Mr John Whittingdale (Shadow Secretary of State for Culture, Media and Sport, Home Affairs; Maldon & East Chelmsford, Conservative)

Thank you, Mr. Gale, for that very helpful comment.

This is a slightly curious debate, because we are now debating clause stand part in the knowledge that the clause will certainly not survive in its present form when the Bill is enacted. We have heard the Minister's statement about the Government's intentions, but inevitably, it was a little sketchy. We shall want to return to those issues as soon as the Government table detailed amendments. However, even though they indicated their acceptance of the concerns that have been expressed, and their proposals about how best to meet those concerns, it is perhaps worth at this stage setting out why we have those concerns, and why we concluded that a pilot scheme is necessary.

The history of casino regulation in this country has been one of caution, and that is entirely correct. The Gaming Act 1968 was brought in to deal with a number of concerns about the way in which casinos operate, and since then, the UK casino industry has operated in a responsible manner, without many problems of criminal activity or a significant problem of gambling addiction. We are keen to preserve that.

Over the years, there has been liberalisation; for example, the last Conservative Government gradually lifted some restrictions, such as reducing the delay in membership from 48 to 24 hours and allowing the use of debit cards. We support further liberalisation and, as I said on Second Reading, we accept that there is probably no longer a need for the 24-hour delay and that there is a case for allowing advertising. Those are liberalisation measures that would apply to the existing industry.

The development of regional casinos or, as we prefer them to be called, destination casinos, is an entirely novel concept—a leap in the dark. Regional casinos are a concept unlike anything that exists in the UK. Over the past few weeks, my colleagues and I have spoken to a number of the operators of huge international casinos that are anxious to establish similar facilities in the UK. To take one example, Caesars Wembley sent an attractive brochure setting out its proposals for a vast enterprise. It says:

''It will be a 'stand-alone' resort with 1,250 slot machines and 110 gaming tables, complemented by a luxury 400-room hotel, spa, shops, restaurants . . . in all occupying 13 acres of . . . development.''

One can see the attraction for the Government of the prospect of hundreds of millions of pounds coming into many cities across the country. People have asked what on earth the Government think they are doing, but it is simply that. I accept that such regenerative benefits offer real advantages. However, we should not throw open the door.

These enterprises represent hundreds of millions of pounds. One operator that we spoke to yesterday was talking about up to 20 facilities, which calls into

question the Government's estimate of 20 to 40 casinos in total. Each facility would have been of the value of about £100 million, which would make £2 billion of investment by just one operator. If operators invest that amount, they will obviously expect a return. They would not be doing it unless they were convinced that there would be a demand for casino gambling unlike anything before in this country.

There would be a gigantic leap in the number of people gambling on slot machines in casinos. In itself, that may not be a problem, but the truth is that we do not know. That is why we have always felt it sensible to proceed cautiously and assess the impact before moving forward. We can examine the experiences of other countries in which there has been liberalisation.

It has been said that the Government's first sign of cold feet—or perhaps I should say concern—stemmed from a visit by the Minister to Australia. What took place in Australia is not what the Government propose. The massive proliferation, particularly of category A machines, not just in casinos, but in bars and clubs across the country, has undoubtedly been the major cause of the massive increase in problem gambling. It is estimated that 2.5 per cent. of the Australian population have gambling problems. There was an enormous increase in gambling, not just in casinos, but across the country, with millions of dollars being spent. Australia is a warning that we should heed. Equally, Atlantic City is a warning of what can happen if there is a proliferation of casinos.

When the Secretary of State first talked about the Bill she said that the Government would have failed if there was an increase in problem gambling and she indicated her confidence that that would not be the case. However, I do not think that any outside observer believes that there will be no increase in problem gambling. If there is a huge increase in the number of people participating in gambling—that must be the case for companies to stand any chance of making returns on their investments—problem gambling will inevitably increase also.

Given the independent studies into the issue that have been conducted and the estimates that have been made, it is not possible for the Secretary of State to say that there will be no increase. For instance, the Henley Centre has said:

''The impact of the proposed Bill is expected to increase''

the number of problem gamblers

''by a further 200,000 . . . due to the growth in the number of casinos and the introduction of unlimited stakes and prizes machines.''

However, in the regulatory impact assessment the Government have sought to cast doubt on the Henley Centre's analysis. They say that there are serious doubts about how the analysis has been conducted and that

''the methodology employed . . . cannot adequately model the radical change in market conditions that the Gambling Bill will allow.''

That may be correct and it may not be.

At the same time, however, NERA Economic Consulting has produced a similar study that says:

''Under a scenario of 60 regional casinos . . . we estimate that there could be up to 500,000 casino-related problem gamblers in 2010, approximately 400,000 more than at present.''

Of course, that might be wrong as well. Also, the Royal College of Psychiatrists has said:

''The Government's assertion that, while expanding the gambling market in the manner proposed, it will be possible to control the inevitable large increase in excessive gambling, is naive and totally unjustified. It is also inconsistent with the experience in other countries where gambling has been deregulated.''

Perhaps all those bodies are completely wrong and the Government are right. Perhaps we can experience a huge increase in gambling in this country without any significant increase in gambling addiction. However, in looking at the two sides of the argument and deciding which one I am more likely to believe, I find that the combined evidence of the Henley Centre, NERA, the Royal College of Psychiatrists and many other outside observers weighs more than the assurances of the Secretary of State that there will be no increase. That is why we suggest proceeding cautiously, with a limited number of casinos and an assessment of their impact. We obviously welcome the fact that the Government have finally accepted that argument.

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