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Gambling and the General Election 2017
Contents General Election 2017 House of Cards the politics of gambling in 2015-2017 Parliament The current domestic issues How did we end up here? Reviewing the review The Brexit effect The runners and riders The Party manifestos Gambling team contacts
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2 | Place your bets Gambling and the General Election 2017
General Election 2017
Two years ago, in advance of the 2015 General Election in the United Kingdom, Olswang and Regulus Partners issued an analysis of what we saw then as the prevailing public policy issues facing the gambling sector. We stated that there was a `watershed moment' and that the sector was facing an unprecedented range of political risks and threats.
Since then much has changed 1 most notably the outcome of the referendum in June 2016 regarding exiting the European Union, the change of Prime Minister and the focus of much of public policy concern towards the single issue of Brexit. However, the risks and threats now facing the industry appear if anything to be even more acute.
Most significantly, the political mood towards gambling appears to have deteriorated further. The Blair era's more libertarian attitude towards gambling (as articulated in the Budd report) seems distant now. There has been conjecture in the press regarding Theresa May's views on gambling but little in the way of fact to support it. Nevertheless, a May administration, comfortable with an interventionist approach to the economy, would appear to have few qualms about intervening robustly in the sector if they perceived social or public health issues.
Nor is there much succour to be found in any obvious alternative, with the Labour Party likely to be even more antagonistic towards the sector. Meanwhile, control of gambling has become a touchstone for devolution in both Scotland and Wales. The SNP's position has the potential to cut both ways depending on the greatest perceived benefits to Scotland but in the near-term is almost certainly negative.
It is perhaps a sign of the times for gambling that in 2017, restrictive policies (chiefly on the issue of machines in betting shops) appear in the election manifestos for Labour, the Liberal Democrats, the SNP and UKIP.
Brexit also poses several significant challenges to the sector. Domestically, restrictions on immigration will challenge those gambling operations which employ significant numbers of overseas workers. Internationally, remote operators will lose even their theoretical protections to provide their services into the UK under the European Union (and from the UK into the EU). The post-Brexit blueprint for the UK set out by the Conservative Party suggests little encouragement for the sector.
In this note, we update our analysis of the public policy issues facing the sector we produced two years ago to reflect the new realities.
Once again, we look at the manifestos of the major political parties. As we approach the final hurdles, a Conservative victory still appears the most likely outcome but in recent years we have learned not to place too much faith in political certainties. Moreover, Opposition policies may be revealing in terms of the general political climate on gambling issues and sources of future pressure.
Any result other than the return of the Conservative Party to Government with an enlarged majority is likely to play badly for those hoping to change the negative regulatory-political tide for gambling.
In light of these concerns, the need for the industry to identify and address political-regulatory concerns and to respond effectively has rarely seemed so important.
1Not least Olswang has merged to become part of CMS Cameron McKenna Nabarro Olswang LLP.
House of Cards the politics of gambling in the 2015-2017 Parliament
Although it was relatively brief, the 2015-17 Parliament was significant for gambling both in terms of legislation and in terms of political discourse.
In terms of legislation, the last Parliament was notable for the first modest steps to devolve gambling regulation to the Scottish Parliament and Welsh Assembly (the Scotland Act 2016 and the Wales Act 2017); and to give Police powers of seizure over gambling assets such as betting slips, machine receipts and casino chips (the Criminal Finances Act, pushed through just before dissolution).
The General Election prevented the taxation of free plays being included in April's Finance Bill but it seems highly likely that this provision will be passed early into the new Parliament and implemented on schedule in August.
The period was also notable for an intensification of public policy interest in gambling (mainly negative for the industry) with pretty much the full range of parliamentary procedures being deployed to apply scrutiny on the industry.
During the course of the parliament, a total of 203 gambling-related written Parliamentary Questions (perhaps the most constant measure of interest) were asked by Members of the House of Commons.
Betting shops was the most commonly discussed sector of the gambling industry, featuring in 36% of the PQs (or 60% where a specific sector was cited see chart [A]) while remote gambling was mentioned in 13%. By contrast, casinos and arcades barely figured at all (1% each) while bingo was not mentioned at all in written PQs.
