Should fixed odds betting terminals be allowed in bookies' shops? Sharon Byrnesupports their introduction, Pat Rabbitteopposes.
YES:There are no valid grounds to ban fixed odds betting terminals machines from licensed betting shops, writes Sharon Byrne
THERE ARE no valid grounds on which to ban fixed odds betting terminals (FOBT) machines from licensed betting shops. In fact there are more reasons to specifically allow them in betting shops than in any other venue. But the question of FOBTs cannot and should not be taken in isolation, as some commentators are attempting to do.
For the first time we are about to have a healthy, informed debate on the future of gambling in this country which will hopefully allow the State recover the millions in revenue lost to offshore internet gambling, the embracing of new technologies, the regulation of private members' clubs and the safeguarding of funding for the horse and greyhound racing industries.
Tax contributions from betting shops have helped make our races the envy of Europe, with greater prize money, the best horses and a much higher profile. In 2007, Irish bookies paid €36.5 million in tax to support the racing industry. This is 1 per cent of turnover and is borne by the bookies themselves rather than passed to the consumer.
However, customers, particularly young punters, have been voting with their feet for several years and the rise of internet gambling, telephone betting and betting exchanges in particular reflects the demand for a more varied betting experience. Much of this money ends up in companies licensed offshore, making no contribution to our exchequer.
From a social perspective too, these forms of gambling are problematic. A laptop and a credit card is all a punter needs to lose thousands of euro in a single sitting. The growth in private members' clubs in recent years further facilitates gambling on a 24-hour basis.
Horse Racing Ireland has estimated the current shortfall in betting duty to be in the region of €30 million. To put this figure into perspective, it is estimated using Paddy Power's accounts for 2007 that around €15 million of its profits are derived from Irish customers spending money outside the State through its online gambling business, with no contribution to the exchequer.
We have proposed a number of measures to address this shortfall. Primarily, steps need to be taken to ensure this Irish money is not lost overseas, and to capture duty on gambling receipts by regulating private casinos. Secondly, the introduction of FOBTs in betting shops will help further bridge the gap on a sustainable long-term basis. These machines would further satisfy the demand for technology, complementing the virtual races and self-service terminals which have been available for some time, yet in a much more controlled environment.
Much has been thrown in the face of these machines. Technologically, they are completely different to the "one-armed bandits" their detractors compare them to. They do not facilitate gaming like slot machines, where the outcome is influenced by the actions of the punter. FOBTs are popular because they return over 97 per cent of their stake monies.
Pat Rabbitte has repeatedly made erroneous use of UK data to claim that the introduction of FOBTs here will result in greater gambling addiction problems. There is no such evidence. In fact, a 2007 British Gambling Prevalence Survey on behalf of the Gambling Commission found that the level of problem gambling in the UK, at 0.6 per cent of the adult population, was unchanged from the previous survey which had been carried out in 1999, before the introduction of FOBTs.
This survey was conducted by the independent National Centre for Social Research (NatCen) and peer reviewed by international experts. It did not support the view that new technologies led to increased problem gambling. In all 9,000 adults surveyed, only 3 per cent of gamblers in the past year were found to have played FOBTs and NatCen identified only 24 individuals who were problem gamblers and who included FOBTs in their portfolio of gambling activities.
Rabbitte has also cited a UK survey which shows the use of FOBTs among problem gamblers at 40 per cent. He omits to mention that it also shows 80 per cent of problem gamblers bet on horses, 47 per cent bet on dogs, 38 per cent on football and 18 per cent on numbers betting. The NatCen survey also found that 84 per cent of customers who use FOBTs play only once a week or less.
Gambling in Ireland has changed beyond recognition. Every PC in the country is a potential FOBT. Licensed betting shops which are responsible, transparent and the most regulated betting environment in the country are not the enemy here.
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Sharon Byrne is an independent bookmaker and chairwoman of the Irish Bookmakers' Association
NO: FOBTs are highly addictive and have been described in the UK, as "the crack cocaine of gambling", writes Pat Rabbitte.
IRISH PEOPLE have long enjoyed "a flutter" and the gambling industry has been regulated to ensure that what is widely considered as a social right does not become a social wrong. However, how the Government responds to the current debate regarding the liberalisation of the gambling laws will determine if the Irish penchant for a flutter will continue to be an enjoyable pastime or evolve into a serious threat.
These issues have been dealt with extensively in the report of the Casino Committee on Regulating Gaming in Ireland, the publication of which was long delayed by the Government.
While the committee's report does leave many questions, I would agree with the majority of their conclusions, especially their determination that the attempt by the majority of bookmakers to introduce fixed odds betting terminals (FOBTs) into the country's 1,250 betting offices could have "potentially serious repercussions in terms of problem gambling" (4.6.12.)
FOBTs may not be widely known in Ireland but are common throughout the UK. Akin to, but much more sophisticated than, slot machines or "one-armed bandits", FOBTs are highly addictive and have been described in the UK, as "the crack cocaine of gambling".
While the tax take from FOBTs is undoubtedly attractive to the UK government, both the Conservatives and the Liberal Democrats have raised serious concerns about the level of problem gambling because of these machines. The National Prevalence Study on Gambling commissioned by the UK Gambling Commission found that one in nine people who play these machines develop gambling problems, which is a much higher addiction rate than for one-armed bandits or indeed for alcohol.
The features that make FOBTs so addictive include: being easily accessible; short payout interval, ie length of time between having the bet and knowing the outcome; and the near miss factor, ie nearly winning encourages playing again. More importantly, any winnings can be re-gambled almost immediately and these machines even have a repeat play button built in. The UK bookmakers were eventually forced into putting a 20-second time delay between games because of concerns over addiction rates.
In attempting to establish an all party committee with the purpose I suspect of overturning the recommendation of the casino committee on FOBTs, the Government seems to have fallen for the lobbyists argument that the €30 million shortfall between taxes and the subventions to the horse racing industry could be made up from the extra taxes from these terminals.
What a wonderful piece of social justice this would be, burdening the most vulnerable and disadvantaged in our society with a new addiction in order to fund the leisure pursuits of some of the wealthiest in our society - namely the thoroughbred horse owners.
Analysts in the UK have estimated that Ladbrokes customers there lose approximately £125,000 in each betting office per year on these terminals. If this was replicated in Irish betting offices it would mean that customers could lose well over €100 million a year, thereby enriching the bookmakers to the tune of €100 million annually before tax.
Despite this wealth of international evidence, Minister for Justice Dermot Ahern wants Labour Party participation in the proposed all-party committee without accepting our condition that FOBTs are outlawed from bookie shops. Why? The publication of the report of the casino committee was forced only because of Labour's stance. Another area under consideration by the casino committee was the regulation of casinos. The reality is that there are 50 to 70 of them operating in Ireland at the moment in a legal limbo and this situation urgently needs to be regulated.
Ultimately, the Government needs to stop sitting on the fence. Casinos need to be removed from their legal limbo and properly contribute to the tax coffers through appropriate regulation.
However, in the case of FOBTs, where the common good is threatened, I believe law makers have the right and the duty to intervene in the interest of the common good and the Government should definitively prohibit their introduction.
I have no intention of joining the all-party committee on gambling until I receive a guarantee that FOBTs will not be introduced into betting offices. I am long enough in the Dáil to know that when a Minister wants to embrace me in an all party committee, it is time to reach for my gun because something very unpopular is usually in contemplation.
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Pat Rabbitte TD, is the former leader of the Labour Party