Select Committee on Culture, Media and Sport Memoranda


Memorandum submitted by RAL Holdings Limited



  RAL was formerly part of the Rank Group, and became a private company in 1996. Its principal business activity is the operation of "all cash" gaming machines at 140 premises around the UK. These premises trade as "Quicksilver Licensed Gaming Centres" and each unit operates around 40 "Category C Machines".* RAL employs around 700 staff nation-wide.

  In this response to the White Paper we address the following issues:

    (i)  The definition of "Adult Gaming Centres".

    (ii)  Linked gaming machines in an Adult Gaming Centre environment.

    (iii)  The proposed licensing of I-Gaming in the UK and the opportunities for future taxation that this could create if dealt with expeditiously.

    (iv)  Social responsibility in the gaming industry.

    (v)  The establishment of a single regulatory body for all forms of gambling in the UK.

    (vi)  The licensing of all gambling operators, as individuals, in the UK.

    (vii)  The need for caution in the proposed introduction of large numbers of Category A machines* in casinos, particularly in an environment where it may be difficult to ensure effective delivery of support to problem gamblers.

  * Applying the machine classification system proposed in section 4.11 of the White Paper.

Annex 1


  The Response in Detail:


  During the consultation process prior to the publication of the Gambling Review Report, RAL hosted a visit by Sir Alan Budd and members of the Gambling Review Body to an RAL outlet in London. Over a two hour period it was obvious that they were surprised at the difference between their pre-conceptions of the "Adult Gaming Centre" and the reality of their observations. It was clear this type of business was providing slot machine entertainment in adult only premises for a wide cross section of the public, demographically split 50:50 male/female (see Annex 2).

  The White Paper, in section 4.13, suggests that Category B (*) gaming machines should only be installed in premises that are specifically licensed for gambling: casinos, bingo clubs, betting shops and adult gaming centres. All the aforementioned being premises from which children are barred and which will be brought clearly within the arrangements for licensing and inspecting gambling premises to ensure proper adherence to regulation and safeguards it brings. We welcome this proposal.

  We recognise however that there are operators in the UK Gaming industry who do not operate controls on access by under 18s, or who operate with a "designated area" within their premises featuring all Category C machines.

  We feel that it is important that these operators are not allowed to operate Category B machines and, that if they wish to do so, they should convert their premises to "adult only" and apply for the appropriate licence (or permit) for an "Adult Gaming Centre".

  We advocate that in any new legislation there should be two clearly distinct types of permit available for premises which are geared specifically for the provision of "Coin Op entertainment"' and for simplicity, these should be called "Permit 1" and "Permit 2".

  Permit 1 should allow the operation of an unlimited number of all Category C machines and be applied to a premises, (not simply to an area within a premises), and should exclude Under 18s from all parts of the premises. An important adjunct to this type of permit should, (as proposed in the White Paper), be parity with a LBO in the provision of four Category B machines. This would provide a clear picture for a local authority with regard to the type of business being conducted, and they would understand the penalties that could be applied to the operator if he were to transgress in any aspect of the operation of the premises, ie to allow under 18s access.

  Permit 2 should allow the operation of a "Family Amusement Centre" such as those found predominantly at coastal resorts but also in some large towns and cities, and also in "out of town" shopping centres. Permit 2 premises would provide for the operation of all types of trivial coin operated equipment such as videos, novelty games, kiddie rides, pushers, cranes and so on. Regulators, opinion formers, and local authority officers would be able to clearly understand the type of business that was being proposed in any licence application, including the proposals for policing the "designated area" and make a decision based thereon.

  We strongly believe that the creation of "Permit 1" and "Permit 2" would solve the problems of definition and allow regulators and local authorities a far clearer understanding of what is being proposed in a licence application.


