include powers to reject an application for a licence and powers to impose other conditions, for example around opening hours. They can also review and revoke licences. The Department for Communities and Local Government also brought in new planning laws last year that ensure that applications to change, for example, a disused shop into a bookmaker’s office will need planning consent.

In looking to introduce this new clause, the right reverend Prelate is seeking to limit the number of fixed-odds betting terminals in bookmakers and casinos. The Government understand the concern that such gaming machines could fuel problem gambling and are committed to reducing the risks of potential harms associated with such machines. Indeed, last year, we introduced new regulations to ensure that players staking over £50 on these machines either had to open an account or had to interact with staff. Evaluation shows that there has been a significant decrease in players staking above £50. The Gambling Commission also introduced new social responsibility requirements last year, including measures that force customers to make an active choice on whether to set time and money limits while playing these machines.

In addition, the noble Lord, Lord Beecham, is seeking to enable licensing authorities to impose minimum staffing levels on premises with such machines. The noble Lord may have in mind a number of tragic incidents in high street bookmakers over the last few years. The Association of British Bookmakers’ Safe Bet Alliance provides specific guidance on staffing security in bookmakers, which was drafted with the input of the Metropolitan Police. Members of the Association of British Bookmakers operate single staffing only when a risk assessment has been undertaken.

Sections 167 and 168 of the Gambling Act 2005 empower the Secretary of State for Culture, Media and Sport to set mandatory and default conditions on premises licences via secondary legislation, which could include a condition setting staffing levels. This would be the preferred route to make such a change. In addition, I must emphasise that the Government believe that the appropriate mechanism for reviewing stakes and prizes, and gaming machine numbers, is the review announced on 24 October by the Minister responsible for gambling, which will consider these issues in a more holistic and comprehensive context.

My noble friend Lord James mentioned statistics about roulette wheels. I have to say that I got slightly lost in all the various numbers, which is not surprising considering that I was unable to add the 45 minutes when it came to the lunchtime break—but I certainly take his point and I listened with interest.

The noble Lord, Lord Beecham, talked about the Sustainable Communities Act. The Government are engaging with the LGA on this issue. The review announced on 24 October is the right mechanism to consider all these issues, and the Government invite Newham Council to take part in that review.

The Government are alive to the concerns about the dangers posed by fixed-odds betting terminals. As I have set out, we have already taken steps to tighten the controls on these machines and have set out our plans for the review of gaming machines, gambling advertising and social responsibility, which will include stakes on fixed-odds betting terminals. I am sure that the right reverend Prelate, the noble Lord, Lord Beecham, and other noble Lords will want to contribute to that review, and I encourage them to do so. The review will include a close look at the issue of B2 gaming machines—more commonly known as fixed-odds betting terminals—and specific concerns about the harm that they cause, be that to the player or the community in which they are located. The call for evidence period will close on 4 December, following which the Government will consider proposals based on robust evidence provided to assist in our decisions.

Given that this process is in train, I invite the noble Lord, Lord Beecham, to withdraw the amendment.

[Lord Beecham]

I thank the noble Baroness for her reply, so far as it goes, which I fear is not very far at all. If the Government are relying on the industry to come forward with proposals, many of us would be somewhat sceptical about a satisfactory result emerging.

I am not, as some of your Lordships will be aware, an enthusiast for secondary legislation but it seems to me that it would be sensible for the Government to take the power, at least, to regulate in some of the areas we have discussed, even if they do not want to incorporate the specific details of the amendments we have been discussing today in primary legislation. It would be a wasted opportunity, it seems to me, if, as I suspect, the gaming industry will not come up with satisfactory answers to the many questions which have been raised today, to then expect a further Bill to come forward. The legislative timetable, many of us will imagine, will be dominated by things of a rather more international flavour for the next few years, whereas, giving the power to regulate on issues of the kind we have identified here would be a much simpler parliamentary process and one which is quite appropriate.

I do not think that many of us in your Lordships’ House have any great confidence in the gaming industry’s willingness to address the problems that have been identified across the House this afternoon. While at this point I will obviously not be asking the House to divide, this is a matter that I hope the Government will consider in a constructive way before Report. I would be tempted, and will discuss this with other of your Lordships, to embody in resolutions on Report a power to deal with matters as I have suggested by way of secondary legislation, but it would be better if the Government took that step. No doubt the noble Baroness will be willing to discuss this with interested Members before Report, but as matters stand I beg leave to withdraw the amendment.

Amendment 214 withdrawn.

Policing and Crime Bill

Lord Beecham Excerpts

Report: 2nd sitting (Hansard): House of Lords
Wednesday 7th December 2016 Lords Chamber

Moved by

[Lord Beecham]

173B: After Clause 126, insert the following new Clause—
“Premises licence under Gambling Act 2005: gaming machines
After section 172 of the Gambling Act 2005 insert—“172A Gaming machines: staffing condition on availability and use A licensing authority, when exercising its power under section 169 to attach conditions to a premises licence, must include a condition, in respect of a licence for premises in which gaming machines are being used, that there must be at least two members of staff present on the premises while the premises are open.””

[Lord Beecham (Lab)]

My Lords, I refer to my interests as a Newcastle City councillor and vice-president of the Local Government Association, inasmuch as parts of the amendments to which I shall refer would impact on local government.

