Gambling (Licensing and Advertising) Bill

Lord Collins of Highbury Excerpts

Tuesday 4th March 2014 Lords Chamber

[Lord Collins of Highbury (Lab)]

My Lords, I am very pleased to associate myself with this amendment. I hope that my new alliance with the noble Viscount will produce positive results tonight. Perhaps it is a sign of things to come and we can co-operate on other issues.

What the noble Lord said reminded me that, in the Chinese zodiac, I am in fact a horse. However, that does not mean that I support the amendment simply from a vested interest point of view. Many people have placed a bet on a horserace at one time or another, but I suspect that few realise that racing is the second largest sporting employer, supporting a predominantly rural industry that makes a significant contribution to the UK economy.

As we have heard, the purpose of the amendment is to capture the revenue that should be paid, as Parliament has already determined, from all betting operators that take online and telephone bets on racing in Britain, wherever they are located. I pay tribute to my honourable friend Clive Efford in the other place, who has consistently raised this issue. The change, as we have heard, could be worth up to £20 million a year to British horseracing, and would undoubtedly lead to a healthier sport, and to more investment, growth and jobs.

Too often, people focus just on the prize money and do not see the work of the board and the training, education and employment initiatives that the levy supports, year in and year out. Nor do they see the broader picture of how the industry has a direct link to building sustainable rural economies. Why should offshore betting operators and those in betting shops pay the full levy while others who are based overseas and do not have a voluntary agreement pay nothing?

In Committee, we heard the argument that any reform of the levy to capture revenues under a point of consumption licensing regime would constitute state aid. As the noble Viscount pointed out, that interpretation is not accepted by the British horseracing industry—and nor, following the ruling of the European Commission, is it one that we need to accept. The French raised the issue and we have had a decision on it.

This sets a precedent that I understand is being reviewed by the department’s lawyers. Clearly it is better that we should rely on new legislation rather than just have another round of disputes following messy court cases. I agree with the comment that in the long term, the Government may want to consider a more modern and commercial framework for the levy. That is something that I know the industry would support. However, with the best will in the world, the sport will be waiting several more years for that, all the while losing out on a vital source of income. Action has long been required and Ministers must not simply allow this once-in-a-Parliament opportunity for primary legislation to pass.

Clearly, there is a strong argument for further consultation and assessment of the implications of the European Commission’s warning on state aid. However, I would ask the Minister to begin consultation on levy reform as soon as possible and to include all options, particularly the option for a “horseracing right”. As the noble Viscount said, the amendment is about the reserve power to allow that to happen, giving the Government the opportunity to consult the Commission and, if that route of action is considered the right one, the power to act. I look forward to hearing the Minister’s response.

[Lord Gardiner of Kimble]

My Lords, my noble friend’s amendment seeks to give the Secretary of State reserved power to extend liability to pay the horserace betting levy to offshore remote gambling operators. We have had some useful discussions about the future of the levy at all stages of the Bill, including some particularly interesting ones in Committee. They have been extremely valuable and I want to reassure your Lordships that the Government have been listening. I am grateful to all noble Lords for the constructive discussions we have had.

We agree with the view that while we still have a statutory levy, it should be fairly applied. Furthermore, we are persuaded that including a clause about extending the levy to offshore remote operators is fully in keeping with the context and purpose of the Bill. We will therefore bring forward a government amendment at Third Reading which will remedy your Lordships’ concerns about ensuring a level playing field between onshore and offshore betting operators in terms of the levy. With the consent of the House, this amendment will give the Secretary of State power to use secondary legislation to secure extension of the levy to offshore remote operators. I shall ensure that all noble Lords who have expressed an interest in this matter during the Bill’s passage are invited to a briefing on the detail of the amendment before Third Reading. Bringing forward a government amendment will complement the work which, as I mentioned to your Lordships, is already under way to seek clarity on the state aid issues from the European Commission. The Government will consult on implementing an extension before any secondary legislation is brought before Parliament.

The Government want British racing to continue to thrive. I know from my own experience just how important racing is to so many in the countryside and of course in all communities—not only its economic impact but the pleasure it gives to so many millions of people. Extending the levy to offshore remote operators will help achieve the objective we all share. I want to say particularly to the noble Lord, Lord Collins of Highbury, that bringing forward a government amendment about extending the levy in the way that I have described does not of course close down options for wider levy reform or replacement. This is very much work in progress.

The Government have committed to bringing forward an amendment at Third Reading which will achieve the outcomes being sought tonight. Consequently, I ask my noble friend whether he will withdraw his amendment.