I am delighted to have secured a debate on the subject of the gambling review report. This is the second one-and-a-half-hour debate on the issue, which shows the strength of feeling that people have on some of the recommendations made in the Budd report. Unfortunately, I was not able to be present for the previous Westminster Hall debate on
Hansard records that hon. Members representing seaside resorts expressed understandably strong views in the previous debate about recommendations that could adversely affect their constituencies. I assure the House that there are also real concerns in constituencies such as mine, which are as far away from the sea as one can get. In my constituency, the town of Burton upon Trent is famous for its breweries. Indeed, it can justly be called the capital of brewing. Unsurprisingly, a number of industries have grown up around the production of beer. Perhaps the best known by-product is Marmite. It is said that people either love it or hate it, but I shall make no comment. It is produced in Burton, and I am pleased to say that the company is celebrating its centenary this year.
Another development from the town's brewing heritage has been the gaming machine industry. More than 500 people are employed in Burton in three businesses that service that industry. Leisure Link and Rank Leisure Machine Services supply, operate and distribute the machines, and Vivid Gaming designs gaming and amusement machine equipment. Obviously, anything that might adversely affect the industry is of direct concern to many of my constituents.
It is important to recognise the many positive proposals made in the Budd report. Many of its recommendations are sensible. It endeavours to modernise and to be libertarian yet, at the same time, it tries to crack down on illegalities. Since our previous debate, recommendation 72 has been implemented, which I welcome. It has increased the stake to 50p and the maximum prize to £25 on all cash machines. I visited two of the companies in my constituency in the new year, and they were pleased about that change.
We need to protect the vulnerable in society by ensuring, as far as possible, that problem gambling is limited, and that when it occurs, effective treatment is provided for people. I believe that the need for a voluntarily funded gambling trust is supported by all parts of the industry. However, one of the main concerns that has been expressed about the gambling review body's recommendations relates to ambient gambling. That misconceived concept particularly affects the gaming machine industry.
If the recommendations are carried through, every sector of the industry—pubs, clubs, the seaside and licensed gaming centres—will see a decline in demand and in the need for machines. That will affect manufacturers and suppliers of the product. The presumption is that ambient gambling, which the report describes as
"gambling opportunities that are available in locations which are not dedicated to gambling" is more dangerous than gambling in premises where it is a primary function, such as in casinos or bingo halls. However, the report states:
"As with the Rothschild Commission, more than two decades ago, we were struck by how little is known about either normal or problem gambling. We had very little in the way of hard evidence to guide our discussions."
To help remedy that problem, the report recommends that
"research be carried out to understand the nature of normal, responsible, gambling behaviour and to understand the development of, and risk factors for, problem gambling".
In the report, there is also a presumption that gaming machines should be restricted in pubs because they are secondary to the consumption of alcohol, and yet the review body recommends that alcohol be permitted on the gaming floors of casinos.
I welcome the proposals for casinos and bingo halls. However, it is important to recognise that British manufacturers will not benefit from the potential introduction of thousands of casino slot machines with unlimited stakes and prizes. The expertise and technology for those machines lies with manufacturers in the United States that will export casino slot machines to the United Kingdom.
Bingo halls provide a valuable form of entertainment and a comfortable leisure activity for many people, especially women who want to go out and meet friends. For most people, visiting a casino is not an everyday activity. Indeed, those who are frequent visitors to such gaming establishments might be viewed as problem gamblers. It would be interesting to study whether most problem gamblers are found in casinos, where the primary function is gambling, or the local pub, where ambient gambling may take place.
In the debate initiated by my hon. Friend Dr. Ladyman on
I congratulate the hon. Lady on securing the debate. She refers to seaside resorts and obviously will develop that point. The recommendations could be devastating for the traditional seaside resort as we know it. She has not yet mentioned rugby, football and other sporting and social clubs. The profitability of many rugby clubs in my constituency is based simply on one or two gaming machines.
The hon. Gentleman is right, and I shall come to members' clubs in a moment. I do not underestimate the impact of the proposals on seaside resorts or clubs. Those who represent seaside resorts may comment further today. Although I have enjoyed the odd hour or two in such arcades on a wet afternoon, I shall leave that aspect of the report to those who represent our sunny shores.
Strong representations have been made about members' clubs and the proposals to remove jackpot machines. My right hon. Friend the Minister for Sport has been lobbied close to home on the issue, and I am sure that he recognises the strength of the argument that many clubs would not survive if they could no longer rely on the income from the machines. In the previous debate, reference was made to the recommendations of the gambling review body to limit the number of all cash gaming machines allowed in public houses.
Does my hon. Friend agree that we all see problems caused by gambling and alcohol in our constituencies, but that those problems do not seem to be the driving force behind the review? Is her postbag like mine, in that owners of pubs and clubs write to point out the extra leisure facilities and community support that they provide? Given that, does she agree that we need to hear from the Minister about Government recognition of the importance of that sector and the need for stability in it?
Yes, I hope that we shall hear that today, as I am concerned about the pub sector. I represent the capital of brewing, and I am sure that my hon. Friend will understand that I want our pubs to remain viable so that they can sell the golden nectar—the beer—that so many of my constituents produce.
No, I cannot. Understandably, however, I have had many representations from constituents who work in the gaming machine industry. I want to speak out not only for those who are directly employed in the industry but for those who work in local businesses and who manage pub estates.
The argument for restricting pubs to up to two all-cash machines is not valid. I would go so far as to say that it is total nonsense to suggest that no account should be taken of the size of the pub. It is absurd to limit a 5,000 sq ft multi-bar pub to just two machines, while allowing a 400 sq ft pub with a single bar exactly the same entitlement.
Currently, local magistrates can approve up to five machines. The British Amusement Catering Trades Association—the trade organisation of the gaming machine industry—believes that it would be sensible to consider legislation to allow up to four all-cash machines as of right. That would reduce bureaucracy and free up valuable local authority time. Cases in which more machines were desired could, in exceptional circumstances, be considered individually.
The gambling review says that pubs have an average of 1.28 machines, so it appears that the report's recommendation is generous. It is, however, important to recognise that not all pubs have, or want, gaming machines, while others have five or more. All pubs are different, and 80 per cent. are independent small businesses. They are often the only source of entertainment in their local community, which they can also provide with other services.
