Photo of Philip Davies

Philip Davies (Shipley, Conservative)

It is a pleasure to serve under your chairmanship, Dr McCrea.

The gambling sector is a highly successful industry in this country, employing more than 100,000 people and contributing more than £1.4 billion to the Exchequer in betting and gambling duty alone. A large majority of the British public enjoy gambling as a leisure activity, with 73% of the UK population participating last year alone, which is an increase of 5% from 2007. In his excellent book, “Gambling: A Healthy Bet”, Patrick Basham finds that gamblers tend to participate more in community and social activities than non-gamblers and donate more to charity. However, for a small proportion—0.9%, according to the latest prevalent study—gambling can develop into a problem that negatively affects their lives.

What we must bear in mind, however, is that 0.9% is a very small amount. Many experts in the field have concluded that the small rise in the number of those with problem gambling in the latest prevalent study may not be a true representation of an increase in problem gambling; it may well be that problem gambling is both better reported and more socially acceptable today and that its true extent is now, therefore, becoming more apparent. Nevertheless, it is difficult to think of any other policy area in which 0.9% of the population affects Government policy as markedly as seems to be the case with gambling.

As with all other forms of addiction, there will always be a proportion of the population who are addicted to gambling. It is impossible to eliminate addiction, no matter how much money, how many programmes or how much treatment is provided. The blame for an addiction should not be placed at the industry’s door, because it is not the industry itself that makes people addicts—it merely offers a service—but the individuals themselves. We should therefore treat the problem, which is the person concerned, and stop attacking the product.

Photo of David Lammy

David Lammy (Tottenham, Labour)

Is the hon. Gentleman not concerned that bookmakers in particular are saturating many of our high streets, particularly in London? Although a few shops might satisfy demand, a proliferation of them and an increase to nine or 10 shops on one stretch of high road can, frankly, only promote gambling and addictive behaviour among the poorest.

Photo of Philip Davies

Philip Davies (Shipley, Conservative)

No, I am not. I know that the right hon. Gentleman has a bee in his bonnet about this issue, but I do not share his concern. I believe in the free market and the market of supply and demand. If there is not enough demand to meet the supply of those shops, they will close down. I am sure that he would prefer high streets to have betting shops rather than shops that have been boarded over and are ripe for vandalism. I certainly welcome betting shops moving on to the high street when other shops will not.

It is for the reason that I have outlined that I disagree with the premise that the gambling industry should be compelled to fund the treatment of problem gambling. It seems absurd, especially as fast-food companies such

as Burger King and Krispy Kreme do not fund research into and the treatment of obesity. I used to work for Asda and I cannot remember anybody saying that Asda was expected to fund treatment of obesity just because we happened to sell cream cakes down one of our aisles. It seems that gambling is treated on a completely different basis from those other industries.

Discussion of the issue also strikes me as disproportionate. The gambling industry’s funding target is set at £6 million for 2011 and £7 million for 2012. In contrast, the Portman Group, another highly regarded organisation, raised £6.3 million between 2007 and 2009 for their trust’s education and campaigning work. Given that the UK alcoholic drinks industry is valued at more than £30 billion, the demands on the gambling sector seem less than fair or consistent, to say the least.

Nevertheless, we are where we are for the time being. Given that the industry is pouring so much money into the issue, and given that it has the greatest vested interest of all in the money being spent wisely and in being successful in reducing problem gambling, does the Minister not agree that it would be fairer and make more sense if it had a greater role in how the money that it gives is spent?

In October 2008, the Gambling Commission recommended the establishment of a new structure to raise and distribute funding for gambling research, education and treatment. The previous Labour Government insisted that if a voluntary agreement was not reached, they would intervene and ensure that a statutory levy was installed. I am interested to hear the Minister’s definition of “voluntary”, because that certainly is not what I understand the term to mean.

As a result, new bodies were created. The GREaT Foundation—Gambling Research, Education and Treatment —raises funds for research, education and treatment of problem gambling by collecting voluntary donations from the gambling industry. The Responsible Gambling Strategy Board advises Ministers and the Gambling Commission on priorities of funding, and the Responsible Gambling Fund is an independent charity that was set up to distribute the money raised. In addition, there are three expert advisory panels. Can the Minister explain why we need all of those? Why can the body that raises the money not be trusted also to allocate it? In short, we appear to have a bureaucratic nightmare—not to mention the cost. The Responsible Gambling Strategy Board costs about £250,000 a year just to run, which does not give any benefit to those suffering from problem gambling.

