The Soft Epidemic: Gambling Ireland

There was a familiar silence in the Paddy Power forecourt as Special Tiara crossed the line to win the Queen Mother Champion Chase at Cheltenham. One of the major races at the festival began with the usual excitement and anticipation. Each punter gripped his slip in his hand or held his phone tightly, his eyes wide in glee and thoughts of glory aplenty.

But silence ensued and the shop floor became muted when it was apparent Douvan, the Wille Mullins trained horse, was faltering. It was evident the horse wouldn’t be winning this race, and with that the atmosphere in the shop was subdued.

It was obvious the crowd needed this horse to win and in that silence there existed an apparent despair; possibly, many had lost a considerable amount of money. The momentary angst, however, didn’t last. Within 30 seconds the men, young and old, scrambled for little green pens and began scribbling their next bet, hoping to offset the very acute disappointment of losing on a well-backed horse.

The gambling industry is evolving. Domestically, globally, it is rapidly changing. Dying are the days men and women wither away in betting shops, spending a weeks’ wages in Friday afternoon’s embrace. Instead – as with all things – how we gamble is evolving with the advance in technology. For every full shop of people watching Cheltenham there are hordes of people in work, at home and in public gambling using technology. 

The Gambling Bill

Gambling is big business in Ireland but there is relatively very little known about the industry.

“Unfortunately, there is very little Irish gambling data available,” founder at Problem Gambling Ireland, Barry Grant, says. “There has never been a gambling prevalence study published in Ireland.”

Thus, our ability to gauge the size of the industry and the effect a lack of regulation is having on it is negligible.

In 2015, the government said they would be implementing the Gambling Control Bill at “the earliest feasible opportunity.”

However, years after it was proposed the Bill remains in limbo, and questions remain as to why a bill of this importance has been sidelined for so long.

Problem Gambling Ireland are urging the government to immediately pursue the implementation of the Gambling Control Bill 2013, but three years down the line it remains dormant. 

Alan Shatter, who proposed the Bill, said that, “The Bill introduces a range of new measures including the introduction of age restrictions; staff training; controls on advertising, promotions and sponsorship; the establishment of a new Social Gambling Fund to assist with treatment services; a new complaints procedure for consumers; and new arrangements to assist consumers seeking compensation from a licence holder.”

Barry Grant and Problem Gambling Ireland welcome the Bill and its recommendations, but its delay has allowed the industry to continue without regulation for a very considerable amount of time. It is also outdated; the industry has evolved rapidly and the landscape of the industry has changed. 

Evolving Landscape, Dublin

In 2010, there were roughly 1,345 betting shops in Ireland. In 2015, there were less than 970. These statistics are indicative of an industry undergoing major evolution.

The number of gambling shops has been falling, but bookmakers are focusing their efforts at relocating exchanges. For example, a large number of betting shops have been opening up close to pubs in recent years. This tactic is nothing new. Bookmakers are targeting pub-goers, but have also been investing in exchanges in perceived disadvantaged areas.

Within a very short walk you can visit six betting shops on or just off Talbot Street in Dublin 1. In Dublin 2 and Dublin 4 the concentration of shops decreases dramatically.

In Ballyfermot, there are at least six betting shops on or near the main thoroughfare. In Dalkey, there is one.

Giants like Paddy Power Betfair have anticipated a shift in gambling behaviour and continue to increase spending on developing their website and app. They recorded a 23% increase in total net revenue in 2015. This growth was driven by mobile gamblers which accounted for 76% of online revenue. Online operating profits increased by 11%.

This represented 84% of group operating profit. Sportsbook net revenue grew 13% with a stakes growth of 8%. Revenue at the company rose by 18% to €885m during the first half of 2016, with double-digit growth recorded across all of its four divisions. Online revenue at the betting company was 20% higher at €513m, with stakes on the sportsbook rising by a fifth.

In 2003 the online gambling market was worth approximately $7.4 billion By 2012, it had grown a staggering 483% into a market worth $35.8 billion. Today, that number is considerably higher.

