The Treasury: addicted to gambler’s crack?

They have become known as crack cocaine for gamblers – and with reason, said the Daily Mail. Since appearing in high-street bookmakers in 2001, Fixed Odds Betting Terminals (FOBTS) have sucked literally billions out of British punters. These touchscreen machines look a bit like old-fashioned fruit machines, offering an easy punt on a variety of games, from roulette to virtual racing; the key difference is that they allow people to place bets every 20 seconds, with stakes of up to £100. With a relatively high return, of 97%, there’s a real temptation to keep playing – and huge losses can pile up within minutes: in the year to September 2016, punters lost £1,000 or more at a single sitting no fewer than 233,000 times. But it seems it’s not only the players who are hooked on FOBTS: the £1.8bn a year that gamblers lose on the terminals accounts for half of high-street betting chain revenues; in the first nine months of 2015, Ladbrokes was making more than £1,000 per week, per terminal. That’s money the industry won’t give up without a fight.

The worry is that the Treasury may be hooked, too – on the tax FOBTS generate, said The Guardian. The Department for Digital, Culture, Media and Sport is expected to recommend slashing the maximum bet on FOBTS to £2 in a review due in October – a move that has strong cross-party support. But apparently, Chancellor Philip Hammond is getting “cold feet” about the loss of £400m a year in tax.

Can this be true, asked Victoria Coren Mitchell in The Observer. If it is, you have to wonder if ministers are corruptly in thrall to the industry – or just stupid. The people glued to FOBTS in rundown high streets on grey weekday mornings aren’t the high-rollers who turn up at casinos in fur coats. They’re the poor, the bored, the ill and the desperate. They haven’t opted in consciously; they’ve got sucked in, after wandering into the bookies that have spread like a rash on our high streets. And why have they spread? Because when the Blair government waved in FOBTS, it stipulated that there could be only four per shop. But the bookies aren’t stupid: the terminals offer free money. If you’re allowed only four in one shop, you open more shops. Sure, some punters will lose and lose, and end up broke, in jail or suicidal. But more will come. Meanwhile, the Treasury ignores the immense social cost, and salivates over the revenue. Yet many players are on benefits, so 100% of the cash they put into FOBTS is from the Government, which gets 25% back. Is this the politicians’ grasp of economics? “As professional gamblers say about chumps: I’d like to be locked up with them.”