Fixed odds betting stakes slashed to just Â£2 to cut gambling problems
It has been billed as the âcrack cocaine of gamblingâ which can devastate lives in minutes.
For years gamblers have been able to lose thousands of pounds when they play on fixed odds betting terminals by pumping Â£100 into machines every 20 seconds.
Campaigners have been fighting for rules to be tightened up and for the limit to drop and now ministers will look at introducing a maximum Â£2 stake on the machines.
Betting firms launched a huge campaign opposing the move with warnings about job losses and losses to the Treasury in tax revenue, the Mirror reports .
Research by KPMG estimated a Â£2 limit would cut revenue for the Treasury by Â£1.1bn over three years, an annual loss of Â£45m to local authorities and Â£50m to British racing.
But today Culture Minister Matt Hancock revealed the government had prioritised vulnerable people over the gambl ing industry.
And Ministers said they would raise the Remote Gaming Duty, paid by online gambling companies, at the next budget to offset tax losses.
Hancock described the machines as a "social blight" and say they have taken the decision to do "everything we can to protect vulnerable people".
'Many Gloucester betting shops could close if government curbs crack cocaine gambling machines'
Sports Minister Tracey Crouch said that a large number of people seeking treatment for addiction say FOBTs are "their main form of gambling".
But today Matt Hancock refused to say how soon the change would come in.
Maximum stakes will need parliamentary approval before it comes into action and the government have said they want to give the gambling industry "sufficient time" to make the changes.
The machines took Â£1,000 from a gambler on more than 233,000 occasions in a single year.
And indiv idual losses have been known to reach nearly Â£14,000 in a single session of play.
Interim findings by the Gambling Commission suggested cutting the maximum stake to Â£30.
But campaigners have demanded the stake be slashed to Â£2 tackle addiction and linked crimes.
Bookies claimed jobs will be lost, profits cut and taxes paid to the Treasury will fall if the Government bows to pressure and announces a new Â£2 minimum.
Earlier this week, William Hillâs boss wrote to Theresa May claiming slashing the stakes would be âcatastrophicâ.
Roger Devlin wrote: âSadly, I fear that your Government is about to make a decision that is unnecessary and lacking in evidence - a decision that will also be catastrophic for a retail betting industry employing over 40,000 people.â
âConsolidation within our sector continues and I would also not want to see the impact of a dispr oportionateâ¦ outcome being a factor in the name of William Hill being added to the list of companies now in foreign ownership.â
While Betfred warned that 900 of the firmâs shops would become loss-making overnight, forcing it to axe 4,500 jobs in a letter to MPs this week.
But today Ministers risked the ire of the gambling industry by introducing the cap by taking the dramatic measure.
Announcing the maximum stake, Culture Secretary Matt Hancock said: âWhen faced with the choice of halfway measures or doing everything we can to protect vulnerable people, we have chosen to take a stand.
"These machines are a social blight and prey on some of the most vulnerable in society, and we are determined to put a stop to it and build a fairer society for all.â
Bookmaker William Hill claimed the cut to Â£2 a spin could trigger a wave of shop closures and wipe up to Â£100m off its annual sales
In a stock market statement it said: âA regulatory change of this nature is unprecedented and its impact on customer behaviour will not be fully known until some years after implementation.â
It warned the cut to Â£2 would result in 900 of its shops - 38% of its total - becoming loss making.
The firm warned: âA proportion of these would be at risk of being closed within a relatively short time.â
Boss Philip Bowcock said: âThe Government has handed us a tough challenge today and it will take some time for the full impact to be
understood, for our business, the wider high street and key partners like horseracing.â
Online giant Sky Bet, based in Leeds, slammed the increase in gaming taxes that will hit firms like it.
Boss Richard Flint said: âSky Betting & Gaming doesnât have any FOBTs but now we â" and Yorkshireâs economy â" risk being punished because of them.
âAny increase in Remote Gaming Duty is a tax on hi-tech Yorkshire jobs.â
But across politics the move has been welcomed.
Shadow culture minister Tom Watson said he was "absolutely delighted" and that he hoped it would "alleviate some of the misery caused by problem gambling in Britain".
He said bookies had "boxed themselves into a corner" by refusing to back down on the issue and diversify into less dangerous forms of gambling.
Bookies Paddy Power Betfair which has a much bigger online arm than William Hill welcomed the news.
In a statement they said: âWeâve consistently called for a significant stake cut which would take this issue off the table, so weâre pleased that the Secretary of State and Government has acted so decisively.
âOur industry provides a fun, exciting experience for the vast majority of customers and it makes sense to try and get back to that by removing what had become a toxic issue.
âTodayâs move will have a short-term impact on our business, but we th ink itâs a really important step towards building a sustainable industryâ.
As well as the cap, ministers have taken moves to toughen up protections around online gambling including stronger age verification rules.
They are also examining proposals to require operators to set limits on consumersâ spending until affordability checks have been conducted.
While Public Health England will carry out a review of the evidence relating to the public health harms of gambling
Last year a report found more than two million people were addicted to gambling or at risk of developing a problem.
It said about 430,000 people suffer from a serious habit.
Adam Bradford, 25, a campaigner for stricter gambling controls welcomed the change.
Adam's father David had a 30-year secret gambling addiction and hid it from his family, remortgaging their home in s ecret and stealing tens of thousands of pounds from his employer.
He went to jail and served a sentence for fraud.
Adam and David said today: âWe are delighted that the Government has finally seen sense on this important issue. No longer will gamblers be able to run into serious trouble on the High Street and betting has been restored to a leisure activity.
" It is also pleasing to see consideration given to advertising and the rise of online gambling however the measures such as affordability checks will not go far enough to prevent people from the dangers of online betting." âWe believe all adverts for gambling should be banned, there is no need for them.
"We also believe more can be done to track risky online betting behaviour as more gamblers will now move their betting online after high street betting becomes less of a tempting option.â
âIn response to the industryâs scare tactics threatening job losses, we believe the industry will be able to stay sustainable through further strengthening their ranges of products and ensuring these are rolled out responsibly.
"We are unsure what calculations have been used to come up with these shocking job loss figures."
The chief executive of amusement machine industry trade body Bacta, John White, welcomed the announcement.
He said: "A stake reduction to Â£2 has long been needed to protect consumers from the harm caused by FOBTs.
"This is a decision that puts player protection first, and will allow the gambling industry as a whole to move forwards and create a safer, more socially responsible environment for consumers.
"It is a testament to the wide-ranging campaign for stake reduction from concerned individuals and organisations across politics, public health and the wider gaming sector. The Government has made the right decision and it now needs to be implemented without delay."
Campaig n for Fairer Gambling spokesman Matt Zarb-Cousin was previously addicted to FOBTs.
âItâs no exaggeration to call FOBTs the crack cocaine of gambling," he has said.
âIf we had a gambling product classification, similar to that of drugs, FOBTs would be Class A.âSource: Google News