Almost half the funding last year was given to a charity called GamCare, which is the leading provider of information, advice, support and free counselling for the prevention and treatment of problem gambling. GamCare has established a responsible gambling code of practice and certification process that have been adopted by many of the successful betting companies. The 11-point code consists of an age verification-parental supervision process, encourages a balanced advertising and promotional message for gambling companies, and allows customers to set a daily, weekly or monthly deposit limit on their gambling accounts.

Other initiatives include a self-exclusion policy whereby customers can close their accounts for six months, after which they must present a written case for why they should be allowed to use their accounts again. Customers can also limit their session times for games or events

that have no natural end, which provides them with greater control over their gambling. Employees in gambling companies also receive responsible gambling awareness training, which assists them in identifying the triggers and causes of problem gambling and raises awareness of the relevant support agencies and the policies, processes and regulatory requirements that surround the gambling industry.

Photo of David Simpson

David Simpson (Shadow DUP Spokesperson (Communities and Local Government); Upper Bann, DUP)

Does the hon. Gentleman see a role for educationlists or schools in helping to educate young people about the danger of gambling addiction?

Photo of Philip Davies

Philip Davies (Shipley, Conservative)

The hon. Gentleman makes a fair point. I encourage him to read Patrick Basham’s book, “Gambling: A Healthy Bet”, which talks about how developing an understanding of risk at an earlier age is good for people in terms of not just gambling, but their skills for the rest of their lives. I certainly think that there is much merit in what Patrick Basham writes in his book.

Photo of Esther McVey

Esther McVey (Wirral West, Conservative)

Is my hon. Friend aware that there is currently no GamCare treatment provider available on Merseyside? The closest is in Manchester. Does he know whether that will be addressed?

Photo of Philip Davies

Philip Davies (Shipley, Conservative)

My hon. Friend is, as ever, on the ball with what is happening in her area. She has quickly established a reputation for herself as a champion of her constituents and her area. She is absolutely right that Merseyside currently lacks a GamCare treatment facility. It is not GamCare’s fault; its provider had funding from other agencies taken away, so it has closed down. I know that GamCare shares my hon. Friend’s concern that there should be a provider on Merseyside, and I hope that it will be able to find a replacement provider soon for the benefit of her constituents.

GamCare has established a national helpline with an international reputation and an infrastructure delivering counselling to 70% of the country. The helpline, including a net-line live chat service and forum, provides a service for gamblers and others affected by gambling. The helpline receives about 1,000 calls a week. It offers help and support to people in crisis, some of them suicidal. GamCare’s professionally trained advisers explore the best way to support the caller by signposting them to debt advice, family therapy, self-exclusion or further counselling.

In 2010-11, GamCare provided sustained confidential counselling for some 2,500 people, which is 20% more than the previous year. GamCare also worked closely with the National Problem Gambling clinic in London to provide the best treatment for customers. And it works; some two thirds of the problem gamblers it treats are no longer problem gamblers at the end of their treatment. At the beginning of counselling, 88% of GamCare’s clients are assessed as problem gamblers; by the end of treatment, that figure is 28%.

GamCare has calculated the cost-benefit analysis of its treatment. It has estimated that each problem gambler costs the state about £8,000 a year. With 450,000 problem gamblers in the UK, that could mean an annual bill of about £3.5 billion. By contrast, GamCare has estimated that, on average, it costs just £650 to treat each individual.

With two-thirds of clients successfully ceasing to be problem gamblers at the end of their treatment, that produces a return on investment that is greater than 8:1—compared with the treatment for drug users, where the return is estimated at just 2.5:1. That surely highlights that the money is well spent and that expanding the service should be a priority.

GamCare has recently launched a new e-learning package, with the aim of helping more companies to improve their standards of player protection. Considering that there are 127,500 people under the age of 24 with a gambling problem in the UK, GamCare is ready to introduce education into schools and for parents and to open the communication lines with GPs. That is all ready to go if the funding is in place. However, at a time when more money than ever is available—a funding target of £6 million this year and £7 million next year—the industry is seeing more and more of it swept up into burgeoning bureaucracy.

In particular, the Responsible Gambling Fund established under the previous Government is crippling front-line services, which is where the money is needed most. In 2009-10, the RGF spent almost £500,000 on staff costs and overheads, including £51,000 on consultancy. Even more interestingly, it is estimated that those costs will have risen by 10% for the year 2010-11. In an age of austerity, such an attempt at empire building is extremely worrying, and it is vital that we guard against the growth of a monster that constantly calls for more and more money, bigger and bigger budgets and more and more employees to deal with a problem that is being tackled effectively by organisations such as GamCare.