I welcome the thrust of the hon. Lady's remarks. She makes a good point about the economic and social contribution made by pubs, and the same is true of arcades in coastal resorts. She may be aware of the Government's initiatives to revive such resorts, but it is not good joined-up government to threaten the future of traditional family arcades at the same time. Closing those arcades in the way outlined in the report will deal a devastating blow to the coastal resorts and seaside centres that, in another context, the Government say that they are trying to help.
I agree. In our last debate on this subject, a good case was made as regards the needs of the seaside. I would hate to see the demise of seaside arcades, which are a part of our history that, like Marmite, goes back 100 years. We must try to save them. I also agree about the need to regenerate our seaside resorts, and it would be wrong to put obstacles in the way of regeneration.
Our pubs and clubs provide pool and snooker tables, thereby making other leisure activities available to local people, but those activities may be lost if the number of gaming machines is reduced.
It may be said that the report does not propose to ban gaming machines from pubs. It is, however, important to remember that the gambling review body said that, if starting from scratch, it would
"recommend banning all-cash machines from pubs."
By saying that it would be "disproportionate and harsh" to follow through on that now, however, it leaves the door wide open to a ban in future.
Another reason that is offered for restricting the number of all-cash machines in pubs is their accessibility to children and young people. Most people would assume that there was already a restriction on those under 18 years of age; indeed, according to a recent MORI opinion survey, 92 per cent. of machine players in pubs believe that there is a legal age limit for playing. It is a credit to the industry that, in the absence of such a law, it operates a voluntary code restricting use of the machines to the over-18s. There is widespread support inside and outside the industry for legislation to prevent under-18s from playing fruit machines in pubs.
There should be no problem in enforcing such a measure, any more than in enforcing the current restrictions on the sale of alcohol to under-18s. Indeed, the report accepts that, when it states that
"by themselves, all-cash machines in limited numbers are an ancillary activity for pubs and we do not think that it is necessary to insist that a separate licence should be obtained for them. The checks that already exist in relation to the granting of liquor licences are adequate for this purpose."
The dispute therefore centres around the number of all-cash machines that should be allowed. Policing the use of machines to prevent young people from using them illegally would be no more onerous if up to four machines were permitted, as suggested by the industry, than it would if only two were allowed, as has been proposed.
Fruit machines are an accepted part of a pub's traditional leisure offering, enjoyed by millions of players. They enjoy a casual gamble while having a pint of beer or other beverage. Why should they be prevented from enjoying what for most people is harmless fun? I support the liberalisation of casinos, but I do not believe that people who want an occasional flutter on an all-cash machine should have to travel to a casino.
According to MORI, three out of four people surveyed are in favour of fruit machines in pubs. I hope that the Government will reject the recommendations that I have pointed out in the gambling review body report, as they will adversely affect pubs as well as clubs. Pubs are a vital part of the community, where people meet for a drink, food, entertainment and company. Many rural pubs are already at risk. We must not compound that situation. I look for any reassurance that my right hon. Friend the Minister can give to my constituents employed in the gaming machine, brewing and pub industries, and to the many hon. Members present who are concerned about this issue.
I congratulate Mrs. Dean on securing this debate on a subject that is important to many hon. Members and their constituents. I know that many hon. Members want to take part this morning, so I shall be brief.
The hon. Lady has already referred to the potential effects on pubs that implementation of the Budd report would have. That point must be true for every constituency in the country. She has referred to the clubs. Most constituencies have Royal British Legion clubs, constitutional clubs and similar venues, which depend for their survival on the proceeds from gaming machines. That ground has been well covered and will no doubt be covered again this morning, so I mean no disrespect to the people engaged in those concerns when I say that I shall concentrate my remarks on my constituents and the British seaside.
To put the issue in context, Thanet hosts several companies that manufacture or sell amusement-with-prizes machines and gaming machines. They employ significant numbers of people and export to the far east. Those sales have been valuable to this country. They employ significant numbers of my constituents and those of Dr. Ladyman, who instigated an earlier debate on the subject. Those are real people in real jobs which are under threat. One of the oldest companies in the country, which has been one of the instigators and developers of much of the machinery that we are discussing, is at this moment fighting for survival. Whether Cromptons will survive, we do not know. Various rumours about its future are circulating.
I do not pretend that Cromptons' problems are entirely due to the Budd report. That is clearly not the case. Any company facing industrial problems must consider several contributory factors. However, the Budd report has destabilised what was a highly successful British industry, exporting British technology around the world. It is an absolute tragedy that that success story is now being placed in jeopardy as a result of a reaction to a threat that no longer exists.
The hon. Gentleman is absolutely right. The entire industry, not just Cromptons, is now operating in an atmosphere of uncertainty. What investor is likely to come forward in such an atmosphere, until we know the decision on the report's recommendations? I must say to the Minister, on behalf of the hon. Gentleman, his constituents and my own, that the sooner the matter is resolved satisfactorily, the better.
Does the hon. Gentleman agree that one of the worst aspects of the report is that, as Mrs. Dean mentioned, the research would be carried out over five years, causing uncertainty for constituencies such as mine, which provide the seaside machines? Firms will not invest during that period, and that will affect jobs in the constituency of Mr. Gale.
The hon. Gentleman is right. That is why I said to the Minister that the matter must be resolved quickly. We cannot wait for five years—the companies will not be there in five years. It is a moot point whether some of them will be there in five months, so the matter must be resolved quickly. I know that the Minister has heard these arguments before, and that he is not unsympathetic to many of our points. I hope that he will be able to send a clear signal that will stabilise and reassure the market, which is seriously under threat.
What does that threat stem from? I do not suppose that there is a Member present who is not conversant with the ill effects of gambling on young people and the potential for harm. However, the idea that amusement arcades, particularly in their seaside manifestation, are still dens of truants and rent boys and young gamblers stealing to feed a penny-in-the-slot machine habit is nonsense. I am not saying that it was not a problem at one time, but I speak for the arcades in my own constituency along the Margate seafront and in Herne Bay, in saying that it is no longer a problem.