  RAL are pleased that the White Paper recognises that the "Adult Gaming Centre" provides alternate entertainment, on the High Street, to the traditional LBO, (betting shop). The demographic information shown at Annex 1 clearly demonstrates, from a membership list of 50,000 players, that Adult Gaming Centres provide a leisure gaming experience to a wide cross section of the public and are certainly frequented by a much larger number of women than a typical LBO. On this basis, whilst we are pleased that it is proposed that we be allowed to operate four Category B machines, we would like to suggest a slight variation to allow for the fact that we are not in a position to offer the same range of betting opportunities as a LBO. We feel that it would be relatively easy to construct machines that provide a common jackpot of £500 on the basis of eight Category C machines to one Category A machine. An operator could then, rather than providing one Category B machine paying out a single prize of £500, instead provide eight Category C machines, all playing for one common £500 prize. In this way an Adult Gaming Centre operator could operate a maximum of 32 (four times eight), of these machines. Linked games, where players compete with one another for a prize, have grown in popularity over the past three years and this proposal would be a simple extension of this successful formula.


  RAL is pleased to note that the Government has accepted the recommendations of the Review Body in respect of on-line gaming products. We note the comments in section 4.48 that "there is a potentially vast international market for which gambling operators based in this country will be encouraged to compete".

  Section 4.52 notes, "there is every reason to believe that Britain can establish a reputation for itself as a world leader in the field of on-line gambling". There are sound commercial and social arguments to encourage the location of I-Gaming businesses in the UK. These arguments fall into two categories, firstly the protection of the UK

I-Gaming Punter

  Currently it is not possible for UK companies to set up hardware and software systems for I-Gaming on the UK mainland, and operators, therefore, have to set up convoluted software architecture in order to ensure that they comply with the current regulations. The effect of this is to encourage the UK I-Gaming punter to play on Caribbean-based web sites which are not regulated and which are often, demonstrably, unreliable and unfair. Naturally these offshore operators would have no truck with UK organisations such as Gamcare who might seek an input into the way that the business is conducted. By granting licences to UK operators the UK, authorities and regulators would then be able to have an input into the ways that sites are presented, promoted and managed. This in exchange for a UK kitemark that would indicate probity, trustworthiness, and systems that have been checked and verified by a third party tester. This could be further reinforced by only permitting UK-based operators to advertise in the UK. This in turn would drive would-be punters to these UK sites as opposed to those in other jurisdictions and would ultimately lead to greater opportunities for taxation.

  The second strand to this issue is clearly fiscal. Many jurisdictions are now moving toward licensing I-Gaming, and the rewards in terms of opportunities for taxation for these jurisdictions are likely to be vast. The I-Gaming market (whether this means Internet, Digital TV, WAP, GPRS or 3G methods of delivery), is widely predicted to grow exponentially over the next few years and there will clearly be many first mover advantages.

  We believe therefore that I-Gaming legislation must be disconnected from other possible new gaming legislation as proposed by the Gambling Review report, and implemented as quickly as possible. There is a real risk that UK plc will miss the boat if this is not done!


  In recent years RAL has been in the vanguard of support for Gamcare, and have been able to convince the trade association BACTA, that Gamcare notices should be displayed in gaming machine venues across the country.

  We have found that promoting social responsibility, and in particular the work of Gamcare, to staff through posters, leaflets and during induction training sessions, is received positively by people joining the industry and assists in dispelling any negative preconceptions that they might have about the gambling industry. Clearly the same shift in attitude can be achieved with the general public and assists in promoting the industry as an integral part of modern day life.

  The imposition of a levy to provide funds to support the GICT (Gambling Industry Charitable Trust), would be divisive and would, ironically, undo a lot of the good work that has been carried out in the area of social responsibility and gambling in recent years. It could once again set the industry in the opposite camp to the charities. However, clear evidence on the part of a Gaming operator not only of voluntary support for the GICT, but also of the implementation of awareness and support programmes, should be a clear criteria not only for the grant of a licence but also for its renewal.

  It has been suggested that a figure of approximately £3 million is required to support the various charities and other support organisations associated with problem gamblers. We question this arbitrary sum and suggest that proper research be carried out by the Gambling Industry Charitable Trust in order to ascertain precisely what the quantum is, both for providing support for the existing charities and also to provide funds for ongoing research.


