The Gambling Act was a ‘mistake' and the consequences are ‘ruining the High Street and people's lives', Harriet Harman MP tells Channel 4 Dispatches.
This is a stark confession from a senior member of the government that passed the Gambling Act, who's now deputy leader of the Labour Party. In an interview to be aired on Channel 4 tonight (Monday 6th August at 8pm) Harriet Harman MP criticised elements of the Gambling Act that has allowed the clustering of betting shops and the introduction of high-stakes roulette machines known as Fixed Odds Betting Terminals (or FOBT machines) on the High Street.
Harriet Harman MP says: "If we had known then what we know now [about the clustering of Betting Shops], we wouldn't have allowed this, because it's not just ruining the High Street it's ruining people's lives," she says.
"I got the most heart-rending letters and emails and calls that I've ever had in thirty years of being an MP. Just saying, please do something about this. It's ruined my life, it's ruined my family, it's really dangerous and the problem is it's getting worse and that's why we need the law to be changed so that something can be done about it."
"Well I think we were wrong, we have made a mistake and this result is the consequence and we need to do something about it", she adds.
Channel 4 Dispatches investigates the rise of High Street gambling and reveals:
The growth of betting shops/FOBT machines on the High Street
FOBTs are high-stakes roulette machines that let you bet £100 in just one stake. Twenty seconds later you can have another spin. Press two buttons and you can repeat any bet, no matter how complex. You can stake up to £18,000 an hour, from early morning till late at night, right on your High Street.
Ten years ago these machines didn't really exist in Britain. Back in 2005 Tony Blair's New Labour government met stiff opposition with attempts to introduce super casinos.
When Gordon Brown came in he almost immediately ditched the idea but kept the rest of the new Gambling Act including measures making it easier to open new betting shops with a maximum of four FOBT machines per premises.
Since then FOBT machines have become a real money spinner for the betting shops with each machine bringing in on average £780 a week.
Channel 4 Dispatches estimate that William Hill nets £416 million a year from FOBT machines, Ladbrokes £359 million; Paddy Power £41 million; and Coral £290 million.
And last year British punters lost well over a billion pounds on FOBT machines.
Clustering of Betting Shops in areas of poverty and high unemployment
Since the Gambling Act, the number of British bookies has risen by more than 300. That's roughly one new shop a week, which may not sound dramatic.
However Channel 4 Dispatches can reveal that a growing number of betting shops are clustered in areas of poverty and high unemployment.
Dispatches commissioned Geofutures - a data mapping firm - to analyse the locations of Britain's betting shops with. The results were stark.
In relatively prosperous areas with low unemployment, there are about five bookies per 100,000 people. But in poorer places with high unemployment - some of Britain's most deprived areas - there's an average of 12 bookies for each 100,000 inhabitants.
Heather Wardle, from Geofutures says: "What we can see now is that this is part of a much bigger national phenomenon by which there are clusters of bookmakers in areas in Great Britain and those areas are more deprived, the people in those areas are less well off."
Deptford High Street with a cluster of ten betting shops
Areas like Deptford High Street in South East London - where Channel 4 Dispatches reporter Michael Crick discovered a cluster of ten betting shops (with a total of 40 FOBT machines) in the space of less than a mile.
The local authority claims that betting shops here are a magnet for anti-social behaviour.
One local resident says: "I've seen terrible fights; I've seen open drug dealing. I've been propositioned by prostitutes."
Another says: "Beer cans all over the step and a great big pool of urine which I had to walk through. And there was one guy still urinating up my front door and he looked at me and he could see that I was disgusted and enraged and he said why do you live here?"
The Association of British Bookmakers says: "It is important to remember that, like any other business, betting shops are the victims of crime, not the cause"
"Like any retailer, betting operators look at footfall, demand, location, rental rates and competitive presence when deciding where to open a new shop."
"Up to 80% of new shops are opened in vacant units, providing jobs and investment that would otherwise be absent."