Chart A: Written Parliamentary Questions gambling mode, House of Commons, 2015-2017 Parliament
Unsurprisingly, problem gambling and machine gaming were the two most commonly addressed themes (35% and 34% respectively) often in conjunction. Sports funding (largely in relation to the Horse-racing Levy) and crime (anti-money laundering and staff abuse) were the subjects of written PQs in 14% and 10% of PQs respectively.
Chart B: Written Parliamentary Questions gambling theme, House of Commons, 2015-2017 Parliament
Problem gambling Machines Sports funding Crime Localism Other
The most prolific interrogators of Government policy on gambling during the Parliament were chair of the All Party Parliamentary Group on Fixed Odds Betting Terminals, Carolyn Harris (Lab, Swansea East), the deputy leader of the Labour Party, Tom Watson (Lab, West Bromwich East), Stephen Timms (Lab, East Ham) and Ronnie Cowan (SNP, Inverclyde).
A total of 56 MPs submitted written questions on gambling during the Parliament (31 Labour, 14 Conservative, seven SNP and four `other') including the leader of the Liberal Democrats, Tim Farron (LD, Westmorland and Lonsdale), the former Minister of State for Culture and Tourism, Margaret Hodge (Lab, Barking) and the sole UKIP MP, Douglas Carswell (Clacton).
4 | Place your bets Gambling and the General Election 2017
Chart C: EDM 61 proportion of party MPs to sign
100.0% 90.0% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0%
Plaid Cymru Green
Lib Dem SDLP
Independent All MPs
A total of 85 MPs signed Early Day Motion 61, laid by Carolyn Harris and calling for curbs on machines in betting shops, including a reduction in maximum stake per spin to 2. It was the 20th best-supported EDM in the session out of 1,209 and was signed by 44% of MPs in Scotland, 28% of MPs in Northern Ireland, 23% of MPs in Wales but only 8% of MPs in England. In recent years, only one gambling EDM (pertaining to animal rights and greyhound racing) has received greater parliamentary support.
The 2015-2017 Parliament also featured one Private Members Bill in relation to gambling also calling for greater controls on machines in betting shops from the Rt Rev Alan Smith, Bishop of St Albans. The bill didn't even receive a date for its second reading but with the General Synod of the Church of England voting unanimously in opposition to so-called `FOBTs', it is unlikely we have heard the last on gambling from the Hertfordshire prelate.
The long-running issue of machines in betting shops was also the focus for a number of parliamentary debates (notably a Westminster Hall Debate in March 2016 and a debate on betting shops and serious crime in the Lords in September that year). Gambling matters also put in cameo appearances in a wide range of debates on matters such as the content of the Queen's Speech, greyhound welfare, the National Curriculum, FIFA, anti-corruption, the Investigatory Powers Bill, local government finance and various matters of English, Welsh and Scottish sovereignty.
With three reviews/investigations of the industry currently in train, gambling is bound to feature more prominently than many executives would like when Parliament sits again in June. In addition to these matters, the interest in youth gambling displayed by the House of Lords since the start of the year may presage heightened interest in that particular subject.
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Current domestic issues
As almost the last gasp of the last Parliament and after finally receiving state aid approval from the European Commission, the secondary legislation was passed to bring into force the long proposed changes to the horserace betting levy. This extended the levy to offshore operators (and to the Tote on-course) and fixed the levy rate at 10%.
These measures are controversial with the legal basis for them uncertain and they could potentially be challenged in whole or in part in the courts both domestically and also in Europe, the latter by means of reviewing the state aid approval.
We will see how the new arrangements (if they remain unscathed by any legal challenge) bed in. The Government has promised to make further changes in due course to remove the Levy Board from the process. Given how stalled the process of levy reform has been historically notwithstanding this development, it cannot be guaranteed that these further changes will ever see the light of day.
In October of last year the Competition and Markets Authority (`CMA') announced that it was launching an investigation into certain online gambling operators. The investigation which is still ongoing forms part of a joint programme of work with the Gambling Commission and the Advertising Standards Authority and focuses on concerns surrounding the fairness of operators' consumer-facing terms (especially in respect of sign-up promotions, so-called `obvious error' terms, the use of disproportionate sanctions and terms limiting consumers' ability to claim redress).