  We wholeheartedly support the recommendation that a new regulatory body (the Gambling Commission), is established and becomes responsible for the control and regulation of all sections of the gambling, gaming and betting industry in Britain. We believe that it will be essential that the new body be given sufficient power and resource to properly police and regulate an industry which will, on the back of technological change, be evolving at an ever increasing pace. There can be no doubt that many foreign gaming operators will see the apparent liberalisation of the UK as an opportunity to be exploited. Strong barriers and controls will need to be in place, (and able to be enforced), to ensure that only those operators who are able to demonstrate the highest levels of probity are able to obtain, and retain, UK licences.

  We believe that the new body should certainly have the power to prosecute. We feel that a weakness of the Gaming Board has been having at times to rely on the Police who do not necessarily see an infringement of the 1968 Gaming Act as top of their list of priorities.


  We applaud the recommendation contained within the Gambling Review Report that a new single regulatory authority (Gambling Commission), should license all gambling operators and key workers (s18.13). We believe that this is long overdue and has, to a certain extent, prolonged the public misconception that gaming is a little "shady". RAL holds a number of different licences for the operation of gaming machines and cash bingo and so on, and sees only positive results from requiring any operator involved in any form of gambling, gaming or betting to present his or her bona fides.

  We believe that this licensing should, (as a minimum), apply to all directors and senior staff within any organisation. It should be the subjective judgement of the officers of the Gambling Commission as to which further individuals might also be required to be licensed.

  RAL believes that this should extend down to unit manager level providing not only an improved skill set, but also a portable qualification that may provide the individual with better future employment prospects.


  Section 1.4 of the White Paper makes the following point; "Experience from around the world suggests that over-enthusiastic de-regulation can cause real social and economic problems, from which it is hard to rein back".

  Those of us who have worked in the gaming industry in the UK for a number of years, have serious concerns as to the social effect of allowing the unfettered introduction of Category A(*) machines in the planned "International Casinos". We feel that, whilst we welcome change and progress, (and it is obvious that the UK has been held back in terms of development over the past 10 years), nevertheless gaming machine numbers must be firmly linked to the number of table games available. We would draw the Committee's attention to the system in Belgium where there is a clear link between the two. As business levels grow during a session, and more table games are opened up, a corresponding number of gaming machines are switched on. As business levels then subside the corresponding numbers of gaming machines are switched off. In this way the balance of table games to slot games is maintained and slot games are never allowed to take precedence over the gaming tables. We believe that this would present an ideal control over the introduction of Category A(*) machines.

  We believe that there is incontrovertible evidence from other countries that severe social problems are likely to arise if operators are not restricted in the number of Category A (*) machines which may be installed in gaming venues. Convincing arguments will no doubt be put forward to suggest that this will not be the case, and we would simply ask that due consideration is given to the various research documents which are available on the subject. In addition, we are concerned that, contrary to the arguments put forward by some casino operators, it will prove very difficult to deliver effective support for problem gamblers in vast "sheds" where many different forms of gambling will be available under one roof. If there are only a few gambling opportunities in any given venue, gambling is less anonymous which may deter some people from excessive gambling for fear of being seen and disapproved of. Currently other various limits to accessibility include opening hours and conditions of entry, both of which it is proposed be relaxed in the future and which may then impact in a negative way on harm minimisation programmes.

Annex 2


  Customer Demographic Profile

  RAL Gold Card Members

  Total Membership: 49,764 of which 43 per cent female, 57 per cent male

  Broken down into age groups:
18-2526 per cent of which 21 per cent female 79 per cent male
26-3522 per cent of which 31 per cent female 69 per cent male
36-4515 per cent of which 50 per cent female 50 per cent male
46-5913 per cent of which 65 per cent female 35 per cent male
60+12 per cent of which 73 per cent female 27 per cent male

  No age given 12 per cent

29 April 2002

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