My Lords, I want to start, as other noble Lords have done, by thanking the noble Lord, Lord Chadlington, for initiating this important debate, and I can assure noble Lords that, having become so used to being able to speak for only five or six minutes in any debate, the news that the maximum time limit has been reduced from 13 minutes to 12 minutes has caused me no concern at all.
The statistics already mentioned by other noble Lords relating to the number of children gambling are concerning to say the least. Although the Gambling Commission reports that the rate of young people participating has remained static over recent times, its finding that 16% of 11 to 15 year-olds had spent their own money gambling in the week prior to the survey was extraordinary. Even more extraordinary was the fact that the most popular form of gambling in this age group included betting through gaming machines. How are these young people getting anywhere near gaming machines of high stakes? Clearly, improvements have to be made in this area. GamCare has reviewed research which suggests, as others have said, that the younger the age at which problem gambling develops, the greater the consequences and severity of gambling will be in later life. This is why we have age limits on gambling, as well as protective licensing systems and codes of practice on advertising.
As your Lordships are aware, the Gambling Act 2005 sets out three objectives, one of which is the explicit protection of children and other vulnerable persons from being harmed or exploited by gambling. Another of the Act’s objectives is to ensure that gambling is conducted in a fair and open way. The area about which I am especially concerned and in which I believe the law fails to meet those two central objectives is the unregulated realm of tipsters, affiliates, and affiliates who pose as tipsters.
For those who may not be aware, an affiliate or tipster is a person whose sole aim is to get people to sign up to betting accounts, for which they will receive a fee from the betting company of usually around £30. An affiliate or tipster also makes money from a percentage of “revenues” attached to that account for the life of the account, even if a person uses the account for many years down the line. To increase account activity, affiliates and tipsters will post or tweet betting tips and all sorts of other content on the internet to encourage play, and because they earn their money from a percentage of gambling revenue, this means that they are making money from a person’s losses as well as advising them on how to bet. I do not think that I would follow the advice of someone who profits when I lose.
These individuals not only advertise gambling but actively and relentlessly encourage as many people as possible, regardless of age or vulnerability, to spend their money taking up their unproven tips via any attention-grabbing methods they can think of and, in many cases, by methods for which regulated mainstream advertisers would be reprimanded. I believe they are dangerous to the gambling industry and particularly to young people because they operate almost exclusively on social media—Twitter, Facebook and the like—which, of course, are so popular with the young and have no watershed. Such activities do not clearly fall within current regulatory frameworks as tipsters are considered not to be gambling operators. Neither are their posts or messages classed officially as adverts, so they circumvent the Advertising Standards Authority and the Gambling Commission. Three things are clear: tipsters are advertising gambling; it is meaningfully unchecked; and it can have dangerous consequences to all gamblers but particularly the vulnerable and the young.
A Demos study last year found that a person who has signed up to or follows a tipster, affiliate or an affiliate masquerading as a tipster is very likely to have signed up to a high number of similar accounts. A spokesman for the study commented that if someone follows one of these social-media tipster accounts they are likely to be following very high numbers of similar accounts. He said—I apologise for the poor grammar—that,
“this means users like this could potentially be swept up by a torrent of betting information which could encourage them to become problem gamblers ... If you’re following 40 or 50 gambling accounts and yet you still turn to Twitter to communicate with your friends or to Facebook to find out what’s going on in the world, you’re going to be constantly inundated with tips and with encouragement and with success stories that are being put out by betting affiliates. If I had to guess I’d say there’s a potential risk for someone who likes to gamble of getting really a bit too far stuck into this kind of thing, by this constant barrage of recommendations and tips”.
That makes a lot of sense and is a tremendous cause for concern.
The Review of Gaming Machines and Social Responsibility Measures is currently under way. Is this issue being covered within that body of work? Would my noble friend the Minister undertake to investigate tipster and affiliate activity in general, particularly in relation to the effects they have on children and young people? It would also be interesting to discover the levels of involvement and encouragement betting companies have with tipsters and affiliates. I would be interested to know what percentage of betting companies’ revenues are paid out to these affiliates and tipsters, and how widespread their use and influence really is.
There have been reports that because traditional online gambling adverts have become more expensive, it has encouraged betting firms to explore other imaginative ways to reach potential customers, often using third parties to harvest people’s data. This must be looked into and subjected to the usual social responsibility standards, as traditional advertising activity would be. As legislators, we are supposed to promote responsible gambling and protect vulnerable people. More needs to be done to regulate tipsters and affiliates so they work in a responsible and transparent way, more in keeping with the gambling industry’s aims of counterbalancing the promotion of products with the protection of consumers. I look forward to the Minister’s response.