The U.K.’s Department of Culture, Media and Sport’s (DCMS), as part of its implementation of the white paper updating its Gambling Act of 2005, will restrict online slot machine spins to £2 for young people 18 to 24 and £5 ($6.3) for adults over 25, reported the Guardian.
At the moment, there is no limit on how much gamblers can wager. This announced limit will take effect this September.
The government also outlined the next steps to be taken in affordability checks, including a pilot program.
The announcement came as a response to the 10-week consultation on proposals for maximum stake limits. DCMS said in a statement on its website: “The imposed limit should serve as a maximum stake which customers can choose to stake up to, rather than as a new default which operators drive customers towards, or which is otherwise seen as objectively ‘safe’.”
The logic for such a restriction is that slots are thought to be more addictive than other forms of gaming. It is similar to the government’s restriction on fixed-odds betting terminals five years ago.
The regulatory move announced February 23 could cost casinos hundreds of millions of pounds, said the Guardian. The games generate more than £3 billion ($3.8 billion) out of a total of £11 billion for the entire industry. The online sector is the fastest growing part of the industry, if you don’t include the national lottery.
According to the DCMS, the consultation included workers in the sector, academics, treatment providers and others. Most agreed with the limits that had been proposed in the white paper. The response included a total of 46 individuals and 52 organizations.
Of the respondents, 60 percent favored a £2 stake limit for young adults, and 34 percent favored that limit across the board.
The DCMS stated, “After considering the consultation responses, we have decided to introduce a stake limit of £2 per spin for young adults aged 18 to 24. We believe the evidence justifies increased protections for this cohort, including a separate lower stake limit.”
The limits proposed are somewhat different from what the white paper proposed in April 2023. At that time it estimated that a £8.50 or $10.74 limit would cost the online sector as much as £185 million, but this new lower limit could dwarf that estimate by many more millions.
The DCMS said that the new proposals will reduce GGY (gross gambling yield) by £166.2 million, a 5.2 percent drop for online slots and a 2.6 percent drop for the total sector.
That’s not the end of the costs the industry will accrue. DCMS has said operators will face other additional costs including “the implementation costs of game development teams needing to test and deploy a stake limit on live games.”
Critics of gambling say the stake limits don’t go far enough. MP Carolyn Harris, who chairs a group that looks at gambling harms, declared, “I am pleased that the government has seen sense and opted for a £2 limit for people under 25. There is, however, clear evidence that a £2 limit should be in place for everyone to prevent harm. The government has sided with the industry and should rethink.”
Liz Richie, co-founder of Gambling With Lives, a non-profit, added, “The government has lost another opportunity to stop the harm caused by high stake sizes, and the truth is that many more people will die.”
DCMS replied that it has no way to accurately determine how stake limits will affect the rates of gambling harms on the population. It said it has evidence that it will “limit the potential for harmful losses from those gambling at elevated levels of risk or experiencing problem gambling compared to the status quo of theoretically unlimited stakes.”
It also stated, “Young adults have the highest average problem gambling score of any age group, generally lower disposable income, ongoing neurological development impacting risk perception, and common life stage factors like managing money for the first time or moving away from support networks.”
Regarding the limit for older adults, the government commented, “We believe that a £5 limit will achieve the government’s stated objectives in a proportionate way, with a lower risk of unintended consequences such as displacement to the illegal online market.”
According to the government, one-fifth of customers choose to bet more than £5 at least once a year, but 0.6 percent of all spins are over £5. It believes there will be reduced harm because players will be prevented from making big stakes bets rapidly.
It added that the £5 online limit aligns with stake limits on slot machines in land-based casinos.
Responses to the consultation from other measures proposed by the white paper will be published soon.
Affordability Checks
Meanwhile the U.K. Gambling Commission has outlined how it will implement affordability checks, beginning with a pilot program with an enhanced tier of checks, CDC Gaming Reports wrote February 22.
This happened a few days before parliament began debating the issue in response to a petition submitted by Jockey Club CEO Nevin Truesdale to the government with more than 100,000 signatures.
Also in the works is the government’s response to the consultation conducted last fall, which the Gambling Commission will publish in March.
The affordability checks proposed by the white paper are by far the most controversial items to come from that document.
Gambling Commission Executive Director Tim Miller on the commission’s blog February 22 updated how the commission will conduct “financial risk checks.”
