Bookmakers Aim To Avoid Gaming Machine 'Catastrophe'.
29 April 2018
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Bosses of leading UK wagering companies have actually sent a letter to Culture Secretary Matt Hancock in a quote to prevent the imposition of a ₤ 2 leading stake on fixed-odds betting terminals (FOBTs).
At present gamblers 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 effect on tasks and the economy".
And they have gotten in touch with Mr Hancock "not to compromise betting shops".
They cautioned: "A maximum stake of ₤ 2 on FOBTs is a de facto restriction on the devices as the video games are not feasible at that level."
The companies, as well as the Association of British Bookmakers, are now looking for talks with Mr Hancock.
'Disproportionate action'
The Department for Digital, Culture, Media and Sport (DCMS) is leading an evaluation into the makers, and media reports last week suggested that the Treasury will back a reduction in the maximum stake.
Those reports said Chancellor Philip Hammond was willing to decrease the greatest amount individuals can wager from ₤ 100 a spin to ₤ 2.
"As the presidents of UK retail betting shops we wish to express our alarm, that according to media reports, the government has determined that the maximum stake on wagering store video gaming machines ought to be lowered from ₤ 100 to the least expensive possible level of ₤ 2," say the gaming executives in their letter.
"We acknowledge that the government is devoted to lowering the maximum stake, however this ought to be a proportionate action and consistent with the proof.
"For the avoidance of any doubt, our company believe a ₤ 2 maximum stake is an out of proportion reaction and will be catastrophic for retail betting in the UK, with widespread repercussions for and the larger economy."
They say analysis from KPMG estimates that a ₤ 2 stake would lead to 21,000 direct job losses, with half of betting stores closing, a loss to HM Treasury of ₤ 1.1 bn over the next three years, a loss to regional authorities of ₤ 45m and to British Racing of ₤ 50m per annum.
Commission evaluation
Recently the Treasury said it was "totally helpful of DCMS's work to ensure the UK's betting routine continues to balance the needs of susceptible individuals, customers who gamble responsibly and those who work in this sector".
Last month, the UK's Gambling Commission advised that the optimum stake for FOBTs ought to be cut to ₤ 30 or less.
Bookmaker William Hill obtains 54% of its retail income from video gaming machines.
GVC Holdings, has linked its offer to purchase Ladbrokes Coral and its 3,500 betting stores, 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 produced from FOBTs made up around 6% of Paddy Power Betfair's overall sales of ₤ 1.7 bn last year.