Online Gambling - Motion to Take Note

– in the House of Lords at 2:53 pm on 23 November 2017.

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Moved by Lord Browne of Belmont

To move that this House takes note of the challenges facing problem gamblers, specifically with respect to online gambling, and of the Multi-Operator Self Exclusion Scheme about to be introduced to help online gamblers.

Photo of Lord Browne of Belmont Lord Browne of Belmont DUP

My Lords, I am very pleased to have secured this debate today, which provides for the first focused debate that we have had in this House on online gambling since the passing of the Gambling (Licensing and Advertising) Act in March 2014.

I am acutely aware that in recent months there has been considerable discussion about the challenges posed by fixed-odds betting terminals. I want to make it very clear that I completely share the concerns of those who have spoken out against FOBTs and I am very pleased that the current DCMS consultation asks about stake reduction and includes the option of a £2 stake.

I have not sought this debate because I take a different view and want to distract attention away from the FOBT debate. Indeed, as a Northern Ireland Peer, I am bound to say that there is real doubt about whether FOBTs are even legal in Northern Ireland. In raising this debate today, I am simply saying that there is another problematic aspect of gambling that we also need to talk about—namely, online gambling. The Gambling Commission itself recognises that in addition to 430,000 problem gamblers in Great Britain, there are a further 2 million at risk. However, I have decided to use that term in today’s debate because everyone knows what it means.

Having made those broad introductory points, I shall define the online gambling sector. According to the Gambling Commission, the most recent figures for 2015-16 demonstrate that the online gambling sector is the largest gambling sector in Britain today. It is worth £4.5 billion. However, this figure does not account for the fact that now 42% of National Lottery transactions are online. If you account for this, the true value of the online sector is £5.9 billion. To put that in context, high street betting is worth £3.3 billion and that of traditional casinos £1 billion. Online gambling accounts for 44% of all gambling in Britain today. Britain’s online gambling sector is, moreover, the largest regulated sector in the world, with 21 million active accounts. In addition to this distinctive claim, UK online gambling has another which is less talked about. The latest problem gambling prevalence figures, published by the Gambling Commission in July, show on page 30 that the highest overall prevalence of at-risk gambling was observed among those who participated in online gambling on slot, casino or bingo games—some 34.9%.

Problem gamblers—defined as those who gamble to a degree that compromises, disrupts or damages family, personal or recreational pursuits—were estimated to comprise 0.8% of the adult population of Great Britain, with such individuals far more likely to be men than women. This translates to an estimated 430,000 problem gamblers in Great Britain in 2015, with a further 2 million having been deemed at risk of problem gambling.

It is no great surprise that online gambling should have the greatest claim on problem gamblers because, unlike other forms of gambling, online is available 24/7 and it is much easier to engage in problematic play without your family finding out because you do not even have to leave your bedroom to do it. Moreover, the fact that it is all done electronically without exchanging real money makes it easier to get caught up in problematic play. Mindful of this, we should be in no doubt about the devastating effects online gambling can have on people’s lives.

There is the case of the 23 year-old accountant, Joshua Jones, who, unbeknown to most people, was an online gambling addict. He committed suicide in 2015 with £30,000 of gambling debts. Then there is the case of the 18 year-old Omair Abbas, who committed suicide after generating just over £5,000 worth of debt from online gambling in 2016. Then there is the case of Adam Billing from Liskeard, who at the age of 27 threw himself off the 120-foot high Moorswater viaduct because of spiralling debts resulting from an online gambling addiction. If you want to get a sense of the misery caused by online gambling, it is well worth visiting a problem gambling website and reading the posts of problem gamblers as they describe the dreadful situations that they face and seek to support each other.

Last week saw the publication of the Gambling Commission’s Strategy 2018-2021, which highlights this through recent polling. It states that,

“our most recent research published in 2017 showed that 78% of people believe that there are too many opportunities to gamble; 69% of people feel that gambling is dangerous for family life; and only 34% believe that gambling is fair and can be trusted, down from 49% in 2008. There are also significant public concerns about the volume, nature and scheduling of gambling advertising and the impact this could have on future generations”.

This is hugely important.

Having defined some of the contours of online gambling today, I will now examine some specific public policy options for helping online problem gamblers. My first engagement with online gambling came in 2014, when I responded to the Gambling (Licensing and Advertising) Act, which was narrowly concerned with online gambling. During the debates on the Bill I argued that online problem gamblers are discriminated against because they cannot access one of the main protections for problem gamblers—self-exclusion—on anything resembling a level playing field with offline problem gamblers. On a strong day, an offline problem gambler might be able to self-exclude from the four betting shops in his or her town and thereby cut himself off from local gambling opportunity for the duration of his self-exclusion. If an online problem gambler manages to self-exclude from four online sites, however, there is no sense in which he can cut himself off from the opportunity of gambling for the duration of his self-exclusion because there still are hundreds if not thousands of other sites he can visit without even leaving his bedroom. It is physically impossible for him to self-exclude from all the available sites.

In response to this I proposed, through amendments, multi-operator self-exclusion, whereby the online problem gambler needs to self-exclude only once with the Gambling Commission or its nominated body, and all online sites with a Gambling Commission licence are required to respect the self-exclusion. On Report the Government announced that they were finally persuaded of the need for multi-operator self-exclusion, but explained that they did not want to implement it on a statutory basis. I was asked to withdraw my amendment on the basis that the Government had asked the Gambling Commission to introduce multi-operator self-exclusion and it would make substantial progress towards its realisation in the next six months. Mindful of the Government’s willingness to compromise, I decided to withdraw my amendment. In June this year it was finally announced that the Remote Gambling Association would run multi-operator self-exclusion—or MOSES, as it is now referred to—for the Gambling Commission, and that it would be called GAMSTOP and would be up and running by the end of the year.

As we address this subject nearly four years later, I make the following points. First, we should be in no doubt about the importance of MOSES. On Tuesday this week, I was very privileged to welcome to Parliament, along with the noble Baroness, Lady Howe, a number of recovering problem gamblers. I was delighted that other Peers were also able to be present, including the noble Lord, Lord Griffiths, the noble Lord, Lord Foster, and the noble Baroness, Lady Masham. One recovering problem gambler explained how, when his wife discovered his addiction, they worked at tackling it together, and she stood alongside him as he self-excluded from the gambling site he had been using. All went well for a while until, a couple of weeks later, he received an email from another gambling provider offering him a free bet for £50 and he got sucked back in again. I asked him whether he felt that multi-operator self-exclusion would be helpful. He said, “It would have saved my marriage”. I asked another recovering online problem gambler whether he had ever tried to self-exclude. “Oh yes,” he said. “I have self-excluded from 20 different sites. The problem is, though, that there are always lots of other sites”.

Mindful of that, I make the following points. First, it is regrettable that nearly four years on from when the commitment was made we still do not have multi-operator self-exclusion up and running. We cannot afford to waste any more time. Secondly, it is important that no corners are cut in implementing GAMSTOP and that it operates effectively. Can the Minister please inform the House how the Government are monitoring progress to ensure that GAMSTOP is implemented robustly? Thirdly, part of the success of GAMSTOP will be letting all online gamblers know of its existence in an ongoing way. Can the Minister assure the House that the Government will ensure that the existence of GAMSTOP will be properly promoted, not through a one-off campaign but in a sustained and ongoing way?

Fourthly, I draw the attention of the Government and this House to some real concerns that have been expressed by online problem gamblers about the proposed remit of MOSES under the Gambling Commission’s Licence Conditions and Codes of Practice. Provision 3.5.4 mandates a self-exclusion system for each website. Provision 3.5.5, meanwhile, mandates multi-operator self-exclusion for online gambling sites. This suggests a two-tiered approach to self-exclusion, which is causing considerable worry. One problem gambler described the concern in the following terms: “You only want to self-exclude when you are desperate. When you reach that point, no one wants to self-exclude from one site and not another”.

Online problem gamblers’ key concern is that having a two-tier system will undermine the efficacy of MOSES. First, if individual websites are trying to run their own independent self-exclusion mechanism as well as MOSES, that means resources which could have been focused on MOSES to make it work well are diverted elsewhere. Secondly, if there are different levels of self-exclusion, it will inevitably cause confusion. Some problem gamblers will find out about one means of self-exclusion and not the other. There is a significant risk that some will assume that their self-exclusion will cover all sites when it actually covers only one.

It does not take a genius to see that a two-tiered approach would be in the short-term interest of the industry. Can the Minister provide an undertaking that he will tell the Gambling Commission that self-exclusion must be provided on a single-tiered basis through MOSES. In any event, I ask him to arrange a meeting, which he would chair, of the Gambling Commission, the Remote Gambling Association and myself, to which I can bring the concerned problem gambling groups. This would be a very worthwhile exercise.

Having dealt with measures that cut people off from gambling through self-exclusion, we must look at provisions that should be made earlier in the process. In this regard, I welcome a series of changes that are being made to the Gambling Commission codes of practice and technical standards from 1 April next year, which will help. However, in the current context, more could be done. In Sweden, players gambling on the state-owned gambling operator Svenska Spel have the option of using a programme called Playscan, which uses behavioural analytics. It prompts players about behavioural change, indicates that a problem might be developing, and provides information about how to limit their gambling or where to find help. In Finland, mandatory daily and monthly loss limits are required by the gambling regulator. On top of that, there is a limit of €5,000 on the amount of money which can be held in a gambling account. The maximum daily loss is set at €500. In addition, transfers from bank accounts to a gambling account cannot be made between midnight and 6 am. This creates a natural boundary for gamblers akin to betting shops.

On the question of a levy, the industry is supposed, by voluntary agreement, to contribute 0.1% of gross gambling yield to the charity GambleAware, which allocates the money to service providers that help problem gamblers, such as the Gordon Moody Association. In the last year, however, the industry failed to invest even 0.1% of gross gambling yield. It managed just £8 million. GambleAware has pointed out that as well as failing to reach 0.1% of GGY, this is also completely inadequate. If there are 430,000 problem gamblers, it is fair to assume that at any one time at least 10% of them—43,000—will be looking for help. The £8 million, however, only enabled it to reach 8,000 people, thus falling short by some 35,000. Meanwhile, it left no money at all for investing in helping the 2 million at risk.

GambleAware has now called for the levy to be made statutory and suggests that it needs to be in the region of £45,000 per annum to address the present need. Professor Jim Orford, an expert in problem gambling, has suggested that rather than being calculated on the basis of 0.1% of gross gambling yield, the levy could be 0.8% to reflect the general problem gambling prevalence figure. In some ways, however, he points out that a more just approach would be to base the figure on the takings that come from problem gamblers, which, writing in 2012, computed to 14% of GGY and which would have come in at £780 million. I clarify that neither he nor I am asking for that, but I hope that it puts in context how grossly irresponsible the £8 million is. Using the regulation-making powers of the Minister with respect to the levy would obviously benefit all problem gamblers. Clearly, however, given that the highest problem prevalence rate pertains to online, this proposal would greatly benefit online problem gamblers.

I very much look forward to listening to the contributions of noble Lords to this debate and especially to the Minister’s response. I beg to move.

