UKGC Looking Into Imposing £100 Monthly Gambling Loss Limits

The United Kingdom Gambling Commission has confirmed it is looking into suggestions from the The Social Market Foundation to consider introducing loss limits of £100 every month for bettors. The aim is to help tackle gambling addiction, which has become a major problem for the regulator who have been under pressure of late. Tackling problem gambling is a big aim of both the UKGC and local councils and it is hoped that the new regulations would go some way to helping on that front.

The Gambling Commission’s main aim is to stop people from losing more money than they can afford to, though putting a limit of £100 per month on losses doesn’t seem to take into account that different customers have different affordability levels. Research suggests that as many as 21% of both problem gamblers and those at risk of becoming problem gamblers spend more money than they can afford to lose.

Loss Limits Being Suggested

It emerged in August of 2020 that the cross-party think-tank The Social Market Foundation believed that ‘protective regulation’ in the form of a £100 loss limit per month should be rolled out across the betting industry. The SMF’s suggestion was that the limit of £100 per month be introduced for all bettors, with the limit only being relaxed once more stringent tests on people had been carried out to prove that they could afford to lose more.

The SMF’s belief is that such a limit would stop gamblers from throwing good money after bad, limiting how much they could lose in the pursuit of winning the money to clear their debts. It now appears that the United Kingdom Gambling Commission is taking the SMF’s proposal seriously, even though the gambling regulator doesn’t appear to be in a rush to introduce the new rule. Instead, the Gambling Commission will examine the evidence.

How The Industry Has Reacted

In the least surprising news for quite some time, figures inside the gambling industry are far from keen on the recommendation. A Sector Analyst for Regulus Partners, Dan Waugh, said that he felt the proposed limited were nothing short of ‘a radical and intrusive approach to affordability’. The Betting and Gaming Council, meanwhile, has been critical because affordability checks are already carried out by the industry on punters.

A statement from the BGC said,

“We already carry out robust and improved affordability checks . . . We disagree with the suggestion of an arbitrary and random low cap on spending and can think of no other area of the economy where the government determines how much an individual can spend.”

Of course, from the SMF’s point of view it would be a much more convincing argument from the BGC if problem gambling wasn’t such an issue.

Would This Be An Overstep?

Ultimately, the feeling of many is that bettors should be allowed to choose for themselves how they spend their money. James Noyes, who used to be an adviser to Tom Watson, the former Deputy Leader of the Labour Party, authored the report and suggested that an ‘unambiguous spending threshold’ would be the ‘only way’ to ensure that individuals spend money that they can afford to lose, but for many this would be a huge overstep.

The report seems to suggest that ‘lower socioeconomic households’ were the ones most in need of a gambling limit being introduced. The belief was that around £23 a week, or £100 a month, was what would be deemed ‘socially acceptable’ an amount of money to lose. In order to be allowed to gamble more money people would need to provide the likes of wage slips, tax returns and endure credit checks before having the loss limit relaxed.

Anger From Punters

It’s not just the gambling industry that doesn’t seem to be overly impressed with the UKGC’s plans. Bettors reacted angrily to the news on online forums, with many being angry that their betting habits would be limited unfairly. There is also a concern from punters that the industry would quickly go out of business if such limits were introduced, which isn’t an altogether outrageous suggestion as far as industry leaders are concerned.

The general feeling from people that like to place bets is that the should be able to decide how much money they gambling with and how much they lose. The issue, of course, is that problem gamblers don’t have such self-control and it is them that the new rules would be introduced to protect. From the Gambling Commission’s point of view, there is a desire to find a balance between protecting consumers and limiting consumer freedom.

Not The Only Suggestion

The white paper that the Gambling Commission’s considerations are being based on didn’t only mention loss limits. The Social Market Foundation’s document also suggestions that limits should be introduced to online slot machines to bring them in line with Fixed Odds Betting Terminals. Perhaps more interestingly, though, is the fact that the report suggests that gambling regulation be taken away from the UKGC altogether.

The abolition of the Gambling Commission and the replacement of its duties by two distinct bodies is something that the report suggests could be vital to the future of the industry. One body would then handle both licensing and compliance issues, whilst the other would look at dealing with customer protection. It is all part of the changes that are being contemplated when the 2005 Gambling Act is reviewed.

How Would It Work?

An obvious question that bettors will be quick to ask is how, exactly, a loss limit would work. Whilst it’s easy enough for online casinos to block accounts once a given amount of money has been lost, it’s much more difficult for sportsbooks to monitor such a thing. Imagine you placed a £100 bet on the outcome of the Premier League in August, for example, knowing that it might not settled until May the following year. How would that be monitored?  If the bet lost what month would that loss be counted in and what if that customer had already lost £100 in May when the bet settled?

The placing of ante-post bets is common in horse racing, so would the limit be introduced on the amount of money a customer has in positions or would it only apply to actual losses? If the latter, wouldn’t ante-post bets settling later in the month then add to the amount of money that someone could lose in a month? It’s obviously a far from perfect system, but if it helps to protect the most vulnerable then isn’t that a good thing? That’s certainly the UKGC’s argument.

Beware The Black Market

It is worth remembering why gambling licensing was brought in in the first place.  One of the biggest reasons at the time was to reduce the number of spurious operators online who would happily accept UK customers with little protections in place.  Before 2005 many operators based abroad provided gambling with little regard for customers as well as little intention to pay tax to the UK government.

Few would argue that licensing has been a good thing and it has allowed the legal gambling industry in the UK to become the biggest, per head, in the world in that time.  Many of the biggest gambling companies today are based on old British bookmaking names like Ladbrokes, William Hill and Coral.

One of the big dangers of imposing universal limits like the £100 loss limit suggested is it could lead to punters being tempted to gambling with unlicensed sites on the black market to avoid this.  This would be catastrophic for protecting customers, especially problem gamblers.  Many of these companies simply do not care if people have problems, let alone the fact that many commit outright fraud and steal customers money.

It is a fine balance between appropriate regulation of the gambling industry and not going so far that they then undermine the main reasons why licensing was needed in the first place.  It is highly likely there will be a middle ground found, perhaps £100 soft monthly loss limits that people can opt-out of it they can prove they can afford to gamble at a higher level.  Still, even then people will be tempted to use illegal opperators as these will require no verification or source of funds checks.