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NEWS 24 May 2016

UK casino operators bemoan Gambling Act at parliamentary seminar

By David Cook
Executives from leading UK casino operators spoke at the Future of Casinos conference in Westminster, and seemed fairly united on wishing to see an amendment to gaming machine regulation.

This was the third in a series of seminars hosted by the Parliamentary All Party Betting & Gaming Group, and the format saw four industry executives give speeches to the floor, followed by a Q & A session. Here is our summary of the key points that were raised at the conference.

First to speak was Mark Jones, managing director for Grosvenor Casinos, and the overall theme of the conference and idea of what the speakers are aiming to achieve was made fairly clear from the outset. Jones mentioned that casino attendances increased by 3.6 million over a five-year period since 2010, but that more than three quarters of that increase has come from London and that 80% of that growth has come from just two casinos – Aspers in Stratford and the Hippodrome in Leicester Square.

Jones spoke of his unhappiness about the three-tier structure that governs machines in casinos, as a result of the Gambling Act 2005. Casinos established under the terms of the Gaming Act 1968 are restricted to a maximum of 20 gaming machines, and Jones said: “Tourists, overseas travellers and investors cannot believe we have a three-tiered system and do not know what to expect when they come for a night out. There are very often nowhere near enough machines compared to what they are expecting.”

As per the terms of the Gambling Act, small casinos are allowed up to 80 machines and large casinos may offer up to 150 machines. Machine gaming was also touched upon by Hippodrome Casino CEO Simon Thomas, who said: “Casinos in all major European countries earn significantly more from slot machines than casinos in the UK. The largest European casino countries earn 90% of their revenue from slots. In France, it makes up 80%, it’s 40% in Spain, 70% in Germany and 55% in the Netherlands, whereas it’s 15% in the UK. The UK Gambling Commission has no issues with increasing the number of slot machines. In 2006, the number of machines was raised from 10 to 20 and there were no issues politically or in the media.”

Next up to speak was Richard Noble, COO of the Aspers Group. Noble called the Gambling Act a “market failure”, as only four of the 16 new casino licensees that resulted from the implementation of the Act are currently still operating. Noble also called for changes to allow for more machines in casinos, for the reason that they would bring increased tax income to the Treasury.

The last speaker was Roger Marris, CEO of The Ritz Club, who outlined an idea for changing the casino tax regime to bring it in line with other jurisdictions. “In Barcelona, they have a lower duty rate for international players and a higher duty rate for nationals,” he said. “The high end really caters to a global audience and we want to expand the international audience we are trying to reach.”

In the Q & A session that followed, Gambling Insider asked to what extent UK casinos need to innovate to attract millennials by offering skill-based gaming amenities. Thomas replied: “One of the areas where we are blocked is modernisation. We are not allowed to offer an electronic random number generator and are not allowed to offer online gaming inside a casino. In terms of millennials, I’m actually quite skeptical about skill-based gaming. I grew up playing Space Invaders, but that doesn’t mean that I now want to play a Space Invader version of roulette. Millennials want a really good night out and want to play James Bond – watch a cabaret, eat steak, have a drink and gamble at the tables if they want to.”

Gambling Insider verdict

What seems clear is that the casinos are not happy about current gaming machine regulation. It seems that machines are unable to go without causing debate in all kinds of gaming sectors at the moment. The industry feels bound in a number of respects and it is evident that this seminar, at least from the perspective of the operators, was about attempting to drive debate, and ultimately, change.
RELATED TAGS: Land-Based | Casino | Legal & Regulatory
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