Photo of Lord Chadlington Lord Chadlington Conservative 3:10, 23 November 2017

I thank the noble Lord, Lord Browne of Belmont, and congratulate him on securing this very important debate. I must first, as always in these situations, declare the interest that one of my children is head of policy for Google in the UK and Northern Ireland.

Public concern with gambling suggests that we are at a very important crossroads. On the one hand, it is perfectly clear that the people running gambling are thriving. Last week, we read that the highest-paid woman in the United Kingdom—indeed, the highest-paid boss in the country—is the head of a gambling firm with a 2016 pay packet of £217 million. The Daily Mail reported that, according to the Sunday Times rich list, the wealth of the British gambling industry’s tycoons, who include five billionaires and 15 multimillionaires, increased by nearly 20% last year to a total of £19 billion. On the other hand, as the noble Lord has pointed out, from a social standpoint more than 2 million people in the UK are either problem gamblers or at risk of gambling addiction.

I feel that constructive debate and sensible lawmaking depend to a significant degree on the quality of the information and research on which they are based. Particularly since the debate that I introduced on 14 September on the effects on children of advertising gambling, I have continually been asked: is the research from the Gambling Commission and from GambleAware, on which arguments and legislation may ultimately be based, genuinely independent of the gambling industry, which funds it, particularly as several of their trustees were recently chief executives of the very companies that provide the money?

The questions about problem and online gambling, to which we need answers, are becoming more and more pressing. For example, do we feel confident that we have well-grounded, long-term trend analysis of problem gamblers in the UK and the causes of their addiction? Is traditional and online advertising encouraging young people to believe that without gambling online they cannot enjoy a fulfilling social life? How far is gambling undermining family life? What are the lessons to be learned from other countries such as Sweden and Australia, where legislation is more advanced, as the noble Lord has just pointed out? Personally, I advocate increasing the levy on gambling industry profits—I would also make it statutory—so that we can fund research into these and other questions.

However, in these days of increased public cynicism, it is not enough actually to be independent of the industry; it is also essential to be seen to be independent and to be transparently so. For my own part, I believe that these organisations are independent, but will the Minister consider increasing the levy on the industry and confirm that he is satisfied with the independence of GambleAware, the Gambling Commission and similar organisations and, most importantly, the subjects they choose to research? Does he believe that there should be any additional protections or compliance procedures? Perhaps, when the final gambling review is published, the Government would also consider adding a profile of the organisations they have used for their research and say why they feel confident that the methodology and conclusions are entirely independent and can be relied upon.

For a number of years I was chairman of Action on Addiction. We believed that the longer we could delay young people experimenting, even with cigarettes and alcohol, the less likely they were to become addicted in later life. Young people who experiment with gambling today, particularly online and therefore often secretly, are in danger of becoming the problem gamblers of tomorrow. A 30% rise in the number of problem gamblers in the UK in the last three years suggests to me that we may—I repeat “may”—be seeing the beginning of a worrying trend.

In my view, some firms are now offering online gambling games specifically designed to appeal to children. Recent press reports refer to an operator offering a Peter Pan game with 20p bets, and Unicorn Bliss has a minimum bet of just 1p. Games such as Goldilocks and the Wild Bears can also be played for free. At noon today I checked: all these sites were up and running and open for business.

Interestingly, the Gambling Commission found that 6% of 11 to 15 year-olds have gambled online using their parents’ account. But on and offline is a blur to the young. They watch programmes when they choose on whichever device they choose. A TV watershed protecting the young is becoming less and less relevant, although the average age at which children watch TV after 9 pm, and unsupervised, is lower than 12.

The government review states:

“Problem gambling has remained statistically stable despite the rise in advertising … Children’s participation in gambling and their levels of problem gambling have declined since 2007”.

Can it really be the case that, despite a 63% increase in advertising since 2012—up to a staggering £312 million—and the proliferation of online gambling opportunities, over the last 10 years there has been no increase in problem gambling?

This is too important to get wrong. There is much debate about the health warnings on gambling advertising, and there is a plan in the review to launch advertising campaigns designed to,

“raise public awareness of risks associated with gambling”.

I wish to make three points. First, this educational campaign is being outspent by the gambling industry 50 times over. Secondly, the important issue for advertising such as this is the tone of voice, as well as the content. Thirdly, my professional communications experience suggests that this campaign may heighten young people’s interest in gambling, which in turn could lead to further experimentation. My experience as a father and a grandfather is that, the more society tells a young person not to do something, or that it is excessively risky, the more likely they are to do it.

I ask the Minister to protect the young of today and thereby reduce the number of problem gamblers for tomorrow by urgently considering severely curtailing or even banning all gambling advertising and promotion on and offline.

I want to make a specific point about the multi-operator self-exclusion scheme—MOSES—which, by the way, I enthusiastically support. It is a very positive step. As I understand it, around 100 online gambling operators are licensed by the Gambling Commission, and they are covered by the multi-operator scheme. However, I have also seen that there are 30,000 sites worldwide. Are the Government reviewing all software and artificial intelligence options, such as gamban, to exclude all these sites?

This is such an important debate, and this issue is moving up the national agenda. If, based on transparent and independent research which we could all accept as correct, we could reduce gambling advertising offline and online, particularly when targeted at the young, and help problem gamblers manage their addiction with the assistance of MOSES and of new software and artificial intelligence solutions, we would, as a result, have a healthier and safer society.

Photo of Baroness Howe of Idlicote Baroness Howe of Idlicote Crossbench 3:19, 23 November 2017

My Lords, I am very grateful to the noble Lord, Lord Browne, for securing this important debate and for arranging the hugely successful event on Tuesday at which Peers were able to meet recovering online problem gamblers.

For too long, online gamblers have, in a very real sense, been afforded separate treatment. That is particularly inappropriate given the challenge that it presents. Online gambling is available 24/7 without even leaving your bedroom, as the noble Lord, Lord Browne, has already said. As such, it is a profoundly solitary pursuit. Unlike in a betting shop, there are no members of staff in your bedroom to intervene if you exhibit a problem with gambling behaviours.

There is an irony because, for many purposes, online gambling provides a greater scope for protection than offline. Indeed, the Government recognise precisely that point in paragraph 5.19 of their current consultation, which states:

“Unlike land-based gambling, all online gambling is account-based, which means operators know who their customers are, what they are spending their money on, and their patterns of gambling. This provides opportunities for operators to use customer data to identify and minimise gambling-related harm”.

While I welcome the fact that the Government have recognised that, the proposals in their consultation do not appropriately marry the potential for protection with the measure of public concern.

Online gambling now has the highest overall problem prevalence figure, with devastating social consequences, including family breakdown, suicide and other horrifying stories that we have already heard. In that context, it is not surprising that public faith in gambling has fallen, as the noble Lord noted, from something like 49% to 34%. We have now reached a stage where we require legislative change, which currently is not proposed by the Government’s consultation. I will focus on some specific legislative changes that the Government should make, but I want first to address the matter of financial transaction blocking.

While MOSES will protect problem gamblers from legal sites, financial transaction blocking protects them from illegal sites. Although the Government rejected my amendment to require financial transaction providers not to process transactions between people in the UK and illegal sites, they accepted the need for it on a non-statutory basis. In response to that amendment, they asked the Gambling Commission to secure the agreement of Visa, MasterCard and PayPal that they would not facilitate transactions from websites accessing the UK market illegally.

I have since tabled Written Parliamentary Questions to assess the efficacy of voluntary financial transaction blocking. They reveal that, as of April 2016, the Gambling Commission had written to 60 foreign sites asking them to cease activities in the UK. Of those, three went on to obtain a licence, 41 ceased offering facilities for gambling and 11 were subject to payment blocking by payment providers. Given that there are nearly 200 countries in the world, many of which will no doubt host multiple gambling websites, the figure seems a little low to me. However, I accept that even if there are thousands of gambling websites in the world without UK Gambling Commission licences, it is only problematic from our point of view if they seek to access the UK market. I would be interested to know what the gambling websites operating legally in the UK think about those figures.

In the meantime, I have two questions for the Minister. First, does he have any more up-to-date financial transfer blocking figures for the House? Secondly, given the sustained interest of this House in the protection of UK consumers from illegal gambling, will the Minister undertake to provide a detailed annual report of the Gambling Commission’s warning to illegal sites and financial transaction blocking activities with the payment providers? That would be good for transparency and much appreciated, I am sure, by Members of your Lordships’ House.

Having addressed financial transaction blocking, I now turn to three specific areas where we need legislative change. The first and most important is MOSES. It is clear from Tuesday’s meeting that online problem gamblers view MOSES as hugely important. They were very upset about the four-year delay and exercised about the dangers of a two-tier system of self-exclusion. It is such a shame that the coalition Government did not accept the amendment of the noble Lord, Lord Browne, in March 2014. If they had done so, it is likely that MOSES would be up and running today. It is vital that this is now implemented as quickly and robustly as possible. That means that it must be introduced on a single and not a two-tiered basis, for all the reasons that the noble Lord, Lord Browne, explained. In implementing it, it is vital to remember that this is one of those areas where online protections can be made to operate more effectively online than offline.

Secondly, the time has come for the Government to look at providing a means whereby they create a single, integrated MOSES covering all legal gambling whether online or offline. That would mean that if any problem gambler self-excludes from any licensed provider on a gambling product in the UK, all such providers should be obliged to respect that self-exclusion for its duration. I am informed by experts that that would be entirely possible. It just depends on whether we have the political will. To be frank, in the context where public confidence in gambling is in free fall, we need the Government to come forward with precisely that kind of bold vision. It would really help the Prime Minister, too, in realising her goal of creating a Britain that works for everyone. If there is a concern about who should pay, I have no doubt that the industry should, as part of its customer care. However, I do not believe that it should proceed on the basis of self-regulated donations, which brings me to my third point.

Gambling creates social environmental pollution. In the same way that an actual environment-polluting business should pay, so too should a social environmental-polluting business. Ever since the Gambling Act 2005 became law, Section 123 has given the Minister regulation-making powers to introduce a statutory levy. Those powers have never been used and the industry is supposed to voluntarily donate 0.1% of its gross gambling yield. It contributes only £8 million. In a context where we have 430,000 problem gamblers needing help and a further 2 million at risk, that donation is, frankly, a joke. The Government should introduce a statutory levy requiring sufficient funds to deal with the social environmental pollution and to help manage it through MOSES. That should include the funding of a joined-up online and offline MOSES.

The final statutory change that I would like to mention pertains to the current inability of a problem gambler immediately to withdraw all money from a gambling account. If you are a problem gambler and you reach a point of resolution and want to stop gambling, amazingly, it takes three days to withdraw your money. At any stage in the process over the next 72 hours, you can cancel that application to withdraw and start gambling again. If you only manage to resist the compulsion to gamble for 24 hours and end up reversing your attempt to withdraw money, you are then back at square one. In the event that you summon up fresh strength the next day and try to withdraw again, you will then face another wait of a full three days with all that that entails. I have to say that it is hard to imagine a system that is designed to make it more impossible for problem gamblers to withdraw their money and take steps to deal with their problems, but perhaps that is the point. As legislators we simply cannot allow it to continue and I hope that the Minister will show that he is going to take some significant action.