As the Member of Parliament representing the people who run those arcades and those who use them, I am satisfied that in the main—there may be the odd error—they are well run and well managed. They do not provide the sort of haunt and haven that Professor Budd and his colleagues seem desirous of attacking. On the contrary, they are an integral part of British seaside life. It is an acknowledged fact that the sunshine in Margate is not always quite as hot or frequent—
Not always—there is the occasional cloud in the August sky. There is, from time to time, even a drop of rain. On those occasions, entire families seek solace in the amusement arcades.
I rise to speak up for my constituency, because in my experience the holidaymakers flock to our amusement arcades in the hot weather because of their good air-conditioning.
Do not excite me. Other hon. Members want to speak.
For much of the British seaside, the amusement arcades are a significant proportion of the all-weather facilities. It is a sad fact that there is a lack of investment in the kind of facilities that meet the needs of our climate.
If one removed the seaside arcade from the equation, it is not an exaggeration to say that one would go a long way towards killing what is left of the British seaside. We have suffered our hotels and guesthouses being taken over, first by dole-on-sea claimants and then by asylum seekers. We have seen the bucket and spade holidays go to the sunshine of the Mediterranean. Yet people are still running good reputable businesses—guest houses, pubs and fish and chip shops. People are still selling kiss-me-quick hats, candy floss and seaside rock from seaside bazaars. One cannot remove one bit of that equation without damaging the rest. Another element of uncertainty has been injected into the fate of seaside resorts, as well as into that of machine manufacturers.
Under human rights law, a sentence must be proportionate. Professor Budd has overreacted to a perceived but non-existent threat; the reaction is not proportionate, and the sentence that he proposes would not solve a problem but be a death sentence for the British seaside.
It is a pleasure to follow my parliamentary neighbour. There are few subjects on which he and I agree; in fact, I can think only of three off hand, and this subject is one of them.
I had a good stab at this subject on
Thanet is the world centre of the penny fall machine industry. Two leading companies in the world are based in Thanet, and they use their United Kingdom business as the bedrock of their business, because the revenue from it pays for their research and development work, which they apply to their machines to sell abroad. Without that United Kingdom business, there will be no exports abroad, the legs will be cut from under those businesses, and they will certainly collapse.
Before I tell my right hon. Friend the Minister for Sport about those articles, let me tell him something that Alan Budd was heard to say on a visit to an amusement arcade in London. He stood in front of a fruit machine and said to the owner of the establishment, "I've never played on one of these before—how does it work?" And yet, in articles in the press, he has claimed to be an incipient gambler who used to get lost in seaside arcades as a child and, therefore, understands the problem of gambling from the inside. Only one of those two things can be true: he either knows the problems from the inside or he has never played on one of those machines before. Which is the real Alan Budd who wrote the report?
I will not go down that route.
Alan Budd has said:
"When I enter a casino I almost fall over from the flood of adrenaline. It is only by immense self-control that I have not gambled away the house and everything in it."
If he had admitted to this problem earlier, does anyone seriously think that the Government would have put him at the head of a commission on gambling?
If limits were placed on the machines that could be put in pubs, clubs and arcades at seaside resorts such as those in my constituency on Canvey Island—across the Thames from the hon. Gentleman's—and on the prizes that they could offer, people would be driven towards casinos, where problem gambling can take hold. That would also result in the destruction of those pubs, clubs and arcades. They are the heart of our community, part of the fabric of our society. We should cherish them, not destroy them.
The hon. Gentleman is right. Nobody in their right mind can believe that the machines that we are discussing, located in seaside arcades, are part of a regime of hard gambling that creates a gambling problem in adult life. If people develop such a problem, it is not because they have spent a wet afternoon in Ramsgate, Broadstairs or Margate playing on a penny fall machine for tuppence a time. The use of such machines should not be treated as hard gambling, yet the Budd report recommends that penny fall machines, roulette machines and "Wheel'em ins"—harmless penny amusement machines—should be treated as coin-in, coin-out machines and their use restricted to people over the age of 18. Who, over the age of 18, wants to play on those machines? [Hon Members: "Alan Budd."] Except that Sir Alan probably does not know how they work.
If that was not enough to convince the Minister that he should drop the recommendations, let me give some facts and figures from the Henley report that might convince either him or the Chancellor. The Henley centre believes that, in the short term, implementing the recommendations will result in the family amusement industry losing £20 million per year in revenue and 1,500 full time jobs. If the five-year ban goes ahead, there will be £117 million of revenue losses and 5,000 full-time jobs will be lost, while the Treasury will lose £14 million per year in licence duty, £51 million per year in VAT and £29 million per year in national insurance and PAYE. That is a loss to the Treasury alone of £94 million.
There will not only be a loss to the seaside amusement industry. You would immediately rule me out of order, Mr. Deputy Speaker, if I suggested that the Budd report would cost the national lottery's good causes hundreds of millions of pounds, but it will. There are some sensible recommendations in the report, as my hon. Friend the Member for Burton has said. Equally, there are some barmy ones. Overall, the Budd report could cost the Exchequer as much as £500 million and 15,000 jobs across the country. Surely we cannot countenance that. I ask my right hon. Friend the Minister, in making his report, to consider those matters carefully. If he comes up with the right recommendation, I can promise him from now on the premium space and the best deckchair on the beach whenever he comes to the seaside. Whatever he does, please will he make his recommendations as quickly as possible, because the uncertainty is already costing jobs and revenue to a vital industry and is adding to the problems of the British seaside.
Order. As hon. Members will see, there is a demand on time. We have some 30 minutes left because, traditionally, the final 30 minutes of a 90-minute debate are reserved for the Front-Bench spokesmen. Please, will all hon. Members whom I try to fit in be clear, concise and pertinent in their remarks, out of consideration for their colleagues?
I congratulate Mrs. Dean on having secured the debate. As its MP, I have an interest in the continuing success of Skegness as a traditional family resort. The town has not just relied on its heritage and excellent reputation, but has seen considerable investment, primarily from private individuals who run family businesses for the benefit of other families who come to Skegness to enjoy its facilities. It must be clearly understood that that investment has enabled Skegness to remain at the forefront of the United Kingdom tourist industry. I hope that hon. Members agree that there is a place in a responsible society for controlled gaming, but we must find a regulatory framework that allows companies to prosper and create employment and allows those who come to Skegness and other tourist destinations to find pleasure and enjoyment.
