I am proud to run Scotland’s largest independent betting group, Scotbet. Last year we marked our 25th anniversary, normally a cause for celebration. But Scotbet, like many other independent operators, is feeling the squeeze.
Increased taxes, regulatory costs and competition from other forms of gambling have seen the number of shops in the UK fall sharply in recent years. Between March and September this year, more than 340 shops closed with the loss of around 1,100 jobs from our high streets. Independent operators, some of them family run, are especially vulnerable. At its peak, Scotbet had 75 shops – today, there are 47.
Nevertheless, those shops - which stretch from Gretna to Campbeltown to Aviemore – make an important contribution to communities, providing jobs, contributing rent and rates and, above all, offering a community hub where people can meet friends and enjoy a flutter.
The UK Government has been consulting on plans to reduce stakes on gaming machines in betting shops (FOBTs). Decisions made in Westminster will have a significant impact on our business for years to come.
While the government originally said that they would base their decision solely on evidence, there has been so much external pressure on politicians that the facts seem to have gone out of the window. It seems inevitable that there will be a considerable reduction in stakes on FOBTs, whether it can be justified or not.
We have an average of just over three machines per shop so we don’t take up the maximum of four allowed and we don’t generate nearly as much money as some of the figures that have been quoted in the media. Our average stake is about £7.
Nevertheless, it’s an important part of our profitability. We’ve seen more and more customers switch to FOBTs because they prefer them as a method of betting. The idea that you could remove FOBTs, or reduce the stake to £2 a spin, would be unattractive to many of our customers and render most – if not all – of our shops unviable.
Punters like FOBTs because they offer a higher return. If stakes were reduced to £2, there would be little incentive to play them. Punters would simply walk away.
Some might say that’s a price worth paying if it reduces problem gambling. But if you look at the evidence, it’s not the level of stake that causes the problem. There are more problem gamblers playing the National Lottery and scratchcards than there are betting on FOBTs. A draconian reduction of stakes to £2 will not solve the problem. Gamblers will simply move to other forms of gambling.
Most of our shops are based in small communities, where the punters are all known to the staff, who take problem gambling very seriously. I don’t want problem gamblers in our shops and I know my staff feel the same. If anyone has been playing a machine for too long, they will ask them to call it a day.
I’m a realist. I can see there is a mood for change, so lower stakes are inevitable. The only question is how low they are set. A £2 stake would be disastrous for my company and my staff, and while the Government might be seen to be doing something to reduce problem gambling, I do not believe this is the answer.
It’s become fashionable to bash the bookies. But bookmakers have 5,000 trained staff in Scotland, hardworking professionals who are very aware of the issues surrounding problem gambling. Bookmakers already contribute to fund research, education and treatment of problem gambling and Scotbet is the only independent member of SENET, the industry body set up to promote responsible gambling. It is an issue we take extremely seriously. Rather than narrowly targeting betting shops, the Government should encourage an industry-wide response to problem gambling. After all, problem gambling is rarely linked to one product or type of gambling.
Having worked in this industry for decades, this feels like a crunch time for betting shops. We have seen a reduction in the number of shops while taxes and business costs have risen. Independents like Scotbet have been worst affected. Our pockets are not as deep as the larger UK-wide operators. Provided Ministers arrive at a fair decision on FOBTs, one based on evidence, I am optimistic that we have a future. The alternative, for our company and countless other independents, is too awful to contemplate.
John Heaton is chairman of Scotbet and a member of the Association of British Bookmakers.