Analysts are forecasting problems for the betting industry after a report by a group of British MPs recommended that the maximum stake on the controversial Fixed Odds Betting Terminals (FOBTs) found in betting shops should be reduced from £100 to £2.
The bookmakers have already lambasted the report, and the MPs behind it, but the market has noticed comments by minister for gambling Tracey Crouch in the report and believes they spell bad news for the retail betting industry.
The report stated: “Tracey Crouch, the Minister responsible for gambling in the Department for Culture Media and Sport noted that she welcomed the opportunity to address the group. She said that the Group’s inquiry was extremely valuable and that she was pleased that it had been set up. The Minister underlined to us that she was only able to give limited evidence to the inquiry due to the review of machine stakes and prizes that was currently underway and that she did not want to prejudge the Government’s Review. She mentioned that her own constituency local authority that has piloted a self-exclusion scheme.
“She also noted that she is determined that the Government’s Review would provide an opportunity to assess the impact of the machines and whether they should be located in a more appropriate environment. Ms Crouch also noted that crime associated with FOBTs would be a key part of the Governments considerations as part of the Review.”
Simon French of analysts Cenkos commented in a note: “We expect an update from the DCMS by the end of Q1 but remain concerned that a significant proportion of Retail revenues are under threat and thus expect stocks with exposure to this segment of the market to continue to underperform.”
Launching the report, the FOBT All Party Parliamentary Group (APPG) chair Carolyn Harris MP said: “There is now a clear case for the Government to substantially reduce the maximum stake which can be played on FOBTs. The time for prevaricating is over. These machines are easily accessed in the most deprived areas, sucking money out of the pockets of families. I support a responsible gambling industry, but there is nothing responsible about how FOBTs are currently being operated. I urge the Government to take action now.”
The inquiry comes at a critical time, as the Government considers the responses to its Call for Evidence on Gaming Machines and Social Responsibility and as the industry awaits publication of the Review of Stakes and Prizes.
Along with a stake reduction, the report said that the Government should also consider reducing the speed of spin on a FOBT in order to reduce the potential for harm to be caused and also review the number of FOBTs permitted in an individual bookmaker.
It added that Government should address localism concerns and calls for greater controls over FOBTs at the local level. It said powers should be given to local authorities to prevent the clustering of betting shops.
The report was also critical of the bookmakers for not engaging with the process. “We were disappointed that the bookmakers declined to participate and fear this is a reflection of their denial of the problems associated with FOBTs and a reluctance on their part to speak to policy makers about appropriate regulation.”