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Letter to Helen Grant MP

Helen Grant MP
Parliamentary Under-Secretary of State (Sport, Tourism and Equalities)
DEPARTMENT FOR CULTURE, MEDIA AND SPORT
100 Parliament Street
London
SW1A 2BQ

RE: Timetable for a decision on FOBTs.

January 2014

I write to you in response to last week’s Opposition Day debate on Fixed Odds Betting Terminals, as I hope you might be able to clarify your position further.

During the debate, you said you had met with the five largest UK bookmakers in December and “challenged them to develop a plan by the end of January to link players with play in a way that allows us better to understand player behaviour and to assess the effectiveness of harm mitigation measures.” Can you confirm whether this actually takes the form of the Code of Conduct drawn up by the Association of British Bookmakers? [1]

It has been brought to my attention that a new Responsible Gambling Committee is being set up to monitor compliance and evaluate the effectiveness of the Code of Conduct. The panel will receive data reports from ABB members, and is likely to report to the Gambling Commission, which advises DCMS. Can you confirm that you will be carrying out your own

evaluation of harm minimisation measures and not relying solely on the Responsible Gambling Committee?

My concern is the Responsible Gambling Committee will be made up of personnel from, or in some way connected to, the Responsible Gambling Trust, which has had its objectivity called into question for a number of reasons. The most pertinent being that it is Chaired by the same man – Neil Goulden – who Chairs the Association of British Bookmakers, and such a flagrant conflict of interest will continue until a successor is appointed [2]. Half of the Responsible Gambling Trust’s board of trustees are also from the gambling industry.

In terms of timescale, the deadline for the Code of Conduct to be rolled out to all of the ABB’s members is March 2014, and the Responsible Gambling Committee will be conducting their review six months after the measures are introduced. So do you agree that the earliest time to assess the impact of these measures is likely to be September 2014, which coincides with when NatCen’s research into Category B machines is scheduled to be completed?

Do you share the concerns outlined by NatCen in their Scoping Study that “because of the small scale and exploratory nature of this work, we do not anticipate that the analytical findings from these studies would be applicable for policy use” and because there is no systematic link between transactions and game play “this closes down a whole range of potential research about how people play and interact with certain game characteristics and features of machines”? According to NatCen, the data: “provides insight into only a narrow range of issues – namely those of financial transactions.” [3]

Do you share the concerns of NatCen that this particular piece of research, which analyses the data alone, will not go far enough and that the bookmakers should co-operate with observation research? NatCen published a qualitative study of gaming machines, which was commissioned by the Responsible Gambling Fund, and independent body usurped by GREaT before the formation of the Responsible Gambling Trust. However, FOBTs are not included as the bookmakers did not grant researchers access to their premises [4].

To put this right, the Campaign for Fairer Gambling requested the donation of a Fixed Odds Betting Terminal with live data to Cambridge University for research into player interaction. However, this request was refused. During the Opposition Day debate on FOBTs, you said: “No stone will be left unturned.” Will you agree to write to Association of British Bookmakers, the Responsible Gambling Trust and the gaming machine suppliers to facilitate the donation of a live SG Gaming terminal for the purposes of research given that the brand is most prevalent on our high streets, so we can build our evidence base further?

I look forward to your response.

Kind regards,

 

Tom Watson
Member of Parliament for West Bromwich East

 

References

[1] http://bylb.iceni.co/wp-content/uploads/2013/10/ABB-code-for-responsible-gambling.pdf

[2] http://www.abb.uk.com/news/neil-goulden-stepping-as-abb-chairman/

[3] http://www.responsiblegamblingtrust.org.uk/user_uploads/industry%20data%20scoping%20final.pdf

[4] http://www.natcen.ac.uk/media/205544/exploring-machine-characteristics-report-final-2-.pdf

David Cameron and Ed Miliband on Fixed Odds Betting Terminals at PMQs today

Below, the transcript of the exchange between Ed Miliband and David Cameron at PMQs. I’m researching this but already I think the PM made an inaccurate claim about machine numbers. And I’m trying to find out what report he was talking about when he said they will “report in Spring”. He seemed to think the DCMS were conducting a review or a report but I don’t think they are.

So all in all, more questions to answer.

EM: Does the Prime Minister recognise the concerns of families and communities about the impact of Fixed Odds Betting Terminals, gaming machines, where people can gamble up to £300 a minute on our high streets?

DC: I absolutely share concerns about this issue and I think it is welcome that we are having this debate in the House of Commons today. I think there are problems in the betting and gaming industry and we need to look at them. I think it is worth listening to the advice of his own Shadow Minister who said ‘I accept that argument that empirical evidence before making any changes because it might just create another problem somewhere else.’ But this is a problem, it does need looking at we have a review under way, frankly we are clearing up a situation that was put in place under the last government but I think if we work together we can probably sort it out.

