Bookmakers Aim To Avoid Gaming Machine 'Disaster'.

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


At present bettors can bet approximately ₤ 100 a spin on the electronic makers.


Ladbrokes' owner GVC, William Hill, Betfred, Scotbet, and state a ₤ 2 limitation would have a "catastrophic impact on tasks and the economy".


And they have called on Mr Hancock "not to sacrifice wagering shops".


They warned: "An optimum stake of ₤ 2 on FOBTs is a de facto restriction on the machines as the games are not possible at that level."


The firms, as well as the Association of British Bookmakers, are now seeking talks with Mr Hancock.


'Disproportionate response'


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


Those reports stated Chancellor Philip Hammond was willing to decrease the greatest amount people can wager from ₤ 100 a spin to ₤ 2.


"As the chief executives of UK retail wagering stores we wish to express our alarm, that according to media reports, the federal government has actually figured out that the optimum stake on wagering shop video gaming makers must be minimized from ₤ 100 to the most affordable possible level of ₤ 2," say the betting executives in their letter.


"We acknowledge that the federal government is dedicated to decreasing the optimum stake, nevertheless this should be a proportional response and constant with the evidence.


"For the avoidance of any doubt, our company believe a ₤ 2 optimum stake is a disproportionate response and will be devastating for retail wagering in the UK, with prevalent consequences for individuals's livelihoods and the broader economy."


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


Commission review


Last week the Treasury said it was "fully supportive of DCMS's work to guarantee the UK's gambling regime continues to balance the needs of vulnerable people, customers who gamble responsibly and those who operate in this sector".


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


Bookmaker William Hill derives 54% of its retail earnings from video gaming machines.


GVC Holdings, has actually connected its offer to purchase Ladbrokes Coral and its 3,500 wagering stores, to the outcome of the review 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 produced from FOBTs made up around 6% of Paddy Power Betfair's overall sales of ₤ 1.7 bn last year.