The White Paper on the Gambling Act Review: A Year After
It’s been nearly twelve months since the White Paper on the Gambling Act Review was released. This crucial document pledged to completely alter the way gambling is controlled in the UK. It was a significant step for the industry. But after a year, has the review truly improved things?
The White Paper on the Gambling Act Review: A Year After
After a lengthy wait, much discussion, and some grievances from the industry, the White Paper on the Gambling Act Review was finally made public on April 27, 2023. The 268-page document contained novel ideas for the industry, ranging from minor enhancements to major alterations and new regulations.
The white paper has had a substantial impact on all facets of the industry. It has particularly affected online casinos, land-based gambling, and horse racing.
It’s essential to note that the UK Gambling Commission has been swift in initiating the implementation of the review’s ideas through discussions. The initial round of discussions commenced in July, concentrating on making gambling safer and more sustainable. This included one of the most significant proposals in the white paper – financial risk checks, which are also known as affordability checks.
Just a few days following the release of the white paper, Tim Miller, the Commission’s Executive Director of Research and Policy, acknowledged that regulators will have limited flexibility to consider policies outside of the white paper’s framework in the years to come. After a year of dedicated work, what strides have we made in implementing the safer gambling and sustainability proposals outlined in the white paper?
The connection between operators and players is central to the industry’s growth, just as finances are the driving force behind global progress. Any action that could potentially harm this connection could have catastrophic repercussions and requires careful consideration.
The white paper’s introduction could easily lead to these repercussions. Victoria Reid, founder of Better Change, believes that the industry’s regulatory standards are already robust, but a delicate equilibrium must be maintained when introducing stricter regulations.
Reid stated: “This is a tightly regulated industry, so I believe the standards are generally high compared to other sectors. However, the nature of our business is heavily influenced by technological advancements and customer trends, so we can never become complacent and assume we have all the answers.”
This equilibrium is especially crucial when it comes to ensuring sustainable gaming.
Numerous online service providers have put in place extra safeguards for individuals between the ages of 18 and 24, and some providers conduct financial reviews if there are any concerns, Reed continued. “Some form of regulation of these actions is sensible, but it’s crucial that the equilibrium between public liberty of choice and government intervention for public health concerns is balanced.”
Matt Zarb-Cousin, co-founder and director of external affairs at Gamban, believes this change in the relationship with service providers is not only advantageous for players. He believes that service providers will perform better under stricter standards, and sustainability is a desirable outcome. He points out that this shift will fundamentally change the relationship between service providers and their customers, forcing service providers to reconsider their approach and how they operate.
“I believe there are aspects in [the white paper] that will fundamentally alter the relationship between service providers and their customers, and for that, I think service providers have to reconsider their approach and how they operate,” he explained.
“In a system where standards are higher and it’s no longer possible to make excessive profits from individuals with gambling issues, the best performing service providers are those that are built sustainably.”
In Reed’s view, promoting sustainable gaming and safer gambling must be approached from a preventative perspective. She believes the white paper doesn’t go far enough in this regard.
“We believe ‘safer gambling’ is the practice of safe gambling.”
Thus, restricting, limiting, prohibiting, barring or even labeling gambling negatively has no place in safer gambling,” she stated. “Hence, we see very little in the white paper that constitutes safer gambling for us – instead, we believe measures such as limitations and financial risk assessments are more in line with player protection.
“Naturally, this is significant, and we believe there should be ample resources for those who have encountered gambling harm, but our role isn’t to rescue people from the river, at Better Change, we’re about preventing them from falling in in the first place.”
Financial capability checks are a major concern for the industry.
Better Change’s philosophy centers around supporting positive gaming through education and reform. It’s about reaching players before they might begin struggling. Some of the prominent aspects of the white paper, like financial capability checks, claim to want to do this.
If implemented correctly, these proposals would tread a fine line – encouraging sustainable, safe levels of gambling before players reach a crisis point. This could be the sustainability solution the industry has been seeking.
If implemented in their current form, financial capability checks would see those who lose £1,000 in 24 hours or £2,000 in 90 days face checks.
It’s difficult to overstate the strong opposition to financial capability checks from a large part of the industry.
A plea against the proposition gathered 100,000 names and was presented to the legislature for review in February 2024.
Despite the debate, Melanie Ellis, a gaming regulation attorney and partner at Northridge Law LLP, stated the affordability checks suggestions “represent an improvement on the current situation.”
“There’s a lot of uncertainty among operators about how they should be evaluating affordability and/or financial risk and when they should be taking these actions,” she said.
“However, we must remember that these proposals are relatively limited in extent and won’t simply replace existing procedures that operators have in place.”
Possible advantages for everyone
Ultimately, players wagering in an unsafe manner will decrease the probability of sustainable gaming – which will lead to losses for both operators and players.
“The more you lose, the more likely you are to become dependent on gambling. If there are systems in place to prevent harm, everyone gains,” said Zarb-Cousin.
“Even the industry will gain because you won’t end up with clients who lose all the money they have at that moment, exclude themselves, and never return.”
But implementing affordability checks could bring a new set of unexpected problems. As the commission prepares to test an affordability checks program, its effect may soon become obvious.
Reed stresses that cost-effectiveness must be implemented on a case-by-case basis.
“The financial risk evaluation system needs to be tailored to individuals, not a universal approach,” she emphasized. “We must be cautious to prevent unwarranted labeling of gambling and other recreational spending, which could negatively affect our industry.
“This will influence commerce and impede those who truly require assistance from obtaining it.”
If implemented effectively, affordability assessments, along with the proposed 1% legal charge on total gambling income, could genuinely aid those struggling with gambling-related issues.
“If affordability checks are implemented properly, the tax will have a substantial impact,” Zab-Cusin stated. “The amount of funding and resources for treatment and prevention efforts – all of this will have a major impact.”
Guaranteeing future enhancements
Over the past year, there has been some advancement on the key proposals outlined in the white paper. But does this signify that standards have improved?
Reed asserts no. In fact, it may have adversely affected the Research, Education and Treatment (RET) funding the commission initiated over the past year.
The ambiguity surrounding financial support due to the proposed compulsory tax revisions has had a considerable negative effect on initiatives provided by organizations on the Gambling Commission’s authorized list. These initiatives are financed by voluntary contributions from the sector and are utilized for investigation, education, and treatment of gambling harm.
She indicated that the compulsory tax needs to be explained, otherwise it could have a more negative effect next year.
“The White Paper has had a significant impact on our industry’s research, education, prevention, and treatment work, and I am sorry to say that unless we address this issue, I don’t believe we will see any progress next year.”
Will the White Paper contribute to raising standards?
In the meantime, Zarb-Cousin hopes that the prominent aspects of the White Paper will be put into practice in September or October this year. He estimates that the affordability checks trial will conclude around that time.
He is more hopeful that the new tax system could be functional by this time next year. This would be a suitable timeframe, marking the two-year anniversary of the White Paper’s release.
For Ellis, the more contentious aspects of the White Paper could lead players to turn to illegal suppliers, which would be counterproductive to improving standards.
A number of proposals, such as online slot wagering limits and restrictions on rewards and incentives, could result in a substantial portion of patrons migrating to unauthorized operators, where they might lack access to tools for managing their gambling or receiving assistance when they display problematic behaviors, she explained.
The Gambling Act Review White Paper has, to some degree, advocated for enhanced standards – even if only in the discourse and debate regarding what the sector can improve upon.
To guarantee the White Paper is enacted in a manner that benefits both providers and participants, durability must be at the forefront of these discussions. If sustainability is relegated to a secondary concern, the industry may discover itself back at the starting point.
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