On top of that, the RGF is funding eight PhD studentships at an average of £20,000 a year to widen participation in gambling-related research as a means of informing public policy. That is a prime example of the unfocused nature of its research. In addition, the RGF has done very little on education for adolescents, while GamCare has already researched and outlined a fully costed actionable programme to implement. Can the Minister enlighten us about what research commissioned by the RGF has led to a major policy implementation that has made a real difference to reducing problem gambling? If he can do that, he is doing better than I can.

The people on the front line desperately need that money to fund treatment and to launch education and prevention programmes. By contrast, GamCare’s funding for 2010-11 has been frozen, which makes it difficult even to maintain existing services, let alone develop new ones. Furthermore, the RGF has decided that GamCare’s helpline should become a national problem gambling telephone helpline, thus throwing away the industry’s investment over many years in an established and successful service and brand.

GamCare is currently basing its programmes on interim funding on a month-by-month basis, when what it really needs is a strategic three-year funding programme. In fact, with the correct funding, GamCare could provide the treatment, education and prevention services—either itself or with the appropriate partners—for an annual cost of around £3.5 million a year. The Government should concentrate on ensuring that the money is well spent, rather than just ensuring that more and more

money is being pumped into a situation where it is being badly spent. The structure that was put in place nearly three years ago is just not working. There has been time for it to prove itself and, sadly, it has failed. Most of the people involved in the industry would recognise that.

The answer to this conundrum is threefold: strip away the unnecessary levels of bureaucracy; let those experts on the front line, who know how to help people in trouble, get on with delivering and expanding their existing services; and put proper programmes quickly in place to educate those most in need.

The Secretary of State for Culture, Media and Sport appeared before the Select Committee on Culture, Media and Sport, of which I am a member, and expressed his concern about problem gambling and the importance that the Government attach to dealing with the matter. It is therefore the Government’s responsibility to ensure that there is a coherent strategy for education, prevention and treatment. The industry needs an effective body that makes good strategic decisions about risks and takes proportionate measures in terms of allocating funding to deal with problem gambling. The majority of the research should go to treatment providers and there is no justifiable reason why GamCare should not remain as the principal treatment provider and operator of the national helpline.

The industry, working directly with the charities, can step up to the plate and sort out the issue of problem gambling, but it would find it easier if it knew that it had the Minister’s support in stripping away bureaucracy, getting the money quickly to the front line and trusting the experts. I hope that the Minister will give me his assurance today that that is what the Government will do.

1:15 pm
Photo of John Penrose

John Penrose (Parliamentary Under-Secretary (Department for Culture, Media and Sport); Weston-Super-Mare, Conservative)

It is a pleasure to see you in the Chair, Dr McCrea.

I will endeavour to respond to the points made by my hon. Friend Philip Davies in order, if I possibly can. I am delighted that he has taken the trouble to air this important and potentially tremendously troubling issue in Parliament. It is a topic that does not get enough balanced and careful debate, and I therefore pay tribute to him for raising it. Some of the issues surrounding the problem deserve a fuller and more careful exploration and I welcome his initiative in seeking to do so.

I also welcome my hon. Friend’s opening comments. He is absolutely right to say that, for the vast majority of people, gambling is fine if it is done carefully and in moderation. In many cases, gambling causes no problems and is a source of innocent fun and enjoyment. It is the same as enjoying an occasional glass of wine or pint of beer—it causes no problem for anybody. He also rightly went on to say that, sadly, that is not the case for a small but real minority of people. I am sure that everybody here regrets and is concerned about the current figure of 0.9% of people who gamble turning into problem gamblers. In focusing on those unfortunate people and what we can do for them, however, we should not lose sight of the fact that, for the vast majority of people who participate in gambling, it is a harmless and enjoyable

source of fun. He is absolutely right to put the matter in context and to lay out that framework before we get into the detail.

I must confess that I was a little concerned when my hon. Friend started to make the point that he is not sure whether gambling companies should be funding research and help for problem gambling. He then moderated his point a bit and said that it is entirely reasonable—he gave the example of the Portman Group in the drinks industry and in doing so seemed to accept the principle—for companies involved in these kinds of industries to contribute something. His point is not that it is wrong in principle; rather he is arguing about the level of contribution. It is important we accept that principle and that all hon. Members agree that companies involved in such an industry, whether we are talking about alcohol or gambling, accept that they have a broader social duty to act and behave responsibly towards the small minority of people whom their products potentially harm.