Exercising its power to do so under the Consumer Rights Act 2015, the CMA issued Information Notices to operators requiring them to provide evidence of compliance with consumer law. A public statement regarding the regulator's initial findings postponed following the announcement of the snap election is expected in June this year.
Any operators found in breach of consumer law will face enforcement action from the CMA. It may be that the CMA seeks to secure undertakings. However with
growing public and political pressure to crack down on the gambling industry, a more hard-line approach may be taken. The longer-term impacts of the investigation will likely be felt throughout the sector, with the Commission likely to impose additional requirements on all licensees, not just those investigated.
In tandem with this, the online gambling sector has also had to grapple with an investigation from the UK's data protection regulator the Information Commissioner's Office (`ICO') into the use of personal details to promote gambling websites. This investigation was announced one month after that of the CMA (in November 2016), with the ICO targeting over 400 companies, all believed to be e-gaming marketing affiliates. The investigation focuses on spam marketing via SMS and was instigated in response to the number of complaints raised by the public about spam texts.
Those being investigated could face fines of up to 500,000 if they are found to be collecting and using personal data for marketing in a manner which does not comply with the Data Protection Act 1998 and the Privacy and Electronic Communications Regulations 2003. Whilst it is marketing affiliates that are the focus of the investigation, this has not meant that gambling operators have been able to breathe a sigh of relief, as the ICO generally considers that operators should take responsibility (and therefore liability) for the actions of their affiliates, and has taken a fairly broad interpretation of the relevant legislation in order to hold operators to account for spam marketing.
In addition to this, the Gambling Commission holds its licensees responsible for any third parties with whom they contract for the provision of any aspect of their business related to gambling activities.
We will reduce the maximum stake on Fixed Odds Betting Terminals from 100 to 2. Labour will also legislate to increase the delay between spins to reduce the addictive nature of the games.
Labour Party Manifesto 2017
How did we end up here? Reviewing the review
The interrupted DCMS review of gambling marked a departure from previous triennial reviews in terms of both content and tone. In broadening the scope of governmental scrutiny, could it be that we may be edging towards another overhaul of gambling legislation?
The current review is far broader in scope than previous `triennial reviews' and seems likely to result in tighter regulation rather than more liberalisation. As well as the issues that the review is designed to address (gaming machine regulations, TV advertising and the effectiveness of responsible gambling measures), the Government has also asked an open-ended question regarding what other aspects of the gambling industry warrant scrutiny.
We do not even know whether we are still on a three year cycle (many commentators have referred to this as the `triennial review' but perhaps tellingly not DCMS) but when the next review does arrive, it seems probable that it will be broader still. The question of how remote gambling ought to be circumscribed by regulation will almost certainly be at the heart of the next assessment (as investigations by the Competition and Markets Authority and the Information Commissioner's Office signify).
Root and branch reviews of gambling regulation (such as Royal Commissions or the Budd Report) tend to occur every 20 to 25 years. We are now 16 years on from
Budd and so starting to move into the phase in the cycle where governments feel the need to do more than just play around the edges.
The shift of the gambling market from licensed venues to online and the potential for mobile to erode the old licensing regimes are good candidates for triggering a more thorough examination of the effectiveness of legislation.
We will also create a power in law for government to introduce an industrywide levy from social media companies and communication service providers to support awareness and preventative activity to counter internet harms, just as is already the case with the gambling industry.
Conservative Party Manifesto 2017
Under pressure: official scrutiny of the gambling sector in 2017
Review area Gaming machines, TV advertising, responsible gambling measures Terms and conditions (remote)
Spam marketing and spyware
Conducted by DCMS CMA ICO
Launched in October 2016; publication of proposals delayed by General Election
Launched in October 2016; update issued in January 2017
Launched in November 2016
8 | Place your bets Gambling and the General Election 2017
The Triennial review the legal position
Despite the pomp with which the Government tends to treat the so-called triennial review, it has no formal legal standing as such.
In particular, nowhere under the Gambling Act 2005 is there any obligation on the Secretary of State to undertake any form of review whether triennial or otherwise. (Under section 349, licensing authorities have to prepare licensing policies every three years but not the Secretary of State.)