Photo of Lord Morrow Lord Morrow DUP 3:30, 23 November 2017

My Lords, I too congratulate my noble friend Lord Browne of Belmont on securing this important debate. Like him, I want to make it clear from the outset that I am also deeply concerned about FOBTs, and this debate should not detract from the need to deal with them. From a Northern Ireland perspective, there are reasons to believe that FOBTs are not legal at all. If the courts rule that they are legal, I would want to see a maximum £2 stake. It is interesting to note that the machines have been banned in the Republic of Ireland. Having made these points, however, I want to be clear that it is just as important that we deal with the equally serious challenges presented by online problem gambling.

In May this year the Department for Communities in Northern Ireland published a gambling prevalence survey for 2016. More than 1,000 people were surveyed about their gambling habits and were asked to consider public attitudes to gambling. The survey illustrates that problem gambling both online and offline is a significant issue in Northern Ireland. It found, as did the previous survey conducted in 2011, that Northern Ireland has a significantly higher incidence of problem gambling than any other region of the United Kingdom. The survey found that 2.3% of the respondents were deemed to be problem gamblers compared with 0.8% in Great Britain. Broadly speaking, this equates to between 32,000 and 43,000 individuals in Northern Ireland, depending on how the figures are calculated.

Many noble Lords will be aware that the Gambling Commission estimates that there are some 430,000 problem gamblers in Great Britain today. If Northern Ireland is added, the figure comes to around 460,000 or 470,000 problem gamblers in the United Kingdom, a figure which includes individuals betting both online and offline. As I am sure is the case in the rest of the United Kingdom, over recent years Northern Ireland has seen a significant increase in the number of individuals who are gambling online. In 2010, 5.4% of those surveyed had gambled online in the past year, but that figure approximately doubled over the next five years, rising to 10.6% in 2016. Among those who responded to the survey and indicated that they gamble, online gambling was engaged in more by younger people. Some 23.6% of those aged between 16 and 24 indicated that they gambled online, compared with only 3% of those aged over 65.

We all know that problem gambling can have a devastating impact on individual lives. I want to tell the tragic tale of one young man from County Fermanagh whose story was reported in the Belfast Telegraph in March this year. Peter and Sadie Keogh told the Belfast Telegraph about the death of their son Lewis, who took his own life having run up debts of more than £50,000 due to his gambling addiction. Peter and Sadie had no idea that Lewis had a gambling addiction and discovered it only after his death. As Peter put it, “Lewis was gambling on the internet, he was gambling on his own in bed and he was gambling at night”. Peter and Sadie told Lewis’s story to warn others of the dangers of gambling addiction and where it can lead. They have bravely told Lewis’s story and I highly commend them for doing so. One of the things I find striking about this tragic story and the others that have been related is the age of online problem gamblers who are committing suicide. They are all either very young or quite young. This fits with the online gambling demographic highlighted by the Northern Ireland survey. In light of that, I ask the Minister what focused support is being made available to young online problem gamblers.

Another striking thing I found when studying problem gambling is its impact on families. One online problem gambler who spoke to parliamentarians this week talked of how, at the height of his addiction he had popped into the house to get a coat for his son, who was in the car. In the few moments he was in the house he had a strong urge to go to his laptop. He emerged two and a half hours later to find his young son asleep in his car seat, his face still wet with the tears he had cried himself to sleep with. Another problem gambler testified that when you are driven by the addiction, anything that stops you gambling is an annoyance. It thus has the devastating effect of making wives and children an annoyance. Some may regard this as the necessary price to pay for a deregulated gambling sector, but I personally do not.

When we seek to measure the social and environmental pollution caused by online and offline gambling by saying that 470,000 problem gamblers are affected, we kid ourselves. The truth is that for every problem gambler there is a family and countless lives impacted in untold ways. Even if we cannot be moved by the suffering, we should surely be moved by the figures. Speaking as I do the day after the Budget, it is worth remembering that the annual cost of family breakdown is £48 billion. In this regard, I was particularly struck by the following observation made in a recent article by Dominic Lawson:

“Divorce Online, a firm which logs all uncontested divorce petitions, last year revealed that gambling is now cited as a cause for marital break-up in no fewer than one in five of such petitions. Only a few years ago, it was cited in only one out of every 15 such claims”.

That is an extraordinary development with far reaching implications. The well-being implications of marriage breakdown on adults and children are huge. Working on the basis that the polluter pays, I wonder whether the Minister could clarify how much money the industry is paying back to invest in marriage support services.

We as legislators have a responsibility to take concrete action to protect and help individuals suffering from gambling addiction. In the rest of my contribution, I would like to focus on the specific steps that I believe we need to take. First, I echo everything that has been said by other noble Lords about MOSES. We should be in no doubt about its importance. I regret that the coalition Government did not place it on a statutory footing and hope that, in the context of the present gambling consultation, the current Government will reconsider. I am particularly pleased to see in the briefing from GamCare that MOSES will be UK-wide. It is certainly very much needed in Northern Ireland, given our significantly higher problem gambling figures.

Advertising will be crucial and needs to be sustained, not a one-off. The gambling industry in the UK is certainly not shy about advertising its services, so I hope it will be willing to invest in a campaign to protect some of its own customers. There must be an initial review of the efficacy of GAMSTOP with a view to fine-tuning it after the first year. Given our higher problem gambling prevalence figure, this review should particularly consider the impact of GAMSTOP in Northern Ireland.

Secondly, I want to talk about the gambling levy. At the moment, my understanding is that it does not apply to Northern Ireland. This is odd, given that the Province embraces gambling providers and has a higher problem gambling prevalence figure. No doubt this is informed by the fact that standing behind the voluntary levy is Section 123 of the Gambling Act 2005, which applies only to Great Britain. For as long as the levy remains voluntary, however, and is not actually constrained by the Act, it certainly should extend to Northern Ireland. What is really required is a statutory levy, which may require two separate pieces of legislation, one for Great Britain and one for Northern Ireland. In a sense it does not matter how it is mandated, just as long as it is mandated. In my opinion it should be worth at least the problem gambling prevalence figure, which would be 2.3% for Northern Ireland. The industry should certainly pay for all the relevant treatment services and for MOSES.

Thirdly, I want briefly to agree with a legislative ban on gambling sites taking bets between midnight and 6 am. In this regard, I particularly highlight the observation of the father of Lewis Keogh that most of his gambling was done at night. I should like to say more, but the Clock has caught up with me.

Photo of Lord Alton of Liverpool Lord Alton of Liverpool Crossbench 3:39, 23 November 2017

My Lords, I too warmly welcome this debate and congratulate the noble Lord, Lord Browne of Belmont, on his speech and on initiating the debate. I wholeheartedly agree with and endorse his remarks, along with those of the other preceding speakers.

In preparing for the debate I have been struck by the fact that the problem gamblers I have spoken to are also passionately against the two-tier system referred to by the noble Lord. One of them, Justyn Larcombe, emailed me this morning, giving me permission to quote him. He said:

“I am at a loss to understand why the Gambling Commission would have settled for this approach. Given that some companies own multiple sites, it doesn’t take a genius to work out why the industry might have pressured the commission into this bizarre arrangement … When you want to self-exclude, you are desperate and, by definition, you want to cut yourself off from all gambling opportunities. The idea that anyone reaches that point and wants to cut themselves off from bet365, but not Paddy Power, is farcical”.

Endorsing a point that we have heard in preceding speeches, he adds:

“It is in the middle of the night that the most destructive online gambling takes place. If it could be shut down overnight in the UK, as in Finland, that would really help increase protections for problem gamblers”.

I will return to each of Mr Larcombe’s points in my remarks.

For 25 years, as a city councillor or Member of the House of Commons, I represented inner-city neighbourhoods in Liverpool. Time and again, I saw the destructive effects of various forms of addiction. Addictive gambling had a corrosive and pernicious effect, with men in particular gambling wages or benefits that their wives and families desperately needed to keep hearth and hope together.

Fast forward to today and into the world of anti-social media; and as the Gambling Commission reminds us, the overall prevalence of at-risk gambling is at its worst among those who are enticed into online gambling. That tears lives, families and communities apart—and we should all reflect on the sometimes tragic consequences, which include suicide and other well-documented mental, physical, and emotional consequences, as we have heard. We have been reminded of tragic cases: the 23 year-old trainee accountant, Joshua Jones, who in the summer of 2015 leapt from the ninth storey of a London skyscraper to his death because his gambling debts had risen to £30,000; the 18 year-old, Omair Abbas, who committed suicide in 2016, having accumulated just over £5,000 of online gambling debts; and the noble Lord, Lord Morrow, reminded us of the death of a young man in Fermanagh who had accumulated staggering debts. This waste of life, full of promise, is desperately unnecessary. Gambling addiction destroys lives, but it can also destroy communities.

Fast forward again to 2017 and visit our hollowed-out high streets, where the dominating prevalence of charity shops and betting shops tell their own story of modern Britain. In a telling and sharp contrast, as local communities are disfigured and struggle for resources, the Local Government Association is right to remind us that the gross gambling yield from fixed-odds betting terminals rose from £1.05 billion in April 2008 to £1.73 billion in March 2016—an increase of 65%. Those figures hardly suggest that the Gambling Act has struck the right balance between the needs of local communities and the rights of multimillion-pound businesses. I particularly agree with the remarks of the noble Lord, Lord Chadlington, who told us that we ought to enforce many more restrictions on gambling advertising.

The fact that our laws lack balance is also illustrated by the findings of the Gambling Commission, which tells us that the UK now has the largest regulated online gambling market in the world. In one recent year, the remote gambling sector generated a gross gambling yield—defined as the amount retained by operators after the payment of winnings but before the deduction of costs—of a staggering £4.5 billion. That is a 32% market share of an even more staggering £13.8 billion generated over the same period by the gambling industry as a whole. Again, it was the noble Lord, Lord Chadlington, who reminded us of the obscene levels of remuneration by some of the captains of this industry.

Problem gamblers in Great Britain—defined as those who gamble to a degree that compromises, disrupts or damages family, personal or recreational pursuits—are estimated to comprise some 430,000 people, mainly men, with a further 2 million deemed “at risk” of problem gambling. To combat that, the commission says that we can harness technology to provide some degree of protection; in particular, it points to the online multi-operator self-exclusion scheme, mentioned by noble Lords in the debate, scheduled to be in place by 2018. However, again, as Justyn Larcombe told me:

“I am at a loss to understand why the commission would have settled for this approach”.

The Gambling Commission licence conditions and codes of practice, in paragraphs 3.5.4 and 3.5.5, appear to suggest that individual sites should continue to run their own self-exclusion system in addition to MOSES. I am underlining the point of the noble Lord, Lord Browne, which is extremely important. I can see that the Minister may be tempted to suggest that having two systems is better than one; in some situations there can be wisdom in a belt-and-braces approach, but not here. The existence of two systems is likely to generate confusion, whereas problem gamblers, such as Mr Larcombe, want to be able to self-exclude from all legal sites at the same time. I very much hope that we are misreading paragraphs 3.5.4 and 3.5.5 and that GAMSTOP will replace all individual online self-exclusion provisions. However, if it does not, I must ask what evidence the Gambling Commission and the Government have from genuine problem gamblers that there is a desire for a two-tier system. I hope the Minister will reflect on that.

