New plan to fund British gambling charities

UK Sports Minister Gerry Sutcliffe has unveiled plans to introduce a tax on the gambling industry to pay for the treatment of problem gamblers. It would require bookmakers and other gaming companies to pay more than USD 7.4 million a year in order to fund education programmes, help lines and research into problem gambling.

According to a report in The Independent newspaper this week, the voluntary donation scheme that has been in place since 2002 has consistently fallen short forcing major operators to step in at the last minute to meet minimum funding targets.

The Department of Media, Culture and Sport (DCMS), which is responsible for regulating the gambling industry, said that existing voluntary arrangements with gambling operators have failed to raise an acceptable amount of money and in some cases, particularly amongst the smaller operators, contributions have not been forthcoming.

The newspaper reported that smaller outlets have consistently refused to contribute over the past two years to the current system citing difficult financial conditions, which has led to a shortfall for 2008/09 of almost USD 1.8 million. “This move will secure the future of problem gambling treatment and will ensure that all operators pay their way,” The Independent quoted a government source. “Discussions continuing on the voluntary route have so far fallen short of the mark and now is the time to get this sorted one way or another.”

It also reported that 80 % of current donations to the Responsibility In Gambling Trust (RIGT) come from just 30 major donors while small, on-course bookmakers would be exempt from the planned compulsory donation system.

“We have put the protection of vulnerable people at the heart of the Gambling Act and that remains our priority,” said the Sports Minister Gerry Sutcliffe. “We must ensure that organizations working to prevent and treat problem gambling are given the financial security they need to carry out the important work they do. Gambling operators have a responsibility to help fund this and it is very disappointing that the industry has so far failed to agree improved voluntary arrangements to do this.”

A statutory levy will come into force during the next financial year, unless the industry can give satisfactory funding guarantees in the meantime. A consultation was launched this week by the DCMS and will run for 12 weeks.

The plan is the brainchild of Andrew Burnham, Secretary of State for the Department of Culture, Media and Sport, and would see bookmakers with one shop required to donate between USD 268 and USD 447 a year while large national chains would be asked for a six-figure sum.

Gambling operators now have twelve weeks to save themselves from the statutory system by agreeing a voluntary deal while a consultation process takes place. ’The prospect of a voluntary agreement is still on the cards if the industry can give satisfactory guarantees,” said the government source.

Under the proposal set out by the government, land-based operators would pay a flat fee based on the number of premises they run and the type and volume of gambling they offer. Remote operators would pay a flat fee within bands based on the Gambling Commission’s license structure.

The Responsibility in Gambling Trust (RIGT), which currently administers the voluntary arrangement, had proposed a statutory levy based on 0.07% of operators Gross Gaming Yield, however this was rejected by the government due to the lack of reliable figures and the cost of monitoring such a system.