Ladbrokes Coral Chief Executive, Jim Mullen has emphasised that cutting the stakes of fixed odds betting terminals (FOBTs) will not only have negative economic implications, but will also “fail to adequately address any issue of problem gambling.”
Mullen was responding to a report in the Sunday Times, which claimed newly appointed culture secretary Matt Hancock is in favour of delivering a ‘worst case scenario’ for bookmakers, by cutting the maximum stakes on FOBTs to £2.
With the Government’s 12-week consultation period on the brink of concluding, the Sunday Times reported that Hancock, whose appointment had previously been perceived as a positive one for the gambling industry, described FOBTs as “social blight.” The consultation period came after the Government’s triennial review and was focused not only FOBT stakes, but also on the current level of advertising allowed in the industry
However, in a statement issued after the Times Story had circulated, Mullen commented: “The triennial review has been running for over 15 months and throughout that time there has been constant rumour and speculation about potential outcomes, of which this is yet more. It should be noted that the current call for evidence is yet to conclude and industry responses have not yet been submitted to Government.
“We are very clear that stake cuts will fail to adequately address any issue of problem gambling. The industry has also always made it clear that a cut to stakes will have serious consequences – resulting in shop closures which will ultimately affect jobs, tax revenue and the funding of racing. There is also no evidence that machine customers will switch their spend to sports betting such as horse racing, and our experience is that they won’t. Any policy made on this assumption would result in a significant reduction in the level of funding for horse racing.
“We will continue to make the case for a sensible measured, evidence led and proportionate response to the public concern regarding these issues and this will be the basis of the evidence submitted as part of the ongoing review.”
The notion that cutting stakes on FOBTs will lead to widespread shop closures, is one that has been continually echoed by the Association of British Bookmakers (ABB). A spokesperson for the trade association stated: “The focus of any final decision should be to adopt measures that will help problem gamblers. A £2 stake is effectively a ban on FOBTs, would put 21,000 people out of jobs and have huge consequences for sports such as horse and greyhound racing. Betting shops are investing significant sums of money in new technology to help identify those at risk and ensure they get the help that they need.”
Last September, a Barclays analyst forecast that should the stakes get cut to £2 on the terminals, Ladbrokes Coral, which has the largest retail portfolio in the UK would lose around £437m in annual revenue, whereas for William Hill the figure would be £288m and Paddy Power Betfair £60m. Shares of Ladbrokes Coral that had previously jumped amid talk of a £4bn GVC takeover, took a hit in the aftermath of the reports, decreasing 12 per cent at 159.7p a share.