Labour’s lurch raises the stakes for gambling

By Dan Waugh, partner at Regulus Partners

One should always be careful what one wishes for.

On May 8^th this year, the bookmaking industry breathed a collective sigh of relief as David Cameron’s Conservatives were returned to government by the British electorate. The spectre of an allegedly anti-FOBT Labour administration had been vanquished but few at the time suspected that Ed Miliband’s defeat would usher in an altogether more alarming era with his party lurching even further to the left.

The future of Opposition politics remains shrouded in uncertainty but the rise of Jeremy Corbyn provides a disconcerting political backdrop to gambling in Great Britain at a time when deal-making has raised the stakes on regulatory risk.

The gambling industry – and the bookmakers in particular – appear to have few friends (if any) on the new Labour front-bench, announced this week.

A quick scan of parliamentary records shows that only one member of the shadow cabinet (on one occasion) voted in favour of positive regulatory change on gambling between 2010 and 2015. Of course, this pattern was entirely consistent with the party line on these votes – but it is worth noting that Corbyn has never voted in favour of deregulation, even when Labour was in government.

More telling perhaps is the number of shadow ministers – 13 out of 26 - who have used their positions as MPs over the course of the last five years to express concern on matters gambling (via Parliamentary Questions and contributions to debates in the Commons); and nine of these related specifically to betting shops (across the intertwined issues of FOBTs, clustering and single-staffing).

Quite aside from the numbers game, this list includes some fairly vocal MPs.

Just last year, the now Shadow Secretary of State for International Development, Diane Abbott warned about the “betting shop scourge” in her constituency borough of Hackney; while the Leader of the House of Commons, Chris Bryant has in the past confessed to being “puritanical about gambling”. Of more immediate concern for the betting industry is the fact that the deputy leader of the Labour Party, Tom Watson counts the Campaign for Fairer Gambling’s Derek Webb amongst his supporters (Webb donated £5,500 to Watson’s office in October 2014). Watson did however vote in favour of increases to stakes and prizes on casino B1 slot machines back in 2013, suggesting that his animus is directed at the FOBTs rather than gambling in general.

Of interest to the gambling industry at large will be Luciana Berger’s focus on the issue of gambling addiction. The shadow minister for mental health is believed to be interested in shifting the onus of problem gambling from charitable organisations to the National Health Service – and that way may lie tighter regulation and tax hypothecation.

Outside of Parliament, Sadiq Khan’s run for Mayor of London is likely to keep gambling regulation – and FOBTs in particular – in the headlines. Khan has already made use of the FOBT issue to win his party’s nomination (with Tessa Jowell unable to shake her ‘pro-gambling’ tag a decade on from the Act) and is likely to continue to do so. This is against a backdrop of incipient devolution of gambling regulation, where the granting of limited FOBT licensing powers in Scotland may well prove to be the thin end of the regulatory wedge (see http://regulusp.blogspot.co.uk/2015/05/patriot-games-scottish-nationalism-and.html) .

Industry will take comfort in the fact that Labour remains the party of Opposition and that Corbyn is perceived to be ‘unelectable’ as Prime Minister. It is a view that ignores the facts that the improbable happens in politics more often than is acknowledged (and that ‘Corbynism’ appears to be in the vein of of a wider global political movement) and that policy formation tends not to be the exclusive preserve of the majority party.

Corbyn’s own record in Parliament suggests that he does not perceive gambling to be an issue of national importance but that does not mean that he and his team are not prepared to exploit it as a means to embarrass both the Government and the rump of ‘Blairites’ on the back-benches. The issue of FOBTs in particular is one where Labour should be able to make common cause with the SNP in order to put pressure on Cameron's slender majority.

We simply don’t know whether Jeremy Corbyn’s leadership of the Labour Party proves to be a seminal moment in British politics or simply a colourful interlude. We can only deal with the facts as they stand; and in the changed political environment, the barometer of regulatory risk in gambling may just have swung again.