The Budd report does not strike the appropriate balance. It is an odd report in that it is contradictory and creates a paradox. It argues that the gambling industry should be liberalised while at the same time proposing to reduce competitiveness by adding unnecessary tiers of restrictions and regulations that will force many seaside arcades out of business. The British Amusement Catering Trades Association is right in saying that amusement arcades are one of the significant attractions of UK tourist resorts, second only to funfairs. They create family entertainment, enabling the family to stay together by providing entertainment for those of all ages, from children in playgroups to adults on gaming machines with large jackpot prizes, in restricted areas. The money from such machines produces the investment that allows the owners of arcades to provide a broader range of services, such as play areas for younger children.
The implementation of the Budd report would change all that. It would drive many adults who enjoy gaming machines away from regulated family arcades into bingo halls, betting offices and other buildings that have gambling licences where children would not be welcome or allowed. There is no evidence to support the suggestion that trivial gambling causes harm, whether it is on low-stake, low-pay-out machines, push machines, cranes or Derby races. Indeed, a recent survey detailed the issues affecting the lives of people under 18 that worried them most. Gambling came 12th. Only 0.6 per cent. of those asked felt that gambling was a significant concern. It might not be a surprise to find that drugs and alcohol were high on the list. Indeed, text messaging and eating junk food came higher up the list than gambling.
If children were banned from arcades, the traditional British family resort would be almost at an end. Where would the family go in Skegness on the rare occasions when the sun is not shining? Such a ban would also have a dramatic impact on the tangential businesses that support amusement arcades, such as electricians and plumbers. It would have serious implications for those employed directly in the amusement arcade business in both full-time and seasonal work. Those employed are often the least skilled and least well educated of our work force and deserve help from hon. Members of all parties. Those workers will be the hardest and first hit by the proposals contained in the Budd report. Many students subsidise their higher education by taking part-time jobs, especially in the summer months, in amusement arcades in Skegness. If the Budd report were implemented, many of those students might not be able to afford higher education and a bar might be created that would prevent those from the poorest backgrounds from having access to higher education.
Any resort must invest to move forward. A lack of investment means that a resort or a business stands still. The length of time that the consultation process is taking is creating a great deal of uncertainty, and the proposals to allow local authorities retrospectively to close arcades or impose a blanket ban on gaming in any particular area will not allow businesses to invest. Businesses need stability and certainty. I ask the Minister to confirm that that recommendation will not be implemented, or at least to say when he will announce the results of the consultation process. Otherwise, the disinvestment that will occur will further damage the already greatly challenged UK tourism market.
I will not repeat the arguments about the loss of revenue to the Exchequer, which have been made eloquently. I shall address recommendation 70, which seeks to reduce the potential jackpots in gaming machines in private clubs from £250 to £25. Many clubs survive solely on the profit generated by those machines.
Does the hon. Gentleman agree that one organisation most affected by that proposal is the Royal British Legion? Its clubs are hardly dens of iniquity and under-age gambling, and the average age of its members is over 40. They raise tens of thousands of pounds for their local communities every year, but many may be forced to close if recommendation 70 comes into force.
I am grateful for the hon. Gentleman's intervention, and agree with his point. Not only those of the Royal British Legion, but many other community clubs exist as meeting places. They often provide cheaper beer than is available in commercial pubs, which allows the retired generation in particular to get together. They are often the core of a rural community and provide money for charities. In one village in my constituency, Kirton, the profits from a jackpot machine in a private club support the only children's playground in the village. Sometimes money is used for educating members of clubs.
I would like to make further points, but I know that other hon. Members wish to speak. It was right to hold a gaming review, but it is wrong further to penalise the UK seaside resorts. It is right further to liberalise the UK gaming industry, but it is wrong to destroy family entertainment centres. I understand that the Minister's Department has been swamped by responses to the consultation process. I hope that he will recognise and react to the very strong feeling that has been expressed, and adhere to the points made.
I congratulate my hon. Friend Mrs. Dean on securing this debate. Hers is an inland constituency, which, like all constituencies, will suffer if many aspects of the Budd report are implemented. However, I think that constituencies with seaside resorts will suffer the most. I notice that many Members of Parliament for such constituencies have taken part in today's debate.
Seaside resorts have suffered tremendously during the past 25 years. Other regions of the UK that have suffered, such as the steel, mining and agricultural communities, have had their heroic struggles well chronicled in books, films and newspaper articles. However, the struggle of seaside communities has not been chronicled, although it is an equally noble struggle. Perhaps that is because we are literally on the periphery of the country and do not have a union or united voice to represent us.
Local arcade operators in my constituency have informed me that the Budd report's recommendations would be the death knell of seaside towns such as Rhyl and Prestatyn. We have heard the statistics: 14,000 jobs will go and £550 million of Treasury income will be lost. Tim Batstone of HB Leisure, a very successful arcade operator in my constituency, estimates that he will lay off 130 workers in the short term and 300 in the long term. That will mainly be in the ward of Rhyl West, the most poverty-stricken of the 850 council wards in Wales.
The effect on my community will be devastating. There will be a human cost, in terms of job losses, and also an environmental cost. On the west parade in my home town of Rhyl, half the old Victorian buildings are now derelict. The other half are currently arcades, brightly lit and well maintained and presented. They, too, will soon fall into dereliction if the Budd report is implemented in full. The knock-on effect on the local economy could be considerable, with a loss in rates and a drastic reduction in the number of visitors to Rhyl.
The part of the Budd report that most concerns the arcade operators and me is its proposal to ban children from arcades, even with parental supervision, which smacks of Big Brother, and "we know best". There is a move by Alan Budd to stop the cheap tuppenny games. Sir Alan Budd believes that such games have a corrupting influence on young people. He recommends a five-year study, which we welcome, but he is prejudging its results and implementing his changes from the outset.
Research needs to take place, and we would all welcome it. Existing research from the British gambling prevalence study 2000 shows that, on the whole, British people are a nation of responsible gamblers. Perhaps that is so because, at an early age, we have spent our tuppences with parental support in a controlled environment, and have developed a responsible attitude to gambling.