As others have done, let me say something about the statutory levy. I particularly endorse what my noble friend Lady Howe said to the House a little while ago. I raised the issue of the Government’s Internet Safety Strategy Green Paper in another context with the Minister who will reply to the debate. I find it quite extraordinary that, without a hint of irony, at the conclusion of page 16 and beginning of page 17, the paper states:

“While the Secretary of State has the power in legislation to bring forward a gambling levy, in practice the sector provides voluntary contributions and support. The majority of these voluntary payments go to GambleAware, a leading charity in Britain committed to minimising gambling-related harm”.

Reading that, it sounds as if the Government are relaying a good-news story of successful self-regulation. Nothing could be further from the truth.

The industry is supposed generously to contribute 0.1% of gross gambling yield, £14 million, and yet it cannot manage even that. Last year, it managed only £8 million, sufficient to enable GambleAware to fund treatment for 8,000 people. Yet there are 430,000 problem gamblers in Great Britain. The Secretary of State should use the regulation-making powers afforded to her by Section 123 of the Gambling Act to give effect to the statutory levy. In my judgment, it should be at least at the level of the problem prevalence figure: 0.8% of gross gambling yield.

Justyn Larcombe also told me:

“It is in the middle of the night that the most destructive online gambling takes place”.

He referred to the situation in Finland. To deal with this challenge will necessitate legislation requiring gambling sites not to accept bets between midnight and 6 am, and financial transaction providers not to process gambling transactions between those hours. As well as reducing the hours during which people can gamble, I hope the Minister will consider reducing maximum stakes on fixed-odds betting terminals—B2 gaming machines—to just £2. The current maximum stake of £100 is significantly out of line with the maximum amounts that can be staked on other types of gaming machines. There is also credible evidence that these machines may be addictive particularly to problem gamblers and therefore pose a greater risk to them, as well as being linked to anti-social behaviour and crime in betting shops.

Then there is the role of the commission. The commission notes, as others have observed, that in 2008 public confidence and trust in gambling stood at 49%. Today, it stands at just 34%. The commission needs to ask why there has been that decline in public confidence. Along with others in your Lordships’ House, I think that we are all indebted to the noble Lord, Lord Browne, for giving us the chance to raise these points and ask these questions today.

Photo of Lord Smith of Hindhead Lord Smith of Hindhead Conservative 3:49, 23 November 2017

My Lords, I wish to keep my comments fairly brief and concentrate on the gap in regulation concerning online advertising and general activities of tipsters and affiliates, and affiliates masquerading as tipsters.

This is a topic on which I have previously spoken in the House, in my noble friend Lord Chadlington’s debate on advertising in connection with online gambling. The reason I feel it is important to raise this topic again here today is that, in many cases, the activities of tipsters and affiliates could easily undermine the aims of the multi-operator self-exclusion scheme about to be introduced.

It has been widely reported that some online gambling companies are investing proportions of their advertising spend specifically in paying tipsters and affiliates, who to all intents and purposes are totally unregulated, rather than spending their advertising budgets on traditional regulated advertising such as on sidebars of websites, on television and radio or in the press.

The problem with this stems from the intrusive and calculated way in which tipsters and affiliates work. For those who may not know, tipsters and affiliates are people behind social media profiles who prolifically post gambling tips. They use whatever attention-grabbing methods they wish to get people to place the bets that they “advise”, using methods which traditional advertisers would certainly be reprimanded for, and then continue to hound their customers, encouraging them to sign up to betting accounts and to place bets, then more bets and more bets, and so the frenzied cycle continues. One report estimated that it is not uncommon for a person to put on an average of 35 bets before a win is realised.

Tipsters and affiliates send out a constant stream of links to betting companies, free bets and offers, together with relentless messages of encouragement and so-called tips which are totally unsubstantiated, making money from signing-on fees for each person a tipster or affiliate manages to convince to sign up to a betting account. They then make money from a percentage of the revenue made by the said betting company for the life of each account. This means that a tipster or affiliate makes his or her money from bets on which a punter has lost while also being the person telling that same punter which bets to make. As they operate on social media, everyone is exposed to them. There is no watershed here and no age limit beyond which they cannot reach. Poignantly, there is no self-exclusion rule by which they must abide.

The blanket multi-operator self-exclusion measure is a sensible move by the gambling industry and could, in theory, help a lot of people who are having problems if it is properly enforced. Making a system where it is easy and quick to turn off the tap has to be a good idea, rather than having a situation where a person has to go back and revisit all the places that he or she may be finding the hardest to resist to shut down activities one by one. I hope it works, and I hope we do not continue to hear reports of companies targeting people again who have excluded themselves.

However, tipsters and affiliates undermine this earnest scheme, since they are not bound by the blanket self-exclusion policy, or by indeed any policy. There lies the problem. Many online gambling companies know that their affiliates cross those lines of responsibility or, at the very best, come close to them. Indeed, two months ago, Sky Bet entirely shut down its affiliate programme stating that,

“the regulatory landscape in which the industry operates is developing and maturing and operators are experiencing increased obligations regarding their regulatory responsibilities and level of compliance. In order to continue to operate in a compliant manner, we feel that operating the Programme is no longer viable and that managing the output of affiliates presents a significant risk to our business from a regulatory perspective”.

Sky Bet should be commended for this, but the operations of tipsters and affiliates should at least be subject to some investigation. Could the Minister undertake to look into this within his department?

Everyone who knows me knows that I am a supporter of gambling. I like to have the occasional flutter, but I am a supporter only of responsible gambling and a responsible gambling industry. Therefore, I really hope that grey areas such as the one I have mentioned can be bridged so that a person facing problems who really wants to stop gambling when it is harming his or her well-being or lifestyle can do so swiftly and has the ongoing help and support they need.

Behind every problem gambler statistic is a man or woman, and often a family, with real problems. We should help them as much as we can and not stand by when outside influencers, motivated by their commercial and financial aims, threaten to disrupt or destroy the progress of an individual who is struggling to get their life straight. I thank the noble Lord, Lord Browne, for initiating this debate today.

Photo of Baroness Benjamin Baroness Benjamin Liberal Democrat 3:54, 23 November 2017

My Lords, I, too, congratulate the noble Lord, Lord Browne, on securing this important debate. I am pleased to be able to speak in the debate because many people have contacted me to raise their concerns about children becoming addicted to online gambling and being targeted for this abuse. To fully comprehend the situation that children are being lured into, think of how children are offered free drugs at the school gates by drug dealers to get them hooked. This can be compared to children and young people being targeted to gamble online. I was shocked and horrified when I looked online and saw how the nation’s children are being targeted. Gambling addiction is not given the attention that it desperately needs, like drugs and alcohol abuse, especially in relation to young people, yet it is just as disastrous and much more common than a lot of people think, sadly with an alarming suicide rate.

Gambling addiction devastates lives. It goes under the radar and is extremely embarrassing for victims, especially for pre-teens and teenagers in secondary school. As they have no income, pupils are often cornered into stealing for a stake—it produces out-of-character actions that will impact negatively on their home and school life. The organisation Odds/Off has set up a gambling awareness and abuse prevention programme and has found that nine out of 10 problem gamblers started gambling between the ages of 11 and 16 and did not understand the severity and reality of this dependency until it was too late.

My concern is how easily children become involved in online gambling. Believe it or not, it is surprisingly easy for a young person to download a gambling app, open an account and start actively gambling. All they have to do is lie about their age. It is rare for gambling companies to ask for any form of photo ID until the user attempts to withdraw winnings, yet they can credit their account with unlimited funds without photo ID. This means that, as long as the child is losing their or their parents’ money to the bookmakers, the gambling company will not make any attempt to stop them. This has to change.

Before I get on to the facts and figures, I want to raise an important point of policy, which I hope the Minister will respond to. The question is: where does the responsibility for protecting children from online gambling-related harm lie in the current flurry of strategy documents that are being published? The Government’s Consultation on Proposals for Changes to Gaming Machines and Social Responsibility Measures says at paragraph 5.11:

“The Government is committed to ensuring young and vulnerable people are protected from gambling-related harm—both online and offline”.

It goes on to refer to the recently published internet safety strategy Green Paper as addressing,

“the responsibilities of companies to their users, the use of technical solutions to prevent online harms and government’s role in supporting users”.

However, there is little mention of online gambling harm in the Green Paper. I am concerned that there is a risk that the protection of children from the harms of gambling online will fall through the gap and that this aspect of regulation will not receive the attention that it fully deserves.

Why should I be concerned about this? Because, as the Government acknowledge in their Green Paper,

“there is an association between early gambling participation and problem gambling in adulthood”.

Statistics published by the Gambling Commission on 14 November show that public trust in gambling is falling dramatically. It says:

“There are also significant public concerns about the volume, nature and scheduling of gambling advertising and the impact this could have on future generations”.

We should be concerned about what is happening to our children now and the impact that it could have on them in later life. According to figures published in 2016, more young people are gambling than are smoking or drinking. Not all of the gambling is online, but some of it is. Some 3% of 11 to 15 year-olds have spent their own money on online gambling, but 6% have gambled online using their parents’ accounts, either with or without permission. Even if children are not gambling online, they are seeing adverts for gambling online. Some 63% of 11 to 15 year-olds have seen gambling ads on social media and 57% have seen them on other websites; 9% of young people are following gambling companies on social media.

Gambling seeps into our children’s consciousness. Some of this enticement is very subtle. An investigation by the Times in October revealed that more than 30 online gambling games targeted children through the cunning use of children’s storybook characters, cartoons and things that are relevant to them in their life, such as sporting heroes, especially football stars. Some of the products did not involve real money and were a fairly blatant example of the online gambling industry trying to entice our children into gambling. Professor Mark Griffiths of the International Gaming Research Unit at Nottingham Trent University has said:

“Research has shown that when we look at those children who are problem gamblers, the number one risk factor is playing games online for free”.

I welcome the joint letter of 20 October from the Gambling Commission, the Advertising Standards Authority, the Committee of Advertising Practice and the Remote Gambling Association, all saying that action would be taken against such ads. But, like many others in this House and the general public, I am concerned that letters such as this are just not going far enough and that more effective action is needed. I refer again to the Government’s gambling paper, which says:

“The Government is clear that on gambling advertising, as with other aspects of social responsibility, more should be done by operators and others who benefit from gambling to minimise the risks to vulnerable people”.

The Government are consulting on a number of proposals to give more teeth to the Gambling Commission’s licensing code if there are breaches to the industry’s advertising codes. However, I question whether these actions go far enough. One of the three licensing objectives in the Gambling Act 2005 is,

“protecting children and other vulnerable persons from being harmed or exploited by gambling”.

Given that, why are the Government not prepared to go further and amend the Gambling Act to make it an offence to provide any form of game for children that involves the act of gambling, even if the currency is not real money? Perhaps the Minister can tell the House why this option is not being pursued. Can he also tell the House how the Government are ensuring that the current regulatory framework provides sufficient protection to children at a time when gambling and online safety are under the spotlight once again?

