It appears industry leaders will have to continue to wait for the much-anticipated gambling white paper, as the UK misses yet another deadline. Although the updates to the 2005 Gambling Act remain relatively a mystery, it has not stopped the rumours swirling about the potential impacts it could have on the gambling industry’s revenue stream. One particular source has revealed that the new wave of regulatory changes could cause nine-figure losses for the overall industry.
According to the Sun, the white paper, which is expected to be published by the end of this month, will include modifications to gambling activity that will cause a ripple effect resulting in 8% drop in gross gambling revenue. These claims were substantiated by a letter drafted by the recently appointed Secretary of State for Culture, Media, and Sport, Lucy Frazer. In her letter, Frazer estimated that the impact could lead to more than $1.3B in losses per year.
Moreover, Frazer continued to elaborate that much of this decrease in online gambling profits will be owed to the fact that individuals who cannot afford to gamble, simply won’t. While it is true that the lure of UK no deposit bonuses will still be there, even for people who fall under a low-income bracket, perhaps the new white paper will enforce stricter restrictions in this regard.
What’s In Store?
Frazer’s prediction seems increasingly more accurate when accounting for the overall gambling spending, including lotteries. According to recent data, compared to all available gambling options, lottery products have the highest gross gambling yield.
Despite these findings, Frazer has maintained that the benefits of reducing the rising rates of gambling harm are far greater that the loss of revenue. There is also the concern that the financial hit will push the industry to seek income elsewhere, which cannot be ignored.
There is also the issue of contradictory opinions floating around with Public Health England releasing a report revealing that economic factors were less impactful at predicting at-risk gambling behaviour than demographic factors such as sex. Unfortunately, these recent findings have made no change to the UK government’s decision to crack down on their problem gambling rate.
The regulatory body is determined to bring the rate to a 0 despite having held it at a manageable 0.2% for years with operator-led efforts. Whether they will ultimately influence the final version of the white paper remains to be seen.
Scott Benton Controversy
The arrival of the UK government’s much anticipated White Paper has not been without controversy, most recently with the removal of the former UK Minister Scott Benton who was caught trading political influence for money.
Caught red-handed, video footage showcased Benton brokering deals on behalf of gambling investors. Benton also allegedly went against congressional norms by providing fellow lawmakers with secret marketing and investment data in exchange for cash.
An undercover reporter masking as an Indian investor, with a keen interest in getting involved in the UK’s gambling and sports industry, recorded Benton allegedly detailing how he could help the ‘investor’ by providing them with access to a copy of the white paper before it was made public.
If this would have transpired it would have given the ‘investor’ access to market data and several new restrictions for operators before anyone else, providing him with an edge over his competition. Benton also allegedly revealed that last year’s departure of the former Gambling Minister Chris Philp paved the way to allow the industry to secure what it wanted out of the upcoming reforms.
It appears that there may finally be a light at the end of the White Paper saga which has caused the UK Gambling industry to remain in a state of uncertainty for years. Originally launched in November 2020, the review has witnessed governmental shakeups and countless delays, building up anticipation for its much-awaited release.
Although the total impact of the new regulations remains to be seen, we can safely say that the industry must buckle up for a dramatic loss in revenue. Additionally, with many of the new laws focusing on consumer protection measures, one can assume that the gambling industry we know today will look very different over the new few years.