Betting, Gaming and Lotteries

Part of Parliamentary Contributory Pension Fund – in the House of Commons at 4:42 pm on 28 March 2007.

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Photo of Don Foster Don Foster Shadow Secretary of State for Culture, Media and Sport 4:42, 28 March 2007

Like Mr. Swire and his colleagues, we will vote against the order. I want to make it clear, especially to Tony Lloyd, that our decision has nothing to do with a specific casino bid or a particular location. I hope that he will acknowledge that my speech demonstrates that.

Also like the hon. Member for East Devon, I am disappointed that the Secretary of State did not make available to me or the hon. Gentleman the contents of the letter that she wrote to hon. Members who represent Blackpool. I have now had an opportunity to read it, but the Committee that she proposes to establish, through an amendment tabled in another place by Baroness Golding, will do nothing to tackle our anxieties. The letter describes the creation of a fresh Joint Committee of both Houses to consider the casino advisory panel and ascertain what lessons can be learned for the future. Clearly, such a Committee will have no impact and give no help to those of us who believe that we need to establish a Committee to examine the recommendations before a vote is taken on them.

The Secretary of State knows that this is extremely controversial legislation. She said so herself in her speech. She has many times argued for a cautious approach. That is why I wrote to her on two separate occasions requesting that she reconvene the Joint Scrutiny Committee of both Houses of Parliament, which was ably chaired by Mr. Greenway and gave us excellent advice, before we set off on the road that led to the Gambling Act 2005. We believe that it should be reconvened and that we should not go ahead with a vote on the CAP's recommendations without the Joint Committee's views on two specific issues. First, it should consider the impact on the CAP's recommendations of the recent and significant changes in gambling ecology in this country. Secondly, it should consider the concerns that have been expressed not least by the Merits Committee in another place about the remit given to the CAP and the way in which it met that remit. The Secretary of State's toothless Committee will offer none of those things.

Since the CAP was established, there have been some significant changes in gambling in this country, which were referred to by the hon. Member for Manchester, Central. Surely those changes have to be considered alongside the recommendations of the panel. In particular, as he said, there has been a huge growth in internet gambling.

It was a year ago that the Secretary of State herself expressed concern. She told the "Today" programme that there had been

"an explosion in online gambling...an explosion over which we have very little control".

Her Department and the Gambling Commission have both admitted that the online gambling market has more than doubled in the past five years and that there are now 1 million online gamblers in this country. It is surely worrying that when I asked the Minister of Sport, in a parliamentary question, what research he had commissioned into the relationship between internet gambling and problem gambling, he told me that he had commissioned no such research.

It is equally worrying that the Government's efforts to bring online gambling companies onshore and under our proposed regulatory regime, which we spent so much time in Committee discussing, have so far completely failed. Frankly, the Chancellor's recent Budget means there is now no chance of success. The online operators have made it clear that they will not seek a UK licence because of the 15 per cent. remote gaming duty outlined in the Budget. It is no wonder that the chief executive of the Remote Gambling Association, Mr. Clive Hawkswood, said that the Government

"has missed a real opportunity to lead the way in terms of international regulatory standards".

To make matters worse, while everyone knows that problem gambling is on the rise, efforts to help those who suffer from gambling addictions remain woefully inadequate. Although, belatedly, the gambling industry has now contributed £3 million voluntarily to support the work of the excellent Responsibility in Gambling Trust and has promised more, we are still way behind other countries. We spend approximately £10 per head on problem gambling support, but it is significantly less than the amount spent in New Zealand, Canada and Australia, where it is £44, £40 and £26 respectively per problem gambler. Failures to address problem gambling should be factored into our thinking about the panel's recommendations.

We should also be considering the Government's complete failure to be clear about how many casinos we are likely to have at the end of the process. The Secretary of State said that there will be no more casinos until the next parliamentary Session, but in the Gambling Bill Committee it took many weeks even to get clear information about how many existing casinos we have—139 at the time, as it turned out. Then the Minister confidently stated:

"we can say with certainty that there will be no more than 150 casinos."—[ Official Report, Standing Committee B, 11 January 2005; c. 718.]

