Gambling Levy Regulations 2025

Lord Kirkhope of Harrogate Excerpts

Wednesday 12th February 2025 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, I shall speak also to the Gambling Act 2005 (Operating Licence Conditions) (Amendment) Regulations 2024. Both sets of regulations were laid before the House in draft on 12 and 10 December 2024 respectively.

Two decades have passed since the Gambling Act 2005 was introduced. Leading gambling firms operating in this country are now some of the world’s most successful companies. With cutting-edge technological capabilities and deep insight into customer behaviour, the gambling industry and gambling behaviours have undergone monumental change, from the smartphone to the huge increase in online gambling. Our manifesto set out a commitment to

“reducing gambling-related harm … strengthening protections”

for those at risk. We know that harmful gambling can have massive financial, emotional and mental health impacts on individuals, families and communities across our country.

The 2023 gambling White Paper laid the foundations for what is before us today as we introduce draft regulations for stake limits on online slots and a statutory gambling levy to fund research, prevention and treatment. The Gambling Act 2005 (Operating Licence Conditions) (Amendment) Regulations 2024 introduce statutory maximum stake limits on online slots games of £5 per game cycle for adults aged 25 and over, and £2 per game cycle for young adults aged 18 to 24.

Online slots are the highest-risk gambling product. They have the highest rate of binge play and the highest average losses of any online product, and are associated with long playing sessions and high levels of use by people experiencing gambling harm. Online slots are also the fastest-growing gambling product. In the past five years, this yield has grown by 61% and growth is not slowing down. However, there are currently no statutory stake limits for online slot games, unlike their land-based counterparts. As the popularity of slots grows, so does the risk for vulnerable people. Now is the time to act and stem the growing tide of unaffordable losses for people most at risk of gambling harm.

We have designed these stake limits to target those most at risk of harm while ensuring that the impact on operators is proportionate. The lower staking limit for younger adults is an important intervention, as our research showed that younger people may be at an elevated risk of gambling harm. The industry’s trade body, the Betting and Gaming Council, welcomed the decision to introduce stake limits. If these regulations are agreed, there will be a transitional period to ensure that gambling operators have sufficient time to implement the changes.

Today, we are also proposing draft regulations for a statutory gambling levy. From April, all licensed operators will be required to pay an annual levy to the Gambling Commission. The rates at which licensed operators pay the levy are set down in the legislation and licensees are at risk of losing their licence if they do not pay. The levy represents a watershed moment: a significant uplift in the investment dedicated to this area; greater government oversight; and a renewed commitment to further understanding, tackling and treating gambling harms.

The significant contributions that the gambling industry has made to support research, prevention and treatment since the introduction of the Gambling Act 2005 have been crucial. This has allowed an expansion of the support and treatment options available for those in need. I am clear that the third sector will continue to play a key role in the future of research, prevention and treatment, but we now need a sustainable and equitable funding system so that all licensed gambling operators are paying their fair share. The levy provides us with an opportunity and the resources to put in place the right projects and services, clear objectives and robust governance.

To create a world-leading funding and commissioning system, we are mobilising existing expertise and infra- structure. Working with UK Research and Innovation, NHS England, appropriate bodies in Scotland and Wales, the Gambling Commission and the third sector, we are transforming the current system to deliver better access, outcomes and services for people across our country. To ensure that there is sufficient trust, expertise and authority in the use of the levy funding for prevention, I confirmed to the House this morning that we will appoint the Office for Health Improvement and Disparities in the Department of Health and Social Care to take on the role as lead commissioning body in this area for England, alongside appropriate bodies in Scotland and Wales.

Prevention remains a crucial part of the government’s efforts to tackle gambling-related harm. An effective prevention plan seeks to identify the right mix of interventions to be applied at both the population and individual level. That is why the Government are increasing dedicated investment, allocating 30% of levy funding to the prevention stream, alongside the significant funding allocated for research and treatment. Ring-fenced investment in this area will help to encourage innovation and support a strengthened, integrated and co-ordinated approach to prevention in Britain. Working closely with appropriate bodies in Scotland and Wales, OHID will develop a comprehensive approach to prevention and early intervention, supporting improvement across the respective nations.

I want to recognise the leading role that GambleAware has played. Its work to raise awareness of gambling harm and provide support for those in need has been invaluable. We want to build on the successes of the current system while improving and expanding the system to better serve those at risk. Until now, financial contributions from operators have been the only source of funding for the sector. This funding has established the National Gambling Support Network, overseen by GambleAware, which has helped people in need across the country. However, the levy will mean that there is sustainable, ring-fenced and trusted funding for the first time. This will be used across Great Britain for vital treatment, better understanding of the causes of harm and early intervention to support greater awareness and reduce stigma.

My decision on prevention is about building the future system on the strongest foundations. Through the levy, we are investing £100 million of public money to tackle gambling harm and it is right that key commissioning decisions on research, prevention and treatment are made by statutory bodies to ensure that funding is spent appropriately. This is why we are appointing OHID alongside UKRI and NHS England.

