Categories of Casino Regulations 2008

My Lords, I must apologise for my late arrival. I hope that I did not miss too many of the Minister’s words, and I thank him for those that I did hear. I suspect that we may have heard some of them before, but I would not wish to predict that, and I hope that the questions I ask the Minister have not already been answered in his introduction. As elsewhere, we are in difficult territory for the Government. I would sum it up by saying, in the words of the old joke about the man who is asked directions, ““I wouldn’t start from here, guv””. All of us in this Chamber are only too well aware of the history of the Government’s supercasino proposals that have led, in the space of three years, for proposals for an unlimited number, then eight, then one and now zero. Over a year ago, the Liberal Democrats succeeded in persuading this House to adopt the proposition that a review of the decision to site a supercasino in east Manchester should be undertaken and that there should be a separate order enabling the eight large and eight small casinos identified by the Casino Advisory Panel, under the late Professor Crow, to go ahead. It is incomprehensible that the Government have delayed for over a year in considering the implications of that vote and coming to a decision. That is dither and delay brought to a fine art. The climate in the casino world has changed dramatically during those 12 months. There have been drastic changes in gaming duty. The abolition of the bottom bands at no notice has forced the casino operators to pay millions more in duty. The Government have decided that so-called Section 21 terminals, which were permitted in the 1968 Act casinos, should be categorised as machines, which has substantially reduced the gaming that existing casinos can offer, and it must be admitted that the smoking ban has led to a reduction in income for existing casinos. As a result, a number of casinos are closing, including establishments in Glasgow, Nottingham, Scarborough, Liverpool and Manchester, with many staff redundancies. One key operator, Ladbrokes, has indicated that it will not be applying for new licences. It has also become apparent that a large number of casinos could open in this country under the 1968 legislation. This has gone well beyond the numbers that Ministers originally said would be in existence. The former Minister, the right honourable Member for Sheffield Central, Mr Caborn, said on 11 January 2005, when referring to the total number of casinos that were expected following the 2005 legislation: "““We can say with certainty that there will be no more than 150 casinos””.—[Official Report, Commons Standing Committee B, 11/1/05; col. 718.]" I recently asked the Gambling Commission and have been told that there are 144 licensed and operating casinos, including two card clubs, under the 1968 Act, with 46 casinos, including one card club, licensed but not operating. Nineteen applications have been rejected by local licensing authorities but are subject to appeal. Fourteen casino certificates of consent have been granted and are waiting for a hearing by magistrates, including three card clubs, and three casino certificates of consent are pending determination or issue by the Gambling Commission. Ten of this total of 82 are extensions to, or replacements for, existing licences. This makes a theoretical maximum of 216, including six card clubs, which is far in excess of the 150 that the former Minister said with certainty were likely to exist, or would exist, in this country. That loophole should have been closed much more quickly than the Government chose to close it. It has now resulted in a potential proliferation of casinos. I heard that the Minister was very optimistic about those casino licences not coming into effect, but that is a very large potential number, and well above the assurance originally given by Ministers. It is extraordinary that we have spent so much time over the past years debating 16 potential new casinos, eight large and eight small, while a vast number of other potential new casinos have not been subject to such debate and scrutiny. Apart from this, there is concern about the impact that the 16 new casinos could have on the existing casino estate. It transpires that 10 out of the 16 sites for new large and small casinos are already in permitted areas under the 1968 Act. The draft regulation specifies a new casino for Southampton, but it already has three before we add the extra one, which will be much larger than any of the existing three. Great Yarmouth has three casinos, as does Hull. Leeds already has five casinos, with one application under the 1968 Act, I believe, still pending. Middlesbrough already has three casinos. Solihull has none, but if we look at the wider Birmingham area, there are eight. In relation to smaller casinos, Torbay already has one and Swansea has two, with two additional casinos licensed but not yet open. Luton has three, with one appeal for a licence pending. Wolverhampton has two operating, with an additional casino licensed but not yet open. Scarborough has one, plus one that recently