Statutory Gambling Levy and Online Slots Stake Limit

Stephanie Peacock Excerpts

Wednesday 27th November 2024 Written Statements

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)]

I am repeating the following written ministerial statement made today in the other place by my noble Friend the Minister for Gambling, Baroness Twycross:

I wish to inform the House that His Majesty’s Government have today published their response to the public consultation entitled “Consultation on the structure, distribution and governance of the statutory levy on gambling operators”.

The current funding system for research, prevention and treatment of gambling-related harms reliant on voluntary donations from industry is no longer fit for purpose. While the industry’s significant uplift in the level of donations in recent years is welcome, we recognise that the quantum of funding is not the only requirement for an effective and equitable system.

That is why we are taking the decision to introduce a statutory levy as a priority, in line with our manifesto commitment to reduce gambling harms. The levy will be paid by operators and collected and administered by the Gambling Commission under the strategic direction of the Government. Today’s publication represents a significant change to funding and commissioning arrangements. It will deliver increased and trusted investment directed where it is needed most. This will further strengthen the evidence base to inform policy, and build an effective prevention and treatment system across the country. We want the public to be better aware of the risks of gambling, and for anyone suffering from gambling harms to access timely and effective support when and where they need it.

The Government will implement the statutory levy as follows:

The structure of the levy

The levy will be charged at a set rate for all holders of a Gambling Commission operating licence, depending on the sector. In recognition of the higher rates of problem gambling associated with products online compared to most land-based products, as well as the higher operating costs in the land-based sector, the levy will see online operators pay more towards research, prevention and treatment. The levy will be introduced via secondary legislation and ensure critical funding is flowing to priority projects and services in the next financial year.

We have had clear commitments from industry that operators will maintain their voluntary financial contributions to research, prevention and treatment under the current regime, especially to support the National Gambling Support Network, until the levy is in force. This consultation response should provide sufficient notice to licensees of our approach and ultimately delivers simplicity for all parts of the new system.

The distribution of the levy

The levy will be collected by the Gambling Commission, as above. To maximise the input of world-leading expertise and authority across our public bodies in the future system, the Gambling Commission will allocate funding to a commissioning lead for each of the research, prevention and treatment pillars:

Research will be allocated 20% of levy funding, and will be overseen by UK Research and Innovation (UKRI) to deliver a bespoke Research Programme on Gambling, and to the Gambling Commission to direct further research in line with the licensing objectives;

Prevention will be allocated 30% of levy funding to develop a comprehensive approach to prevention and early intervention with the lead organisation as yet to be decided. However, further consideration of the evidence is needed in order to appoint a lead commissioning body in this crucial and novel area for the Government’s approach to tackling gambling-related harm.

Treatment will be allocated 50% of levy funding and be overseen by NHS England, and appropriate bodies in Scotland and Wales, to commission the full treatment pathway, from referral and triage through to aftercare.

I recognise that many of those interested in this area have been expecting the Government’s final decisions on all aspects of the design of the future levy system, especially regarding prevention on which we consulted broadly. Ultimately, prevention is a crucial part of the Government’s efforts to further reduce gambling-related harm and it is important we take the time to get this right.

However, the statutory instrument introducing the levy is silent on the distribution of levy funding, and our overriding priority is to meet our commitment to having the levy in place by the summer.

That is why we are seeking to publish this initial response and progress the legislative process. We will continue to work at pace to finalise our decisions on prevention soon. Our aim is to publish a further response document in the coming months and I will update the House in due course.

The governance of the levy

A Gambling Levy Programme Board will be established to be the central oversight mechanism for the Government. This will bring together key Government Departments, including the Department for Culture, Media and Sport, HM Treasury, the Department of Health and Social Care and the Department for Science, Innovation and Technology. It will also include representatives from the Scottish and Welsh Governments to ensure the levy is making an impact on the ground.

Alongside the board, a Gambling Levy Advisory Group will be established to provide expert advice on funding priorities and emerging issues in support of commissioning bodies’ efforts to deliver on the Government’s objectives. We will conduct a formal review of the levy system within five years, where the structure and health of the levy system will be assessed and adjustments can be made to ensure we are achieving our aims.

Policy impact

While we expect the statutory levy will have some financial impact on gambling operators, we think these are necessary and proportionate. The levy will increase the independence of spending and Government oversight regarding commissioning decisions. It will play an important part in the Government’s wider aim to have a better informed and protected public when it comes to gambling-related harms. This investment will also ensure the Government and the Gambling Commission have the robust evidence needed to strike the right balance between freedom and protection as new challenges arise.

The publication today is further evidence of the Government’s continued commitment to tackling gambling-related harm. We want to ensure that people across our country can access trusted and quality information, support and treatment when it comes to gambling-related harms. We believe that the introduction of the statutory levy is a crucial step in meeting these aims. I will place a copy of the response to the consultation in the Libraries of both Houses.

Stake limits for online slots

Online slots are a higher-risk gambling product, associated with large losses, long sessions, and binge play. However, unlike land-based gaming machines which offer broadly similar games, they have no statutory stake limits. The Gambling Act Review White Paper, published on 27 April 2023 under the previous Government, committed to addressing the risk posed to players by these theoretically limitless online slots stakes. I wish to inform the House that His Majesty’s Government intend to proceed with the introduction of stake limits for online slots through a statutory instrument.

A consultation was run from 26 July to 4 October 2023 that invited views on a stake limit for online slots games of £2, £5, £10 or £15 per spin. It also outlined options for additional protections for those aged 18 to 24 through a £2 limit, a £4 limit, or specific protections on a case-by-case basis. Ministers have considered the consultation and available evidence and the Government have decided to introduce stake limits of £5 per spin for adults aged 25 and over. We will also introduce a statutory maximum limit of £2 per spin for young adults aged 18 to 24 years old, whom the evidence suggests can be particularly vulnerable to harms associated with high stakes play.

These stake limits will be subject to an implementation period. This means that, following debates in Parliament, operators will have six weeks from the day the statutory instrument is made by the Minister to implement the £5 limit and a further six weeks to implement the £2 limit.

The introduction of these stake limits is proportionate and is a key step in achieving the Government’s objective of reducing gambling-related harms. Importantly, these changes bring online slot games in line with existing restrictions on slot machines in casinos. These limits are also aligned with the recommendation made by the Culture, Media and Sport Committee’s second report of Session 2023-24, “Gambling regulation”, published in December 2023.

[HCWS253]