Bookies’ scaremongering over betting shop closures

Posted on April 12, 2017 by admin
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The Campaign for Fairer Gambling asks questions about projections of betting shop closures which could take place if changes to fixed odds betting terminal stake levels are brought in by the Government.


The bookmakers expressed “surprise” in a Daily Telegraph article on a report by NERA Economic Consulting on the impact on betting shop numbers of stake reduction on FOBTs.

An Association of British Bookmakers (ABB) spokesperson claimed that NERA had not had access to FOBT data and shop profitability data. Quoting from their own analysis, they said: “2,500 shops may close nationally by 2020 if a £20 stake limit was imposed and 3,300 shops may close at a £10 limit.”

By contrast, the NERA report claimed there would be no shop closures as a consequence of a £20 maximum stake, and that a £10 maximum stake, shops could be safe if a high portion of the money previously spent on FOBT gambling was spent on other forms of gambling in the same shops.

NERA stated the “report was harvested using a model it had previously developed”, which refers to a report carried out by NERA and published by the Campaign for Fairer Gambling in 2014, which estimated shop closures would be in the 700 to 1,200 range at a £2 maximum. The bookies had years to find fault in that NERA report, so if they tried, then they failed. As the Financial Times highlighted, Landman Economics argue that, with a stake reduction to £2, revenue from FOBTs would transfer to more labour intensive goods and services, creating more jobs.

The new NERA report was commission by bacta, the British Amusement Catering Trade Association which represents adult gaming centers, family entertainment centres, machine manufacturers, suppliers and distributors. The ABB spokesperson claimed that bacta has a “commercial interest in undermining bookmakers” by “benefitting if FOBT stakes were reduced”.

But even with a FOBT stake reduction to £2, a betting shop gambler can still gamble over-the-counter or on self-service betting terminals at higher stakes or on games up to £2. If going to an arcade the only option is games up to a £2 stake, why would any gambler change from a betting shop to an arcade?

If there is a betting shop closure, bearing in mind there are several times more betting shops than arcades, why would a betting shop gambler choose an arcade instead of a betting shop? The shops most likely to close are the new shops that have been opened to offer more FOBTs in the high-street clusters. With virtually every cluster containing two or more merged Ladbrokes Coral shops, why would any revenue not be redistributed to the remaining Ladbrokes Coral shop(s) if one closed? If the ABB can’t get the redistribution to arcades correct how can anyone rely on it getting any redistribution projections correct?

Whilst there have been arcade closures and arcade job losses as a direct cause of FOBTs, a stake reduction to £2 will not bring back any of those jobs or businesses. It would only prevent those declines from continuing.

As the ABB is keeping the KPMG reports secret, there is no purpose in anyone considering quotes on either the bacta NERA report or the ABB KPMG reports, when the publically available Campaign NERA report provides the estimated impact of the stake reduction to £2, which the ABB has failed to find fault with.

One ABB KPMG report did not consider a FOBT stake reduction, but forecast that 1,200 betting shops would close by 2020. Are the bookies double-dipping, by including those 1,200 in their current projections?

The ABB implies that having access to FOBT data provides a better understanding. Yet they have refused to give Local Authorities demanding a reduction in the maximum stake to £2 answers to the following questions:

  • How many FOBTs are damaged through violence?
  • What FOBT data shows incidents of money-laundering?
  • What FOBT data shows incidents of gambling related harm?

The Gambling Commission published FOBT data, but has not provided any commentary to answer any of these questions. If FOBT data cannot provide these answers, then how can it provide re-distribution projection analysis?

“Scaremongering” is too kind a description for the bookies’ tactics. They are engaged in promulgating misinformation to influence the public, media and politicians for their own financial gain. It harms democracy if more attention is paid to the fakers than the facts.

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