My main concern is the effect on seaside towns, but a further worry is the effect on military clubs such as the Royal British Legion, Royal Air Forces Association and Royal Naval Association clubs, on political clubs—perhaps we should declare an interest—such as Conservative, Labour and constitutional clubs, and on social clubs. Many clubs in the poorest areas, especially in my constituency, will fold unless they can make money from gaming machines.
We have heard many opinions expressed. Aspects of Sir Alan Budd's report have united all political parties in one voice. That is unique in Parliament. However, although many aspects of the report are good and sensible, many of its proposals, particularly those that pertain to seaside resorts and registered members' clubs, should be extinguished at the earliest date. Uncertainty is undermining registered members' clubs and seaside resorts, which have suffered so terribly in the past. Those resorts need help, not a kick in the teeth, which is what Sir Alan Budd is offering. I ask the Minister to listen to pleas from all quarters and end the uncertainty as soon as possible.
I will be brief. I wish to reinforce the comments made by other hon. Members.
I declare an interest as an officer of the all-party group on non-profit-making members' clubs. I recognise, as I am sure do all hon. Members, that the gaming machine industry and non-profit-making clubs are irrevocably interlinked. The fortunes of the private clubs have a great effect on the fortunes of the gaming machine industry—clubs are a major customer of the industry. As the Minister knows, well over 20,000 private non-profit-making clubs in this country will be savagely affected should recommendation 70 come into play.
The Royal British Legion will be one of the biggest sufferers. The term "non-profit-making clubs" means that profits from machines go back to help members and local communities and provide comfort for those less well off or less well supported in the community. There are more than 20 non-profit-making clubs of all types and of different memberships in my constituency. They will be severely affected should recommendation 70 be introduced.
The Minister will remember that I asked him a parliamentary question in October about the number of representations that he had received from clubs and their members. He admitted that more than 1,500 clubs or members had written to him expressing concern about the effects of recommendation 70. He also knows that the organisations that represent such clubs nationally are desperately worried about the future of working men's clubs, social clubs, military clubs, the Royal British Legion, and, of course, political clubs. My local Conservative club in Eastleigh has written to me. It is desperately concerned that it will be forced to close if high-payment gaming machines are removed. I know that the Minister is a fair man. Given the average age of Conservative party members these days, he would hate to take away the old codgers' last bit of enjoyment.
The Minister has been gracious enough to listen to the views of the all-party group on non-profit-making members' clubs and the association that represents the clubs. He knows the issues well and I would like him to confirm that private, non-profit making clubs are an essential part of our community and social fabric. He has the chance to tell us that they will be exempted from a regulation that would destroy the very nature of an essential part of our society.
I congratulate my hon. Friend Mrs. Dean on securing this important debate. It is also a pleasure to follow a fellow chartered civil engineer, Mr. Chidgey. We both know the importance of foundations and structures. In this debate, it is important to recognise the linkages between each facet of the industry.
I want to concentrate on the importance of the seaside, but I will not rehearse the weather forecasts that we have heard from such delightful places as Skegness, Margate, South Thanet, Great Yarmouth—
And Rhyl. The best place, and the place where the seaside industry was founded, is Scarborough. On behalf of my community, I thank my right hon. Friend the Minister for the tremendous work he did in laying key foundations to help the regeneration of the seaside while he was at the Department of Trade and Industry and the former Department of the Environment, Transport and the Regions. That important work led to my community being established as an objective 2 area.
An engineer's view of what confronts us would be simple. The Government are taking a long time to determine their response to the Budd report and, therefore, we face a blight on the industry at every level. I reiterate my previous invitations to the Minister to come to the front at Scarborough and do what Sir Alan Budd was not prepared to do: meet the many families who run businesses there. They cannot invest in their businesses because they are unsure of their direction.
The Budd report offers opportunities as well as challenges for the seaside community. The direction of the regeneration for which the Minister was responsible in seaside communities such as Scarborough and Whitby links to the possibilities for developing a casino-like culture in places such as Scarborough. I have a vision, which many of my constituents share, of turning Scarborough perhaps not into the Las Vegas of the north, but into something like the Monte Carlo of the north. I notice that my parliamentary neighbour, Mr. Greenway, knows exactly what I mean. The beauty of the area is very similar to that of Monte Carlo. He represents the good people of Filey, so he will know that a casino in Scarborough, as well as suitable hotel development, could bring about the Minister's vision.
My simple message to the Minister from the many people who work in the seaside community in Scarborough is that he would be throwing the baby out with the bathwater by taking up the proposals on seaside gambling in the Budd report. The North sea is very grey and cold even at the best times of the year. Prosperity could be increased for many people in my community and I am here to try to bring that about. If it does not happen, my community will be blighted and things will be bleak.
At the earliest opportunity—today would be great—will the Minister please say that he is prepared to put to one side the proposals relating to the seaside community and gambling, which is the only way to go until we have some effective research? We must end the blight and bring about prosperity for the seaside, especially for my constituents in Scarborough and Whitby.
I shall be brief and try not to reiterate the excellent points that have been made both by hon. Members who represent seaside communities and by those whose constituencies are inland. I congratulate Mrs. Dean on securing the debate.
I should like to place on record my congratulations to the industry, which has completely changed its image in the past 20 years. Restricting access and improving policing have enhanced the quality of the environment in amusement arcades. I cannot remember the last time that I read in my local newspaper of a problem in an amusement arcade, whereas 20 years ago there were regular reports of incidents. The industry should be congratulated on getting its act together to provide true family entertainment and amusement.
One issue that has not been raised is that of piers. We talk a lot in this place about reforming peers, but I am talking about piers. Piers are run with amusements, and we want to retain the great British pier. Most of us who represent seaside resorts have a pier in our constituencies, and some constituencies contain two or more of them. I hope that the Minister will take it on board that piers are an integral part of the seaside and the traditional British holiday, and that they are threatened by the legislation. I know that he is no stranger to seaside resorts because he has visited my constituency in the past, and he is always welcome to come again. He would not need to bring an umbrella because my constituency is in the English riviera.
As others have said, if some of the recommendations in the report were accepted they would cost jobs. They would not kill the holiday industry in British seaside resorts because we have many other attractions, but we must offer a package, of which amusement arcades are a part. Amusement arcades are an integral part of the British seaside holiday experience, and we do not want to see them go.