EM: Let me say the 2005 gambling act limited the number of machines to 4 per betting shop but it didn’t go nearly far enough in the action that should have been taken. Let me just say Mr Speaker, he asked about evidence, local communities from Fareham to Liverpool are saying that these machines are causing problems for families and communities, now local communities already believe they already have the evidence, shouldn’t they be given the power to decide whether they want these machines or whether they don’t want these machines?

DC: I think he is making a reasonable point but first of all just deal with the facts. Fixed Odds Betting Terminals were introduced in 2001 after the Labour government relaxed gambling regulations. The second fact is there are actually now fewer of these machines now than there were when Labour were in office and to his point he has just made councils already have powers to tackle the issue and I believe that councils should make full use of that power. Now I’m not arguing that is job done, there may well be more to do but we have a review underway, this is an issue for the Department of Culture, Media and Sport, if he has ideas I’d ask him to put those ideas into this review, but as I say he might want to listen to his own shadow minister who as recently as November said: ‘There is no evidence to support a change to stakes and prizes for Fixed Odds Betting Terminals.’ So there does seem to be something of a change here but if he has got extra evidence put it into our review and I think we can sort it out.

EM: Well Mr Speaker our ideas are in our motion today and if he wants to vote for it we would be very happy for him to do so. Mr Speaker, he says there are already powers in place but the Mayor of London and the Conservative head of the Local Government Association have said local authorities do not have the power to limit the number of these machines. Now one in three calls to the gambling helpline are about these machines and they are clustered in deprived areas. For example Mr Speaker there are 348 in one of the most deprived boroughs in the country, Newham. Can he at least give us a timetable for when the government will decide whether to act?

DC: We will be reporting in the spring as a result of the review that is underway but I think it is important we get to grips with this. There is something of a pattern Mr Speaker, we have the problem of 24 drinking and that needed to be changed and mitigated and we have done that. We have the problems created by the deregulation of betting and gaming which he is raising today and we need to sort that out. We have also had problems of course in the banking industry and elsewhere that we have sorted out, so, as I say, if he wants to input ideas into that review I think that is the right way forward.

Video games,rickets,newspapers and headline writers

Professor Simon Pearce Dr Tim Cheetham published an fascinating clinical review in the British Medical Journal earlier this month. Their research, a collaboration between Newcastle University and Newcastle NHS Foundation Hospital, led the two respected academics to conclude that Vitamin D should be added to milk and other food products, in a bid to halt a rise in the number of children suffering from rickets. Here’s the press release from Newcastle University that highlights their research.

After reading the press release, a startling fact jumped off the page:

“Half of all adults in the UK have Vitamin D deficiency in the winter and spring, and one in six have severe deficiency. This is worse in northern regions and could be part of the reason for the health gap between the north and south.

“And the condition has been linked to cardiovascular disease, type 2 diabetes, several cancers, and autoimmune conditions as well as osteomalacia, which is the painful manifestation of soft bones in adults.”

I discovered their research after reading lurid headlines in the Metro Newspaper last week. The front page splash carried the headline “Video gaming leads to a surge in rickets”. The headline was so obviously misleading that I knew it would irritate the army of video game players who form Gamers’ Voice, the group we established just before Christmas.

Even the respected correspondent in the Times, David Rose, had to suffer the indignity of the headline “TV and computer games blamed for rickets” ITN (yes, ITN) ran the story “Experts say gaming leads to a rise in rickets”.  Well done to the one media outlet I could find  thatwrote the headline: “50% of UK Vitamin D deficient”

After consulting members of Gamers’ Voice, I emailed Professor Pearce:

“I read the front page of the Metro this morning with interest. Am I right in thinking that you have written a report that links video games to rickets? Is it possible to send me details?”

He was candid about how the story was portrayed in some newspapers and online outlets:

“No we really didn’t do a study to show that, or say that Gaming causes rickets. It was a classic piece of dodgy lazy journalism, taking 3 words out of PA’s hyped-up version of our press release.”

The Press Association release that I assume he’s referring to, does not mention video games, though there is a reference to computers.

By chance, I’d met the amiable Nicholas Lovell at a video games industry conference on the day the story was published. He was similarly irritated by the misleading headlines and had contacted the academics as well. Nicholas is not a journalist. He’s an analyst. Still, he did fair reporting a favour last week.

So, once again video games get a kicking in the press based on an untruth. And the poor health academics who are trying to get their important research across to policy makers have their work undermined by nonsensical headlines. Now that I’ve read the research and talked to Professor Pearce, I feel I have a duty to help them get their message across.

