Mo Money Mo Problems – the debate over funding for harm prevention

Pin the tail on the donkey

Mo Money Mo Problems – the debate over funding for harm prevention

Mo Money Mo Problems – the debate over funding for harm prevention

The question of how much operators should pay for the provision of gambling disorder treatment services (as well as research and preventative education) is becoming an increasingly contentious aspect of regulatory policy the world over. Since the start of the year, governments and regulators in Japan, the Netherlands, Ireland and Great Britain (amongst others) have made high profile announcements about the need for substantial increases in funding.

As research reveals more about the human costs of excessive gambling and the public health lobby continues to gain influence over policy, it seems inevitable that more and more governments will adopt strong-arm tactics to extract greater levels of funding from licensees. However, money alone is rarely the answer. Developing sensible policies to ensure fund-raising integrity and effective use of resources can be difficult when political discourse on gambling is so febrile. In this article, we examine the debate in Great Britain and consider the lessons that can be learned across all markets.


One of the wonderful aspects of childhood is that the simplest things can afford the greatest pleasure – games like ‘pin the tail on the donkey’ for instance. Sadly, it seems inevitable that this particular children’s party tradition will soon be banned on the grounds that it ‘normalises’ games of chance and that it promotes cruelty to animals.

It is therefore heartening that the spirit of the game is being kept alive in parliamentary and regulatory commentary on matters of gambling policy. Blindfolded by the absence of key pieces of information, politicians and others gamely persist in attempting to stick it into the proverbial ass of the gambling industry.

So it is with the proposal for a responsible gambling levy on British licensees to pay for research, education and treatment services (‘RET’) and other prophylactic measures. The proposal is not necessarily wrong; but there is little evidence that it has been fully considered.

This question of funding for research, education and treatment is at heart a highly subjective one; but it is also relatively simple, if we are prepared to break it down into its constituent parts: What services are required? Who should provide them? How much will they cost? How will this change over time? Who should pay?

Once we have addressed these points we can move to consideration of the most appropriate mechanism to finance it all. Until then, arguments about whether the industry ought to cough up £12m, £70m, £140m or £1.2bn and under what level of duress are likely to be of more academic than practical value.


An assessment of treatment and support for those affected by gambling harms is the obvious place to start. These are in some cases literally vital services and fittingly the recipients of the largest part of industry funding. Deal with the question of treatment and the relatively small beer of research and education will seem far more manageable.

The treatment universe in Great Britain is fairly uncomplicated. GamCare runs the national helpline and netline and provides cognitive behavioural therapy courses directly and indirectly via its national partner network. The Gordon Moody Association (‘GMA’) operates the two residential treatment centres in Beckenham and Dudley as well as the Gambling Therapy multi-lingual helpline. Finally, Dr Henrietta Bowden-Jones runs the NHS national problem gambling clinic in London (a similar clinic will shortly open in Leeds). Gamblers Anonymous also provides a national network of 12-step treatment groups but the organisation is determinedly independent and self-financing.

The National Health Service plans to increase the number of clinics but how many and how quickly remain undisclosed (further details are expected over the summer). It seems likely that for the foreseeable future, treatment services will continue to be provided in the main by GamCare and other charitable organisations

Of course, what is currently provided is not the same as what is required. Problem gambling is a highly diverse diagnosis – the symptoms and harms vary significantly from one individual to another. It is likely therefore that a broader range of treatment services may be required than are currently available.

We may also require specific approaches for different groups (based upon age, gender, culture, language and life circumstances). Finally, it is possible that any increase in funding will attract the attention of mental health treatment providers not currently active in this field.

GambleAware has commissioned research into treatment gaps. We do not know how authoritative this study will be (it is not a simple question to address) but it ought to have a bearing on funding policy.

Things are less clear in the realm of research. If the ability to inform regulatory policy is the acid test of research then the official programme, devised and commissioned by the Advisory Board for Safer Gambling (‘ABSG’), the Gambling Commission and GambleAware does not appear to be working. A hotch-potch of uncoordinated pet projects and politically motivated studies, it palpably failed to provide the Government with a hard evidence base for its last, tortured triennial review of gambling legislation.

The ABSG has suggested the establishment of a national centre for the study of gambling with an indicative annual price tag of around £10m. This would be a snip if it resulted in a structured, long-term programme of high-quality research that could inform both operating and regulatory policies; but at the moment, this is no more than an idea.

Work on preventative education is carried out by a small number of organisations engaged in schools and youth-based programmes along with occasional public health advertising campaigns (‘Bet Regret’ and ‘When the Fun Stops Stop’). This area is replete with good intent but devoid of any clear strategy. Careful analysis is required before we can start making assessments of need.