I congratulate my hon. Friend Mrs. Dean on securing today's debate. I shall speak briefly.
I want to impress on the Minister the effects that the five-year review is having on my constituency. Pavilion plc, one of the arcade owners in my area, intended to invest an extra £3 million in Pier avenue, but it has put that on hold because it cannot wait for five years. No one will give it investment and support because there is no certainty that there will be arcades in the area after five years. I stress the importance of the five-year review, and I, too, should like my right hon. Friend to make a statement as soon as possible on whether it is going ahead.
I remember hon. Members' campaigns for seaside resorts, and it was only in 2000 that we called on the Chancellor to help seaside resorts in his Budget. I shall read an extract from the Budget report 2002, in which we received a good response from him on the concerns raised about seaside resorts and arcades. The report says:
"The removal of the £645 annual licence charge on small-prize 'amusement with prizes' machines (AWPs), costing 10 pence per play or less, will provide a boost to seaside arcades, and will help to support the Government's 'Tomorrow's Tourism' initiative, aimed at reviving traditional seaside resorts."
The Chancellor is giving and Budd is taking away. We cannot afford some of the report's recommendations.
My hon. Friend Dr. Ladyman mentioned an article. I wish to draw Members' attention to an article in Coinslot International, which is a publication for the traders who operate the arcades and machines. It says that Sir Alan Budd's problem is alleged to have stemmed from boyhood, specifically time spent in amusement arcades during holiday visits to the seaside. It says:
"The experience has clearly imprinted on Budd a protective attitude towards fruit machines, of which he is quoted: 'Machines are the most addictive form of gambling. The best way to trap someone is with machines. They are designed to be addictive.'"
The banning of non-monetary prizes could be taken to an extreme. I am sure that we can all remember going into a shop and paying for a lucky dip, and how disappointed we were that we did not get what we wanted from it. One might take the ban even further. How many Members, when they were younger, paid to see Father Christmas, sat on his knee, asked for all sorts of things and did not get what they wanted at the end?
Is Budd saying that we should not play because we may get a prize at the end that we do not want, or because it may trap people in gambling? That is ridiculous. It is an idea that should be put to bed straight away so that we can safeguard the future of arcades. It is ridiculous to think that every time a young child spends a penny or two and gets a prize he will be trapped into a gambling habit.
For years, arcades in my constituency have regulated themselves. They do not allow under-18s into certain areas, and they have people on the doors who ensure that children do not go into arcades during school term and question them if they try to. Such regulation is already in place; the Budd report goes too far. We should ensure that our seaside resorts are maintained, and we should accept that arcades are part of their proud history.
The Government were right to conduct a review of the industry's regulations. It is an important industry, contributing some £42 billion a year to the UK economy and retaining a relatively modest £7 billion. Some of the proposals in the Budd report will find favour with the industry, punters and society generally. However, some parts of it contribute to an incoherent, contradictory and potentially damaging whole.
A main impetus for the review was that the Treasury was licking its lips about the prospects of regulating and taxing internet gambling. I have no objection to the Government doing that, but, as Dr. Ladyman said, there is a potential downside in terms of Government revenues. The perceived benefit to the Treasury could easily be wiped out if we were to accept the package as a whole.
Hon. Members have already made the point that the incidence of problem gambling in the UK is not very high, certainly in comparison with other countries. There is something rather perverse about the report. It attacks and undermines some traditional British forms of gambling, which we know do not create serious problems with social gambling. At the same time, it seeks to espouse and permit the growth of huge Las Vegas-style casinos. We know that America and Australia, where that is a far more typical part of gambling, have a far greater problem with dependent gambling. In Australia, for example, 2.5 per cent. of people have problems with gambling, and gambling addicts are estimated to cost the Australian community more than 5.5 billion Australian dollars a year.
The situation is extraordinary. Our industry does not give us problem gambling, and we may undermine all its essential and traditional characteristics. However, the same report proposes to allow the type of gambling that has contributed to problems in America and Australia.
The hon. Gentleman has not mentioned France, where a gaming machine regime has been instituted similar to that proposed by Budd. In France, the problem with gambling is people who are shot by gangsters for not buying their gaming machines from the right set of criminals.
The hon. Gentleman makes an important point, and it is another that the Minister will have to consider when he decides how to respond to the proposals.
When we debated the subject in this Chamber in November, most of the speeches were about the impact that the proposals would have on social clubs, a point that my hon. Friend Mr. Chidgey referred to this morning. Such clubs were quick off the mark with their lobbying, and it is clear that they made an impression on hon. Members from all parties. The Minister has acute political antennae, so he will have picked up on that. Were I a betting man, I would wager a small sum on his not accepting the burden of that recommendation.
Today, hon. Members from all parties have expressed loud and clear their belief that damage would be caused to seaside resorts if the Budd recommendations went through. Almost all those resorts are economically fragile. I know that myself, as north Devon has several seaside resorts that are in serious trouble. Amusement arcades are an integral part of the package of seaside resorts, so I urge the Government to think long and hard before going down the suggested route.
Similarly, the recommendations on pubs could be extremely damaging. It seems self-contradictory to offer local authorities, which are to be the licensing authorities, the prospect of draconian blanket bans on all forms of gambling yet not allow them to exercise common sense on how many machines should be allowed in different pubs. Pubs can come in different sizes, so a one-size-fits-all solution to the number of machines allowed in them does not seem logical.
If the Government decide to accept the Budd recommendations about allowing large-scale use of machines in casinos, they must be aware of what will happen. Most of the bingo clubs will turn into casinos overnight. The image that the public have of casinos—with smooth Roger Moore-type figures in black bow ties playing the roulette tables—will bear no resemblance to what will follow. I do not say that I am morally or implacably opposed to allowing larger-scale machine gaming halls—that is exactly what they will be—but I urge the Government not to allow them to operate in an uncontrolled way. They should leave in place certain brakes and controls to prevent them from getting out of hand.
Hon. Members from all over the country and all points on the political spectrum have spoken. Clearly, they have many serious worries and reservations. I am glad that the Government have taken the time to absorb the burden of the lobbying that has taken place and the representations that have been made. If they introduce a White Paper or Green Paper on the subject in the next few months, I hope that they will treat the Budd report in an à-la-carte fashion. They should pick the good bits from it and ignore the bad, because if they took it as a whole, the result would be complete disaster.