I’m going to table this motion later today:

This House notes with concern the recent clinical review by Cheetham and Pearce in the British Medical Journal, “Diagnosis and management of vitamin D deficiency” that shows an increase of rickets amongst children in the UK; further notes that this was reported in many newspapers as being linked to the growth of video games and that the newspaper “Metro” published the front page headline “Video gaming leads to a surge in rickets”; understands that half of all adults in the UK have Vitamin D deficiency in the winter and spring, and one in six have severe deficiency and the condition has been linked to cardiovascular disease, type 2 diabetes, several cancers, and autoimmune conditions as well as osteomalacia; understands that it has been known since 1922 that rickets and osteomalacia are caused by a deficiency of Vitamin D in the diet and inadequate  exposure to sunlight; and therefore realises that video games do not, in fact, cause the disease; believes that the solution to combatting rickets is cheap and simple; calls on the government to examine the case for Vitamin D supplementation in food and for parents to encourage their children run around more.”

I’m also going to quiz Department for Health Ministers to see what work they’re doing in this area.

Finally, if you’re a gamer, why not let Metro know about the research.

Video Games: It’s time to play

Fascinating taxpayer funded research commissioned by NESTA on what leading figures in the games industry think the effect of a cultural tax credit might be. It’s Time to Play: A Survey on the impact of a tax credit for cultural video gamesin the UK development sector (pdf format) The executive summary says it all:

A world-class sector under pressure
Survey respondents describe a world-class creative industry under increasing pressure. Experience, creativity and quality have been the traditional advantages of UK video games developers, while high costs and skill shortages are their main disadvantages. The availability of government subsidies overseas is making the UK even less competitive as a video games development territory, not only from the point of view of costs, but also of skills -Strong government support in competitor countries (particularly Canada) is attracting key senior staff in a ‘brain drain’ which intensifies existing skill shortages and threatens the quality of the UK’s output.

Original IP development seems to be in decline
Nearly three quarters of respondents claim that original Intellectual Property (IP) development has slowed or stopped in the last 5 years, and more than half think that this the trend will continue in the future, with the potential exception of emerging networked gaming platforms. Risk aversion by publishers is making it harder for UK developers to be creative and innovative, areas where they have excelled in the past.

A slow-down in the UK video games sector
Most respondents report growth of some kind over the past 2 years. This growth is expected to slow down, or halt altogether in the coming 2 years. The survey sample includes some of the UK’s most successful video games business. This means that the growth prospects for the rest of the industry could be expected to be significantly worse. A shift in publisher strategy might benefit some UK developers Although 3rd party development managers report low levels of investment in UK-based original IP production over the last 2 years, they claim that there will be a steady increase in the funds available for original IP in the years to come. This is a consequence of a shift in some publishers’ development resources from internal studios towards external contractors, who are often seen as more efficient. This increased demand will, however, need to be matched by an increased supply of original IP from the UK. There is optimism about the potential impact of a tax credit for cultural games Almost all respondents believe that if introduced, the tax credit for cultural games currently under discussion would have a positive impact on the sector, as long as it is designed to take into account the specific requirements of the industry, and administered effectively. The tax credit for cultural games would help to ‘level the international playing field’, and make it easier for UK studios to retain their talent. In regards to direct impacts, 89% of studios responding to the survey believe that a tax credit for cultural games would lead to increases in their staff numbers. 70% of publisher and external finance company respondents state that a tax credit could make the difference between investing in and passing on a games development opportunity in the UK.

The tax credit for cultural games would kick-start original IP development and encourage experimentation with new business models. Two thirds of studios claim that a tax credit for cultural games would have a definite, positive impact on original IP development, while 75% of independents believe that the measure would help them to keep hold of the original IP that they produce.

All independent studios state that a tax credit would encourage them to adopt new business models based on digital distribution, with the potential to establish direct relationships with their consumers and generate steadier revenue streams. In order to fund these new ventures, they would be more likely to seek financing from sources outside of the video games industry, such as venture capital or project financing. The tax credit would boost publisher investment in the UK video games sector All 3rd party development managers claim that a tax credit would increase their companies’ funding of externally contracted development, and could make the difference between investing in and passing on a UK games development opportunity. Similarly,80% of senior publisher executives claim that tax credits would boost their funding of development by both internal and independent studios in the UK.

The investor perspective
The majority of external finance sources consider the UK video games sector to be an unattractive prospect for investment at the moment. The reasons for this are lack of scale, and an excessive emphasis on traditional, high-risk retail business models instead of network gaming and direct-to-consumer propositions. They are unanimously positive about the impact of a tax credit on the scale and/or number of investments in UK video games projects. Half of respondents would change their attitude towards investing in UK video games companies if the tax credit for cultural games was introduced.