BHA concern over financial risk checks as government reveals white paper

British racing's governing body the BHA has voiced concerns about just how "frictionless" the financial risk checks detailed in the long-awaited gambling white paper will be after the government finally revealed its proposals for reform on Thursday.

The measures include what the government described as "background checks at moderate levels of spend" to look for issues such as county court judgements, set at a £125 net loss within a month or £500 within a year.

A second tier of checks which might indicate "harmful binge gambling or sustained unaffordable losses" would come in at proposed thresholds of a £1,000 net loss within 24 hours or £2,000 within 90 days. Triggers would be halved for those aged 18 to 24.

However, ministers added their intention was that the checks would be "frictionless" and conducted online by credit reference agencies or through other means such as open banking, with documentation asked for as a last resort.

Gambling review white paper: the main proposals

• Frictionless player protection checks starting with background checks at a £125 net loss within a month or £500 within a year
• A review of the horserace betting levy
• A statutory levy on gambling operators to pay for research, education and treatment of problem gambling
• New stake limits for online slots games of between £2 and £15 per spin
• Extra powers for the Gambling Commission to tackle the black market
• Rules to prevent bonus offers such as free bets harming the vulnerable
• Closing loopholes to make sure under-18s cannot gamble
• A new industry ombudsman to deal with disputes and rule on redress

The government claimed checks would happen "instantaneously", that around eight in ten players would not undergo the checks and that only around three per cent of the highest-spending accounts would have more detailed checks. The measures will go to a Gambling Commission consultation this summer.

Speaking after the white paper was released, BHA chief executive Julie Harrington said: "In terms of the impact, the numbers around £1,000 and £2,000 are probably as we anticipated. The number around the less-intrusive checks of £125 is much lower."

She added: "The big unknown for us at the moment is how unobtrusive and friction-free those checks are."

Harrington said the sport would do its own due diligence to see if the three per cent of punters subject to more detailed checks would be mirrored among racing's customers.

She added: "Our suspicion is that there will be a higher value punter in there so we would be more impacted than the average."

The subject of affordability checks has been one of the most controversial aspects of the government's gambling review, with campaigners having called for punters to have to prove they could afford gambling losses of as low as £100 a month.

Arena Racing Company last year estimated the sport was losing £40 million per annum from checks already put in place by bookmakersCredit: Matt Cardy (Getty Images)

British racing's leadership has warned that blanket affordability checks would be "highly damaging" to its finances, while Arena Racing Company last year estimated the sport was losing £40 million per annum from checks already put in place by bookmakers involving requests for personal financial information such as bank statements.

Asked about the demands for documentation that are already taking place, gambling minister Stuart Andrew said:  "This is precisely why we are introducing these so there is actually a uniformity of approach across all of the industry so that the punters know that they will be treated in exactly the same way regardless of which operator they are betting with.

"For 80 per cent of people who will be putting on a bet and taking part in gambling, nothing will happen with them. For the 20 per cent, then there will be a background check but that will all happen almost without you knowing about it and in some instances that is already happening.

"We just want to make sure that we have that uniform approach right across all operators."

The government also revealed that a review of the levy, British racing's central funding system, had commenced. It had originally been set to happen by 2024.

Other proposals contained in the white paper include a statutory levy on gambling operators to help fund treatment services and research of problem gambling, collected by the Gambling Commission and with spending approved by the government.

It had been expected that the government would set the rate at one per cent of the industry's gross profits, which could raise as much as £140 million. However, the rate will be subject to further consultation.

New stake limits for online slots games of between £2 and £15 per spin will be brought in to mirror those found in bricks-and-mortar premises. The stakes had previously been unlimited.

The Gambling Commission will receive extra powers to tackle black market operators, the government said, through court orders and work with internet service providers to take down and block illegal gambling sites.

A new industry ombudsman will also be created to deal with disputes and rule on redress where a customer suffers losses due to an operator failing in their player protection duties.

However, campaigners who had hoped for bans on gambling advertising and sponsorship in sport will have been left disappointed.

The government launched its gambling review in December 2020 with a call for evidence, which resulted in 16,000 responses.

A white paper setting out the government's plans was expected to be published by Christmas 2021, but a succession of ministerial changes at the Department for Culture, Media and Sport (DCMS) resulted in publication being repeatedly postponed.

Culture secretary Lucy FrazerCredit: Anadolu Agency

Announcing the government's proposals, culture secretary Lucy Frazer said: "We live in an age where people have a virtual mobile casino in their pockets. It has made gambling easier, quicker and often more fun, but when things go wrong it can see people lose thousands of pounds in a few swipes of the screen.

"So we are stepping in to update the law for those most at risk of harm with a new levy on gambling operators to pay for treatment and education, player protection checks and new online slots stake limits.

"This will strengthen the safety net and help deliver our long-term plan to help build stronger communities while allowing millions of people to continue to play safely."

Michael Dugher, chief executive of the Betting and Gaming Council, said he welcomed the publication of the white paper.

Dugher said: "We need time to consider the full detail and impacts of these proposals, but it is important to recognise the BGC has worked closely with government to deliver a wide-ranging package of balanced, proportionate and effective reforms."

He added: "Our members generate £7.1 billion for the economy and raise £4.2 billion in tax every year, and the measures announced today should protect jobs and sustain that vital contribution, while also building on our own work to drive world-leading standards in safer gambling."

What happens next

Governments use white papers to set out their proposals for legislation, but that will not be the case when it comes to the gambling review.

There will be no new gambling bill as a result of the proposals set out by the government, with ministers not wishing to use primary legislation to make changes due to a lack of time in the parliamentary schedule. Instead, many of the proposals will be enacted through changes to the Gambling Commission's licence conditions and codes of practice following consultations.

Campaigners have already voiced concerns over the prospect of consultations, accusing the government of further delaying reforms.

Other elements of the proposals will be brought about through a statutory instrument – secondary legislation, which has previously been used to make changes to the stakes on betting shop gaming machines known as FOBTs. And the government is set to leave issues such as gambling advertising and sponsorship to codes drawn up by the gambling industry and sports bodies.

What's your verdict on the white paper? Email us at editor@racingpost.com with the subject 'Gambling review' to share your views following the publication of the gambling review white paper

Read these next:

'Frictionless' affordability checks raise more questions than answers 

Gambling white paper: key plans, affordability checks and what it means 

What they say: 'We will continue to make our case that sweeping blanket checks on affordability are not appropriate' 

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