Clause 8 - Exclusive licence
Horserace Betting and Olympic Lottery Bill
3:45 pm
Mr Richard Caborn (Minister of State (Sport and Tourism), Department for Culture, Media & Sport; Sheffield Central, Labour)
It is worth explaining the composition of the Tote and its income. About 22 per cent. of the Tote's turnover comes from pool betting. I am referring now to pool betting and the necessary protection, but I appreciate that we are discussing the role of pool betting in the wider gambling market. Although pool betting is an important part of the Tote's operation, we need to keep that in mind. Recently, activity on the fixed-odds betting side of the business has been building, so the Tote has become about much more than just pool betting.
In response to the suggestion that everything will be dragged away from the Tote, I reassure Members that if the licence went, the racing trust would still have the profitable part of the Tote, which consists of the betting shops, the phones, the internet and all the hardware and, I suppose, the relevant intellectual property rights. We are not therefore talking about an absolute when it comes to the Tote and pool betting. As I said, about 22 per cent. of the Tote turnover comes from pool betting.
Clause 8 sets out provisions for an exclusive pool betting licence post-transfer. Subsections (1) and (2) allow the Secretary of State to require the Gaming Board to issue to the successor company an exclusive licence to carry on the pool betting business in any form in connection with horse racing in Great Britain. In the light of Opposition Members' concerns, the Government will examine how we can make it clear in the Bill that the licence will be for seven years. After discussions within government, it has been decided that if the Tote is sold to the racing trust, an exclusive licence will be granted for seven years on terms
specified by the Secretary of State. The proposed licence link strikes the right balance between providing a sensible level of certainty for racing and introducing competition into the pool betting market after seven years. That will allow the Tote's successor to establish itself and ensure continued provision of pool betting at race courses.
The Secretary of State's powers to require the issuing of a licence, which may be before, on or after the appointed day, are provided in subsection (3). Only one exclusive pool betting licence will be issued and if, for example, an exclusive licence has been issued and is subsequently revoked, the Secretary of State will not have the power to request the Gaming Board to issue another exclusive licence.
Subsections (4) and (5) provide that the successor company may authorise other persons to conduct pool betting, along lines similar to the Tote's current practice. For example, those who wish to organise a totalisator at point-to-points will have to be authorised by the successor company. The successor company may state the terms and conditions under which another body may conduct pool betting on British horse racing.
While the Tote was in public ownership, its pool betting operation was self-regulating. That will not be suitable for a private sector body. Therefore, the Gaming Board has been given the task of issuing the licence and regulating its use. When the new Gambling Commission is established, it will regulate all forms of betting as part of our plans to reform the country's gambling laws. We are satisfied that, until then, the Gaming Board is well equipped to do the job.
Under subsection (6), the Gaming Board will have the power to revoke the licence if required by the Secretary of State, or if it thinks that a term or condition of the licence has been breached. My hope and belief is that the Gaming Board and the Tote's new owners will develop a constructive working relationship. It is right to have a power to revoke the licence, but it would be a matter of regret if it ever needed to be used.
If the licence is revoked following a direction from the Secretary of State, the reasons and the time that the revocation will take effect must be given. Subsection (9) provides that the Secretary of State may require the revocation of the exclusive licence only while the successor company is wholly owned by the Crown or during the 14 days after it ceases to be wholly owned by the Crown. The 14-day transitional period was provided for in case any serious problems with the transaction should emerge after the sale—for example, meeting the sale price. However, as I indicated to the Committee, we shall review whether the provision is necessary. Finally, subsection (10) provides that the exclusive licence may not be renewed.
Question put and agreed to.
Clause 8 ordered to stand part of the Bill.
Clause 9Section 8: supplemental