Will the new FOBT gambling regulations do more harm than good?

With the number of people suffering from gambling addiction continuing to rise, MP’s are looking for new ways to regulate the industry and protect the most vulnerable in society. However, a new policy that’s being introduced this week has come under intense scrutiny.

The government strategy, which has been described by the culture secretary, Jeremy Wright as a “significant step forward in protecting vulnerable people”, means that bookmakers would have to reduce the stakes on fixed-odds betting terminals (FOBTs) from £100 to £2.

FOBTs have previously been described as the “crack cocaine” of gambling machines. But the industry has warned that reducing the stakes would simply mean the gambler would move to other – potentially even more harmful – forms of gambling.

Furthermore, the Association of British Bookmakers has predicted that up to 4,500 shops could shut in the UK as bookmakers struggle to make enough profit to stay open. This could also result in job losses.

And despite bookmakers seeing their profits cut, it wouldn’t, according to experts, necessarily help addicts. It’s thought that many could switch to other types of gambling, like arcades, casinos, slot machines, or online gambling, many of which can be even more harmful.

For example, even though slot machines have lower stakes, they are also faster paced than FOBTs and have lower payouts. This means that gamblers can lose money just as quickly. So even though bookmakers will make less, it’s predicted other parts of the industry are set to benefit.

In a report released by the RPC, it’s noted that the Department for Culture, Media and Sport (DCMS) is aware that this risk exists and that some of the evidence used in making this policy is flawed; but it’s not stated how it will deal with the potential change in behaviour.

The RPC says:  “The Department recognises that displacement to other forms of gambling might include significant substitution to other gambling products or outside betting shops. The department notes that this could have significant effects on competition in the gaming industry.”

A Gambling Commission spokesperson said: “Our advice to the government’s gambling review was based on the best available evidence and focused on reducing the risk of gambling-related harm.”

“Our recent call for evidence builds on our advice that a stake cut for B2 gaming machines does not address the risk of harm presented by other categories of gaming machines. The gambling industry has an opportunity to demonstrate progress since the gambling review in trialling and evaluating new player-protection measures.”

A DCMS spokesperson said: “We have taken decisive action to ensure we have a responsible gambling industry that protects the most vulnerable in our society: “By reducing the maximum FOBT stake to £2 we can help stop extreme losses by those who can least afford it.”

“This will target the greatest proportion of problem gamblers and mitigate the impact on those most vulnerable to harm. We have been clear that problem gambling is not confined to one product, which is why we have brought in a package of measures to strengthen protections around gaming machines, online gambling, gambling advertising and treatment for problem gamblers.”