The old triennial review was a mechanism used by the Gaming Board of Great Britain to ensure that stake and prize limits on machines did not get left behind by inflation. It tended to be an upwards only review concerned with just two dimensions of gambling regulation how much gamblers should be allowed to stake and how much they should be allowed to win on machines.
Despite its name, the review has been held just once in the 12 years since the passing of the Gambling Act. The 2013 Triennial Review appeared to re-establish the protocol of three-yearly reviews, essentially in the power of the Secretary of State under section 235 to make regulations regarding machines.
In 2013, another review was promised in 2016 but in stating that future reviews might lead to reductions in stake and prize limits and that companies were expected to evaluate the effects of any changes it signaled a departure from previous rules.
10 | Place your bets Gambling and the General Election 2017
The Brexit effect
Whatever the outcome of the election, the central political event over the next Parliament will be Brexit and in particular (assuming the UK proceeds with leaving the European Union) the terms the UK agrees with the EU and the other 27 Member States. Brexit presents a number of challenges for the gambling sector. We address some of the more obvious ones here.
Freedom to provide services
The Prime Minister has signaled her intention that the United Kingdom leave the European single market. That will mean that gambling operators in the United Kingdom (including for these purposes Gibraltar) would lose the right under Article 56 of the Treaty for the Functioning of the European Union (`TFEU') to provide services into other Member States. Without this right, other Member States can legitimately impose any barrier they wish to operators from the UK.
It is true that in the past this right has been less than absolute for gambling operators with Member States claiming that the public interest in various cases justified a range of restrictions on the provision of gambling services into their territories. But in many situations, the Article 56 right has been used as a means of forcing Member States to liberalise gambling regulation and to allow outside competition.
It may be that the UK Government can negotiate a similar provision in the trade agreement it is seeking with the EU. Gambling is comprised within the service broadly protected by Article 56 but tends to be expressly excluded from more specific protections such as the e-Commerce Directive. One challenge for the sector will be to ensure that gambling is at least not expressly excluded from any protection for services in any free trade agreement.
Allied to the freedom to provide services into other EU Member States is the ability on the part of UK operators to receive payments from EU customers. On departure from the EU, there is no guarantee that the UK will remain part of the EU payments system and that there will be any obligation on banks in the EU to effect payments to UK operators.
The continual effective operation of the financial system between the EU countries and the UK after Brexit will plainly be a central concern for the UK Government in the Brexit negotiations but operators will want to ensure that to the extent they can provide services into the EU, payments transactions will continue to run properly.
The EU has been responsible for the ratchetting up of anti-money laundering provisions, which have increasingly applied to gambling operators. The Fourth Anti-Money Laundering Directive (the `4AMLD') is due to come into effect of 26 June 2017 but, in practice,the UK Government has stated that it will apply the 4AMLD to the gambling sector relatively sparingly.
In theory, when outside the EU, the UK may (subject to any exit agreement with the EU) draw back on existing anti-money laundering provisions, but there seems no likelihood of that. Indeed, the Gambling Commission has been at pains to point out that sectors other than land-based and remote casinos should not consider their exemption from 4AMLD as a right.
In the future, as and when the EU ratchets up anti-money laundering provisions even further (which seems more than a possibility, particularly without the moderating influence of the UK), these will not apply to the UK but compliance on the part of an operator may be required as a condition for providing services into the EU.
The General Data Protection Regulation (the `GDPR') is due to come into force on 25 May 2018. This complex legislation most significantly affects operators by requiring them show that they have instituted good data protection practice for example where appropriate by appointing
a data protection officer. The penalties for breaches of data protection requirements are to be increased markedly both in terms of regulatory fines and the new potential for mass civil claims from disgruntled users.
On Brexit the UK could in theory seek to reduce these laws, but again there is absolutely no sign that they will do so. The Conservative Party's manifesto specifically refers to bringing in a data protection law. This is probably little more than an allusion to the GDPR but more importantly suggests no public policy desire to draw back on data protection obligations on businesses.