On the lower tier, gamblers would be subject to checks if they spend more than £125 per month or £500 annually. The commission will employ data available to the public. This level won’t require bookmakers to consider gamblers’ job titles or postcards.
Miller wrote on the blog: “To ease the introduction of these checks they will initially come into force at a higher threshold for a short period of time, before reverting to a lower threshold later in the year to smooth implementation for consumers.”
The second tier will be triggered by losses of £1,000 within 24 hours or £2,000 within 90 days. The government has promised that the more detailed checks will be “frictionless” “for the vast majority of customers who undergo them,” but hasn’t detailed how that might work.
Miller implied that the pilot program, which will run for up to six months, might help the commission find such a method. He said it would “enable us to test the details of data-sharing in practice, working with credit reference agencies and gambling businesses.”
Meanwhile the commission and operators will work together on an interim system of checks.
During the pilot program operators won’t be required to act on what they uncover about their customers, although they will still be expected to employ existing safety procedures.
The commission has been under considerable pressure from the horse racing industry. Some observers suggest that Miller’s statement on that issue indicates he has been paying attention: “We will continue to gather data which will inform the final thresholds and definitions of loss or spend for implementation following the pilot period.”
The Betting and Gaming Council (BGC) responded to the news by stating: “The BGC has consistently called for frictionless, enhanced spending checks online, so those showing signs of financial vulnerability can receive swift, targeted interventions.”
It added that the spending checks should “not interfere with the vast majority who bet safely and responsibly, so they can continue enjoying their hobby without unnecessary intrusion” or drive those who are legally betting safely and responsibly into the black market.
Parliamentary Debate Begins
The debate called for by the petition on affordability checks began February 26 with MP Philip Davies calling the government proposals “completely unacceptable,” iGaming Business reported.
Davies was previously chairman of the All-Party Parliamentary Group on Betting and Gaming. He declared, “Let me make it clear at the outset that I am speaking up for two groups today. One is the horse racing industry, but first and foremost I am speaking up for punters. The people who have been largely ignored in this long-running debate and tug-of-war over affordability checks.”
Bettors, he said, “often get caught up in the crossfire of the arguments between the well-funded betting industry and the well-funded anti-gambling campaigners.”
Encouraging people to only bet what they can afford is not onerous, he said, but added, “It is unacceptable that the government, the Gambling Commission and the bookmakers will basically, between them, decide how much each individual punter can afford to spend on their betting and the punter gets virtually no say whatsoever.”
This could also adversely affect the “largest spectator sports in the U.K., behind” football, which brings in considerable foreign investment.
Per iGB, Davies added, “The government cannot possibly allow themselves to introduce measures, however well meaning, that will have a devastating effect on this great sport.”
Last October Lord Lipsey, who is also chairman of Premier Greyhound Racing, warned that affordability checks would damage the industry by driving more players to the black market. A fear that the government has called “overstated.”
On the other hand, the gambling harm prevention nonprofit GamCare supports the concept of affordability checks, but argues that they don’t go into effect until a player has lost a lot of money.
MP Carolyn Harris, answering Davies, noted that 22.5 million British gamble, about 44 percent of the population. She declared, “The overwhelming majority gamble without any issue, but not everyone,” Harris stated. “When it comes to those for whom gambling is an addiction, the Gambling Commission and the government have a duty to act responsibly and protect them from harm.” Harris added, “I am very fond of visiting the racetrack, as I am the bingo hall. I want to protect vulnerable people.”
She said the affordability checks “would not stop anyone who can afford it betting as much as they choose, but it would stop those who cannot.”
Since many MP’s represent constituents employed by the horseracing industry, that industry’s problems with the affordability checks were uppermost in the debate.
However, Melanie Ellis, a partner a Northridge law, points out that the industry already conducts affordability checks. “In reality, many licensed operators are conducting detailed affordability assessments at lower triggers than the proposed enhanced assessments at £1,000 in a 24 hour period or £2,000 in a 90 day period, because they rightly fear the Gambling Commission will fine them or even revoke their license if they do not,” she told iGaming Business. She added, “As such, my view is that the proposal for frictionless early checks and defined triggers for enhanced checks represent an improvement on the current situation for customers, operators and indeed the horseracing industry.”
