Campaign groups fighting for gambling reforms in the UK were hoping for the release of the Gambling White Paper in March. But to no one’s surprise, the paper was postponed.
The government first proposed the introduction of a white paper designed to reform betting laws in December 2020. It was postponed three times before the then Prime Minister, Boris Johnson, promised to publish its content by July 2022.
Boris Johnson resigned before he could release the white paper, leading to a fourth postponement. Earlier this year, the Rishi Sunak government promised to release the white paper by March. It didn’t.
New culture minister Lucy Frazer recently said she’s working to release the paper by April. If this happens, it will have a massive impact on the gambling industry. Let’s break it down for you.
It Could Reduce the Industry’s GVA Significantly
Last February, the Department for Digital, Culture, Media & Sport (DCMS) released data showing the amount of economic value added by several industries it oversees. The data shows these sectors added a Gross Value Added (GVA) a total of £161 billion in 2022.
The Creative industry contributed the highest GVA to the DCMS ministry: £120 billion. The Culture sector added a GVA of £32 billion. Sports chipped in£16 billion while gambling produced£7.05 billion.
Despite generating an estimated £7 billion in GVA, gambling was the least-performing sector in the DCMS department. This figure could reduce further this year if Ms Frazer finally releases the much-anticipated white paper.
The gambling white paper is expected to lower the industry’s GVA by up to 8%. This could translate to a total annual loss of over £1.1 billion. This is according to the Sun, which says there’s a strong chance Ms Frazer will release new betting reforms before May.
Lower Betting Limits
One of the reasons the white paper has been postponed so many times is that it aims to toughen betting rules. Gambling stakeholders are afraid these new rules could impact their bottom line. And they’ve been lobbying MPs against introducing strict rules.
According to the Financial Times, the white paper will propose a rule to cap betting limits on slot machines at £5. Presently, you can bet up to £100 per spin on most games.
If this rule is introduced, VIP gamblers will be affected the most. Lowering the maximum bet on a slot to £5 reduces a player’s maximum winning potential tremendously.
Another change expected in the white paper is a cap on monthly and annual losses. The government plans to limit a gambler’s betting losses to £125 per month and £500 per year.
Affordability Checks
Perhaps the most controversial change in the white paper is how betting companies will enforce affordability checks. The Guardian reports casinos and sportsbooks will be required to ask for “proof of affordability” from customers losing between £100 and £500 a month.
The biggest issue surrounding affordability checks is that they will be frictionless. Gamblers will be asked to provide evidence that they can afford to spend more than £100 on betting per month. However, casinos won’t be bothered to ask for too much evidence.
Not every lawmaker agrees with this proposal, which is why the white paper is yet to be released. Some MPs are pushing to make betting sites accountable for verifying that a customer can afford to gamble.
Gambling companies oppose such a measure, saying it will drive more people to join black market casinos. As a compromise, there’s an expectation lawmakers will ask gambling firms to use credit information available publicly to verify affordability.
Betting Firms to Fund Gambling Addiction Research
Gambling companies have been successful with most of their lobbying efforts of the last decade. For example, they convinced the government against forcing them to fund gambling addiction a few years ago.
In exchange, casinos and sportsbooks volunteered to donate money to various gambling addiction charities. Gambling reformist groups believe this “voluntary model” isn’t enough.
As a result, the white paper may actually force betting companies to fork out 1% of their annual revenue to fund addiction research. This could resultin a contribution of roughly £100m per year.
To be fair, more money is needed to help the country reduce problem gambling. But should betting firms be forced to fund these efforts? Casinos and sportsbooks certainly don’t think so.
Surprisingly, it’s not yet clear how many people are problem gamblers in the country. The Gambling Commission believes just 0.3% of British adults have gambling issues.
On the other hand, YouGov thinks nearly 1.4 million adults, or 2.8% of the country, have a betting addiction. Interestingly, problem gamblers are the biggest money makers for gaming companies, according to a parliamentary report released in 2021.
Football to Maintain Self-Imposed Measures
For a long time, the English Premier League has been lobbying the government to let it implement safer betting measures voluntarily. The white paper won’t change this tradition.
The league will continue to decide how to protect the public from public harm without government interference. Earlier this month, the EPL’s 20 teams voted to put an end to front-of-the-shirt advertising by betting firms. The new move will take effect beginning the 2026-27 season.
James Grimes, who heads an organization that’s against gambling sponsorships in sports, says the new move is a welcome step.
“Although this outcome isn’t perfect, it’s a huge step,” Grimes said. James also added that the new move is akin to an admission that gambling sponsorship causes harm to the sports community.
Grimes isn’t convinced the voluntary measure by the Premier League will bringtotal change. He believes the league also needs to remove LED advertising on the courtside if it’s totally against betting sponsorships.
Lower Profits for Clubs
Gaming companies pay a lot of money to sponsor football clubs. Everton makes £10m per year from its partner, Stake.com. Newcastle generates £6.5m from Fun88.
If this source of revenue is dropped, some football clubs will suffer financially. Newcastle is confident of getting a lucrative replacement now that it’s performing well. However, Everton, which has been struggling this season, may find it challenging to get a better deal.