One significant factor which will arise on Brexit in respect of data protection is the likelihood that the final determiner of UK data protection law will be the UK Supreme Court rather than, as now, the Court of Justice of the European Union (the `CJEU'). This has some attractions in that we can expect the UK court to be better at providing clear judgments in this complex area (for example, the judgment of the CJEU three years ago in the Google Spain decision regarding the notorious `right to be forgotten' was so unsatisfactory that another case on this issue has recently had to go before the court).
One example of the potential for a disparity of approach between the UK Supreme Court and the CJEU may lie in the question of consent. A data controller may process personal data if it has the consent of the data subject. However, a growing issue is how meaningful that consent is, particularly in the context of online use where the ostensible consent may be hidden away in lengthy terms and conditions (something that both the Competition and Markets Authority and the Information Commissioner's Office have taken an interest in). The CJEU approach to this is likely to be sceptical as to whether that constitutes proper consent. The UK approach may not be the same, having regard to the lengthy tradition of the doctrine of volenti in UK law and may be readier to construe consent in particular situations.
This is highly uncertain territory but underlines the likely complexity in addressing data protection issues post Brexit, particularly for operators dealing with users in both the UK and the EU (where it is likely they will have to comply with any EU norms). But with the fines and the potential for civil litigation rising, it cannot be ignored.
With gambling being a major industry in Gibraltar, its status and the practicalities of doing business there are likely to be a significant concern for operators post Brexit. Without the protections under TFEU gone, some believe there are dangers for the territory for example in relation to free movement over the border with Spain.
In his letter to EU leaders in March, General Secretariat of the Council, Donald Tusk stated that `no agreement between the EU and the United Kingdom may apply to the territory of Gibraltar without the agreement between the Kingdom of Spain and the United Kingdom'. This provoked a hostile response from the UK side and it looks like it will act strongly to protect the interests of Gibraltar.
Finally, to the extent that the gambling industry in the UK uses EU workers, this is thrown into question by Brexit. What is plain is that automatic free movement for EU workers into the UK is very likely to end on Brexit. What is less clear is what will replace it and what the consequences will be for the industry.
There is no doubt that Fixed Odds Betting Terminals cause harm and hardship in communities across Scotland. That's why the Scottish Government needs legislative powers to control the growth and impact of these machines, and we believe the UK government should devolve these powers in full. The problem of Fixed Odds Betting Terminals is linked to the proliferation of betting shops in some communities and so we will continue to argue for Scotland to have full responsibility for the regulation of gambling.
SNP Manifesto 2017
12 | Place your bets Gambling and the General Election 2017
GOOD TIME TO Identify Brexit issues and liaise across industry
GOOD TIME TO Identify relevant negotiating team and engage on
The likely Brexit process
Date 29 March 2017 April 2017 29 April 2017 June/July 2017 Summer 2017 September 2017
Event Article 50 notification Commission issue draft guidelines European Council summit meeting, final guidelines likely to be published Likely to be summit of UK and EU 27 to agree format of negotiations EU Commission and Council propose and agree negotiating mandate UK Parliament returns after summer recess
Ratification of agreement completed
Announced by EU European Council President Donald Tusk on 21 March.
Possibly by reference to Article 218 TFEU.
Unclear the extent to which the UK Government will disclose details regarding the negotiations at this stage. Likely to be some central `political' negotiations and very many highly technical negotiations Any agreement may well require ratification by each of the remaining 27 Member States so prudent to leave six months for this. The agreement may be (a) an exit agreement (b) a new relationship agreement including as regards free trade (c) an interim agreement or (d) a combination of all three.
DELAYS POSSIBLE UK General Election 8 June 2017
DELAYS POSSIBLE German federal elections 24 September 2017
We will...grant new powers to local authorities to protect high streets and consumers by reducing the proliferation of betting shops and capping the maximum amount able to be bet on fixed odds betting terminals (FOBTs) at one time to 2.
Liberal Democrats Manifesto 2017
The runners and riders
In this section, we consider the impact of the election on the chief parliamentary protagonists in the public policy debate on gambling regulation. In doing so, we have assumed a Conservative Party victory on June 8th, in line with current polling.
In the event of an enlarged Conservative majority, the chances of a ministerial re-shuffle increase, although given the proximity of the last Cabinet makeover, we would not expect wholesale changes.