Photo of David Lammy

David Lammy (Tottenham, Labour)

The Minister has paid some attention to the small proportion of problem gamblers, as has Philip Davies. Does he recognise that the prevalence study also reveals that there has been a 50% increase in gambling in society since 2007? That is significant and of concern.

Photo of John Penrose

John Penrose (Parliamentary Under-Secretary (Department for Culture, Media and Sport); Weston-Super-Mare, Conservative)

I completely accept what I think is the right hon. Gentleman’s underlying point: that one figure—it was just into the area of statistical significance, although it was right at the borderline—in the recent gambling prevalence survey shows that there has been an increase in the number of problem gamblers. That figure has partly been driven by the fact that more people are gambling, many of whom create no problem at all. However, the fact that the total number of gamblers has increased and that a proportion of those are problem gamblers means that there has been a statistically significant increase. He is absolutely right to point that out. I hope that I struck the right balance in my earlier remarks about the need to put that into context. We are not doing too badly internationally and, relatively speaking, other countries have higher proportions of people who are problem gamblers, but I am sure he agrees that that is absolutely no cause for either complacency or relaxation. We need to ensure that we remain alive to the matter, so I am glad that he made that intervention.

To return to the earlier comments made by my hon. Friend the Member for Shipley, I am delighted that he accepts the principle that it is right for companies involved in this kind of industry to contribute and to remain responsible. To be fair, almost without exception, the vast majority of people I have met in the gambling and gaming industries are keen to ensure that they recognise and live up to that duty. They are delighted to let it be known that they want to do that. There is an acceptance in the industry, and I think in society as a whole, that that is appropriate for companies involved in the industry. There may be an argument about the level of collaboration and involvement, which is entirely appropriate, but there is a broad cross-party consensus.

I accept my hon. Friend’s point, however, that it is not only up to the industry. Clearly, Government and public health have a role. Organisations are starting to move into and participate in this area—the NHS has been participating for some time. It is interesting to note that—if I can call it this—the medicalisation of problem

gambling is far less advanced than the medicalisation of other kinds of addiction. The treatment provided in the NHS for other kinds of addiction—for example, substance abuse—has been longer established than that provided for gambling addiction. There are moves in the NHS to do more, but he is right to say that there has to be a partnership between the industry and publicly-funded bodies to address the issue.

My hon. Friend has discussed the current arrangements. He is right to say that they have been in place for not quite two years. They stem from a report in 2008 and were implemented in 2009. I must confess that when I began my current role as Minister with responsibility for this issue, just under a year into the new arrangements, I looked at the history. It is true to say that there was a series of different attempts before the current arrangements were set up. I think that this is either the second or the third set of institutional architecture that has been imposed in this area. While there were people who made the precisely the same points as my hon. Friend on the concerns about the bureaucracy and cost in the current structure, a third or fourth reorganisation would have been something that both the industry, and to be fair problem gamblers, probably needed like a hole in the head at that point. He is, however, right to make the fundamental point. It is always correct for everybody to want to get the maximum possible value for money from any funds put towards treating an addiction problem, such as problem gambling. It is therefore sensible for us to look periodically at whether we are getting the best possible value for money.

The small caveat that I add to my hon. Friend’s remarks is that, yes, the Government need to be comfortable with this, but we also need to bear in mind that the organisations that he talked about are overwhelmingly—exclusively, in this case—funded by the industry itself. This is industry money, not public money. We are not talking about a public bureaucracy, or an executive agency of either my Department, the Department of Health or any other branch of Government. Those organisations are, rightly in my view, funded and organised by the industry, and they include people who are involved in treating and dealing with gambling addiction. They share a very heavy proportion of the burden of trying to ensure that the maximum possible value for money is achieved.

My hon. Friend is also right to say that the new arrangements have been in place for nearly two years, so there is beginning to be enough of a track record to evaluate whether they are effective. In the course of the coming 12 months, that track record will be well bedded-in, and it will be sensible to start evaluating whether the value for money that everyone wants to see is being achieved. He is enunciating a very sensible principle. The plea that I would make, and the principle that I want us to establish, is that while Government clearly have an interest, we would expect the charities concerned and the industry to take a leading role as well.

