The economic impact of Fixed Odds Betting Terminals

Posted on January 19, 2017 by admin

Since 2013, the economic research consultancy, Landman Economics, has undertaken several research projects for the Campaign for Fairer Gambling (CFG) on the economic impact of Fixed Odds Betting Terminals (FOBTs). This article presents a summary of their most important findings. 






Recent survey data shows that only a small proportion of the UK population use FOBTs – between 3 and 4 %, yet these players account for 66% of all UK gaming machine losses. However, FOBT users are much more likely to be ‘problem gamblers’ and much more likely to contact gambling helplines due to gambling addiction or other related problems than are almost all other types of gamblers. FOBT users are more likely to be young men (aged under 35), unemployed and/or from low-to-middle income households.

The Association of British Bookmakers (ABB) has lobbied against increased regulation of FOBTs, claiming that it would lead to substantial job losses in the betting sector. However, the ABB does not take account of the overall impact of a shift in consumer spending towards FOBTs and away from other goods and services. Each pound which a consumer spends on FOBTs (net of winnings) is by definition a pound which is not spent elsewhere in the economy. In a report last year on the economic impact of FOBTs, Landman Economics estimated the amount of employment supported by a certain quantity of expenditure on FOBTs compared with the employment supported by the same quantity of consumer expenditure on other goods and services in the economy. Because expenditure on FOBTs supports relatively little employment compared with consumer expenditure elsewhere in the economy, the analysis concluded that £1bn of “average” consumer expenditure supports around 21,000 jobs across the UK as a whole, whereas £1bn of expenditure on FOBTs supports only 4,500 jobs in the UK gambling sector. This implies that, other things being equal, an increase of £1bn in consumer spending on FOBTs destroys over 16,000 jobs in the UK.

Our analysis suggests that if current rates of growth of FOBT expenditure are maintained:

  • Gross industry revenues from FOBTs will double in real terms between 2015/16 and 2025/26, resulting in a gain of around 5,000 jobs for the gambling sector by 2025/26 but a reduction of around 25,000 jobs for the economy as a whole.
  • By 2025/26, the total annual wage bill in areas where FOBTs are established will be around £700 million lower (in today’s prices) than if FOBT use remained at its 2015 level.
  • tax receipts will also be around £120 million per year less due to the expansion of FOBTs. Revenue from Machine Games Duty is forecast to increase by around £280 million but this is more than offset by reduced receipts from income tax and National Insurance contributions (due to lower employment) and reduced VAT receipts (due to lower consumer spending on other goods and services).

There is also a clear link between FOBTs and deprivation. A mapping analysis by Geofutures for the CFG in 2014 found that 34 percent of all betting shops are located in the most deprived quartile compared to only 16 percent in the least deprived quartile. This was backed up by further analysis by Landman Economics of data from the Index of Multiple Deprivation (IMD) for England showing that the most deprived areas in England contain substantially more betting shops than the least deprived areas. In contrast, research commissioned from the Local Data Company by the ABB, which claimed “to refute claims that bookies prey on the poor”, was found to be flawed because it used data on betting shop location and deprivation for urban areas only, rather than a full nation-wide dataset.

The most important and concerning finding from our report is that increases in spending on FOBTs are likely to destroy jobs in the UK economy rather than creating them.

Read more - https://www.politicshome.com/news/uk/culture/opinion/campaign-fairer-gambling/82494/economic-impact-fixed-odds-betting-terminals

Why football bets are far more profitable to bookmakers than gambling machines

Posted on January 17, 2017 by admin

When the government completes its review of the gambling sector in the coming weeks, a clampdown on fixed odds betting terminals (FOBTs) looks to be on the cards. Dubbed the “crack cocaine of gambling” for allowing punters to bet stakes of up to £100 in games like roulette and poker, even former UK culture secretary Tessa Jowell has joined the chorus demanding curbs – despite overseeing their expansion in the 2000s.

