Gambling companies’ lobbyists had previously warned that the reduction of the maximum betting stakes of the fixed-odds betting terminals (FOBTs) from £100 to £2 would lead to serious financial difficulties and the loss of about 21,000 jobs across the sector.
According to reports, British punters lost £700 million less on the controversial betting machines in the year following the country’s Government imposed stricter measures on the FOBTs. The predictions for more than 20,000 job losses in the gambling industry in case local lawmakers proceeded with the stricter regulatory policy, however, have not come true.
With the gambling regulatory body of the country having released fresh data regarding the effect of the reduced maximum stakes of the machines, campaigners in favour of more relaxed legislation shared that lawmakers should take into account industry forecasts of serious financial struggles.
It became clear that the customers’ spending on FOBTs offered by local bookmakers declined by £700 million to just under £2.1 billion. When the effect of the Covid-19 lockdown in March is also taken into account, UK bookmakers’ revenues experienced a decline from £3.26 billion to £2.4 billion in that year.
Before the final decision of the Government to slash the maximum betting stake allowed on so-called FOBTs in 2019, gambling industry lobbyists had repeatedly warned that the reduction of the stake from £100 to £2 could force 4,500 betting shops across the country to cease operation.
British Gambling Sector Projected Over 20,000 Job Losses Across the Industry
Now, the latest figures released by the gambling industry watchdog for the year that is set to end in March 2020 show that the number of high-street bookmakers was reduced by 639 to 7,681 over the first full year after the reduction of the maximum FOBT stake and income, respectively. The figure represents a 7.7% decline, which is partly due to the fact that many British consumers started gambling mostly online, where the gambling firms’ costs are far lower than if they are land-based.
The migration of many British gambling customers online was already considered one of the main causes for the decline in the number of high-street bookmakers that has been estimated at about 3% on an annual basis.
The trade body representing the gambling sector in the UK – the Betting and Gaming Council (BGC) – shared that a lag in the presented data meant that the number of high-street betting shops closures in the sector was closer to 1,400, with over 8,000 jobs being lost across the industry. This estimate has been significantly higher than the figure presented by the UKGC but it still represents less than a third of the previous warnings of industry lobbyists.
On the other hand, the figures provided by the gambling regulatory body of the UK show the extent to which spending of local gamblers has changed since the implementation of the new £2 maximum betting limit of the FOBTs, with local gamblers losing a considerably lower amount.
Reportedly, the overall losses on gambling machines fell from £1.16 billion to £12 million in the year that ended in March 2020. On the other hand, spending on so-called B3 gambling machines, which offer lower-stake games, increased from £1.1 billion to £1.5 billion, indicating a significant change in interest towards gambling products offering lower betting stakes. The average loss rates at the £2-a-spin products are similar in the longer term, but the large one-off losses that could really have a devastating impact on a person’s life, are not that common.