I am concerned that the industry does not seem sufficiently motivated to address any of these issues. It would be far more effective for the Government to use their regulatory powers in Section 123 of the Gambling Act 2005 to introduce a statutory levy. This money would have to be sufficient to meet the needs of Britain’s 430,000 problem gamblers and to develop preventive measures to help the further 2 million people who the Gambling Commission says are at risk. More important, the Government must also ensure that sufficient attention is given to preventing children and young people from becoming addicted to online gambling and protecting them from the long-term misery associated with it. It is our moral duty to do so because, let us not forget, childhood lasts a lifetime. So this debate is a wake-up call—to parents, teachers, the Government, the industry; in fact, to the whole of society—if we truly care about our children’s future and want to save them from falling into the pit of despair of addictive gambling abuse. Let us work together to protect and safeguard our children and young people from online gambling abusers.

Photo of Baroness Richardson of Calow Baroness Richardson of Calow Crossbench 4:03, 23 November 2017

My Lords, I, too, am grateful for this debate and for the carefully argued and knowledgeable speeches that have been given so far. I have learned an awful lot about a subject about which I knew quite little.

Until recently, I was the minister of a Methodist church in Enfield, which hosted a group of Gamblers Anonymous. They were a wonderful and varied group. They met weekly to tell each other how long it had been since they had had their last bet and to encourage and support each other in their efforts to get themselves out of what they had recognised as problem gambling. It was a really good experience to be in their company. I have a great deal of admiration and respect for the way in which they faced their demons and helped each other to get rid of them.

Your Lordships may notice that two Methodist ministers are taking part in this debate. Perhaps that is not surprising, for if you tell anybody you are a Methodist they will say, “You don’t drink or gamble, do you?”. It is a long time since that has been a real part of the Methodist church, so there will be many people who do not and many who do. It was never a prohibition.

There is still a kind of understanding of our society as one in which Christian principles apply: of honest work for just reward; of the sense of caring for our neighbour—by not seeking that for me to win, our neighbour has to lose—and of recognising that gambling, on the whole, appeals to our baser instincts of selfishness and greed. Of course, it can be a harmless and entertaining activity. A little flutter on the horses, a visit to the amusement arcade with a pocket full of 10p pieces for a coin drop, even a bet on who will be the next Prime Minister or when the House of Lords will be abolished can be great fun and harmless activities. Betting has become normalised largely through the public acceptance of lotteries and scratchcards, which are a good way of supporting charities. Where is the harm?

It is an extremely lucrative activity, as we have heard, for those who are the operators and it is a useful activity for criminals. For growing numbers, it is an extremely harmful activity that compromises, disrupts and damages family life and relationships and often leads to crippling debt—we have already heard all these things. It has serious repercussions for health and society; it is associated with anxiety, depression, suicide, crime and domestic violence. The people most at risk are, as we have heard, those for whom it is a private, lonely activity exercised through internet gambling sites that are poorly regulated, so that immense sums of money can be lost in a short time. Chance is artificially created and the gambling is repetitive, with no interaction with others and no distractions. The very short gaps between the stake and the result are known to lead to more addictive behaviour.

The role of government is to ensure that gambling is well and safely regulated. As we have heard, the Department for Digital, Culture, Media and Sport is consulting on making changes to the maximum stakes and therefore the maximum losses on betting terminals. This is to be welcomed, although I hope that the betting level will be nearer the £2 suggested than the £50 that might be on offer. I also welcome the promise, as I understand it, of multi-operator self-exclusion. That scheme is promised for next year, although I note that many people feel that there is a lack of sanctions within the legislation.

I commend the work of the Responsible Gambling Strategy Board, with its 12 priority actions relating to increased understanding of the effects of gambling, identifying harm and highlighting the need for education and intervention strategies. To go back to those in my group in Enfield, they are working hard for their own self-benefit and for the benefit of those friends whom they meet. It is up to us to do all we can to encourage that and make sure that some of the temptations and opportunities are regulated, so that people can thrive, and for their well-being.

Photo of Lord Wigley Lord Wigley Plaid Cymru 4:10, 23 November 2017

My Lords, I am delighted to follow the noble Baroness, Lady Richardson, for reasons that will shortly be evident. I am very grateful to the noble Lord, Lord Browne of Belmont, for introducing this most timely of debates.

In my childhood in non-conformist rural Wales, gambling of all sorts was a sin, as the noble Lord, Lord Griffiths of Burry Port, will no doubt recall. People were expected, in line with Methodist orthodoxy, to work for their entitlement and never to expect anything for nothing. That day and age has clearly changed, not necessarily for the better, for there were many good social reasons on whose foundation that orthodoxy was built, and some of those social reasons are relevant to today’s debate.

I am glad that noble Lords who have participated, particularly the noble Lord, Lord Browne, in opening this debate, have made the essential link between problem gambling and the growth of online gambling facilities and their accessibility in a domestic setting. In addressing this subject, I do not for one moment take a fundamentalist line that all gambling is, of necessity, evil and that nothing but harm will come to those who participate. How could I, having entered elected politics, the biggest gamble of my life?

The majority of those who gamble do so responsibly, but there is always a danger of pressing that line too far. Everyone will want to identify himself or herself as a responsible person yet still may be in the minority for whom gambling can be a devastating affliction, leading to considerable harm. In reality, there are unacceptable consequences of gambling that go beyond the group identified as problem gamblers, as has been described very effectively in the research paper by Langham and others that was published by BMC Public Health last year. That paper is well worth studying. Its aim, as noted in its conclusions, was,

“to create a dialogue that will lead to a more coherent interpretation of gambling harm across treatment providers, policy makers and researchers”.

It identifies a number of elements as dimensions of harm; namely, financial harm, relationship disruption, emotional or psychological distress, detriments to health, cultural harm, reduced performance at work and criminal activity. That is quite a list, and we, as policymakers, would be negligent to ignore it.

A study of gambling-related harm undertaken in Victoria, Australia, by Matthew Browne and others was published in March this year. It aimed to calculate the burden of gambling harm on the quality of life of the population. The conclusion was that gambling-related harm was associated with 101,675 years of life lost in Victoria. Significantly, this is equivalent to two-thirds of that caused by alcohol use and dependency. Problem gamblers suffered 50% worse than moderate-risk gamblers in that analysis and three times worse than low-risk gamblers. However, because of their greater prevalence, moderate and low-risk gamblers accounted for 85% of the population level harm that was done. However, it is clearly problem gamblers who rightly demand our attention today.

The noble Lord, Lord Browne, rightly focused on the links between problem gambling and online gambling, and I am totally convinced that the availability of gambling opportunities within one’s own home, facilitated by online gambling, is a very serious component in tempting people into gambling. People who would never be seen dead in a bookmaker’s shop or in a roulette salon can be drawn in by the ease of opportunity and sometimes by the boredom of being at home, perhaps alone or in a caring capacity, for long hours. It is revealing that two of the groups most prone to problem gambling are those who are economically inactive and, sadly, those who are carers.

It is one thing to identify a problem; it is quite another to put forward a solution or even policies which may alleviate the problem. However, it strikes me that there is one glaring opportunity to try to reduce the number of those who get seduced into gambling online, and that is to do something about the television advertising of gambling which seems to be quite overbearing in proximity to televised sport on commercial television channels. We get in-your-face advertising of gambling before, during and after sporting events. Every possible aspect seems fair game for a bet: who scores, when they score, the most likely scorer, and all the rest. It seems that the slogan is, “Where there's a point, there’s a punter”. Their frequency is matched only by their vulgarity.

As the noble Baroness, Lady Benjamin, emphasised a moment ago, young people are particularly attracted to sport and are among the most committed viewers of televised sport. It is surely fundamentally wrong that such a vulnerable captive audience should be targeted with adverts that will lead some—yes, perhaps a minority, but some—down the path that eventually makes them problem gamblers.

To my mind, for the protection of such groups, the advertising of gambling on television should be banned by law. Other anti-social activities which can have an addictive element, such as smoking and drinking alcohol, have been subjected to restrictive legislation—rightly so—and I believe that the promotion of gambling on television should be treated in the same way. If it were possible to ban it also from social media, that is something else which I would support, because of the vulnerability of young people to those media, although such action may be more difficult to enforce.

I am sure that we will hear the squeals of commercial television companies whose profits might be marginally lowered by such an intervention, and I am sure that some sporting activities will complain that if money does not come to them from television companies, there will be less paid by them for transmitting live sports. But I am going to take a lot of persuading that soccer has too little money available—on the contrary, the wages paid to top players are scandalously high and a sad reflection on the values of our society. I will equally take much persuading that bringing big sums of money into rugby has done very much for its well-being.

Restricting, or banning, advertising of gambling on television is only one of many initiatives which are needed in relation to problem gambling. I hope, however, that it is one the Government will seriously consider as they address the concerns emanating from today’s debate.

Photo of Baroness Masham of Ilton Baroness Masham of Ilton Crossbench 4:17, 23 November 2017

My Lords, I thank the noble Lord, Lord Browne of Belmont, for instigating this debate, which highlights the worrying and escalating situation of the addiction of gambling, especially among young people gambling online. I take this opportunity to congratulate my noble friend Lady Howe of Idlicote, who has campaigned endlessly on the challenges facing problem gamblers arising from online gambling.

I declare an interest associated with this debate. A few months ago, I had the details of one of my credit cards stolen, unknown to me. When I looked at my statement from Coutts, I noticed three strange withdrawals. When I investigated and telephoned the bank, I found £60 had been taken out three times and used for online gambling. It must have been used to buy credits for the person’s own online gambling account. Does the Minister know how big a problem this pilfering is? How much money are the banks losing and is there any way there could be more protection for innocent victims? The dark side of the internet is an escalating conundrum. It is a huge problem, and I hope it is now going to be solved.

Some time ago, I had to visit a pub in Yorkshire, and I saw a young teenager completely mesmerised by his computer. It looked to me that he was in another world, with glazed eyes and totally transfixed. It made me realise how serious this is for young people’s lives. Gambling seems to have become socially acceptable, and there are many different platforms on which it can take place. To mention a few: casinos, bingo, the National Lottery, scratchcards, betting shops, racing and betting online. What worries me is what happens when people become addicted.

Addiction is a registered mental disorder that causes the person to need to gamble. I quote from the fifth Diagnostic and Statistical Manual of Mental Disorders:

“Persistent and recurrent problematic gambling behavior leading to clinically significant impairment or distress, as indicated by the individual exhibiting four (or more) of the following in a 12-month period … Needs to gamble with increasing amounts of money in order to achieve the desired excitement … Is restless or irritable when attempting to cut down or stop gambling … Has made repeated unsuccessful efforts to control, cut back, or stop gambling … Is often preoccupied with gambling (e.g., having persistent thoughts of reliving past gambling experiences, handicapping or planning the next venture, thinking of ways to get money with which to gamble) … Often gambles when feeling distressed (e.g., helpless, guilty, anxious, depressed) … After losing money gambling, often returns another day to get even (“chasing” one’s losses) … Lies to conceal the extent of involvement with gambling … Has jeopardized or lost a significant relationship, job, or educational or career opportunity because of gambling … Relies on others to provide money to relieve desperate financial situations caused by gambling”.

