Bookmakers Aim To Avoid Gaming Machine 'Disaster'.

29 April 2018
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Bosses of leading UK betting have sent a letter to Culture Secretary Matt Hancock in a bid to prevent the imposition of a ₤ 2 top stake on fixed-odds betting terminals (FOBTs).


At present bettors can bet up to ₤ 100 a spin on the electronic machines.


Ladbrokes' owner GVC, William Hill, Betfred, Scotbet, and Jenningsbet say a ₤ 2 limitation would have a "disastrous influence on jobs and the economy".


And they have gotten in touch with Mr Hancock "not to sacrifice wagering shops".


They alerted: "An optimum stake of ₤ 2 on FOBTs is a de facto ban on the devices as the games are not practical at that level."


The companies, along with the Association of British Bookmakers, are now looking for talks with Mr Hancock.


'Disproportionate response'


The Department for Digital, Culture, Media and Sport (DCMS) is leading a review into the machines, and media reports last week suggested that the Treasury will back a decrease in the maximum stake.


Those reports stated Chancellor Philip Hammond wanted to decrease the highest quantity individuals can bet from ₤ 100 a spin to ₤ 2.


"As the presidents of UK retail wagering stores we wish to express our alarm, that according to media reports, the federal government has actually determined that the optimum stake on betting shop gaming devices need to be lowered from ₤ 100 to the most affordable possible level of ₤ 2," state the gambling executives in their letter.


"We acknowledge that the government is devoted to lowering the maximum stake, however this ought to be a proportionate response and constant with the proof.


"For the avoidance of any doubt, we think a ₤ 2 maximum stake is an out of proportion reaction and will be catastrophic for retail betting in the UK, with extensive effects for people's livelihoods and the larger economy."


They state analysis from KPMG estimates that a ₤ 2 stake would result in 21,000 direct job losses, with half of betting shops closing, a loss to HM Treasury of ₤ 1.1 bn over the next 3 years, a loss to regional authorities of ₤ 45m and to British Racing of ₤ 50m per year.


Commission evaluation


Last week the Treasury said it was "totally supportive of DCMS's work to guarantee the UK's gambling routine continues to balance the needs of susceptible people, consumers who bet properly and those who work in this sector".


Last month, the UK's Gambling Commission suggested that the maximum stake for FOBTs should be cut to ₤ 30 or less.


Bookmaker William Hill obtains 54% of its retail revenue from gaming machines.


GVC Holdings, has actually linked its offer to purchase Ladbrokes Coral and its 3,500 wagering shops, to the result of the evaluation into FOBTs. If the optimum 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 generated from FOBTs made up around 6% of Paddy Power Betfair's overall sales of ₤ 1.7 bn in 2015.