Next comes the question of how much we ought to be spending. Part of the problem is that we have no idea of current levels of expenditure – partly because artificial and entirely arbitrary calculations have been allowed to distort the picture.

We know that GambleAware raised £9.6m in 2018/19 via voluntary contributions. Industry critics compare this figure against the £14bn of gambling revenue and conclude that operators are not even contributing the GambleAware recommended figure of 0.1% of revenue. This is misleading. First, around £3bn of the £14bn relates to the National Lottery and yet in 2018 Camelot contributed just £300,000 to GambleAware (up from £190,000 the year before). The Government and regulator may have good reasons for agreeing a low level of funding with Camelot (the need to accommodate high taxation and donations to good causes) but this accounts for the majority of the deficit against the 0.1% target. Those who fail to mention this in their analysis are either lazy or dishonest.

GambleAware received an additional £7.3m last year as a result of notionally voluntary settlements arising from Gambling Commission enforcement actions. In addition to this, some companies have made payments directly to GamCare and Gordon Moody and supported organisations outside the GambleAware funding circle (e.g. YGAM, BetKnowMore, EPIC Risk Management, the Chinese National Healthy Living Centre and Action on Addiction). Some local authorities have received direct payments for problem gambling treatment services from operators as part of their licensing arrangements.

We simply don’t know how much all this adds up to, which is a weakness of both industry and regulatory reporting. The Gambling Commission has estimated that around £3m may be contributed to research, education and treatment organisations in addition to funds given to GambleAware. Our best guess therefore is that industry contributions (voluntary and coerced) to GambleAware last year totalled around £17m with total funding to all organisations involved in harm prevention and treatment possibly as high as £30m. It is not clear where all this money has gone or indeed whether it has been spent wisely.

Yet this is only a part of the picture. To get a proper grasp on what is going on, we must factor in a number of other elements.

First, the industry pays £19m a year (and rising) to finance its regulator, the Gambling Commission. A large chunk of this is spent on safer gambling initiatives (including for example paying for the ABSG). Then there is the cost to operators of maintaining an expanding army of safer gambling officers as well as training and licensing for employees, research projects and significant investments in technology (biometrics, play management tools, diagnostic analytics, exclusion and barring systems). These investments need to be weighed in the balance of industry funding, regardless of whether they are voluntary or compulsory.

The case of blocking software illustrates the arbitrary nature of current distinctions. At present, licensee funding for the free-of-charge provision of gamban is recognised under RET conventions. However, if it becomes a requirement for all remote (and possibly non-remote) licensees to offer this then it will cease to qualify. Operators will still pay (indeed, they will pay more) but the sums will be ineligible for RET reporting. Such distinctions appear to serve little value except to downplay the industry’s commitment to harm reduction.

Not knowing how much is currently spent is not a promising start to working out what needs to be spent. Nevertheless, anyone who has spent any amount of time with GamCare, the Gordon Moody Association and the National Problem Gambling Clinic will be clear that more – much more – funding is required for treatment providers.

In 2018/19, the three main treatment providers received around £6m in funding from licensees via GambleAware and through direct grants. The ABSG estimates that over time this might need to increase to around £60m. This at least is an attempt to identify need – but it is fairly speculative, based upon straight line increases in the proportion of problem gamblers receiving direct treatment. It also marginalises the importance of GamCare’s helpline and netline for those with less severe problems as well as other sources of support (most obviously Gamblers Anonymous).

Other attempts to guess at funding needs include high-level comparisons between international jurisdictions; and between problem gambling and other disorders (such as alcohol dependency). These are inevitably flawed. International comparisons must take into account the specific circumstances of gambling and healthcare in those jurisdictions; and there is no law of equivalence between problem gambling and alcohol dependency (which is not directly analogous to problem gambling anyway).

In the absence of better guides, these speculative approaches have some directional value – but we should aspire to better. What we really need are bottom-up budgets based upon thorough examinations of current need and graduated expansion. We also need to improve evaluation of treatment services to ensure that funds are spent wisely. Ratcheting up funding without a clear idea of what to do with the money or how effective it is seems likely to result in waste.

Once again, important work is being done in this area. It is understood that much of the detail for gambling-related treatment services under the NHS Long Term Plan has now been hammered out and that we may look forward to publication over the summer. The existing treatment providers have also been working on their plans to increase capacity. At the same time, GambleAware has commissioned research into treatment effectiveness. While this work may not be definitive it is germane to the debate on funding and surely worth waiting for.

Having worked out what is required, we may address the question of who should fund it all. The standard response is to state that the gambling industry should pay and to trot out the “polluter pays” platitude. Most major licensees agree with this – but this warrants scrutiny.