closed. In all those cases, as a result of this order, we are proposing to add another casino that could well have an impact on the viability of the existing casinos in those areas. In the debate on these draft regulations in the other place in March, the Minister, Mr Gerry Sutcliffe, said that he was carefully considering the proposals that he had received from the British Casino Association, with the aim of protecting the viability of the existing casino estate. These relate to the ability of so-called casinos established under the 1968 Act to be able to relocate, subject to the relevant consent from magistrates and local authorities. I have seen copies of some ambivalent correspondence, subsequent to that debate, passing between the BCA and the Minister. What is the position? Is he taking these proposals seriously, and what conclusion has he come to? Is his position, in reality, that he wants the number of casinos to shrink? Is he content for existing casinos to close? We then come to another important matter. The existing casino operators are keen for the Government to conduct an immediate review of stakes and prizes for machines, because they also impact on the viability of existing casinos. The Minister, Mr Sutcliffe, was very clear in the other place on 25 March that the review of stakes and prizes would take place shortly, yet nothing at all has happened in the interim. I do not know how quickly the clocks run in Mr Sutcliffe’s household, but they clearly do not keep ordinary hours and minutes as we know them. Perhaps No. 10 has stopped the clock. What is the situation? Then there is the question of contributions to the Responsibility in Gambling Trust. On 26 February the Secretary of State, Mr Burnham, expressed concern that a large number of organisations—more than 90 per cent of the operators, it seems—were making no contribution at all. He said: "““Unless the industry delivers a substantial increase in contributions by the end of this year and makes contributions in a timely fashion, I will seek the approval of the House for a statutory levy, at a rate to be determined””.—[Official Report, Commons, 26/2/08; col. 904.]" Again, this is relevant to the viability of the existing casino estate and the new casinos coming on line. Will the Minister amplify what the Secretary of State meant by ““substantial increase””? What would satisfy him? To cap it all, since our debate in March 2007 the Merits Committee has issued another damning report calling into question the procedures that the Casino Advisory Panel adopted in relation to the decision to locate the 16 small and large casinos. It said that the policy objectives of the order may be imperfectly achieved. At this stage it is extremely unclear what the Government’s policy objectives are. If we were so minded there would be ample reason to throw out these regulations in the same way as the previous ones were. There have been some limited pluses in the interim as Liberal Democrats, and in particular my honourable friend Don Foster, acknowledged in the other place when the order was debated there. There is now greater clarity about consultation. On these Benches we made it very clear, on a number of occasions, that before an additional large or small casino opens for business in any of the 16 areas there should be maximum opportunity for wide consultation at all stages of the process. That was confirmed by the Secretary of State on 26 February and so those who live close enough to the premises and are likely to be affected by the new casino, or those with business interests that might be affected, will be able to make representations. We welcome that. The Government have also clarified their approach on changing the age limit for casinos and the time limitation on the so-called ban on 24-hour gambling. Finally, there is the question of regeneration assistance for both Blackpool and Manchester to make up for the fact that there will be no supercasino to assist in regenerating those cities. Last year the Government set up a Blackpool regeneration task force, and this February in their response announced financial support. How much of this is new money? There are other elements and decisions which Blackpool badly needs to kick-start its regeneration where government help is being sought. What can the Minister say about that? We heard in February, likewise, that an ad hoc group was being set up to look at regeneration alternatives for Manchester. The Secretary of State for Communities and Local Government made a statement in March which contained a number of welcome ingredients. What will be the continuing status of that group? What additional funding is being levered in by its activities? On these Benches we do not intend to divide the House. We advocated the separation of the 16 casinos a year ago and we stick to that position. Of course we are unwilling to delay the hopes and expectations of the locations for small and large casinos any further than they already have been. But there is absolutely no doubt that the Government have made a complete mess of their whole gambling strategy. The least they can do is acknowledge that.