An addictive gambler can wreck family life and cause catastrophic results, as many noble Lords have said. Gambling when depressed can get to a point of no return and cause the ultimate, which is suicide. With the ease of accessibility of the internet and online gambling with an account and credit card, accumulating debt can easily get out of control. I look forward to hearing from the Minister what controls and support mechanisms are going to be put in place to alleviate this growing infectious disease. Can the gambling industry help to support treatment and rehabilitation? I hope so.

Photo of Lord Trevethin and Oaksey Lord Trevethin and Oaksey Crossbench 4:22, 23 November 2017

My Lords, I also pay tribute to the noble Lord, Lord Browne, for raising this important matter and for his powerful and moving speech. I want to declare an interest of a sort: I have been instructed in a number of cases involving addicted gamblers who have sought to self-exclude. While for obvious reasons I will not go into the detail of those cases, the pattern that recurs is as follows. The gambler, in what the Gambling Commission refers to as a moment of lucidity, decides to stop and presses the button on the screen marked “self-exclude”. That button has alongside it a period of time. It is normally not less than six months, for reasons that I do not understand, and at present it is normally not more than five years—I shall come back to that a little later.

The moment of lucidity passes and the gambler decides that he or she—it is almost always he—wants to go back to gambling. It is often possible to circumvent the self-exclusion simply by using some other operator. Sometimes, in cases where gamblers want to wager very substantial sums of money, there are a limited number of sites that will provide the necessary service. Then, the gambler has to use some sort of subterfuge to get back online; a different name is used, for example. Money inevitably is lost and, in the cases I am talking about, astonishing amounts of money are lost in a very short period. Then the gambler may try to recover that money from the bookmaker provider. Issues then arise as to the steps the bookmaker has taken to satisfy itself that the gambler has not self-excluded. Issues tend to arise as to whether the bookmaker actually knew that a self-excluded gambler was coming back to the tables, or at least turned a blind eye to that fact for commercial reasons that are not difficult to understand.

That sort of problem is arising in the courts. Until now, disappointed self-excluded gamblers who have brought such claims have found it difficult to make them good because they have run into a defence which is of some relevance to the policies under consideration in this debate. The defence that the bookmakers tend to run—not a particularly attractive one—is a causation defence. They say, “Yes, we probably should not have let you gamble all that money, but if we had not let you come on to our virtual tables and lose hundreds of thousands of pounds, you would have found another online provider who would have taken your money. Therefore, you have suffered no loss. Therefore, you have no claim”. There is a case involving a gambler called Calvert, who was suing William Hill, in which the claim failed for that reason.

That is the legal context. In working on those cases, I have had occasion to look at the change in the law that occurred in 2005. I went back to the White Paper, which the Government produced before the Gambling Act 2005 was enacted. I noted that the White Paper was entitled, rather troublingly, A Safe Bet for Success. Yes, perhaps, but the success in question would be that of the bookmakers. The paper characterises the existing legal framework as it then stood as being one of grudging toleration. Some of the powerful speeches that the House has heard this afternoon may indicate that that is precisely the attitude that the legislature should have to gambling.

The position taken by the Government before they enacted the Gambling Act 2005 was very different. It was expressed as follows. In the Government’s view,

“the law should no longer incorporate or reflect any assumption that gambling is an activity which is objectionable and which people should have no encouragement to pursue … It is an important industry in its own right, meeting the legitimate desires of many millions of people and providing many thousands of jobs”.

That passage appeared in a very short section headed “Dealing with the downside”. This debate is concerned with the downside and, in the time I have available, I shall make one or two practical observations about the reforms being discussed.

Before I do that, I want to say something about the profits that are being and will be generated by online gambling. Some of the figures have been mentioned. I was struck by this useful briefing paper to be found in the Library. The gross gambling yield, which is the return to the bookmaker, taking into account any winnings that have to be paid out to the punter, has risen year on year from £12.6 billion to £13.8 billion—the latter figure is for 2015-16. That is a rise of £1.2 billion in a year and, give or take, about a 10% increase. Those are good figures for the bookmakers. During the same period, the gross gambling yield from remote gambling—online gambling of the type we are discussing—rose from £3.6 billion to £4.5 billion, a rise of £0.9 billion. So one can see that a large part of the increase in the profitability of the industry that has occurred in that period is attributable to such online gambling.

A further consideration indicates the power of the commercial motivations that will affect bookmakers’ operations. The provision of online gambling is, relatively, very cheap. That is obvious, because you do not have to build and pay for a casino building or pay for the employees in a betting shop, and so on. This striking statistic caught my eye: just over 6,000 employees are employed in the remote sector—the online sector—whereas some 106,000 employees are employed in the entire gambling sector. That rather brings home just how profitable online gambling is for those who provide it.

Members of the House have spoken eloquently and movingly of all the moral problems and personal tragedies caused by online gambling. There are moral questions here. If one goes into a betting shop, as I do occasionally—for research purposes, obviously—and one looks around, one sees dead-eyed men, and they are almost always men, hunched over the FOBTs, occasionally exploding into impotent rage. First of all, you are reminded of similar scenes that must be taking place in the bedrooms of our children all around the country, which is disturbing. I am also reminded of a line in a piece by Rebecca West, which I adapt. She said that a visit to the casino is a foretaste of death, where the dominion of the will gives way to the dominion of the worm. That is a rather dramatic way of expressing what, in my view—and I think that of many noble Lords who have spoken in this debate—is a moral question.

In the time available, I make three or four short practical observations and points. First, will the new multi-operator self-exclusion scheme leave open the possibility for UK gamblers to access non-licensed foreign sites that do not subscribe to the scheme? If so, the new scheme will not do its job. I would be very interested to know what protection might be provided in that respect. Secondly, I echo the compelling arguments against a two-tier system and in favour of a one-tier system. Thirdly, I am most anxious to know whether it will be possible for addicted gamblers to exclude themselves for life—they should be able to do that. Fourthly, I would be very interested to know what sanctions are to be imposed for non-compliance by bookmakers with the new system. Their commercial interests lie elsewhere. For them, the bigger the problem, the bigger the profit.

Photo of Lord Foster of Bath Lord Foster of Bath Liberal Democrat 4:32, 23 November 2017

My Lords, I congratulate the noble Lord, Lord Browne, on securing this important debate and on the work that he has done in ensuring at least progress towards the establishment of the multi-operator self-exclusion scheme for online gambling.

Listening to the debate, I have been struck by four things. First, I was struck by the call by the noble Lord, Lord Chadlington, for more independent, transparent, quality research on which to base public policy on this issue. Secondly, we have heard far too many horrific examples of the problems caused by problem gambling—from, among others, the noble Lord, Lord Browne, himself, the noble Lord, Lord Morrow, who drew attention to the impact on families, and the noble Lord, Lord Alton, who reminded us, as did the noble Lord, Lord Wigley, of the impact that can be had on entire communities. Of course, we had that very powerful description by the noble Baroness, Lady Richardson, of the circumstances that can lead to such misery. Thirdly, I have been struck by the unanimity in your Lordships’ House on the very many ways forward that have been talked about that could help to improve the situation, from preventing a two-tier MOSES to moving towards a statutory levy. Fourthly, I have been struck by the concern in your Lordships’ House about children and young people. The noble Baroness, Lady Masham, gave a description of the young person mesmerised by online gambling, and the noble Lord, Lord Chadlington, talked about the need for protection of children and young people—an issue that has been so powerfully raised by my noble friend Lady Benjamin, who pointed out that it is completely unacceptable that online gambling apps are made available to children with pretend currencies. Since the Gambling Commission cannot act because its remit pertains only to gambling that involved real money, I hope that the Minister will see if there are ways in which the Government can take action on this.

I served on the committee in the other place that considered the 2005 gambling legislation. We spent much time on super-casinos, which thankfully never materialised, and on the maximum allowable value of teddy-bear prizes in amusement arcades. We did not spend enough time on online gambling or on category B2 machines—or FOBTs, as they are more commonly known. For many years, I have argued that the maximum stake for FOBTs should be £2. Like the noble Lords, Lord Browne, Lord Morrow and Lord Alton, the noble Baroness, Lady Richardson, and others, I hope that a £2 maximum stake will be the outcome of the current review. The stories of the misery caused by FOBTs are numerous and so I hope that we will also be able to reduce the spin rates, so that fewer games can be played per hour, reduce the number of machines in each betting shop, require increased staffing levels, and strengthen local council powers to tackle the blight of clusters of betting shops on our high streets. I hope that the Minister will be able to tell us that such measures are being seriously considered.

If FOBTs are the crack cocaine of gambling, it is online where we see the wild west of gambling. Online, there are no limits, no time when sites are closed, no supervision, easy access and constant availability. It is no wonder that the highest prevalence of gambling problems comes from the online sector, with its 44% share of the gambling market, 21 million active accounts and huge growth in associated advertising and marketing strategies, such as the so-called “free bets”. I hope that the Minister will take note and consider acting on the concerns of the noble Lord, Lord Wigley, about gambling advertising, not least that link to sport.

The 2005 gambling regulations are, frankly, wholly inadequate to deal with the current situation caused by the technological explosion since then. I acknowledge that some improvements have been made in respect of advertising and the regulation of offshore gambling sites, but more certainly needs to be done by policymakers and, as the chairman of the Gambling Commission said on Tuesday, by the industry itself. There are a number of measures that have been raised in your Lordships’ House that I entirely support: the rapid introduction of the too-long delayed online multi-operator self-exclusion scheme—to be called GAMSTOP and run by the Remote Gambling Association. As many others in your Lordships’ House have said, I hope that the Minister will assure the House that the scheme will be carefully monitored, that there will be a review within three years and that it will be backed by a major ongoing advertising campaign. There would be little point in introducing such as scheme if online gamblers are unaware of its existence.

Crucially, I hope that the Minister can tell us what sanctions will be applied to any licensed operator who does not offer GAMSTOP. Does the Minister also agree with the point made by so many people that, once the online MOSES is in operation, the single-site exclusion schemes that currently exist should all be dropped so that we do not have a two-tier system? I also hope that he will agree with the need to work towards a single MOSES scheme that covers all forms of gambling.

I welcome the other measures that have been raised. The noble Baroness, Lady Howe, talked very passionately about the need to have effective monitoring of transaction blocking mechanisms, and she is absolutely right. Others have talked about the importance of behavioural change prompts, loss limits and bank transfer time limits. I know that if my bank manager agreed to loan me money to go gambling, I suspect that it would rightly be frowned upon, so can the Minister explain why we let people generate huge online debts by allowing financial services to lend them money to gamble through credit cards? Will he at least agree to look into this?

