Gambling (Licensing and Advertising) Bill

Jim Shannon Excerpts

Tuesday 5th November 2013 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

I congratulate the Minister on her new position and look forward to her response to the debate.

Hon. Members have referred to taxation and regulation, but I would like to focus on enforcement, in particular in relation to problem gamblers and others who are vulnerable. When I read the Bill and realised it would provide a regulatory framework for online gambling providers that are not based in white-listed jurisdictions, I was pleased that at long last we would have regulation—that had to be good. I have also received advice on the Bill and some concerns have arisen, in particular relating to those who are vulnerable.

At the moment, online gambling providers located in jurisdictions that are not on the white list can access the UK market, despite the fact that they are not regulated by the UK Gambling Commission or by a domestic regulatory regime deemed sufficiently robust to justify their being deemed a white list jurisdiction. The only thing they cannot do is advertise in the UK. The fact that companies not subject to proper regulation can access the UK should concern anyone who knows anything about the social problems associated with gambling.

Problem gambling is a desperately destructive social phenomenon that brings real suffering and economic cost. According to the Gambling Commission, 450,000 people in the UK suffer from problem gambling, the effects of which should not be underestimated: it can take families to breaking point and beyond and sometimes lead to suicide. As a modern society, it is incumbent on us to ensure that the regulatory framework for gambling provides the greatest possible protections for vulnerable and problem gamblers, and it is certainly wrong that hitherto we have adopted such a laid-back attitude to gambling websites that we deem not to be properly regulated. To this end, the Bill’s proposal to subject providers from beyond the UK and white-listed jurisdictions to UK regulation comes not a moment too soon.

In scrutinising the Bill, however, some questions arise. All online gambling providers seeking to access the UK market will be required to get a licence from the Gambling Commission before they can advertise their services, but there is no clarity on enforcement, and the claim that the Bill protects the vulnerable will completely disintegrate if companies without a licence are not prevented from accessing the UK market. If licensing is not backed up with an enforcement mechanism, the Bill will simply result in an increase in online gambling advertising. Some online providers that currently have access to the UK market but which cannot advertise here would be able to advertise, while those that cannot advertise would be able to access the UK market on the same basis as today. That is not the right step forward.

I know the Bill gives the Secretary of State regulation-making powers, which could be used for enforcement purposes, but if we are serious, as I believe the Government are, about creating a progressive legislative framework that shows proper regard to the vulnerable, why not put enforcement mechanisms in the Bill to make it clear from day one that if an online gambling provider from outside the UK market wishes to access that market, it must have a licence? It would be perfectly possible to make that plain by amending the Bill to prevent such companies from accessing the UK by using financial transaction blocking measures, which have proved successful in other countries that have gone down the same road. I seek an assurance from the Minister, therefore, that the licensing regime will be backed up with a clear enforcement mechanism that makes it absolutely clear, in the Bill, that if a company outside a white-listed jurisdiction does not have a licence, it will be prevented from accessing the UK market by a financial transaction blocking measure or similar mechanism. I look forward to her response.

My concerns do not end there. Our current regulatory framework incentivises online gambling providers located in the UK to relocate to white-listed jurisdictions beyond the UK. The vast majority of UK-facing online gambling providers have left the UK for nearby white-listed jurisdictions, such as Alderney and Gibraltar, which are subject to a different regulatory regime and one that has often exhibited greater regard for problem gamblers than the UK regulatory framework. My concern, therefore, is that if we remove the incentive for gambling providers to locate outside the UK, problem gamblers in the UK will find many key providers less responsive to their needs—unless, while removing the incentive, we also make our regulatory framework for problem gamblers at least as robust as the best white-listed jurisdictions.

The Minister might be tempted to say that licensing is a matter for the Gambling Commission, and of course it is, but it is also a matter for the House, which created the commission when the current legal regime was introduced. We cannot, therefore, pretend that a significant change in that regime does not require us, the legislature, to review the capacity of the commission to deal with the new challenges emanating from the Bill. I would like a strong assurance that she will review the regulatory regimes of white-listed jurisdictions—the regimes from which British consumers of many online gambling services have benefited in recent years—and the regard they show for problem gamblers and the vulnerable, and ensure that when the Bill takes effect our regulatory regime will be made as sensitive to the needs of problem gamblers as the regulatory regimes of the very best white-listed jurisdictions. If we do not do that, the unintended consequence of the Bill will be that British customers accessing the many providers currently based in white-listed jurisdictions might actually enjoy fewer protections than they do now.

Finally, even if the Bill is accompanied by proper enforcement mechanisms preventing providers from beyond the white list accessing the UK market, and even if we ensure that the return of online gambling providers to the UK does not erode protections by enhancing our regulatory regime with respect to care for problem gamblers, the Bill will still result in an increase in advertising for online gambling in the UK. Although online gambling is not associated with the highest problem gambling prevalence figures, it does have one of the higher figures for problem gambling. Unlike other gambling opportunities, it is available 24/7; one can access hundreds, if not thousands, of gambling websites without leaving one’s house or bedroom.

I and my constituency office are often confronted by people with addictions, be it drink, drugs or gambling, and I am aware of the illusion of the gambler when they make the gamble, their depression when it is not successful and their guilt when they realise they have spent money they could not afford to spend. We cannot ignore the vulnerable or problem gamblers. As online gambling providers not on the white list access advertising opportunities for the first time, the Bill will make people in the United Kingdom, including problem gamblers, more aware of opportunities to gamble online. If the House is to vote for measures designed to result in an increase in online gambling in the UK, which is effectively what the advertising provisions propose, we should complement it with enhanced assistance for problem gamblers, who will face additional advertising challenges as a result of the Bill.

One mechanism developed to help problem gamblers is self-exclusion, which empowers a problem gambler on “a strong day”—even on their strongest days, some of those I have met are still not strong—to exclude themselves from the services of a gambling provider for a fixed period. Although in principle this is a good thing, in the context of online gambling it is useless: there are so many online gambling providers—hundreds if not thousands—that it would be impossible to self-exclude from them all. One answer to that dilemma has been proposed by academics, including Dr Sally Gainsbury, author of “Internet Gambling: Current Research Findings and Implications”, published in 2012, in which she states that “a significant limitation” of self exclusion

“is the lack of collaboration between different online gambling sites and venues, so that excluded individuals may find it easy to gamble at another site or venue.”

Will the Minister indicate how we can address that issue? Again, she might say it is a matter for the Gambling Commission, but again I would say: yes, but it is also a matter for the House, which created the commission and established the legislative framework that the Bill significantly amends. I believe that it would be appropriate for us to put in place a system that provides problem gamblers with a credible, meaningful, one-stop-shop self-exclusion mechanism. I should like to hear her thoughts on that matter.

I fear that, if the concerns that I have outlined are not addressed, the effect of the Bill will simply be to allow some people who cannot currently advertise in the UK to advertise online gambling opportunities, and to erode the level of protection afforded to problem gamblers on the many sites accessed by the UK market. We must seize the day and ensure that those things do not happen. We must ensure that providers from beyond the white list who do not have a Gambling Commission licence are prevented from accessing the UK market, and that the UK licensing regime is made at least as robust as those in the best white list jurisdictions, so that problem gamblers and vulnerable people can be protected in the context of the increase in advertising through the provision of a one-stop-shop self-exclusion mechanism.