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Tuesday, 15 January, 2019

Racing to tell government £2 FOBT limit would undo benefits of levy reform

Nick Rust has warned of a significant impact to racing if FOBT stakes are cut to £2
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BHA chief executive Nick Rust has said the sport will take steps to tell government of the "significant" impact a £2 maximum stake on fixed odds betting terminals could have for British racing.

He warned that the financial benefit the sport has experienced since the levy was reformed could be wiped out if the government decided to take the most hardline option on the machines.

Last weekend's Sunday Times reported that culture secretary Matt Hancock favoured cutting the maximum stake on FOBTs to £2 from £100, a move called for by campaigners against the controversial machines who blame them for causing problem gambling.

Bookmakers claim a cut to £2 would cause thousands of betting shops to close with severe financial consequences to racing.

Arena Racing Company chief executive Martin Cruddace said this week a £2 maximum stake would be "pretty catastrophic" as it would reduce the sport's income from media rights and levy payments by at least £55 million.

Martin Cruddace: has warned a £2 maximum stake would be 'pretty catastrophic'

Rust said the sport needed to be careful it did not interfere in overall government policy and that it wanted to see a "a strong, responsible betting sector".

He said: "We recognise the strong contribution betting makes to our sport so we are very clear with government that if it were to go to a £2 maximum stake on fixed odds betting terminals it would have a significant impact in the short and medium term on British racing," he told At The Races.

"We want government to understand that fully before it makes its final decision and we are taking steps to ensure they understand the impacts, they understand the cashflows and the likely impact on our sport.

"The great work that government has done in helping us extend the levy . . . could be undone at a stroke if there is a move to a £2 maximum stake."

The Sun newspaper reported on Thursday that there was disagreement within the Cabinet about the right level for FOBT stakes, with chancellor Philip Hammond wanting a £20 maximum to reduce the impact on tax receipts, although the Treasury distanced itself from the story.

Philip Hammond: reported to favour a £20 maximum to reduce the impact on tax receipts

The paper quoted a government source as saying: "Matt Hancock is jumping the gun by suggesting the stake will be set at £2, because the Treasury will have a big say in this and they are not at all happy with it.

"He hasn’t thought this through or seen it in a wider context of the damage it will do to the public finances."

However, a Treasury spokesperson said they were "fully supportive of DCMS's work to ensure the UK's gambling regime continues to balance the needs of vulnerable people, consumers who gamble responsibly and those who work in this sector".

There has been speculation that bookmakers might launch a legal challenge if stakes were reduced to £2, but the government was told to hold its nerve by the mayor of Newham in London, Sir Robin Wales, who has been one of the most implacable opponents of the machines.

He said: “Over 90 local authorities, industry watchdogs and campaigners have made a powerful and compelling argument for a £2 maximum stake, and the government must not run scared at the first sign of a threat from this powerful industry."

The government's consultation closed on Tuesday and in its submission problem gambling charity GambleAware said while there was evidence of problem gambling at all staking levels there was a trend towards a higher rate at higher levels.

The submission added: "We believe there is sufficient risk of high losses in a short period of time to vulnerable people to warrant a reduction in the maximum stake of B2 machines."

However, their response did not mention what GambleAware believes the level should be.

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The great work that government has done in helping us extend the levy . . . could be undone at a stroke
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