New Cap On Small And Large Casinos Upsets UK Operators
It was certainly no present in pre-Christmas wrapping for the UK casino industry as the British government unveiled a less than generous offering to the sector in its latest despatch on gambling deregulation. This time, as far as most of the industry were concerned, Scrooge definitely had come to town with Tony Blair's government announcing that the number of small and large category casinos will be capped to eight each for at least three years after the first licences are awarded. The directive follows the recent decision also to cap the number of regional casinos to eight.
The move means that most of the existing 130-odd casinos will not be able to take advantage of most of the important elements of deregulation in the Gambling Bill. Although restrictions on advertising and the 24-hour rule will be done away with for all venues, only the lucky few will be allowed to operate more than the ten Category B machines currently permitted, and only they will be able to offer betting on 'real or virtual events'.
During the initial three-year phase, the UK's newly formed Gambling Commission will be required to carry out an assessment of whether levels of problem gambling increase as a result of the new UK casino licences. Further licences would only be granted if Parliament approves.
In the meantime, an advisory panel will be set up to determine, probably by the end of 2006, the areas of the country where the eight licences in each of the categories may be granted. The final decision on location will be left to local authorities.
A spokesman for the Department of Culture, Media and Sport said: "This is a precautionary measure based on the potential risks of new gambling products which is designed to give up sufficient time to analyse the impact before deciding on any more. We had to come up therefore with a system that would allow us to limit the numbers for an initial phase and make it fair and objective. That is why we are setting up a panel to advise ministers. We will want representatives with expertise in various areas but we haven't yet decided on who will be on the panel. Their aim will be only to advise on the location of casinos."
He added: "We have come to a policy that takes a cautious approach. If there is no evidence of an increase in harm, more casinos will be allowed in due course. The policy, however, was clear from the start. We do not want to create a situation where there would be ambient gambling opportunities and casinos springing up on every street corner. We were creating a situation where the demand could lead to up to 100 new casinos as an inevitable consequence of the cap on regional casinos. We have listened to all sides of the debate and believe that this policy will be acceptable to all."
There was little sign of acceptance at the British Casino Association where the proposals were roundly condemned by the chairman Penny Cobham. She said: "The government's announcement will have a very severe impact on the UK industry, setting the existing estate in aspic. The UK casino industry has operated with complete probity for forty years. Everyone - even the Secretary of State - acknowledges that. We have worked hard and honestly with the government in getting the Bill to this stage but this latest move comes without any consultation at all."
She added: "Where is the logic? We were told by a special advisor that eight, eight and eight had symmetry. That's not logical. We're not building a house here. Small and large casinos are not like regional casinos and there would be no proliferation - the economics of small casinos in particular argues against that. And local authorities, anyway, always have the right not to allow any casinos at all in their areas. Who has asked for this change? Not even the Daily Mail! And no MPs on the Standing Committee where the announcement was made congratulated the government."
The debate in the UK seems destined to roll on, not least of all because of the high investment stakes being planned by both the domestic and international casino industry. The intensity of the battle for a better deal is certain to continue.
