Finnish Ministry of Social Affairs and Health rallies against licence system change

The Finnish Ministry of Social Affairs and Health has referenced Norway’s monopoly structure as proof that monopoly frameworks function better than alternative licensing systems. 

Finland is currently reviewing a move from its existing monopoly structure to a commercial licensing system akin to other European markets. 

There has been almost unwavering support for this change, with several major political parties in Finland voicing their support for the disassembly of the country’s gambling monopoly framework. 

The monopoly operator in Finland, Veikkaus, has given its support of this change as well. 

The only real opposition to a change to the monopoly system has come from the government’s Ministry of Social Affairs and Health, which has questioned the initial report on a new gambling regulatory system. 

This report came from the Finnish Ministry of the Interior, which detailed the benefits that could arise from a change from the existing monopoly model.

The Ministry of Social Affairs and Health’s Mari Pajula, who expressed the original concern, and permanent secretary Veli-Mikko Niemi have both praised Norway’s monopoly system, citing its effectiveness in reducing problem gambling, as an example of how a monopoly system can work successfully. 

The two minsters highlighted that Norway’s implementation of a number measures around advertising and restricting payment methods has helped to reduce problem gambling and has cut consumer spending at non-monopoly operators by two-thirds. 

Niemi said: “A recent population survey conducted in Norway shows that gambling problems can be substantially reduced by developing the monopoly system. Finland could also proceed by first assessing and introducing new restrictive measures and then considering whether the gambling system needs to be amended.”

Pajula added: “One major criticism of the monopoly system is that, because of it, a significant amount of money is lost due to gambling outside the system. That said, it appears that gambling outside the monopoly system has reduced considerably in Norway as a result of developing the system.

“It is also worth noting for Finland that switching to a licence system is said to bring additional revenue to the state. In reality, the government revenue from gambling is much lower in the licence system than in the monopoly system, and it is likely that the government revenue would not increase in the licence system,” she added.

In contrast to the findings of the Ministry, legal advisor at Legal Gaming Attorneys at Law, Antti Koivula, questioned how Pajula drew this conclusion from the report after he was given access to the same data last month. 

Koivula said: “Based on the presentation I received, I would seriously question her findings. In short, the state revenue under a monopoly system seems to be badly overestimated, while state revenue under licensing system seems to be underestimated.

“For example, her presentation includes three scenarios for a monopoly system, in all of which the channelisation appears to be unrealistic. With more realistic assumptions, all the scenarios for a monopoly model would appear much less appealing in terms of revenue.”

Koivula further queried whether the numbers had been skewed to suit Pajula’s narrative to retain an operator monopoly. 

He commented: “Numbers are seemingly simple; more is more, and less is less. But on the other hand, it is easy to use numbers in a deceptive manner, especially if one is in position of authority and presents the numbers for an audience that is unfamiliar with the topic. 

“By choosing the right angle, point of comparison, period of time etc, it is possible to provide evidence literally on behalf of any argument. Not to mention if you have the power to make calculations based on variables of your own choosing, without anyone questioning the choices.”