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  3. ABSG Progress Report on the National Strategy to Reduce Gambling Harms – Year Two

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ABSG Progress Report on the National Strategy to Reduce Gambling Harms – Year Two

ABSG - Year two Progress Report on the National Strategy to Reduce Gambling Harms

Published
7 July 2021

Last updated
13 March 2023 - Changes

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Contents

2 - Improved regulatory protections

Industry challenges

The ‘industry challenges’ announced last year have progressed and led to tangible changes which may improve consumer protection. These changes are welcome but need to be monitored for impact and followed up with more emphasis and action to deliver safe products and better support for customers.

Safer game design

The consultation has led to new rules for safer game design, including the removal of ‘auto-play’, increased prominence of players’ balances and prevention of reverse withdrawals59. These changes were supported by available evidence, but also represent precautionary action on game design features which are likely to be associated with the risk of harm. ABSG welcome the move to make these requirements mandatory through the LCCP, rather than relying on a voluntary industry code.

Requirements for how operators interact with customers who lose the most money

Schemes for so-called ‘high-value customers’ have been recognised as a key area of risk in enforcement action for some time60. ABSG are pleased to see new requirements emerging and welcome the Gambling Commission’s commitment to becoming more proactive in monitoring the impact of these new requirements and to take further action if continued failings are observed.

Ad-tech

An industry code has been implemented to ensure better use of ‘ad-tech’ to avoid young or vulnerable people being targeted by marketing for gambling61. We note this is a voluntary code and look forward to seeing the evidence of effectiveness which will be carried out by the BGC.

ABSG commends the Commission for promoting a more a rigorous approach, consulting quickly on key issues and mandating requirements where evidence has identified a need to take further precautionary action. However, as with all projects, this needs careful evaluation and greater levels of transparency. ABSG look forward to reporting on evidence of effectiveness in 2022.

National Lottery Age Limits

The Government announced in December 2020 that the minimum age for purchasing National Lottery products would increase from 16 to 18. This change has been made with the aim of protecting young people from gambling-related harm – particularly given the evolution of National Lottery products from weekly draw-based games to a growing trend towards scratchcards and online instant wins. The change will be fully implemented in October 202162.

Single customer view

Progress on developing a single customer view has been less tangible. Highly engaged gamblers have multiple accounts63. There is a clear rationale for taking a holistic approach to a consumers’ data to allow better detection of harmful gambling and more targeted interventions. We are pleased that co-operation will continue between the Commission, the Office of the Information Commissioner (ICO) and the Betting and Gaming Council (BGC) to achieve an effective solution64. Input from the financial sector, which also holds data relevant to building a single view of a consumer’s risk of experiencing gambling harms, is also needed. We welcome steps being taken by the Commission to explore the feasibility of access to this data. Key reports published this year concur with ABSG’s position. Data from operators, the financial sector and the Commission, if combined, could form a powerful tool to reduce harms65. The creation of a single customer view is essential to progress.

Customer interaction and affordability

In last year’s progress Report, ABSG discussed four categories of metrics which required further regulatory action66. Affordability was one of these. Since then, the Commission has consulted on bold plans to enhance and strengthen the requirements on operators to interact with their customers and check their levels of gambling are affordable. Focus on this issue is welcome as published enforcement cases shows failings by operators in this area have been responsible for harm over many years67. A review of the Commission’s most recent compliance work shows there is no sign of improvement on the part of the industry68. The Commission is currently considering its response to the consultation. It received a large number of responses expressing concerns about proportionality, but equally strong views making the case that regulatory action on affordability would be effective at protecting those at risk of harm.

As with the proposals for a single customer view, we welcome ongoing work between the Commission, UK Finance and the ICO, to explore how operators can have access to information that could inform their customer interactions, whilst acknowledging that operators do have sufficient information on their own customers to be more proactive than they currently appear to be. Recent analysis of 140,000 active accounts across seven operators found that that, during a one-year period, 0.13% of customers are contacted by phone and 3.9% by email69.

The Commission will publish its proposals on this in the coming months. ABSG’s position is that there is sufficient evidence to take action now and to introduce mandatory action in this area70,71. Voluntary compliance has not been effective. The evidence of high harms associated with high spend is strong72, together with factors such as length of gambling sessions, number and type of gambling activities undertaken73. Recent research using machine learning has shown that a combination of variables are better predictors than single variables to identify those at risk74. Further, the evidence of links between harm, spend and deprivation indices supports immediate action to protect those with the least resources75,76. This needs to take account of research which suggests a rise in use of payday loans and PayPal accounts to fund gambling77.

References

59 Gambling Commission announces package of changes which make online games safer by design, Gambling Commission, February 2021

60 Changes to the licence conditions and codes of practice on High Value Customers: Consultation Response, Gambling Commission, September 2020

61 Gambling Industry Code for Socially Responsible Advertising (PDF) (opens in new tab), Industry Group for Responsible Gambling, January 2021

62 https://www.gov.uk/government/news/government-launches-review-to-ensure-gambling-laws-are-fit-for-digital-age (opens in new tab), DCMS, December 2020

63 Gambling participation in 2019: behaviour, awareness and attitudes, Gambling Commission, February 2020

64 ICO supports innovative data sharing projects to protect vulnerable people (opens in new tab), Information Commissioner’s Office, January 2021

65 Gambling regulation: problem gambling and protection of vulnerable people (opens in new tab), Public Accounts Committee, June 2020

66 Progress report on the National Strategy to reduce Gambling Harms, ABSG, June 2021

67 National Strategic Assessment 2020, Gambling Commission, November 2020

68 Raising Standards for consumers - Compliance and Enforcement report 2019 to 2020, Gambling Commission, December 2020

69 Exploring online patterns of play: Interim Report (PDF) (opens in new tab), D.Forrest and I.McHale, NatCen/University of Liverpool/GambleAware, March 2021

70 Deriving low‐risk gambling limits from longitudinal data collected in two independent Canadian studies (opens in new tab), Currie et al, Addiction, November 2017

71 Similar results found in: The development of empirically derived Australian low-risk gambling limits (opens in new tab), Downing et al, 2021.

72 The association between gambling and financial, social and health outcomes in big financial data (opens in new tab), Muggleton et al, Nature Human Behaviour 5, February 2021

73 The conceptual framework of harmful gambling: a revised framework for understanding gambling harm (opens in new tab), Hibrecht et al, June 2020

74 Gambling spending and its concentration on problem gamblers (opens in new tab), Fiedler et al Journal of Business Research, 2019

75 Using machine learning to predict self-exclusion status in online gamblers on PlayNow.com platform in British Columbia (opens in new tab), Finkenworth et al, Sept 2020.

76 Our Year One Progress Report recommended operators should be required to publish figures on the number of customers losing more than £500 per month as part of a drive to increase transparency. In the Nordic countries, operators are required to submit losses for the highest 5% of spenders.

77 Six-month progress report, LAB Group and City, University of London, February 2021 (forthcoming)

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