New betting shops in and around Deptford High Street have taken the place of vacant shops and pubs. But whether the economic impact of these new bookies really is positive is highly debateable.
The 40 FOBT machines around here suck out of the local economy an estimated £30,000 every week.
Highest rates of gambling problems are aged 16 to 24. Case Study
Channel 4 Dispatches has learned that those with the highest rates of gambling problems are aged 16 to 24.
Young people like Matt Zarb-Cousin who says he bet on FOBT machines at his local bookies when he was just 16.
The law is clear - you're not allowed into a betting shop until you're 18. However, Matt Zarb-Cousin says: "The machines attracted this kind of new type of gambler which was a kind of young, double your money quickly sort of gambler."
"The first time I went in, I put a couple of quid in the machine, got it up to a tenner. Second time I went in I put a tenner in and then got it up to twenty quid, and then the next time I went in, I put twenty quid in and got it up to fifty. And then from then on I think I went in there every day probably for the next two years."
"I used to go in there after school, so I would still be wearing school uniform at the time. Still wasn't ID'd or anything."
James Burton, an older former gambling addict spoke of the compulsion he had to play FOBT machines.
"It's so addictive, so addictive, I've never taken cocaine but I'm told that's how it is because it was so quick, so, so dynamic. It was just one pick, bang, bang, bang, bang, and literally every few seconds," he says. "It's personal, it is so personal, no money is involved in terms of your head, and you're losing thousands."
Getting industry insiders to talk about FOBT machines is hard. One betting shop manager agreed to speak anonymously to Channel 4 Dispatches.
"Last Thursday, nine thirty in the morning doors open, never seen the chap before. He puts two thousand pound cash in, he then wants to play with his card, and then there's another twelve hundred pounds gone.", he says. "Machines are kicked, machines are punched, ... because they've taken money, money people couldn't afford to lose."
FOBT machine are ‘particularly problematic'
It's estimated that there are more than 450,000 problem gamblers in Britain - people whose gambling damages their relationships and career.
Henrietta Bowden-Jones works at the NHS' only specialist clinic for problem gamblers, part funded by the industry. She says: "Here at the National Problem Gambling Clinic, we have an extensive database. We know exactly what games they're playing and FOBTs come first."
"About 50% of our patients claim fixed odds betting terminals as being particularly problematic"
"My patients here have a drive, an internal drive that forces them to chase their losses for hours and hours."
But till now no-one's worked out how much problem gamblers lose on Fixed Odds Betting Terminals. Professor Jim Orford from Birmingham University has started to crunch the raw data from Britain's most respected gambling survey. He can't produce exact figures because the sample's small, but he's estimated how much problem-gamblers lose - and on what kinds of gambling.
Professor Jim Orford says: "For the first time we know for example in relation to horse race betting or dog race betting or fixed-odds betting terminals, what proportion of gambling and what proportion of the profits are taken from problem gamblers.
His research suggests problem gamblers lose up to £57m a year on the horses; around £75m a year on the dogs; and around £75m in casinos. But problem gamblers lose an estimated £297m a year on FOBT machines - more than horses, dogs and casinos combined.
Professor Jim Orford says: "Getting on for a quarter of all the profits from these machines are being contributed we think by people who've got problems with their gambling"
Put another way - if a betting shop has people playing all its four machines, the chances are one is a problem gambler.
"My own view is that we should probably get rid of them on the High Street. I don't think casino gaming by machine belongs in the High Street, I think it belongs in casinos", Professor Jim Orford adds.
Government and select committee response to FOBT machines
This summer a parliamentary committee into the gambling act recommended that the problem of betting shop clustering could be addressed by allowing more than four FOBT machines in each bookies to satisfy customer demand, subject to review by the local authority,.
Jeremy Hunt, the culture secretary, in charge of gambling in this country, declined to appear in this programme but a spokesperson says: "the government has no plans to amend the gambling act unless there is clear evidence of a need to do so".
Notes to Editor
Britain's High Street Gamble - Channel 4 Dispatches. Monday 6 August, 8pm, Channel 4