I congratulate Mrs. Dean on securing the debate, and on providing a further opportunity for the House to consider the implications of the Budd review for the future of the gaming machine industry and the importance of the income generated from gaming machines to several organisations. She set out clearly her constituency interest, as 500 local jobs depend on the gaming machine industry, and advanced a logical, coherent and powerful argument against a number of the Budd recommendations, which have caused such dismay and uncertainty throughout the industry.
The hon. Lady's thoughts were echoed by all the other speakers in the debate: my hon. Friend Mr. Gale, the hon. Members for South Thanet (Dr. Ladyman) and for Vale of Clwyd (Chris Ruane), my hon. Friend Mr. Simmonds, and the hon. Members for Torbay (Mr. Sanders), for Scarborough and Whitby (Lawrie Quinn), for Harwich (Mr. Henderson), and for Eastleigh (Mr. Chidgey). Indeed, the hon. Member for Eastleigh gave the best example of how desperate people have become when he told us of the Conservative club that felt it necessary to write to a Liberal Democrat Member. One could not wish for greater evidence.
No one doubts that a review of gambling legislation was overdue. The regulation of casinos, internet gambling, the future of betting shops and the permitted mix of alcohol and gambling in various locations were all issues that needed to be addressed, and they needed to be considered against the background of a growth in leisure time and more relaxed attitudes generally. The Budd report, however, found difficulties in areas where no one had seen much of problem beforehand.
Sir Alan's thinking was so out of line with the industry view, and I shall quote again from the Coinslot interview. This comment says even more than those quoted by other hon. Members. He says of BACTA members,
"This will destroy us, they complain."
"What they don't understand is that the alternative proposal is not to leave things as they are but to abolish it completely."
There we have it: we should abolish seaside arcades and jackpot machines in clubs and public houses. Many in the industry realise the scale of the threat. There is strong reason to doubt whether the existing regime for the availability and regulation of gaming machines was a matter of concern when the Budd report was commissioned. I do not recall it being so. If there was a problem, it was that the existing framework was too restrictive.
I was constantly lobbied as a member of the Home Affairs Committee, with my hon. Friend the Member for North Thanet, and when I had the gambling brief as Home Affairs spokesman when the Home Office had that responsibility. I was often told that the number of machines allowed in betting shops and bingo halls was too restrictive, and that the 100 local authorities that had banned all cash machines in a number of locations were being to restrictive.
There can be no doubt that the industry is deeply shocked by the Budd recommendations on clubs and seaside amusement arcades. We understand that the Minister will need time to respond in detail. I sympathise with him; it is a huge report with many recommendations. However, it is equally clear that the Budd report has generated huge uncertainty within the industry. Although it is not the only cause of decline in machine sales—I understand that sales of jackpot machines fell by about 27 per cent. between 1990 and 2000—it seems to have caused a major acceleration. In the quarter ending
Some jackpot machines are too complex for some of the older members of clubs, which may be another reason for the decline in income in some clubs. That all impinges on the fact that if they lose that income altogether, they will be in real difficulty. I have considered the matter in considerable detail, and I would argue that the case has not been made for the Budd recommendations on jackpot machines or on how they might affect the seaside. Many hon. Members have said loud and clear that no one outside the review body has a good word to say for the recommendations, and I praise the views of the hon. Member for South Thanet.
At the BACTA conference in November, I made clear the Conservative view that we should leave alone the current regime of jackpot machines in clubs. Similarly, we believe that proposals to restrict machines in pubs to two are hard to fathom. Imposing such restrictions at the seaside is illogical given that there has been no research on their effect on tourism or on whether there is a problem with under-age gambling. It undermines the credibility of the recommendations. In our view, the solution—which Budd proposes—is a prohibition on under-18s playing jackpot or all-cash machines, regardless of their location. There must be a presumption that the proprietor will enforce that prohibition.
I concede that it is perhaps easy for the Opposition to take that view, but the strength of argument suggests that it is time to end the uncertainty. Every speaker has said loud and clear that businesses and jobs are at stake. I attend 90-minute debates in Westminster Hall with the Minister for Sport or his colleague the Minister for Tourism, Film and Broadcasting once a fortnight, but attendance has never been as good as it is now. That shows how concerned Members are about their constituency interests.
The general philosophy behind the Budd recommendations appears to be that ambient gambling should be discouraged and that gambling should be increasingly concentrated in premises that are dedicated to that purpose. It is, however, time to move the debate on and to ask whether that approach will create an industry and a gambling environment with which society feels more comfortable. Increasingly, I do not believe that it will, and I am becoming less and less convinced that the wholesale deregulation that Budd advocates is necessary.
Many in the industry who would benefit in the short term from Budd's proposed deregulation of casinos and amusement centres worry that we may see a massive expansion of casinos or so-called outlets—Mr. Harvey stole my best line. Such outlets do not reflect the James Bond image of spending a luxury night out at a casino with—we can thank Budd for this recommendation, and there is nothing wrong with it—a glass of champagne in hand. Instead, we shall see wall-to-wall gaming machines in sheds that could be described only as gambling warehouses. It is a sad irony, however, that the machines in those premises will not benefit our manufacturers, because they will most likely be imported from the United States of America.
I want to give the Minister ample time to respond, so I shall conclude by advocating a cautious step-by-step approach to implementing those parts of the Budd report—I have alluded to some of them—that the Government support and for which there would be genuine all-party support. At the same time, when deciding the appropriate response to Budd's thinking on the gaming machine environment, the Government must keep in mind the old saying that if it ain't broke, don't fix it—I apologise that that is one of the most commonly used lousy cliches in our debates, but I could not think of a better one.
The debate has been a good opportunity to make it clear that the industry is convinced that the Budd report would wreak havoc on a range of legitimate businesses, and the Minister now has a good opportunity to respond.
Mr. Cook, I congratulate my hon. Friend Mrs. Dean on initiating this very good debate, which, as she said, is our second debate on the Budd report. Both debates have homed in clearly on the significance of the review and of the gaming machine industry. I acknowledge that there is concern, which has also been reflected in the number of hon. Members from across the House who signed the early-day motion.