I wish to speak to the two amendments in this group in my name and those of the right reverend Prelate the Bishop of Bristol and the noble Baroness, Lady Howe. Fixed-odds betting terminals, even after a reduction from £100 to £50 on the amount that can be wagered every 20 seconds, are a source of large profits and social and economic damage. The 35,000 machines to be found in betting premises are concentrated in poorer areas of the country, where they divert money from the local economy and are the scene of 40% of all serious crimes against businesses. As I pointed out in Committee, police callouts to attend incidents at these premises increased by 51% in 2014 from the previous year. Seven thousand machines a year are destroyed and assaults on staff are increasing. The London Borough of Newham, with no fewer than 87 of these shops, sees police being called out on average once every day to premises harbouring these machines. The Local Government Association backs Newham’s campaign for more control over this growing industry.

The Campaign for Fairer Gambling commissioned a report on these machines which referred to the claim of the Association of British Bookmakers that increased regulation would cause a substantial loss of jobs in the betting sector. But whereas the £1 billion that is spent in fixed-odds betting terminals supports 7,000 jobs in the gaming industry, that diversion from other forms of consumer spending destroys 13,000 jobs in the wider economy. If the industry continues to grow to double its size in the next 10 years, the net cost to the economy will be the loss of 11,000 jobs, with the total annual wage bill affected by a loss of £650 million at today’s prices compared with the level obtaining in 2013, on which the comparative figures are based.

The report also deals with the tax revenue flowing from the use of these machines. This year it is estimated that the duty received by the Revenue will be £78 million, but the amount of income tax and VAT lost will be £90 million. By 2023-24, the net annual loss will be £50 million. These figures do not, of course, reflect the indirect cost to the taxpayer of the consequences of the social damage arising from gambling—for example, in family breakdown or costs to the National Health Service, let alone the crime to which I have alluded.

BACTA, the body representing the manufacturers, suppliers and operators of 310,000 amusement machines —not those in betting offices or casinos—has come up with 12 proposals which it is submitting to the consultation being undertaken by DCMS. Interestingly, these include a new machine with a maximum stake of £10 instead of the current permitted stake of £50; a suggested jackpot limit of £125; and a high-percentage payout of 90% on the money staked, bringing the industry closer to the concept of amusement arcades rather than high-risk and expensive gambling.

All of this suggests that greater control of the industry, as envisaged in Amendment 173C, in the name of the right reverend Prelate, is required. In addition to the impact of the industry on society, however, there is also, quite literally, the impact on staff. In Committee I referred to the revealing fact that in many shops, where it is now usual to have only one employee, staff are housed in what is described as a cage, which they are permitted to leave only after 6.30 pm. Tellingly, Ladbrokes is now purchasing chairs weighing as much as 35 kilograms for customers—too heavy, it is assumed, for a disappointed customer, or indeed a criminal, to use in an assault on staff or to do damage to the premises. That is an indication of the seriousness of those issues.

Amendment 173B, in my name, prescribes that at all material times, at least two members of staff must be on the premises to deter violent behaviour and, if need be, to seek assistance. The noble Baroness, Lady Chisholm, replying to the debate in Committee, referred to the power conferred on the Secretary of State to set conditions by way of secondary legislation—under existing primary legislation—including staffing levels, and indicated the Government’s awareness of,

“the dangers posed by fixed-odds betting terminals”.—[Official Report, 9/11/16; col. 1232.]

She repeated this at a meeting she kindly organised and said that the Government would consider proposals emerging from the review they launched on 24 October, in which the call for evidence closed two days ago. Can the Minister indicate when the Government expect to release the results of the consultation and their response to it? Of course, I do not expect her to give an indication at this stage of what that outcome will be.

However, I hope that the Government will not be swayed by the self-interested testimony of the industry or, for that matter, by the views enunciated in an article for ConservativeHome—described as “the home of conservatism”—by Christopher Snowdon, who rejoices in the title of head of lifestyle economics at the Institute of Economic Affairs and who in a recent article dismissed concerns about this industry and the terminals, concluding that they,

“might not be to everybody’s taste but they have a place in the modern industry and existing regulation and taxation is more than adequate, if not excessive, for a gambling product that is only available in licensed, adult-only establishments”.

The evidence contradicts that bland assertion of acceptance of this side of the gaming industry pretty comprehensively. One can only hope that, unlike the appointment of Brexit Ministers, the Prime Minister will not be tempted to appoint Mr Snowdon to be involved in the review or to advise the Government. I look forward to the Minister giving assurances that the Government recognise the need to change the regime under which this industry, which blights too many high streets and too many lives, operates, and that they will act quickly after receiving and considering the review report. I beg to move.

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[Lord Beecham]

My Lords, I am grateful to the Minister for her reply. At one stage I thought about asking her how much I should stake on the change that she seemed to be sympathetic towards.

However, I am slightly disconcerted by the latter part of the noble Baroness’s speech, when she referred to concerns about legal challenge. If there are such concerns, I hope the Minister will indicate that the Government would—assuming they want to make a change—enact the necessary legislation to pre-empt the legal challenge which might arise under the system as it currently stands.

With respect, I question one of the assumptions which is often made, and to which I referred in moving the amendment, about the contribution made to the economy. If the study to which I referred is correct, there is a net loss to the economy from the current operation of the industry in respect of fixed-odds betting—I am not talking about other elements of gambling. I invite the Minister to ensure that proper consideration is given to that aspect. The industry will undoubtedly talk up the economic benefits, but according to the report that I cited that seems not to be the case and it is misleading to make that claim.

However, it is clear that the Minister is at least sympathetic to the amendment. Although I will not seek to divide the House, I hope for a positive response as part of the process that the Government have already initiated. I beg leave to withdraw the amendment.

Amendment 173B withdrawn.