H2 Gambling Capital, a leading supplier market intelligence on the global gambling industry, puts the size of the global online gaming market at approximately $37 billion. This is a conservative estimate.

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The growth of Paddy Power Betfair is indicative of a rapidly changing and expanding market in a time of inadequate regulation. With the increased popularity and prevalence of gambling there has emerged a steadily increasing addiction problem.

Big Business and Addiction

In 2015 Irish gamblers reportedly spent approximately €5 billion. In 2010 Ireland had the second highest spend per capita on gambling. 

Profits in the gambling industry are at an all-time high. This means that lots of people are losing.

According to a report carried out by University College Dublin and the Department for Social Protection there are possibly 40,000 problem gamblers in the country. Taking into consideration the often secretive nature of the practice and its subsequent addiction that number may be a lot higher.

Last year, Chief Executive Maebh Leahy said: “The gambling industry in Ireland is worth billions of euro but is still largely unregulated.

“The Gambling Control Bill 2013 has still not been passed and meanwhile the gambling landscape is rapidly evolving with the growth of technology and online gambling.

“The effects on the person and the family because of a gambling addiction are simply devastating, suicide relating to a gambling addiction is incredibly high,” she added.

Addiction services such as the Rutland Centre in north Dublin report an alarming increase in people seeking treatment for problem gambling.

In 2013, just 3% of addicts at the Rutland Centre were there for gambling-related problems. In 2016 that number has risen to almost 10%.

Rutland Centre, a support organisation for those with addiction problems, say they have seen a rise in younger people seeking treatment. This, they say, is due in large part to the increasing prevalence of online gambling, which makes it easier for youths to develop a problem.

Dr. Colin O’Gara is a leading expert in addiction services. He says he often visits schools to educate young people about gambling addiction and routinely discovers high amounts of teenagers who have online gambling accounts.

Young teens, aged from 14 upwards, are circumnavigating gambling laws by using online accounts, he has found. 

Bookmakers do not have the requisite parameters in place to keep individuals under 18 from using their services. This is a direct consequence of the lack in regulation. 

A young man at an inner city addiction centre says he began betting online. He’s only ever set foot in a bookmaker’s twice but developed a €200-a-day habit.

“I started gambling at 16. It was football first, then the ponies. Before I knew it I was spending hundreds a day, betting on silly things like the second division in Holland or horse racing in South Africa. Nobody knew the extent of my habit, for months I was at it.”

Gamblers no longer need to set foot in a betting shop to gamble. It can be done during a commute to work, in a cafe or pub, at a family gathering, at home in bed.

Regulation

According to the Gaming and Leisure Association of Ireland the implementation of the Gambling Control Bill will lead to the prevention of underage gambling. Betting companies will be required to contribute money to a social fund for research, treatment and education to combat addiction.

Tracking and intervention obligations will be mandated, forcing operators to track a player’s expenditure, intervene when irregularities emerge, and identify potential problems before they escalate. Advertising standards will be established ensuring that the young and vulnerable are not enticed into gambling. Properly regulated service providers will be obliged to train staff to identify behaviour patterns that may indicate that an individual is starting to gamble beyond their means, and to provide contact details for treatment services. It could also generate over €200 million, by more rigorously regulating unlicensed gambling which is rampant.

“The Revenue Commissioners have stated that ‘Gaming’ is subject to VAT at the standard rate, currently 23% of the gross win (total bets placed less winning bets paid out)”, according to the GLAI report.

“Accordingly gaming activities, such as roulette in gaming arcades and private member gaming clubs, is subject to VAT at 23%, whereas virtual roulette in a bookmakers premises is subject to a betting turnover tax of 1%. Clearly this is in breach of the EU principle of fiscal neutrality which stipulates that goods and services that are identical or similar shall be treated in the same way for VAT purposes.”

There have been calls to update and implement the Gambling Control Bill as soon as possible. However, much of the damage in the industry has already being done and the Bill remains dormant.

 

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