The question the bookmakers avoided

Posted on November 18, 2010 by admin
Print this page

Members of the gambling industry, Haringey Councillors and residents came together on Wednesday 10 November for the Haringey Council Overview and Scrutiny Committee investigation of the clustering of betting shops in the area, and we were able to also attend the proceedings.

The meeting, split into two sessions, provided a great opportunity for residents and the industry to openly discuss the problem with the clustering of betting shops and the reasons behind it.

One subject that a number of residents raised concerns over was the issue of fixed odds betting terminals (FOBTs) in betting shops – an echo of our fairer gambling campaign.

Towards the close of the meeting the bookmakers admitted that removal of betting shop machines would result in closure of some premises. It is inconceivable that it would be un-clustered units that would close rather than clustered units. Therefore, the removal of betting shop machines would result in less clustering.

The bookmakers claimed that footfall, and other commercial considerations are the driving location factors. However, the repeated reliance on the footfall position by the bookmakers could be telling – it could be that the majority of regular repeat betting shop machine players do not have access to personal transport. It is not just the footfall, but whose feet are falling that determines the bookmakers’ location decisions.

At the meeting the bookmakers avoided answering the following question:

50% of bookmakers’ revenue comes from betting shop machines. The limit of four machines per shop causes the bookmakers to open small shops in close proximity so causing clustering. Any machine that a player never cashed out on would retain 100% of player funds and clearly be addictive. Obviously the higher the retention percentage is then the more addictive the game content is.

Will bookmakers be fair and open to the Scrutiny Committee and make public the retention percentage for betting shop machines?

The answer they gave was that it was that there was a 97% payback, with the regulator even willing to speak up and agree with the bookmakers when we contradicted this. So to clarify this aspect:

In the fantasy world of a player having one bet and quitting the payback on one spin is 97%. In the real world where the player continues playing the payback on the second spin is 97% of 97%, and on the third spin is 97% of 97% of 97% etc.

The retention percentage, player losses as percentage of funds used, and the payback percentage as percentage of player funds used will always add up to 100%. We have asserted that we think the retention percentage is over 50%. If we were significantly wrong the bookmakers could have disclosed this percentage and defeated our position – the more we reflect on this the more concerned we are that the actual retention percentage is around 75% and the actual payback percentage around 25%.

We believe bookmakers are not upholding the ‘fair and open’ and ‘protecting children and other vulnerable persons’ legislation set out by the regulators by not making public the actual retention percentage per betting shop machine.

We’re looking forward to receiving a copy of the Scrutiny Committee’s report of this landmark review – it could be the first step in changing the UK gambling regulation for the better.