Industry reaction to the proposed mandatory levy in the UK

The UK government has announced the revamped levy will funnel £100m a year into the NHS to provide much-needed research, prevention and treatment (RET) services to those dealing with gambling-related harm.

The levy, which will become statutory, has been proposed at 1% of annual gross gambling yield (GGY) for online operators, with traditional betting shops and casinos to pay a proposed fee of around 0.4%. 

The new system will replace the current voluntary system which does not put any requirements on operators to donate a set portion of funds for RET support.

Currently, firms are encouraged to give 0.1% of annual GGY to RET services, while companies that generate less than £250,000 in annual GGY are asked to donate a minimum of £250.

The new levy has been championed by the government as a means to provide “fresh funding” across England, Scotland and Wales for the provision of a “full treatment pathway”.

A subsequent eight-week consultation into the design of the proposed statutory levy has been launched to take in the views of various stakeholders.

And while the 1% figure is positive news, some industry heads have raised concerns and queries over the NHS taking sole ownership of the donated funds.

To get a feel of the prevailing attitudes to the changes, EGR spoke to some key figures from the third sector as well as collating wider reactions to the government’s proposal.

Pedro Romero, chief of safer gambling partnerships at BetBlocker

“We fully support any initiatives aimed at assisting individuals struggling with problematic gambling.

“Many charities and organisations involved in RET have been doing an outstanding job, and we believe that funding should be earmarked specifically for supporting them or developing a solution to ensure the sustainability of the UK support network.

“A levy could be imposed to support NHS gambling clinics and a regulatory settlements pot that would support RET organisations.”

Victoria Reed, Better Change founder

“The alarming news that funds raised through the mandatory levy for the research, prevention and treatment of gambling harm, an estimated £100m, would be directed to the NHS is deeply concerning and smacks of lazy governance on behalf of the government.

“The lead commissioner and lead treatment provider should not be the same organisation.

“This is frankly irresponsible and poor governance leading to a situation where an organisation can effectively mark their own homework, which, from a safeguarding point of view, is not acceptable. Furthermore, the NHS have not covered themselves in glory when it comes to their stance on gambling.

“Making threats to not refer clients or work with third-sector organisations that receive funding directly from the industry, despite doing so themselves now by accepting levy payments, is a case of them putting their own political agenda ahead of the welfare of those in desperate need of support.

“Is this the kind of organisation we want in charge of treatment and what are the repercussions for research, education and prevention? This anti-gambling stance and potential exclusion of industry input into safer gambling and player protection is ill informed.

“Language such as ‘treatment and research will finally be removed from the harmful grip of the industry’, as well as the failure to recognise the significant contribution financially and collaboratively in recent years from the industry driven by the BGC, is stigmatising gambling and unfairly tarnishing the reputation of many people employed in the industry who are as committed to reducing gambling harm as anyone.

“I sincerely hope this is not a done deal, and implore anyone who cares about this space to contribute to the consultations. For all its faults, the current system of RET-listed organisations was an open church providing space for a variety of organisations as well as theoretically a way of ensuring adequate governance was in place for the vetting of each organisation. We need a solution that recognises all voices within this space, and one that prioritises people over politics and profits.”

Kirsty Caldwell, Betsmart Consulting founder and director

“While news stories reporting that NHS treatment programmes are set to benefit directly from the mandated industry levy are positive, it shouldn’t be forgotten that the government consultation deals with multiple, vital questions relating to the levy’s implementation. Key areas include the amount different types of gambling operators will be required to pay and when, the approach to research and prevention funding allocation, and how the government will ensure that levy funds are being distributed and utilised appropriately.

“It is imperative that the industry has its say on all matters regarding the levy framework and so I would strongly encourage gambling operators to provide a full and robust response to the consultation.

“Although the government’s press release states that some operators are contributing very little under the current voluntary levy approach, it should be noted that most are already choosing to donate significant amounts to help fund research, education and treatment.

“Under the current system there is often little in the way of accountability, in relation to how funds are being spent and whether initiatives are really being effective, so a more transparent system being brought into force would be welcomed.

“The other key point for me would be around collaboration of different stakeholders across the industry. A quote from the government’s press release states that under the new proposed system ‘the gambling industry will no longer have a say over how money for research, prevention and treatment is spent’.

“Now, while I appreciate it’s important that a certain level of independence is achieved between industry and support services, it should be remembered that gambling operators are in a unique position to support new, innovative initiatives through the sharing of activity data and historical learnings. If we are to properly address the societal issue of gambling-related harm, all key stakeholders must play a part and have a voice.”

David Inzani, partner at Poppleston Allen

“The statutory level was one of the key proposals in the white paper and much of what has been published in the consultation document was widely expected.

“It’s likely that it will be welcomed by many bodies – not only those involved in harm prevention and treatment, but also industry bodies and operators. Many operators already make significant contributions to research, education and treatment under the existing requirements, although the amount donated is discretionary so a statutory levy will level the playing field somewhat.

“In the past the NHS and some other bodies may have been reluctant to accept funds that originated from gambling firms due to the political optics, but with the money collected and distributed by the government, it should be much less politically sensitive for them to put this to good use.

“Land-based operators are likely to be pleased that the proposed structure reflects the varying levels of harm associated with the different sectors and also the costs that land-based venues have in running their premises when compared with online operators.

“The proposals are particularly favourable for the smallest operators as those with GGY or gross profits below £500,000 will not be expected to pay the levy. Adult gaming centres (AGCs) and land-based bingo operators have also fared well compared with other forms of land-based gaming, with their level proposed at the lowest rate of 0.1%.

“Some may be surprised at the inclusion of society lotteries in the levy, particularly when the government has thus far resisted calls from some parts of the sector to impose the levy on the National Lottery. But as is outlined in the consultation document, the power to introduce the levy is a blanket power and therefore these cannot be excluded entirely.

“However, in recognition of the low rates of harm associated with society lotteries and the fundraising for good causes that they are associated with, the government are considering a definition comparable to GGY that can be adjusted to account for contributions to good causes.”

GamCare spokesperson

“We welcome this announcement that the consultation process for the statutory levy on gambling operators has begun and the clarity it will bring in setting out how research, education and treatment services for gambling harms will be funded in the future.”

Brigid Simmonds, Betting and Gaming Council chair

“While we don’t have any say over how this money is currently distributed and nor do we seek one under the new statutory levy, we are however concerned about the future of funding for a network of over 120 third-sector problem-gambling treatment centres and many educational programmes that could be put at risk from proposals contained in the government’s consultation.

“This new funding model must protect the third sector, these are the experts, they should have the sustainable funding for their long-term future, or the levy will no longer be fit for purpose. Instead, it will be a hypothecated tax to raise funds for the NHS at a time when many Conservative MPs have said they would oppose new taxes.”