While the dissolution of Parliament means that none of the individuals listed here are currently Members of Parliament (let alone office holders), we cite them in reference to the positions they held at 3rd May 2017.
The Prime Minister
Theresa May (Cons, Maidenhead) Majority: 29,059 / Entered Parliament: 1997
It is unlikely that gambling issues will consume too much of the Conservative Party leader's thoughts as she enters this election. However, it is possible that certain aspects of gambling may be used as touchstones for May's broader principles (e.g. predatory capitalism, mental health) particularly if the opposition parties seek to exploit concerns in this area.
Despite suggestions in the press that her upbringing as a daughter of a high-church Anglican priest might make her unfavourably disposed towards gambling, there have been no signs of such antipathy in her two decades in Parliament. She has tended to vote with the party line on matters related to gambling (including voting against proposals to create tighter controls on FOBTs and betting shops in 2014) and has asked no parliamentary questions on the subject.
If the Conservatives do increase their parliamentary majority this summer, May will return to Downing Street with less need to worry about matters such as gambling regulation. Nevertheless, rumours persist that May has taken a particular (and particularly worrying) interest in the current DCMS review notwithstanding press reports that her party's election campaign received 175,000 from the owners of one particular bookmaking firm.
The Secretary of State
Karen Bradley (Cons, Staffordshire Moorlands) Majority: 10,174 / Entered Parliament: 2010
From a gambling perspective, perhaps the most significant fact about Karen Bradley is that she is not John Whittingdale, her predecessor in the role. Whittingdale, who was shuffled onto the backbenches when Theresa May assumed office last year had been seen as being pro-gambling.
Bradley's parliamentary record shows little interest in betting and gaming prior to her assuming office as secretary of state in 2016, although she is on record as saying that she was `well aware' of issues related to FOBTs from her time in the Home Office.
Tracey Crouch (Cons, Chatham & Aylesford) Majority: 11,455 / Entered Parliament: 2010
Tracey Crouch has earned respect for the way she has grasped the gambling element of her ministerial brief, since taking over from Helen Grant in 2015. Crouch has consistently voted against increasing regulatory burdens on the gambling industry, including votes against extending the horserace betting levy in Nov 2013.
With a strong local majority, Crouch looks set to be returned to Westminster after June 8th; but in an interesting twist, Labour has selected Vince Maple one of the most vocal of anti-FOBT campaigners in local government to stand against her in Chatham and Aylesford.
Given the status of the gambling review and her obvious love of the sports minister role, it seems likely that Crouch would wish to resume her ministerial duties assuming she is returned to Westminster (and the Conservatives to Government) in June.
Tracey Crouch was a member of the Select Committee for Culture, Media and Sport between 2012 and 2015.
14 | Place your bets Gambling and the General Election 2017
Matthew Hancock (Cons, West Suffolk) Majority: 13,050 / Entered Parliament: 2010
As the MP for Newmarket Matt Hancock has been an influential figure on gambling since entering Parliament in 2010. Hancock was one of the most active MPs on bringing offshore gambling companies into the net for remote gaming duty (even sponsoring a Private Members Bill on the subject) and extending the Levy.
As the DCMS Minister for Digital Policy since last summer, Hancock has had some tangential interest in remote gambling and safe-guarding and on occasion has been required to respond for the Government to Parliamentary Questions about gambling.
The Shadow Ministers
Tom Watson (Lab, West Bromwich East) Majority: 9,470 / Entered Parliament: 2001
The Deputy Leader of the Labour Party inherited the culture, media and sport Shadow Secretary of State brief after the resignation of Kelvin Hopkins in October last year, thus becoming the sixth MP to hold the position in just two years.
In the past, Watson has enjoyed close ties with the Campaign for Fairer Gambling (the Campaign's founder, Derek Webb donated 25,000 to Watson's campaign for Deputy Leader in 2015). He set up his own anti-FOBT petition last year and has also probed the Government on the governance of the National Lottery and problem gambling as a public health issue. While he clearly has concerns in a number of areas, he does not appear to be anti-gambling and voted in favour of the increases to stakes and prizes on casino slot machines in 2014.
Tom Watson was a member of the Select Committee for Culture, Media and Sport between 2009 and 2012.