Like others, I do not believe that the current level of funding for research, education and treatment to help problem gamblers and to limit problem gambling in the first place is adequate—£8 million is simply not enough. The 2005 Act gave the Secretary of State the power to introduce a statutory levy for such purposes, but effective industry lobbying persuaded the Government to accept a voluntary approach. However, it is simply not delivering anywhere near the level of funding required to meet the demands placed on GambleAware—demands that all the evidence suggests will increase. The industry fell 20% short of the target last year. Seven months into the current financial year, the industry was 60% short. Such were GambleAware’s concerns about cash flow that in August it notified the Gambling Commission that the services it funds were at risk. No wonder the trustees of GambleAware have criticised the industry’s willingness to address the problem. I am pleased that they intend to name and shame those parts of the industry that do not contribute their share, but I am particularly pleased that they are also lobbying for a ring-fenced statutory levy. It is worth noting that the chair of the Gambling Commission believes that a statutory levy would be a fair way to address the weaknesses of the current system.

After all, a statutory levy is not a new concept for the gambling industry. We have had one for horseracing since 1961, and next year it is estimated that it will generate £90 million. This means that the gambling industry will statutorily donate 10 times more to look after horses than it voluntarily gives to look after people. Staggeringly, the voluntary levy for greyhounds raises almost as much—at £7.5 million—as the voluntary levy to support people, so far more is raised for horses and greyhounds than for people. It is tempting to think that the industry believes in the maxim, “four legs good, two legs bad”.

The time has come for us to take decisive action to ensure, as the noble Baroness put it, that the polluter pays equitably and fully for the cost of gambling-related harm by introducing a statutory levy, and at a higher level than the current 0.1% of gross yield. Requiring no primary legislation, it is an easy win for the Government. It should have been included in yesterday’s Budget. Done quickly, it could still be their own early Christmas present but also one for all those afflicted by problem gambling and their families, who may not have much to look forward to this Christmas because the budget for presents is now sitting in the profits of the gambling industry.

This has been a wide-ranging, well-informed and interesting debate, and I look forward to the Minister’s response.

Photo of Lord Griffiths of Burry Port Lord Griffiths of Burry Port Opposition Whip (Lords), Shadow Spokesperson (Digital, Culture, Media and Sport), Shadow Spokesperson (Wales) 4:42, 23 November 2017

My Lords, the weight of opinion from all round the Chamber has fallen equally in one direction—the Minister’s head. I look forward to his handling of the responses. The contributions have been the best possible vindication of the initiative of the noble Lord, Lord Browne, in bringing this matter to our attention. We do not have to say thank you; the gratitude has been expressed in the way that people have rallied round him and supported the cause. That makes it incumbent on us to do something with the unanimity expressed. I hope that a moral force will have been let loose that will yield its own results in due course.

The noble Lord, Lord Browne, and some other noble Lords, who have contributed to this important debate are veterans in a cause which is too often laughed off by people who consider those who raise these concerns to be cranks, do-gooders or zealots. In case noble Lords think that I am exaggerating, I should tell them that after my contribution to the previous debate on gambling, which was only three or four weeks ago, I had some such comments from other Members of the House. Therefore, I hope that they read the record of this debate and realise that I am in such good and worthy company that I can be spared any of those epithets.

In the New Testament there is a story about a woman who goes on knocking at the door of a judge in her demand for justice until, finally, though grudgingly, worn out by her persistence, he lets her in and hears her case. Taking that as our example, it would be apposite to think of these proceedings therefore as the parable of the importunate noble Lord, Lord Browne. I hope that the knocking on the door that he continues to do will yield its results and allow us to consider these matters that affect the moral fibre of the country in which we live.

It is only a short time since we debated fixed-odds betting terminals. Most speakers in that debate were mystified by the news that the Government were about to conduct a consultation to reach a decision about the amount of money that could be staked on those machines. We felt that any number of consultations had taken place in the fairly recent past and failed to understand the particular nature of this one. The problem is so urgent that one consultation after another hardly seems the best methodology. A figure between £2 and £50 has been mentioned more than once, and those who mentioned it expressed the hope that £2 would be nearer the point at which judgment sits than the £50 at the other end of the spectrum. I begin my remarks by asking the Minister and the Government whether any progress is being made with this consultation and whether any clarity is beginning to emerge, and when they feel they will be able to announce the outcomes of the consultation as well as the level set for those stakes.

That is the past, but I begin there for a reason. In March 2014, the noble Lord, Lord Browne of Belmont, was persuaded to withdraw his amendment to the Gambling (Licensing and Advertising) Bill with an assurance that the Government would bring forward non-statutory proposals for a multi-operator self-exclusion scheme. We have heard about that from various noble Lords this afternoon. An undertaking was given that it would appear before the end of this year, although that was presented as an ultimate delay. Yet those goalposts too have now been shifted again and the summer of next year is now being spoken of. Can the Minister throw some light on this? If it is true, can he tell us whether we can have greater confidence in the latest projected date than in previous ones, and why exactly it is taking so long? Can the proposal be put on a statutory basis when it eventually comes our way?

The online self-exclusion proposal is not by any means a solution to the problem facing us, and we should not kid ourselves that it is. At the very least, we should find a way to enable someone who wishes to end their online gambling to have a one-stop route to cutting out of all online sites, whether they are operating under a Gambling Commission licence or not. Some 200 such sites are quoted as having a licence, and an innumerable swarm lie beyond that. Various noble Lords, including the noble Lord, Lord Foster, have asked precisely for that. Even if we get that assurance or that provision, of course it is nothing like enough. I have worked in the field of addiction long enough to know that the hardest thing of all for an addict of any kind is to be sufficiently self-motivated to take such an action in the first place. The very nature of addictive behaviour is the erosion of self-determination, where one’s will is dulled and overwhelmed by habit and where realism gives way to fantasy. It is a big ask to expect such people to opt for even a well-constructed self-exclusion scheme. It is like asking an alcoholic to give up drinking or asking someone suffering from depression to pull their socks up. The work I did for 17 years with the noble Lord, Lord Mancroft, in establishing Addiction Today set its sights on the 12-step method—which again, is reviled by some but a proven rescue line for others—because it is a social remedy: an attempt with others to solve a problem. I am personally committed to that method myself.

We are told—we have heard the figure many times—that there are 430,000 problem gamblers, with five times that figure at risk of falling into the same category. Their habits are difficult to detect. Many of them are children. The noble Baroness, Lady Benjamin, made her passionate case for children. The plea is made to protect children from being groomed—why do we not use that word?—for the gambling industry with games that feature the likes of Peter Pan and Sherlock Holmes, which have also been referred to.

The Minister is only too aware of recent debates on how best to protect children from the dangers of the internet. The Data Protection Bill is going through this House at this very moment and these matters are being discussed in great depth. I know that the Minister will certainly be smacking his lips at the prospect of debating the amendment to that Bill in the names of the noble Baronesses, Lady Kidron and Lady Harding, on the question of child-friendly design in the use of the internet—a concept that started to emerge in services where kids spent a considerable amount of time on social media and there was concern that they would be exposed. Initially, that concern was primarily about grooming for sexual exploitation, but it became more about exposure to all kinds of harms and criminality. Can we promise ourselves to look at proposals to protect children in the area of gambling by looking to the provisions that we seek to make to protect children from the harm imposed on them by the internet in more general terms? The wisdom there might be helpful here. We could also look at the proposals relating to age verification—that, too, has been mentioned in this debate—with a view to bringing them into play to help us deal with children at risk from gambling.

It is a fact universally acknowledged that, by its very nature, gambling will produce victims. Experts differ on the numbers but, as already mentioned, we are speaking here of hundreds of thousands. Eventually, treatment regimes will be needed to help with their mental and physical health—that is, they will be a charge on our health and social care services. In acknowledging this, will the Government consider imposing a levy on the gambling industry to meet these costs—a proposal made by many in this debate? The 0.1% contribution from the gambling industry’s £13.8 billion is derisory. A statutory levy—I was intrigued to hear about the horses and greyhounds—could produce much more money for GambleAware and related bodies to do their work and even generate finance that could be hypothecated, perhaps as a direct contribution to NHS budgets. Do the Government agree with reasoning of this kind, and would they be led to consider such a levy? If not, why not?

I could go on—there is much to say. Noble Lords have raised a number of points. They have made us all aware that, far from being cranks, do-gooders or zealots, they care deeply about the well-being of our citizens and the communities they live in. I look forward to hearing a recognition of this concern and a serious engagement with the issues raised in this most welcome debate when the Minister makes his reply.

Photo of Lord Ashton of Hyde Lord Ashton of Hyde The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport 4:52, 23 November 2017

My Lords, I am grateful to all noble Lords who have taken part in this informed and very interesting, although somewhat alarming, debate. I particularly thank the noble Lord, Lord Browne, for securing it and for sharing his thoughts with me beforehand. I am also pleased that the A-team on the Data Protection Bill, which has already been mentioned by the noble Lord, Lord Griffiths, is in place.

The issue here—in a sense, the dilemma—is that for millions of people gambling is an enjoyable leisure activity with no harmful consequences. Sixty-three per cent of adults gambled in one form or another in the last year. However, the Gambling Act makes it clear that gambling is subject to the licensing objectives set out by the Gambling Commission, including the protection of young and vulnerable people from gambling-related harm. Headline rates of problem gambling have remained relatively low over time, at below 1% of the adult population. As noble Lords have mentioned, the latest statistics found that 0.8% of the adult population—some 430,000 people—were classified as problem gamblers in 2015, but a further 2 million people were identified as being at risk of problem gambling.

I do of course realise, and the noble Lord, Lord Morrow, reminded us, that, in addition to those headline numbers, there may be severe consequences for families. I generally agree with the many statistics that have been mentioned in this debate—too many to come back on. The basic fact is that online gambling is big and growing, and 5% of those online gamblers are problem gamblers. The Government are clear that more must be done to protect people from harm, and on 31 October we published a consultation on proposals for changes to gaming machines and social responsibility measures across the gambling industry. The consultation sets out a package of measures to improve player protection for the online sector, including strengthening existing protections and outlining further measures relating to gambling advertising to minimise the risk to the most vulnerable.

Although online gambling is widely accessible and available 24 hours a day, it also has unique characteristics that provide opportunities to protect players. For example, all online gambling is account based, unlike land-based gambling where customers can often gamble anonymously. That means that online operators can know exactly who their customers are, what they are spending their money on and their patterns of gambling behaviour. We have seen some progress in this area with a number of operators adopting the use of behavioural analytics and algorithms to detect problem gambling on their websites. Recent research has found—this might address some of the identity issues raised by the noble Lord, Lord Trevethin and Oaksey—that operators are able to detect problem gambling using the data they collect from customers today.

While that is encouraging, the Government have made it clear that industry must act on the findings of the research to date and trial a range of harm-minimisation measures to strengthen player protection. We want to see the industry evaluate the action it takes and share best practice. In addition, the industry must continue to engage in GambleAware’s research and commit to implement the findings of this ongoing work. The next phase of the research aims to provide a best-practice model that can be used by online gambling companies in their responsible gambling operations, including recommended interventions which have been evaluated for their effectiveness to reduce the risk of harm.

In the light of those issues, what is the Gambling Commission doing? The Gambling Commission is monitoring this area closely and is encouraging operators to increase action to identify harmful play, design and pilot better interventions and put in place measures that work. The commission has already concluded that it will need to consult on changes to the licence conditions and codes of practice next year in order to raise standards in this area. The commission will also issue guidance to the industry setting out expectations in relation to operator interactions with customers.