Clearly, he totally failed to take account of the possibility of more casinos opening under the existing gambling legislation. He knows that that is the case because, from the figures that he sent to me last night—for which I am extremely grateful—in the worst case scenario there will be 249 licensed casinos. Even if we take a more conservative estimate and assume that only half the licence applications are successful, the Minister's cap of 150 will be far exceeded.

We also need to take account of the possible impact of the claim for judicial review being brought by the British Casino Association, which has so far not been mentioned. That association believes that grandfathering arrangements for existing casinos introduced by the Gambling Act are unfair and place existing casinos at a substantial competitive disadvantage to the proposed new casinos. If that judicial review goes ahead and is successful, it would significantly change the climate in which the new casino trial is due to take place.

One final change in the gambling ecology that we should be considering also comes from the Chancellor's Budget. By imposing a new high 50 per cent. top rate of tax, the new super-casino's profit margins will be reduced and its ability to contribute to regeneration, wherever it is located—Manchester or anywhere else—will be diminished. Surely concerns about the explosion of internet gambling, the failure to provide adequate support for problem gamblers, the likely higher than expected number of casinos, the impact of a possible judicial review and the higher than expected super-casino tax are all matters that a reconvened Joint Scrutiny Committee would want to, and I believe should, consider.

The second fundamental reason for my decision to vote against the order today is based on my concerns about the remit given to the CAP and the way that it has executed it. Frankly, the panel was dealt an unfair hand, and the process by which it came to its conclusions has led to a range of criticisms, not least, as we have heard, by the Merits Committee. In its report, the CAP declared that the central tenet of its assessment of the bids was its quest to find the best test of social impact. Last week, as we have heard, the Secretary of State wrote to Lord Filkin in response to the damning findings of the Merits Committee. In it she said:

"the criteria by which the Panel would assess submissions were set out in the national policy statement".

However, the Secretary of State must know that the best test of social impact was not included in the statement of national policy. In fact, the remit on which the panel based its decision changed significantly from the one outlined in the national policy statement—something that the House had the opportunity to debate—to the one outlined in the terms of reference issued much later by her and not subjected to parliamentary scrutiny. Despite placing the best test of social impact as the panel's guiding principle, the Government never defined it. The panel was left to determine it for itself. It is not surprising that it admitted that seeking the best test of social impact was "a peculiar problem". It certainly is. One of the UK's leading experts on gambling, Peter Collins, has vehemently argued that the very idea of finding a best test of social impact is an impossible task, not least because there are numerous interpretations of such an ambiguous term.

What is more, the CAP concluded:

"After considering all the evidence"—

I hope that the hon. Member for Manchester, Central is listening—

"no single regional casino proposal emerged as the self evident favourite in presenting the best test of social impact. All had one or another point in its favour".

No one bid stood out for the panel in terms of testing social impact, and yet the panel continued to use it as their guiding principle. It seems odd that it spent so much time pursuing the elusive and undefined social impact, rather than considering the Government's other guiding principle of minimising the harmful effects of gambling, a principle that was supposed at least to be implicit in the panel's terms of reference. So it was not surprising that the Merits Committee said:

"when the objectives were in tension, the Panel veered towards their terms of reference with their emphasis on the research testing of impacts rather than the minimisation of harm".

What is more, the panel made its decision based upon testing the effects of the new regional casino assuming it to be a pilot, whereas it seems increasingly likely—if the Chancellor has his way—that there will only ever be one regional casino.

There are many other concerns—for example, the British Casino Association highlights the panel's failure to consider the existing gambling landscape during its decision-making process. The association argues that

"the location and proximity of existing casinos will dilute the likely impact of the new casinos and render any social impact test more complex and less certain".

Many people find it somewhat bizarre that the casino advisory panel recommended the location of proposed new casinos in areas where in many cases there is already a large number of casinos—for instance, Manchester already plays host to 10 casinos and there are 19 existing casinos near 10 of the proposed new small and large casinos.