Rosena Allin-Khan (Lab, Tooting) Majority: 6,537 / Entered Parliament: 2016
The shadow minister for sport finds herself contesting the Tooting constituency for the second time in 12 months, having successfully defended for Labour the seat resigned by Sadiq Khan on his way to City Hall. Within four months of her arrival in Westminster,
she was handed the shadow brief for the gambling sector but somewhat improbably given the context has so far managed to stay silent on matters of gaming and betting policy.
Carolyn Harris (Lab, Swansea East) Majority: 12,028 / Entered Parliament: 2015
The chair of the All Party Parliamentary Group on Fixed Odds Betting Terminals, Carolyn Harris has made a reputation as a campaigning MP since her entry into Parliament in 2015 and tasted success earlier this year in getting child burial fees scrapped in Wales.
The Labour vote in Wales has historically been somewhat more resilient than in the rest of the United Kingdom and Harris is a popular MP with a strong majority. We should expect her to continue to play a part in Parliamentary discourse on the future of machines in betting shops and perhaps matters of gambling regulation more generally.
Philip Davies (Cons, Shipley) Majority: 9,624 / Entered Parliament: 2005
The son of a betting shop owner, the self-styled libertarian MP Philip Davies has come to be seen as one of the most vocal parliamentary defenders of the gambling industry.
At one point, Davies had appeared to be on the brink of leaving the Conservative Party (and possibly politics altogether) on the issue of Britain's continued membership of the European Union. With Article 50 now triggered and UKIP seemingly in decline, we can expect the Honourable Member for Shipley to continue to fightthe gambling industry's corner through the next five years.
Philip Davies has been a member of the Select Committee for Culture, Media and Sport since 2006.
We stand by our 2015 manifesto pledge to...Update licensing laws to limit the maximum stake on fixed-odds betting terminals to 2.
UKIP Manifesto 2017
The Party manifestos
Pledges to reform gambling regulation have made it into four major party manifestos for this election emphasising the politically choppy waters that the sector appears to have entered. As Britain heads to the polls, we take a look at the stated and tacit party positions on gambling policy.
Although `gaming' is cited approvingly in the Conservatives' manifesto as an area where the UK enjoys particular expertise, that seems more likely to be a reference to the video games industry than the gambling sector and the overall picture emanating from the parties towards the sector is not positive particularly on the matter of gaming machines in betting shops.
Indeed, it is a reflection of the heightening of the industry's political-regulatory risk profile over recent years that gambling looks likely to play a cameo role within the 2017 General Election.
Labour Liberal Democrats SNP
---- One specific reference to gambling citing powers granted to Government to impose a responsible gambling levy as precedent for a similar arrangement for social media this may signal intent to replace the current voluntary scheme to fund `responsible gambling' with a levy.
---- Otherwise there's a promise to `strengthen the hand of regulators', in particular `to order fines against companies breaking consumer law and deliver redress for wronged parties' and to `put the interest of vulnerable consumers first' which clearly could have significant application in the gambling sector.
---- Reduction of maximum stake for machines in betting shops from 100 to 2 ---- Slowing down speed of play on gaming machines
---- New powers to local authorities `to protect high streets and consumers by reducing the proliferation of betting shops'
---- Cap on maximum stake for FOBTs of 2
---- Greater controls on machines in betting shops (based on previous policy statements, this is likely to include maximum stake reduction and powers to determine numbers of machines per shop 2)
---- Full devolution of gambling regulation and taxation to Holyrood
---- Reduction of maximum stake for machines in betting shops from 100 to 2
Affects ---- All sectors
---- Betting shops ---- Possibly casinos, arcades
and bingo clubs too ---- Betting shops
---- Betting shops
---- All gambling (except National Lottery)
---- Betting shops
In addition to direct references, a number of themes may have indirect relevance to gambling regulation. These include mental health, digital resilience, `sin' taxes (e.g. sugar) and advertising controls (e.g. Labour's plan to look at advertising as part of its approach to addressing childhood obesity).
2Under current legislation, local authorities may determine the number of machines permitted (up to a maximum of four) in new betting shops only. 16 | Place your bets Gambling and the General Election 2017
While the major party manifestos are silent on the subject of gambling taxes, this is an area of perennial vulnerability for operators. The dislocated nature of the taxation regime for gambling lends itself to tinkering, either as a result of litigation (such as the need to replace VAT with gross profits tax on bingo, poker and gaming machines between 2009 and 2013) or opportunism.