If I may, Mr. Cook, I shall—
Order. That is the second time the Minister has referred to me as Mr. Cook, although other hon. Members have done so, too. I would be failing in my duty if I did not call attention to the fact that the House—in its wisdom or otherwise—has decided that the four senior members of the Chairmen's Panel should be referred to as Deputy Speakers in this Chamber. As a senior member of the panel, I should point that out.
Please accept my humble apologies, Mr. Deputy Speaker. I am sorry if I have offended the House, or indeed the Chair.
In considering the reason for commissioning the Budd report, we need to look back to the mid-1960s when the last relevant legislation was put on the statute book. I remind hon. Members of the reason for that measure; it was driven, to a great extent, by criminality and the laundering of money through various gambling outlets, particularly casinos. The Budd report has originated from a different perspective—the acknowledgement of the fact that information is now passed around electronically. If we are to continue as a major centre of the gambling industry globally we shall need primary legislation. The law requires the person who places a bet to be in the place where the bet is made, so electronic gambling is illegal. The stimulus for the Budd report was to a large extent the internet and the electronic movement of information.
I want to make it clear to the House that we do not intend to damage an industry which, as has already been mentioned, has something like a £42 billion stake, and contributes marginally less than £2 billion to the Exchequer. The number of people employed in the industry, and the location of that employment, which tends to be seaside resorts, are important considerations for the Government.
If anything, we want modernisation along with deregulation to move gambling into mainstream leisure. In view of the restrictions under the Gaming Act 1968, which were introduced for the reasons I explained, we now believe that that is the right approach. There has been significant change. It is interesting that there has not been much opposition to gambling in this debate. A decade ago, the atmosphere would probably have been quite different. It is significant that about 70 per cent. of the population now gamble through the lottery.
That cultural change has led to the acceptance of gambling as part of leisure and there is now an opportunity to move gambling into mainstream leisure. There are several reasons to do so, including employment and inward investment. Also, I have been struck, as someone who was not an expert on gambling—people would probably say that I am still not; they might compare me to Alan Budd—by the integrity of the gambling industry in the United Kingdom. That is important when we consider global gambling and wonder where internet gambling will find its base in the future. We must take such issues into consideration in evaluating the Budd report.
Governments are criticised for consulting and for not consulting. On the present important issue, we wanted the Budd report and three months of consultation; about 3,000 representations have been made and the matter is being considered. I gave the House an assurance that we would respond by the end of March or the beginning of April. We are on course according to our timetable and will do that, assuming that my colleagues in other Departments do not raise other major issues. We have tried to bring certainty to the consultations in setting out a clear timetable. I am hopeful that we shall be able to adhere to it.
It is important to eliminate uncertainty. I have come to this House from industry, where uncertainty is an expensive commodity. Several hon. Members have pointed out the effect of uncertainty on the gambling machine industry. I give an assurance that we have kept to the timetable and will deliver on it.
Several hon. Members have raised the issue of the protection of children and vulnerable people with regard to gaming machines. One must acknowledge that in the UK, the incidence of abuse in gaming is very low indeed relative to other countries. Again, the integrity of the industry shines through—but it is right for Budd to raise the question of ambient gambling and vulnerability.
The industry has responded in an effective and responsible way to the Budd proposals on setting up a voluntary trust to consider how organisations such as GamCare can be funded and to conduct research. Just under £1 million has been raised by the industry on a voluntary basis, and that is to be welcomed. I met several people yesterday about the trust and I hope that it will develop.
It has also been interesting to find that it is an aspect of British culture that we allow our children to play slot machines. Almost every other country in the world forbids that. However, we have all been brought up with it and we acknowledge it. For the past 20 years I have spent my summer holidays in the UK. If I were to approach the report in the objective manner in which some Members have described the weather in our seaside resorts this morning, I would probably produce a rather perverse analysis of it. Nevertheless, Members or Parliament, particularly those who represent seaside constituencies, must promote their areas as strongly as possible.
We must give serious consideration to the five-year timetable that has been laid down for the further review of the industry. We have received strong representations on that. To return to my earlier point, I do not believe that such timetables should be left hanging over industry because they build in uncertainty. We must take on board the comments that have been made and factor them in clearly, trying wherever possible to remove those uncertainties.
The review resulted in a number of recommendations, the arguments around which have been well rehearsed here today. We have heard what the industry has to say and listened to Members' representations, and we will factor those into our final decision. We do not want to damage any of the resorts; we want to build them up. We want them to move gambling into mainstream leisure, and that will be our approach as we evaluate the Budd recommendations and Members' comments.
On jackpot machines and the proposal to reduce the maximum jackpot from £250 to £25, I can only repeat what I have said on previous occasions. I am president of a trades and labour club in Sheffield. I walked into the club at 9.30 one Sunday evening and found four secretaries of local working men's clubs. One of my colleagues said, "They've come to see you, Richard." They did not quite resort to the vernacular, but they made their position very clear indeed. I thanked them, and they did not buy me a drink. They spoke very forcefully, and we are taking that into consideration.
I have made a statement in the House to the effect that we are also factoring in the fact that many clubs play a major role in the social infrastructure of their communities. That has been forcefully expressed. I met the all-party group on non-profit-making clubs, and we will factor in all those considerations.
The overall industry response has been quite positive. We were right to take up the Budd report. Budd has done a good job in bringing several areas into the 21st century, which was necessary. The industry's response was quite predictable. It wants to see some recommendations implemented, but rejects others. Overall, the report gives us a firm foundation on which to build.
I understand the points made by Mr. Greenway about casinos, and I take them seriously. We must be careful as we proceed with the legislation. We want to deregulate, and to allow the industry to grow, but we do not want it to lose its integrity. We have seen how some countries have deregulated too fast, and it is difficult to pull back when that has happened.
We need to allow the creativity of the industry to flourish in a framework in which change can be managed. In respect of casinos, we must ensure that we do not deregulate at a pace that cannot be managed properly and would damage the industry.
I have heard what hon. Members have said. The debate has been a good one, and I take on board all the points that have been made. The main point is that we shall try to meet the timetable that I gave at the beginning, and I hope that that will remove the uncertainty from the future.