Bookies' fury at “rigged” FOBT stakes report

A new report urging the UK government to slash the maximum stake on fixed-odds betting terminals (FOBTs) to £2 per spin is “rigged”, “deeply flawed” and backed by “vested interests”, a group of leading bookmakers has said.

The Association of British Bookmakers (ABB), which represents major high street bookies such as William Hill, Betfred and Ladbrokes Coral, has demanded an urgent inquiry into today’s report, which it said had been delivered by a “tiny group of anti-betting shop MPs”.

The report was put together by the FOBTs All-Party Parliamentary Group, which concluded that a maximum stake of £2 and a longer time delay between spins would lead to a reduction in the risk of problem gambling.

However, the ABB this morning said there was “no evidence” a reduction in stakes would decrease the risk and highlighted a number of financial backers of the report which it said would all stand to benefit from a reduction in FOBT stakes.

“Vested interests”

The Hippodrome Casino, major land-based gaming supplier Novomatic, casinos and arcades company Praesepe and pub chain JD Wetherspoon are listed among those which have given the FOBTs All-Party Parliamentary Group £3,000 each.

“This is a deeply flawed report funded by vested interests who would directly benefit if its recommendations are ever implemented,” Malcolm George, ABB chief executive, said.

“The report is the view of a tiny group of anti-betting shop MPs [which] has been financed by those with interests in the casino, arcade and pub industries.

“We strongly believe that the Parliamentary Commissioner for Standards should urgently investigate this All-Party Parliamentary Group,” he added.

William Hill, a bookmaker which would be greatly impacted by a stakes reduction, agreed with the ABB’s assertion that an inquiry into the report should be launched.

“This small group of MPs are presenting this report as an independent inquiry,” a spokeperson for Hills said.  “It isn’t anything of the sort as it is funded by commercial interests.

“It appears to have breached a number of Parliamentary rules on APPG Reports and the ABB will be raising it with the Parliamentary Standards Commissioner.  Loss rates on FOBTs at £50 stakes are less than a £1 slot in a pub and bookies have far higher standards of responsible gambling,” the spokesperson added.

FOBTs All- Party Parliamentary Group also used the report to lament bookmakers for their refusal to take part in the report, suggesting bookies had their heads in the sand when it came to the issue of problem gambling.

“We were disappointed that the bookmakers declined to participate and fear this is a reflection of their denial of the problems associated with FOBTs and a reluctance on their part to speak to policy makers about appropriate regulation,” said the MPs’ final report.

Yet the ABB reacted angrily to this accusation, and said the Parliamentary Group had drawn up the report in a discredited fashion.

“This group of MPs has operated in secrecy, provided no transcripts of the evidence given to their meetings and operated throughout behind closed doors away from public scrutiny,” George said.

“Kangaroo court”

Furthermore, a spokesperson for Ladbrokes Coral said it was only prepared to take part in “sensible evidence based inquiries”.

“This was a parliamentary group funded by anti-FOBT campaigners and commercial competitors using select evidence to build a predetermined case calling for specific action,” the Ladbrokes Coral spokesperson said.

“The industry did not take part as it was nothing more than a FOBT kangaroo court.  We are always willing to take part in a sensible evidence based inquiries, however sadly that does not suit everyone’s agenda.”

While the Parliamentary Group has no political authority, its report comes ahead of the publication of the Triennial Review into stakes and prizes conducted by the Department for Culture, Media & Sport (DCMS).

And within today’s report, the Group noted that DCMS secretary of state Tracey Couch had described the MPs’ input as “extremely valuable”.

A reduction in FOBT stakes could have a ripple effect on the online industry, with affected bookies likely to transfer more players to digital roulette play, where restrictions such as the £50 journey and £2 max spin limits would not apply.

A reduction would also negatively impact the value of bookmakers such as Ladbrokes Coral and William Hill, with lower profits strengthening the case for further consolidation.

Simon French, leisure analyst at Cenkos Securities, said that while today’s report wasn’t “new news”, it did cast a shadow over the performance of the publically-listed operators.

“We expect an update from the DCMS by the end of Q1 but remain concerned that a significant proportion of retail revenues are under threat and thus expect stocks with exposure to this segment of the market to continue to underperform,” French said.

The share prices of publically listed high-street bookies all suffered a fall when the markets opened this morning but had more than recovered and were slightly ahead of their opening levels at the time of writing.