The gambling industry generates around £3bn a year in duties (in addition to a variety of other taxes). While rates of duty vary, HMRC’s yield from gambling is significantly higher than it is for general retail (where VAT is applied). Some London casino operators despatch almost half of their gaming revenue to Exchequer every year. We estimate that the taxman raises an additional £200m (possibly more) a year because some consumers choose to spend their money on betting and baccarat rather than bowling and burgers. There is almost no discussion of whether this excess tax should be used to fund treatment services but – given that HM Treasury is a major beneficiary of legal gambling – there should be.

Once we have addressed these questions we might hope to have a sensible discussion about funding mechanisms.

In principle, a statutory levy has a number of attractive features – fairness, independence, predictability of funding and simplicity – but the test is whether these hold up in practice.

The fairness argument follows the logic that all parties should stump up in equal proportion – but how does this fit with the ‘polluter pays’ principle? Is it fair that lower risk forms of gambling such as bingo or lotteries should pay the same as online casinos? Similarly, is it fair that those operators who pay high levels of duty should chip in the same as those who pay relatively little? These are largely academic questions at current funding levels – but they are likely tend to become more contentious as the quantum increases. New Zealand operates a smart responsible gambling levy that imposes different costs based upon different assessments of risk (with lottery and horseracing at the bottom of the scale and slot machines at the top) but introducing this model to Britain’s diverse gambling market is likely to be complicated and controversial.

The need for independence – to ensure that the industry does not exert undue influence – is another commonly cited argument in favour of a levy. However, this is principally an issue for research (and public health advertising campaigns) rather than treatment. Research that is designed to inform regulatory policy really ought to be independent – and much of it already is. The Gambling Commission spends around £750,000 a year on research (including the gambling prevalence elements of the British Health Surveys), funded by the industry through licence fees. It is possible that an increase in licence fees may provide a relatively simple mechanism for resolving the issue.

However, while a cleaner funding mechanism for research is desirable, it is unlikely to end the controversy. Independence is much more than simply a question of cash. Research has shown that amongst social researchers (who dominate the field of gambling studies) there is a pronounced bias to left-of-centre political philosophies. Uncritical postings on twitter of unverified news stories vilifying the industry suggest that some well-known researchers simply don’t like the gambling industry. This is important because pronounced ideologies (for or against gambling) are more likely to distort research than money alone.

Sustainability is a critical factor. Those involved in delivering services need to be able to plan ahead in the knowledge of funding security – hand-to-mouth is no way to manage. However, under the voluntary system funding has grown steadily year-upon-year. If the 2016-2019 National Responsible Gambling Strategy failed to meet expectations, it was down to poor planning and engagement rather than absence of resource.

Indeed, the fact that the major operators have funded GambleAware to within a whisker of its target is somewhat miraculous when one considers how the charity has treated its supporters. There can be few (if any) charities that have grown funding while routinely (and at times unfairly) disparaging its supporters. It is tantalising to consider what might be achieved given greater trust and transparency – and we ought not to assume that a voluntary system of substantial and sustainable funding is impossible.

At present however, official guidance on how much to give and to whom is unclear. The Gambling Commission will publish its Harm Reduction Strategy in July (more than three months after the start of the period it covers) and we must hope this will include detailed budgets and funding guidance. Critics of the industry would do well to remember that the only organisation that currently has in place a published, detailed and operationalised plan for funding research, education and treatment is the betting and gaming giant, GVC.

The fact is that hypothecated systems of taxation are pretty rare; and responsible gambling levies in particular tend to be the exception rather than the rule (although betting operators looking at expansion in the US should consider that tribal gaming compacts have set precedents for harm prevention levies in states such as Arizona and New Mexico). Governments tend not to enjoy administering them. They can be bureaucratic and costly to run, fraught with controversy (as Britain’s horseracing levy has demonstrated) and subject to political influence.

The point of this article is not to resist a levy but simply to make the point that more thought than has been demonstrated to date is required. It may be that a mandatory mechanism would produce better results than the ambiguity of the current voluntary-coercion system. However, we ought to have learned by now that making significant structural changes without due examination and proper planning is likely to result in chaos. It may not be the popular view but the Government is right to wait until it is in possession of more of the facts before it commits to change.

Those who are serious about addressing harm need to cut out the grand-standing and instead develop coherent and coordinated plans that draw on insights from international jurisdictions and the treatment of other relevant disorders. More money will be required but decisions about how much more should be based upon careful assessment rather than simply a desire to penalise the industry. A system of funding based on virtue-signalling rather than analysis is likely to be both wasteful and ineffective.