Debt-Inducing Casino Machines Drain £11 Million a Year from Leicester

Massive corporations reap immense profits for their shareholders by draining money out of some of our country’s poorest communities. The gambling industry does this with unnerving precision by targeting the poorest sections of society with illusionary promises of easy money; thereby basing their burgeoning profits on the sad fact that many people are paid so little that they see gambling as there only hope of attaining the good life.

During their last term in power, the Labour Party made its own contribution to this problem by pushing through the Gambling Act “which took nearly all the caps off the betting industry.”  This Act paved the pathway for the massive growth of fixed-odds betting terminals (FOBT), the “crack cocaine of gambling”. A recent industry-funded report acknowledged that more than a third of people playing such high-speed, high-stakes betting machines experience problems with their gambling.

So given Labour’s role in the rise of such profiteering from the working-class, our Labour Council in Leicester is at least trying to make some amends. Thus last year they added our Council’s support to a campaign to reduce the maximum stakes on FOBTs, from £100 a spin to £2. This is of course an important issue given the possibility of betting £300 a minute on such casino-style debt-inducing machines: but is this really all the Labour Party can offer the public? It seems so.

One report published by the Campaign for Fairer Gambling in 2013 as “The Economic Impact of Fixed Odds Betting Terminals” pointed out how:

“Fixed Odds Betting Terminals only began to be installed in betting shops in the early 2000s but the growth in the number of FOBTs and the revenue from them has been very substantial since then, to the extent that FOBTs have now overtaken more traditional Over The Counter (OTC) betting activities (such as bets on horseracing, etc.) as the main source of revenue generation for bookmakers.”

Industry statistics from the Gambling Commission demonstrated that in the three years between 2008/09 and 2011/12, profits in the sector surged while the numbers employed in the bookmaking industry actually fell, from 60,247 to 54,449. But while the industry is amassing ever-increasing profits, the average hourly wage rate for workers employed in the industry (in 2012) was only £7.25 per hour — above the National Minimum Wage but not by much.

It seems that these FOBT machines are virtual goldmines for the companies that run them; and with many betting shops being run by just one low-waged member of staff, four FOBTs (the maximum allowed in any single shop) can generate an estimated profit of £3,500 per week for bookmakers – or £182,000 every year. Recent figures demonstrate that Leicester city has 243 FOBTs spread out amongst some 65 betting shops, which in real terms means that each year around £11 million is being lost from out city through the misuse of these poverty-escalating gambling machines.

As if this was not bad enough, in the past year campaigners say that FOBTs are one of the major reasons “for a 20 per cent rise in crime at betting shops as addicted punters turn violent”. For example: “In one case, an FOBT gambler in the Midlands who lost £5,000 in one afternoon used his last £5 to buy a claw hammer at a nearby hardware to vandalise the machines.” Moreover as the Daily Mail reported last year:

“The Government is recommending that players should have to seek permission from staff to stake more than £50. But this was greeted with incredulity by workers, who said it would be impossible to monitor players’ gambling habits, particular if they were working alone and busy with over-the-counter bets. Staff also fear abuse if they stop a customer.

“Meanwhile, documents seen by this newspaper reveal that bookmakers routinely award staff with bonuses that are linked to FOBT revenues.  Rewards depend on profits made by the machines, as well as the amount customers bet over the counter and the number of total bets made, leading to accusations that staff are being getting incentives to encourage people to gamble more.”

Yet on a national level such problems are hardly likely to go away any time soon, as the Tories have just appointed “pro-gambling” John Whittingdale as their new Culture Secretary, where he will supposedly serve the public interest by regulating the gambling industry.

That Mr Whittingdale is a council member of the ultra right-wing Freedom Association — a group headed up by UKIP leading-light Christopher Gill — certainly does not bode well for the future. Here might also recall that UKIP’s own star, Mr Farage, starred in a TV advert for Paddy Power — a leading betting giant that continues to suck money out of Leicester by deliberately targeting our poorest communities with their ghoulish FOBTs.

Only this week it was revealed that people living in Leicester are the poorest in the country. This is something that needs to change urgently. But unfortunately such a turn around is unlikely to happen under the rule of the current Labour Council, especially given their pledge to cut a further £54 million from our city’s budget in the coming years. Thus, as ever, it will be up to the people of Leicester to build a political force that is both able and willing to move forward with a realistic and positive alternative for our city.

tax poliy

Further reading

Recent articles in Leicester Mercury that illustrate the tragic social costs of gambling are: “Teenage gambling addict stole cash and jewellery from relatives in Barwell” (January 2014);  “Gambling addict raided the bank account of a good friend’s mother” (December 2014); “Gambling addict stole £22,000 from grand-mother’s partner, 98, and blew the lot on scratchcards” (April 2015); “Promising Prince’s Trust candidate stole project’s credit card and went on £7,000 spending spree” (May 2015). Finally two useful articles providig further background on this issue include:

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