Read the full story in the Conversation 

Real life gambling story number three – Chris

Posted on January 13, 2017 by admin

Chris’s story is all too-common – childhood holidays in seaside resorts with seemingly innocent family trips to amusement arcades. The lure of the flashing lights and the possibility of winning some money can be irresistible to children, and may also be the start of a life-long gambling habit. This was indeed the case for Chris.

Chris went on to lose £350,000 in the grip of a gambling addiction that lasted over twenty years. This is his story, as told to Sarah Marten at Gambling Watch UK.

Read the full story on the Gambling Watch UK website

Former Culture Secretary calls for probe into “outbreak” of high street betting shops

Posted on January 13, 2017 by admin

A fresh gambling crackdown is needed to tackle the “outbreak” of betting shops on Britain’s high streets, a former Culture Secretary warned today.

Baroness Tessa Jowell called on ministers to look at new regulations to target young punters who try to place bets despite being under 18.

 She wanted curbs to stop children illegally playing machines such as fixed odds betting terminals, dubbed the “crack cocaine” of gambling.
Read the full story in The Mirror

Now even Tessa Jowell – the architect of ‘crack cocaine’ gambling – demands a new clampdown on addictive game machines

Posted on January 13, 2017 by admin

A former Labour culture secretary has demanded stricter regulation of gambling – despite encouraging betting when she was in power.

Tessa Jowell brought in controversial reforms in 2005 blamed for allowing a free-for-all of fixed-odds betting terminals – known as the ‘crack cocaine’ of gambling – on high streets.

But today, she urged the government to beef up regulation to tackle the ‘outbreak of betting shops’ in town centres, saying it was vital to protect young people.

Read the full story in the Daily Mail

FOBTs and MPs over the recess

Posted on January 12, 2017 by admin

Derek Webb, founder of the Campaign for Fairer Gambling comments on recent fixed odds betting terminal (FOBT) news. (more…)

Ladbrokes and Betfred ‘pirating’ content in stand-off with Britain’s main racecourse group

Posted on January 10, 2017 by admin

Thinking of wandering down to your local bookie on Monday to have a flutter? Well if British horseracing attracts you, don’t bother to go to a Ladbrokes/Coral or Betfred shop. As of Monday, they have decided they can make do without pictures from Britain’s biggest racecourse group.

It is, of course, right that if they feel they can make do without Arena Racing’s content from these courses, it is a sensible business decision not to buy it. If they want to turn their backs on racing, they have other products to push, and punters have other betting shops to go to for those races. Assuming they don’t live in Chipping Norton and own a bicycle.

Read the full story in The Telegraph

The Government must take action on Fixed Odds Betting Terminals

Posted on January 6, 2017 by admin

In December, 2016, the All-Party Parliamentary Group on Fixed Odds Betting Terminals published the interim findings of its investigation into the effects of FOBTs, and made a number of recommendations.

Over the last few years, heart-breaking story after heart-breaking story has been reported, with gamblers losing their savings, marriages, careers and homes as a result of these addictive machines, where thousands of pounds can be lost in a matter of minutes. According to Stop the FOBTs, over £7m has been lost by people gambling on these machines in Bolton in the twelve months leading up to September 2016, of which over £3.7m was lost in my constituency.  The report highlights the need to limit the stake per play on these machines, preferably to a maximum of £2, and also the need to limit the number of FOBTs permitted in individual betting shops.

Read the full story on MP Yasmin Qureshi’s blog 

Gambling firms charmed MPs ahead of betting review in 2016

Posted on January 4, 2017 by admin

Gambling firms staged a charm offensive during 2016, spending more money on adverts and stepping up the hospitality they offer MPs, who are considering a regulatory crackdown.

The industry has come under the spotlight amid concern about its commitment to curbing problem gambling and fears about the influence that daytime TV adverts have on children.

The increased scrutiny culminated in a government review of betting firms’ social responsibility, including controversial fixed-odds betting terminals (FOBTs), often dubbed the “crack cocaine” of gambling for their addictive nature.

The parliamentary register of members’ interests, which details the value of gifts and donations received by politicians, reveals that major bookmakers and horse racing firms quadrupled their efforts to entertain MPs ahead of the review.

Read the full story in The Guardian