Bookmakers Aim To Avoid Gaming Machine 'Catastrophe'.

29 April 2018
ShareSave


Bosses of leading UK betting companies have actually sent a letter to Culture Secretary Matt Hancock in a bid to prevent the imposition of a ₤ 2 top stake on fixed-odds betting terminals (FOBTs).


At present bettors can wager approximately ₤ 100 a spin on the electronic makers.


Ladbrokes' owner GVC, William Hill, Betfred, Scotbet, and Jenningsbet say a ₤ 2 limitation would have a "devastating influence on jobs and the economy".


And they have actually gotten in touch with Mr Hancock "not to compromise wagering shops".


They alerted: "An optimum stake of ₤ 2 on FOBTs is a de facto ban on the makers as the video games are not possible at that level."


The companies, in addition to the of British Bookmakers, are now seeking talks with Mr Hancock.


'Disproportionate response'


The Department for Digital, Culture, Media and Sport (DCMS) is leading a review into the machines, and media reports last week suggested that the Treasury will back a decrease in the maximum stake.


Those reports said Chancellor Philip Hammond wanted to minimize the highest amount people can bet from ₤ 100 a spin to ₤ 2.


"As the chief executives of UK retail wagering shops we want to express our alarm, that according to media reports, the government has identified that the maximum stake on wagering store video gaming makers need to be lowered from ₤ 100 to the most affordable possible level of ₤ 2," say the gaming executives in their letter.


"We acknowledge that the federal government is committed to lowering the maximum stake, nevertheless this must be a proportional action and consistent with the proof.


"For the avoidance of any doubt, we believe a ₤ 2 maximum stake is an out of proportion response and will be disastrous for retail wagering in the UK, with prevalent consequences for people's incomes and the wider economy."


They state analysis from KPMG approximates that a ₤ 2 stake would lead to 21,000 direct task losses, with half of betting shops closing, a loss to HM Treasury of ₤ 1.1 bn over the next 3 years, a loss to local authorities of ₤ 45m and to British Racing of ₤ 50m per annum.


Commission evaluation


Recently the Treasury said it was "fully encouraging of DCMS's work to ensure the UK's gambling regime continues to balance the requirements of susceptible people, customers who gamble responsibly and those who operate in this sector".


Last month, the UK's Gambling Commission suggested that the optimum stake for FOBTs need to be cut to ₤ 30 or less.


Bookmaker William Hill derives 54% of its retail revenue from video gaming makers.


GVC Holdings, has actually connected its offer to purchase Ladbrokes Coral and its 3,500 betting shops, to the result of the review into FOBTs. If the maximum stake is cut to ₤ 50, GVC pays ₤ 3.9 bn for Ladbrokes Coral. If it is lowered to ₤ 2, GVC will pay ₤ 3.2 bn.


Revenues created from FOBTs made up around 6% of Paddy Power Betfair's total sales of ₤ 1.7 bn in 2015.