All the parties have spending plans to fund and a desire to not hit too many voters in the pocket and gambling has been long on foes and short on friends in Parliament of late. With Britain's gambling expenditures shifting inexorably online (where a relatively low duty rate of 15% applies), HM Treasury may well look at remote gaming duty as a potential piggy bank. Input VAT exemptions for offshore operators appeared to be under threat until recently and this may well return.
More immediately, the odds appear to be shortening for a responsible gambling levy to replace the existing voluntary arrangement not least because the Conservative Party manifesto has cited gambling as an example for social media to follow. With the current funding shortfall (GambleAware raised around 7m in 2016; its target for 2017 is 10m) unlikely to solve itself, a statutory levy looks increasingly likely. Those currently contributing to GambleAware at the recommended rate of 0.1% of net gaming revenue are unlikely to baulk at a mandatory scheme but the notion that in time a levy could become a hypothecated tax (with upwards-only reviews) for the NHS remains a concern.
The Conservative Party has targeted a 17% rate of corporation tax by 2020 while Labour `will ask large corporations to pay a little more' and has pledged to `meet the business need for a more skilled workforce with extra corporate tax revenues'.
One of the most contentious issues for this election, particularly with Brexit in mind, is immigration. From the Conservatives' promise to `reduce and control' immigration with ambitious net immigration targets; to the Liberal Democrats' stance that immigration is an essential part of a healthy and growing economy; and Labour's prioritisation of growth, jobs and prosperity ahead of, what they call, `bogus immigration targets', the impact of the election result on employers could be significant.
If the Conservatives remain in power following the election, betting and gaming businesses (along with many other sectors) are likely to feel the effect of the Conservative's ostensibly tough stance on immigration. For businesses which have traditionally employed staff who are not citizens of the UK, there is the possibility of coming under increased Government scrutiny regarding their recruitment strategies.
Under a Conservative government, the Immigration Skills Charge will be increased to 2,000 by the end of the next parliament. The amount is to be paid each year in respect of every migrant worker if they are applying for a visa to work in the UK for 6 months or more. Currently this regime affects employees from outside the EEA. However, after the UK leaves the EU the charge may be widened to include workers coming from the EEA.
A Conservative Government will also increase earning thresholds for businesses that sponsor family visas. Visa requirements for students will also be toughened.
Any other outcome at this election would likely have a less drastic impact on the workforce of betting and gaming businesses.
The General Data Protection Regulations will be the centre of the UK's data protection laws from the period when it takes direct effect (25 May 2018) to the date agreed for the UK's exit from the European Union. The provisions of the GDPR will likely still have effect in the UK following the exit via the Great Repeal Bill which is predicted to enshrine all existing EU law in UK statute.
Labour and the Liberal Democrats have stated generally that they will continue to uphold strict and fair data protection laws to protect and enable data to flow into and out of the UK.
The Conservatives however, have stated that they will introduce a new data protection law if elected. The new law will `ensure the very best standards for the safe, flexible and dynamic use of data and enshrining our global leadership in the ethical and proportionate regulation of data'. No further detail is given. However, the new law will need reflect the provisions of the GDPR to avoid restricting the data flow between the UK and EU.
Gambling team contacts
The CMS team
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Robert Willis Partner T +44 20 7067 3398 Erobert.email@example.com
Anna Soilleux-Mills Of Counsel T +44 20 7067 3765 Eanna.firstname.lastname@example.org
Dan Tench Partner T +44 20 7067 3518 Edan.email@example.com
Tamsin Blow Of Counsel T +44 20 7067 3793 Etamsin.firstname.lastname@example.org
Vanessa Whitman Senior Associate T +44 20 7367 3198 Evanessa.email@example.com
The Regulus team
Adam Brickell Eadam.firstname.lastname@example.org
Paul Leyland Epaul.email@example.com
Michael Ellen Emichael.firstname.lastname@example.org
Dan Waugh Edan.email@example.com
18 | Place your bets Gambling and the General Election 2017
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