Photo of Philip Davies

Philip Davies (Shipley, Conservative)

I welcome the comments that the Minister has made so far, and I agree with what he has just said. The industry needs to play a leading role. Will he accept, therefore, that it would be far better if the gambling industry, which funds all this, had much more of a say in how the money is spent to ensure that it is spent effectively? The industry pays the money, but it often has very little say in how it is actually spent.

Photo of John Penrose

John Penrose (Parliamentary Under-Secretary (Department for Culture, Media and Sport); Weston-Super-Mare, Conservative)

That is a fair point, although it has a practical limit. It is perfectly reasonable for the gambling industry to be a force for good and to expect it to want to ensure that the money that it is donating is spent in an appropriate way. Other stakeholders will, none the less, want to be convinced that the gambling industry would not—I am sure that it would not, but this is the fear—give money and then direct the research into areas that were comfortable for the gambling industry, but not necessarily in the best interests of the wider issue of problem gambling. The gambling industry needs to push forward an agenda of value for money and the effective use of the cash that it is donating, but the gambling industry will need other stakeholders to create the right level of credibility in deciding where the money goes in the same way that the Government currently give money for academic research, but research funding councils decide which research projects are selected. That is correct, because otherwise there would always be the fear that the Government were funding academic research, in any area, into pet projects—politically convenient projects—rather than the ones that were academically pure. The same argument applies here.

Photo of David Lammy

David Lammy (Tottenham, Labour)

The Minister makes a very good point. Is he concerned about the prevalence of fixed-odds betting terminals, particularly in bookmakers? That is a concern in other parts of the gambling industry. We also have two bookmakers currently paying their tax overseas. That is a concern, if we are talking about the overall quantum available for treating problem gamblers.

Photo of John Penrose

John Penrose (Parliamentary Under-Secretary (Department for Culture, Media and Sport); Weston-Super-Mare, Conservative)

The right hon. Gentleman makes an important point, which I think goes back to a question asked by my hon. Friend the Member for Shipley: are there any examples of public policy research, funded by the Responsible Gambling Fund, that have made an impact on any of my decisions, or those of my predecessors?

One issue that I have raised with the RGF is that I am concerned that there is no significant research into establishing the kind of causal links, which I think the right hon. Gentleman suspects that there may be, between particular kinds of gambling and problem gambling. For example, many people believe that fixed-odds betting terminals are more likely to contribute to problem gambling than other kinds of gambling. The difficulty for someone in my position is that, while that is a

widespread suspicion, there is no academically solid underpinning as yet to justify it. From my point of view, therefore, it is extremely difficult for any Gambling Minister to take effective decisions about whether particular kinds of gambling should be expanded or reduced, because there is not an adequate evidential basis on which to build a proper business case, or a proper political consensus. Into that vacuum rushes everybody with their favourite prejudice. Everybody has an answer about the reasons why we have this amount of problem gambling here and that amount of problem gambling there, but nobody has enough facts to form a solid evidential basis on which to build a reason for changing the law. I have therefore asked the various bodies to prioritise research that will provide that kind of evidential basis, and they have agreed to do so. Clearly, they must then decide what that will be—it needs to be at arm’s length from Government to be credible. In response to the right hon. Gentleman’s question, it is vital that we have that kind of evidential basis for the benefit of sensible and objective fact-based public policy making in future.

Photo of Philip Davies

Philip Davies (Shipley, Conservative)

Will the Minister also bear in mind the common-sense point that the number of machines in a particular shop cannot hinder problem gambling on the basis that somebody can only play on one at a time? That is like saying that if a pub has four different beers, and decides to extend that to 10, there will be an increase in alcoholism. That would clearly be nonsense, and I hope that the Minister will not let common sense fly out of the window when he looks at the research.

Photo of John Penrose

John Penrose (Parliamentary Under-Secretary (Department for Culture, Media and Sport); Weston-Super-Mare, Conservative)

I am always happy to apply common sense. The particular example that my hon. Friend has chosen is perhaps unfortunate, because with the advent of the switch from £2 stakes to £1 stakes, there have been examples of people playing two machines at once, because they like playing with £2 stakes. I take his general point, however.

My hon. Friend has said, rightly, that he wants the industry to step up to the plate and take a lead in trying to sort out issues around problem gambling that cause concern. I share his view, and it is essential that both the industry and the other stakeholders do precisely that. The Government will certainly support any of their efforts to bring this issue under control.