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A flagship government strategy to help addicts stop gambling can simply shift the problem from one part of the industry to another, experts warn – as it turns out, nothing has been set up to assess its effectiveness.
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Bookmakers must reduce bets on “crack cocaine” gambling machines from £100 to £2 by this week, but experts fear users will simply move to other, equally harmful forms of gambling.
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Despite being aware of this risk, the Department of Culture, Media and Sport (DCMS) has not done any work to track how gamblers change their behavior, and has no plans to do so.
The complete lack of oversight means that a policy over which former sports minister Tracey Crouch resigned in November may turn out to be ineffective.
Dr. Heather Wardle, a leading expert in gambling behavior, welcomed action being taken on problem gambling but said that it was “deeply worrying that such a huge regulatory change will not be evaluated to better understand the full range of outcomes and impact on people’s behavior”.
“You can only do this effectively by talking to people themselves and understanding how these changes affect the way they think and feel about gambling and are motivated to change behaviour,” said Dr Wardle.
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Just three weeks before the stake cuts are due to come into force, DCMS quietly published a report detailing major flaws in the evidence relied on for the policy. The department has been working on the report for a year.
The Regulatory Policy Committee (RPC) report shows that while bookmakers will lose out when bets are cut to £2, other parts of the gambling industry stand to scoop a £440m windfall if players shift their behavior.
Even this figure may be an underestimate because it is not based on empirical evidence, the RPC report shows.
Some of the hundreds of millions of gambling losses that will migrate from FOBTs, will probably flow to sectors such as arcades and casinos that spent large sums lobbying MPs for the FOBT stake cut.
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Casinos and arcades have slot machines with many of the same addictive features as FOBTs. Because these machines are faster than FOBTs and pay out less, players can lose money on slots just as quickly – even at drastically lower stakes.
The RPC – a government body that evaluates the evidence behind proposals – initially found that DCMS’ impact assessment for the £2 stake policy was “not fit for purpose”.
After DCMS made changes, the RPC gave the green light, but with a series of important caveats about the evidence relied on. The committee told
Stronger evidence was needed on “what behavioral changes the policy will cause, and what level of benefits this will generate”, the RPC said.
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“Given that we have already seen evidence of industry practices that encourage FOBT players to migrate to online platforms, it seems to me that you want to better understand these processes so that you can then understand the implications of the policy change and think about what further regulatory action may or may not be necessary,” Professor Wardle said.
Overall, DCMS estimates that £1.3bn of the £1.8bn currently lost each year on FOBTs will move to other forms of gambling when bookmakers implement the stake cut on 6 April. The industry regulator warns that many of these alternatives are just as harmful as FOBTs.
The RPC emphasizes that the government knew about this problem at least a year ago: “The department recognizes that displacement to other forms of gambling may involve significant substitution for other gambling products or outside betting shops.”
And it suggests it knew other parts of the industry would benefit: “The department notes that this could have significant effects on competition in the gaming industry.”
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Mike Chatha, who has worked with problem gamblers for 25 years and is the author of a new book on the science behind gambling addiction, said that any attempt to tackle the problem must look at all forms rather than individual products.
There needs to be a “laser focus on one problem: that you can’t tackle problem gambling by focusing on one product”, he said.
“You can’t regulate such an addictive substance. You can’t tackle alcoholism by banning vodka. It’s just not possible.”
Mr Chatha, who suffered with his own gambling addiction for a decade before recovery, welcomed the introduction of a stake cut as a “small miracle” given extensive pressure against it from bookmakers.
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“But, and it’s a big lake,” he added. “If someone is addicted, they need a certain amount of gambling to give you that hit. If they don’t get it anymore, they will simply switch products.
“In 25 years of working with Gamblers Anonymous I am not aware of a single example of an individual who has managed to stop gambling on one product and have no problems with others.
“Actually, the opposite is true. People who can’t control their gambling think: ‘Well, I’ve lost a lot online, I’ll go to the casino. I’ve lost a load at the casino, I’ll go to the bookmaker ‘. It’s typical addict thinking.”
One step Mr Chatha says would make a difference would be to get gambling machine makers and online casinos to hand over data about the way people play, so that experts could track harmful signs.
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Despite this being relatively simple and cheap for businesses to do, neither DCMS nor the Gambling Commission collects such data, or has no plans to do so.
Arcade owners lobbied hard for the cut of the FOBT stake which the government knew would benefit them financially
Mr Chatha said that to really have an impact on gambling addiction, the government must massively ramp up spending on treatment. There are hundreds of thousands of problem gamblers in the UK, but there are only resources to help around 20,000 of them. Spending on treatment is massively behind that for alcohol and drug abuse.
People who recognize that they have difficulty controlling their gambling can register to exclude themselves, meaning that companies will not take their money.
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But at the moment the system is almost useless because it is not comprehensive meaning gamblers can easily work around it, Mr Chatha says. To combat this he crowdfunding for a new app that will block all online gambling sites.
When it comes to reducing FOBT stakes to £2, addicted gamblers will not have to find a solution as they can still lose money quickly on the same machines in bookmakers.
While the public may be under the impression that “crack cocaine” betting machines have in fact changed into much less harmful fruit machines, this is not the case.
FOBT machines run two types of games only one of which is affected by the new stake limit. That category, known as B2, typically takes the form of roulette.
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But the same machines are also allowed to run slot machine-style games – category B3. The last category allows players to bet eight times faster and jackpots are just as high as £500. It also takes a much bigger cut of their winnings.
Gamblers lose money on slot machine games at £2 bet just as fast as on FOBT games at £50 bet, raging questions about why only one type of game was targeted.
A third of the total lost on FOBTs is already lost on slot machine games that will not be affected by the new policy, DCMS says.
Given the availability of these games on the same machines, the amount lost on slots seems likely to rise when betting on roulette is drastically cut.
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The Gambling Commission said it had advised the government that slot machine games at low stakes were as harmful as roulette at high stakes, but DCMS decided to focus only on one type.
Last month the Gambling Commission issued a call for evidence on the damage of other types of machines, but it has no indication of when any findings will be published or action taken.
A spokesman for the commission said: “Our advice to the government’s gambling review was based on the best available evidence and focused on reducing the risk of gambling-related harm.
“Our recent call for evidence builds on our advice that a stake reduction for B2 gaming machines does not address the risk of harm presented by other categories of gaming machines.
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“The gambling industry has an opportunity to demonstrate progress since the gambling review in trialling and evaluating new player-protection measures.”
A DCMS spokesman said: “We have taken decisive action to ensure that we have a responsible gambling industry that protects the most vulnerable in our society.
“By reducing the maximum FOBT stake to £2 we can help to stop extreme losses by those who can least afford it. This will target the majority of problem gamblers and mitigate the impact on those most vulnerable to damage.
“We have been clear that problem gambling is not limited to one product, which is why we have brought in a package of measures to strengthen protection around game machines, online gambling, gambling advertising and treatment for problem gamblers.”
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