Calls for a mandatory levy

A voluntary levy has been in place for gambling companies in the UK for a number of years. The levy go towards funding gambling addiction programs. Currently, the voluntary levy asks for 0.1% of the gambling companies’ revenues.

However, a lot of gambling operators have not been meeting their obligations for it. This has led politicians, the British Medical Journal and the UK Gambling Commission to call for a mandatory levy.

GambleAware is the main charity that receives funds from the voluntary levy. In the most recent period, gambling companies had revenues of around ￡14.4bn, meaning the voluntary levy fund should have been ￡14.4m. In reality, less than ￡10m was handed over. Some of the gambling operators gave as little as ￡1.

A mandatory levy could generate an additional ￡60m for problem gambling treatment. As there is currently only one dedicated treatment center for gambling addiction in the UK, this would be very welcome.

Offer to increase voluntary levy

A number of notable gambling companies are offering to increase their voluntary contributions to help problem gambling. Bet365, Skybet, Paddy Power Betfair, Coral Ladbrokes and William Hill have all committed to this approach.

They are offering to increase the voluntary levy from 0.1% up to 1% of revenues for the coming five years. This would generate around ￡100m in funding each year, a significant increase on last year’s ￡10m.

The companies made this offer in a letter sent to the department for digital, culture, media and sport (DCMS). The sector has experienced a lot of reputation damage in the UK as of late, particularly in relation to fixed odds betting terminals. This move could go a long way to helping clean up the image of these companies.

Jeremy Wright, secretary of state for DCMS, recently commented on the potential increase of the voluntary levy. He said: “I want the gambling industry to step up on social responsibility and keep their players safe, including through making more funding available for research, education and treatment to tackle problem gambling.

“I have met the major players in the sector recently and my department is in discussions with them on a strong package to increase their financial contribution, as well as make meaningful commitments on other measures to help ensure people gamble safely.”

Tipping point

This is an extremely important time for the gambling industry in the UK. Many operators fear the backlash will continue and that their ability to advertise will be severely curtailed in the coming years. This would be similar to what has been seen in the tobacco and alcohol industries in recent decades.

There have been extensive calls to ban gambling companies from being kit sponsors for sports teams and having pitch-side ads. There is already a new ban in place on showing gambling ads during sporting events. The group of companies that wrote this letter account for about half of the UK’s gambling sector.

Tom Watson, deputy leader of the Labour Party, is calling for all gambling companies operating in the UK to have to reapply for their licenses so they can recommit to their corporate responsibility. He also wants a new gambling ombudsman position to support those people who have received poor treatment from gambling companies.

Problem gambling is a serious issue in the UK. A report in the British Medical Journal recently showed that there has been a significant understatement of the social and economic harms of problem gambling.

Currently, the UK Gambling Commission estimates that the number of people struggling with serious gambling issues is around the 430,000 mark. This figure rises to more than 2 million people when accounting for those at risk of developing an addiction.

(cash)(Increasing the voluntary levy from 0.1% up to 1% of revenues would generate ￡100m a year to help treat problem gambling)