I turn now to the issue of self-exclusion—an important tool for those who recognise that they have a problem with gambling and a vital means of protecting consumers from harm. All operators must offer self-exclusion to customers on their request, and more than 800,000 online self-exclusions were reported last year. However, as the average player has more than one account, that does not necessarily translate to 800,000 people. The Government understand just how important it is for recovering problem gamblers to be able to self-exclude from all licensed online gambling platforms in one step. A new multi-operator self-exclusion scheme for online gambling, called GAMSTOP, will be launched in spring next year. A range of stakeholders, including GambleAware and GamCare, have provided advice during development of the scheme. I am aware that the proposals for such a scheme were debated by noble Lords during the passage of the Gambling (Licensing and Advertising) Act 2014 and I pay tribute to the noble Lord, Lord Browne, who was a vocal champion of such a scheme back then and has remained a leading advocate for it since.

The new scheme will allow customers to self-exclude from all online licensed operators in a single step. The website will also set out other measures that are available to help people manage their gambling and will signpost specialist advice and support services. It will significantly strengthen the self-exclusion arrangements available for online gamblers and provide improved protection for those customers who have previously self-excluded from individual gambling websites, only to open an account with other operators. As the noble Lord, Lord Browne, asked, we want to see the industry promote awareness of the scheme and do more to increase its take-up along with other responsible gambling tools such as time-outs and deposit limits which are available. These are in the consultation that we have just published.

The noble Lord, Lord Griffiths, asked why this has taken so long. I share the noble Lord’s frustration, and I would have liked to have seen the scheme in operation sooner. Indeed, we called for the gambling consultation and review for implementation of the scheme to be completed at the earliest opportunity. The truth of the matter is that there have been a number of complex issues to consider which I will not bore noble Lords with, but it is absolutely vital that when GAMSTOP is launched, it actually meet its objectives and can ensure that customers who register with it are prevented from gambling online with licensed operators. It is an industry scheme, but the Gambling Commission is working closely with the industry on its development to ensure that it is robust and effective, again a point made by the noble Lord, Lord Browne. Certain technical barriers have had to be overcome, not least in relation to data protection. The system must be capable of dealing with millions of checks being made by operators every day in real time. It must provide a service to consumers that is effective and easy to use, and therefore while the delay is frustrating, it is important that it is robust and will work across all licensed operators. However—in reply to the noble Lord, Lord Griffiths—we expect it to be up and running by March 2018.

While self-exclusion is a useful tool, it is often the case that an individual who chooses to self-exclude may do so as the result of having suffered harm in relation to their gambling. The Government are clear that operators must act quickly to improve approaches to identifying problem gambling on their platforms and interacting with their customers to protect vulnerable people before serious harm occurs.

I turn now to the points raised by my noble friend Lord Chadlington. Where gambling operators have used children’s characters to front games, the Gambling Commission and the Advertising Standards Authority have written to them to make it crystal clear that they are in breach of advertising rules that prohibit gambling marketing material aimed at children. My noble friend also raised the question of independent research and transparency, as did the noble Lord, Lord Foster. We agree that this is an essential tool in building an evidence base and enhancing our understanding of gambling-related harm. GambleAware is an independent charity with an independent chair, and the majority of its board members are from outside the betting industry. We want to see the industry continue to fund GambleAware and others in this important work, as they do research, education and treatment for problem gamblers. We welcome the additional funding of £5 million to £7 million a year for the next two years that the industry is to invest to support a responsible gambling advertising campaign. This is a large sum in advertising terms which compares well with major national health campaigns.

If the current arrangements fall short, the Government will consider alternative options, including the introduction of a mandatory levy. But it is worth reminding ourselves that the current funding target to meet the needs of research, education and treatment, set by the Responsible Gambling Strategy Board, has been suggested to be around £10 million by 2018-19. This target is being actively pursued by GambleAware, but as and when funding targets change, the voluntary system must gear up to meet that need. I repeat: the consultation made it clear that the Government will consider alternative options, including a mandatory levy, if current arrangements fall short.

Let me address some of the points made by noble Lords in their speeches. As far as the two-tiered approach to self-exclusion is concerned—mentioned by, among others, the noble Lords, Lord Browne and Lord Alton, and the noble Baroness, Lady Howe—we want to see the industry build on the existing protections. Some consumers may wish to self-exclude from certain individual products and not the entire online sector, but we want to encourage self-exclusion. Websites are required to set out clearly the gambling management tools available, including self-exclusion. The important thing to remember is that self-exclusion is only part of the problem. Lots of problem gamblers do not self-exclude, so we must deal with the harms caused to others with perhaps worse problems than those who are prepared and self-aware enough to self-exclude.

The noble Lord, Lord Foster, mentioned FOBTs in the consultation, as did others. I can confirm that we are considering potentially going down to as low as £2 for the stake, and are consulting on that specific issue. We have asked the Gambling Commission for more information about how better tracking and monitoring of play on FOBTs can help with interventions to protect players and whether spin speeds on games such as roulette should be looked at.

The noble Lord, Lord Griffiths, asked about how the consultation is going and whether clarity is emerging. The consultation is ongoing and clarity may well emerge from it but we will not be certain until January next year. He also asked when we will produce our results, and he will not be surprised to hear that we will do that in due course. The noble Lord, Lord Morrow, talked about the problem of gambling in Northern Ireland. It is a bit difficult for me to address the issue here as it is a devolved matter for Northern Ireland.

The noble Baroness, Lady Benjamin, talked about children and what we have done to protect them online, and, more importantly, the issue of what we might do to protect them online and whether we will legislate. Under the Gambling Act, the Gambling Commission has broad powers to place new licensing requirements on operators and respond to the pace of change in the online gambling market. In addition, the Gambling Commission has powers to suspend or revoke a licence, impose financial penalties or take criminal action where there is a failure to prevent underage gambling. However, we are not complacent, which is why the Gambling Commission and the Responsible Gambling Strategy Board are currently examining the relationship between children and gambling to determine whether further action is necessary. We expect the gambling industry to play its part in protecting children online, in line with the Government’s internet safety strategy. We will keep the issue firmly under review, acting accordingly where necessary. As for her questions on age verification, children and free games, all licensed operators must have robust policies to prevent underage gambling. Where age verification is not satisfactorily completed within 72 hours, the operator must return any money that the customer has paid into their account and not pay out any winnings.

The noble Lords, Lord Trevethin and Oaksey and Lord Foster of Bath, asked why operators cannot exclude for life. Data protection rules regarding data retention prevent GAMSTOP from technically offering an indefinite self-exclusion option. However, procedures will be in place to notify self-excluders in these circumstances and give them the opportunity to renew their self-exclusions. The noble Lords asked what would happen if there was non-compliance of operators. It will be a licence condition that all operators sign up to GAMSTOP and the normal penalties will therefore apply, including losing their licence.

The noble Lord, Lord Wigley, mentioned the academic paper on gambling-related harm. He was right to point out that harm goes beyond that of the problem gambler—a point which I made at the beginning and was made also in our consultation. In that regard, I welcome the work that the Gambling Commission, the Responsible Gambling Strategy Board and GambleAware are doing better to understand and measure the extent of this issue, which we agree is very important.

My noble friend Lord Smith of Hindhead asked why we are allowing operators to use affiliates and tipsters to harvest data and target the vulnerable. All gambling operators must have a licence from the Gambling Commission to operate and are held responsible for the actions and behaviours of their affiliates. The commission published advice earlier this year on ensuring that direct marketing is not sent to those who have self-excluded from gambling. Operators and affiliates must comply with the requirements of the privacy and electronic communications regulations and the Data Protection Act, and the ICO may take enforcement action if there is evidence of a breach. The Advertising Standards Authority also has the power to take action if it were to receive evidence of irresponsible targeting.

The noble Baroness, Lady Howe, asked about financial transaction blocking. The Gambling Commission has had great success working with payment providers to prevent unlicensed websites accessing the British market. Payment providers work proactively to stop payments to and from unlicensed websites, which means that the true number of websites effectively blocked may be higher than the figures held by the commission, but I would certainly be happy to write to the noble Baroness with the latest figures held by the Gambling Commission.

I am coming to the end of my time. I will certainly write to other noble Lords, because there are several questions that I have not answered—I think that about 48 questions were asked during the debate. I will read what the noble Lord, Lord Alton, said and write to him on it.

This has been an informative and interesting debate. I thank again the noble Lord, Lord Browne, for bringing it and allowing us to discuss these important issues. We have seen significant changes to the market since the implementation of the Gambling Act, as well as to public perceptions of gambling and to our understanding of harm across the gambling landscape. Our objective in engaging in the gambling review is to strike the right balance between socially responsible growth and the protection of consumers and the communities in which they live. We have listened to what has been said today. I will take noble Lords’ speeches back to the department. I encourage all noble Lords who have a view on these matters to respond to the consultation, which they have until January to do.

Photo of Lord Browne of Belmont Lord Browne of Belmont DUP 5:13, 23 November 2017

My Lords, I am extremely grateful to everyone, including the Minister, who has taken part in today’s debate. It has been an excellent debate, with support right across the House. I do not think that anyone could have failed to be moved by all the contributions. I find myself at the conclusion with a strong sense that, to coin a phrase, something must be done.

I am grateful to the Minister for setting out what has been done, but the Government should not underestimate the level of public concern and I hope they will mediate on the political significance of the recent evidence from the Gambling Commission. Public faith in gambling has fallen dramatically in the past nine years. While I certainly did not hear complacency in the Minister’s response, I am not totally convinced that the Government are fully seized of the importance of this issue.

There is a mismatch between the significant technological possibilities for enhancing online gambling and the current proposals in the DCMS consultation. I very much hope that the Minister and the Secretary of State will take away all the excellent proposals that have been made in today’s debate and use them in the current consultation process. I hope that they will accept that while the current consultation proposals for online gambling are good as far as they go, they need to go further. I hope that when they respond to the consultation they make clear their determination not to allow multiple individual self-exclusion mechanisms to continue to exist but mandate their replacement with GAMSTOP. I hope that they will prohibit the marketing of gambling games to children and, even more importantly, prevent children’s access to such games through age verification. I hope that they will introduce a statutory level of at least 0.8% and that they will end the lending of money for gambling through credit cards. I hope that they will look at prohibiting online betting between midnight and 6 am.

I have listened very carefully to the Minister, but I do not think he responded to my specific request for a meeting with himself, GAMSTOP, the Gambling Commission and problem gamblers.

Photo of Lord Ashton of Hyde Lord Ashton of Hyde The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport

I am very happy to take that request back to the department and put it before the Minister responsible for gambling.

Photo of Lord Browne of Belmont Lord Browne of Belmont DUP

I welcome that. Finally, I think there is a lot more work to be done. As we do it, we should not forget Joshua Jones, Omair Abbas, Adam Billing and, back home, Lewis Keogh, and their families. We should seek to build a public policy framework that means that their suffering will not be repeated by others.

Motion agreed.