Robust government oversight will ensure that levy funding is getting to where it is needed most. The Government will set clear objectives for the system to maximise value for money. We will establish a levy board as the mechanism for the Government to closely monitor spending and the overall effectiveness of the levy. We want to be led by the evidence of what works across the system and so, alongside the levy board, we will organise an advisory group.

We are confident that we have designed the levy in an effective and proportionate way. It has been a priority to strike the right balance between managing impacts on licensees and ensuring that operators are paying their fair share. I recognise that some gambling businesses are facing a tough fiscal environment. These regulations reduce levy rates for a number of licensees compared with the rates proposed in the previous Government’s consultation. Both the Tote and on-course bookmakers will also pay the levy at rates much lower than other land-based operators such as casinos and bookmakers. Online operators will be required to pay significantly more.

These regulations represent the beginning of a new phase for gambling harm reduction, one where people in our country are better protected and aware of the risks of harmful gambling. The levy is a crucial first step to delivering this and I look forward to discussing it further in the debate today. I beg to move.

[Lord Kirkhope of Harrogate (Con)]

My Lords, first, I confirm that I have not been promoted and nor am I even a Whip who is able to take over in certain circumstances. I am not sure whether a colleague of mine will be here to answer this debate from the opposition point of view.

I would just like to say a few words because I know others wish to speak who are far more up to date in many ways than I am. I was the Minister in the Home Office responsible for gambling—or controlling gambling, I should say, perhaps—back in the mid-1990s. I welcome in general anything that improves the services available to those who have addiction or who are likely to be vulnerable to gambling, but I always took the view when I was Minister that we could develop these matters in a simple, one-by-one regulation way rather than in a great way. I was therefore very disappointed when the Labour Government came in in 1997 to see that they took a very strong and comprehensive approach towards gambling, which I never thought was appropriate.

I have worried ever since about its effect. I spoke in the House on an Oral Question earlier this week and said how disturbed I was at the level of gambling in front of all of us, particularly young people, today, both in television advertising, which I would not accept was sensible or proper, and, as we all know, in the burgeoning amount of advertising in sport, such as at sports grounds and in sponsorship. There has been a dramatic increase in the amount of gambling in this country, which has been deleterious and unacceptable. Therefore, I welcome anything that is going to help. I want to ask a couple of questions, if I may, on this.

First, the use of the levy—directional and focused—seems to be correct, but we need a little more flesh on the bones regarding the delivery of support. We have talked about organisations. A number of organisations, some known to the Government and some in the charity sector and so on, are there to look after people who have fallen for gambling in the wrong way and are looking after their addictions and so on. Will the dispensation of the money raised on this levy be wide enough and comprehensive enough to cover all the areas in which people are vulnerable and suffering? I am not sure that that is the case, so I hope that the Minister will give us some reassurances. I must say that I am not happy with that element.

Secondly, is the administering of the levy sufficiently watertight, or are there ways in which it can be avoided? The list of specifics where the levy will be applicable is fairly comprehensive, but I still feel that we need to be clear that this is an obligatory levy that cannot be avoided by various means that might be used.

Finally, am I wrong to assume that the Government will not be doing much else about gambling advertising? I would like to know because, as I have pointed out and as other people have raised with me on many occasions, this level of advertising is unacceptable, but we never seem to deal with it—indeed, it burgeons even more.

[Lord Foster of Bath (LD)]

May I ask the noble Lord to go a little further than saying it is “unacceptable”? There is very clear evidence—more in this country than in any country in the world—that gambling advertising, marketing and sponsorship is causing considerable gambling harm.

[Lord Kirkhope of Harrogate (Con)]

The noble Lord is right. I do not think I can go much further because I am just making my views clear. I have certainly had direct contact with a number of organisations, in the charity field and other fields, which think that the matter is out of hand. I said it was “out of hand” in the Chamber earlier this week. It is out of hand. Consequently, while I welcome these provisions, I am pleading with the Government to get greater control of this, because it is unacceptable. Of course, online gambling is another area where it has burgeoned completely, and that seems to be in greater need. I know there is reference to that in the second of these two statutory instruments. It is completely out of control as well.

I am sorry to be so negative about this. I welcome the levy, at least, and, notwithstanding my questions about dispensation, I support the Government in what they are trying to do.

[Lord Watts (Lab)]

I very much welcome this legislation, which is overdue. I was a member of the Select Committee that looked at gambling, and we were very concerned about the lack of action, so I am pleased to see that the Government are taking action and have brought this forward.

I have two questions, the first of which is about the distribution of resources. We found that there were a number of organisations which were sometimes in conflict with each other. There needs to be co-ordination to make sure that we get effective spend and that spending results in the things that we want to see. Secondly, I am concerned about the growth of offshore gambling. It grew by a sizeable amount last year and is growing very fast. It is unregulated and will not be touched by this legislation. Will the Minister say something about that? It is of concern to the industry as well as to the public.

Overall, this strikes the right balance. I disagree with the previous point that there is plenty of evidence; there is not plenty of evidence that we can scrutinise. There needs to be proper scrutiny and accountability.