B3 and the reintroduction of a Triennial Review?

06/07/2011

Last night the House of Lords Grand Committee considered and approved two related Category B machine concessions. The Gambling Act 2005 (Gaming Machines in Adult Gaming Centres and Bingo Premises) Order 2011 and Categories of Gaming Machine (Amendment) Regulations 2011.

Both were presented by Baroness Patricia Rawlings of the Conservative Party who proposed that the Category B £1 stake be doubled. She also called for the maximum number of Category B machines (currently 4 for adult gaming centres and 8 for bingo halls) be increased to 20% of the overall machine quota for individual premises.

Baroness Rawlings said that AGCs and bingo clubs have been struggling for a number of years due to difficult trading conditions  and the economic downturn. She quoted BACTA figures saying that revenues in the industry are down some 36% since 2007 with over 250 arcades and 1300 jobs lost.

She said that BACTA also estimate that gambling machine manufacturing output has dropped by  40% since 2006 with employment down 33 per cent in the sector since 2009. She quoted the Bingo Association as saying that 128 clubs have closed since 2006 and gross gaming sales fallen £90m since 2008/9, with  employment down 30%.

“Category B gaming machines are an intrinsic part of the business model and generate significant levels of revenue,” she said. She called on the Lords to pass the motion so that the industry could, “Adapt and develop its business model.”

The Baroness explained that amusement arcades and bingo halls form one of the oldest and most valuable forms of tourism and are invaluable to the leisure industry.

She claimed that gambling was not a problem to the overwhelming majority of people and that those with problems formed a tiny minority. She quoted the Gambling Prevalence Survey saying that the number of problem gamblers had only risen from 0.6 to 0.9% in the past 5 years, which constituted around half a million people.

She stressed that the industry was subject to a comprehensive licensing process and obeys stringent rules with regulations that strictly control stakes and numbers and types of machines. “Compared with the rest of the world, Britain has a very low rate of problem gambling,” she said.

Baroness Rawlings then went on to point out that the industry is “Unable to adjust product pricing to absorb increasing costs therefore they are limited to how they can respond to demand.”

“The Government is persuaded that the case is sufficiently brave to justify the increase and bring forward these measures,” she added. “The government wants to give flexibility for B3 gaming machines in Britain to give a boost for manufacturers and operators.”

“The government is confident these matters do not present a risk problem gambling,” she went on to say. “Let us bear in mind that in the Prevalence Survey players of slot machines reduced from 14 to 13 per cent. Such is demand for B3 machines that operators have often resorted to artificially splitting premises. This is not simply about supplying more machines and charging more – it is about stimulating the market.

“Operators will be able to offer what players demand without playing fast and loose with the law. It will bring around 3000 B3 machines into the market  and this could see revenues of around £8.5m a yr across these industries. This will protect jobs and it will make the difference in keeping smaller bingo clubs open and provide a lifeline to small arcades in seasides.”

Lord Clement Jones was next to speak, “I commend these regulations,” he said. “Some of the figures of closures (391 arcades and bingo halls) illustrate the problems those establishments have faced. I play tribute to BACTA and other orgs for their persistence on lobbying for changes to B3.”

“I have some issues with how these things have been done piecemeal. We had Category  C changes in 2009 and these now. It is important we have a  regular review of these issues. There used to be a regular one – is there a plan to reintroduce a review every 3 yrs?

“What other establishments should benefit from B3 machines – what about snooker halls? I hope that the minister and colls in DCMS consider this.”

Lord Colin Moynahan then said, “I echo the views on the effectiveness of BACTA – it is  good to see highly professional trade associations working with small businesses

Over last 2 yrs approx we have had approximately 200 arcade closures. This has had a direct knock-on effect on related enteprises such as souvenir shops and food and drink outlets. The Prime Minister made pre-election pledge to support these proposals but they do need to be revised more frequently.”

 

 

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