Gambling Local Concerns Environmental Health & Licensing Manager Head of Planning Services. Regulatory Affairs

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1 Committee: Licensing Committee Date of meeting: 23 June 2014 Agenda item: 5 Subject: Lead Officer: Portfolio Holder(s): Link to Council Priorities: Exempt information: Delegated status: Gambling Local Concerns Environmental Health & Licensing Manager Head of Planning Services Environment Regulatory Affairs A Safe, Caring & Healthy Elmbridge For Resolution EXECUTIVE SUMMARY: An update on the legislative background and developments regarding betting premises following the Licensing Committee Chairman s statement to Council on 2 April RECOMMENDATION: THAT (A) (B) THE STRATEGIC DIRECTOR, IN CONSULTATION WITH THE CHAIRMAN OF THE LICENSING COMMITTEE, BE AUTHORISED TO WRITE TO RELEVANT MINISTERS SETTING OUT THE COUNCIL S CONCERNS AND PROPOSALS FOR CHANGE AND THAT THIS BE CIRCULATED TO THE LGA, THE LOCAL MEMBERS OF PARLIAMENT AND OTHER INTERESTED PARTIES; AND THE LICENSING COMMITTEE SUPPORT THE LGA S APPROACH OF ENGAGING WITH THE GAMBLING INDUSTRY TO BRING ABOUT IMPROVEMENTS TO ADDRESS LOCAL CONCERNS OVER GAMBLING. REPORT: Background: 1. Following concerns arising over the last few months from a number of applications for gambling premises licences the Licensing Committee Chairman made a statement to Council at its meeting of 2 April 2014 setting out local concerns and requesting that a report be prepared to go to both the Licensing and Planning Committees. The relevant minute extract from the Council meeting held on 2 April 2014 is provided at Appendix A. 2. The report was requested to provide an assessment of the powers and actions available the Council to strengthen its controls on the potential proliferation of such premises and also to support the LGA s action to seek a change in the law so that local authorities secure the necessary powers to exercise the necessary controls. Licensing Committee 23/06/14-1 -

2 Licensing Legal Framework: 3. The Gambling Act 2005 ( the Act ) regulates almost all gambling that takes place in England and Wales except exempt gambling specified under the Act and the National Lottery which has its own legislation. Responsibility for administering and enforcing the legislation is split between the Gambling Commission and Licensing Authorities. Elmbridge Borough Council is the Licensing Authority for the purposes of the Act. As a Licensing Authority the Council has set out its Statement of Policy which was adopted and came into effect on 1 September 2013 and expires on 31 December The Gambling Commission has responsibility for dealing with Personal Licences and Operating Licences. In April 2014 the DCMS announced plans to provide increased power to local authorities to control the number of betting shops on their high streets. Planning Legal Framework: 5. Currently, betting premises are generally classed as financial and professional services, falling under Class A2 of the Town and Country (General Permitted Development) Order (GPDO) This is along with banks, building societies, pay day load shops and estate agents. The GPDO permitted changes of use between Class A2 and from Class A3 (restaurants and cafes) to class A2 uses. However, further amendments to the GPDO applying from May 2013, have relaxed the regime even further allowing changes between Class A1, retail, Class A2 and Class A3 as well as Class B1 offices without requiring planning permission for a temporary period of 2 years. 6. Changes were mooted by the Government in its 2014 Budget, which set out that the Government would consider a much wider retail use class, excluding betting shops and payday loan shops. A written Ministerial Statement on 30 April 2014 said that the Government would consult in the summer of 2014 on creating a new class for betting shops so that planning permission would be required before betting shops could be created from former banks, building societies, restaurants or pubs. 7. The Government s action follows on-going controversy over a number of years about the permitted changes which have resulted in a proliferation of betting shops in the high street. The then Planning Minister, Robert Neill rejected a request, by David Lammy MP for Tottenham, to remove betting shop from a Class A2 definition and reclassify them as sui generis a category of their own. Having rejected this request, a formal consultation is still awaited. 8. It is understood, the Department for Communities and Local Government is due to consult on the specific details and their potential impact as part of a wider change of use consultation during the summer. The DCMS has also proposed to introduce 'Player Protection Measures', requiring individuals using higher stakes (over 50) on Fixed Odds Betting Terminals (FOBTs) to Licensing Committee 23/06/14-2 -

3 use 'account-based play or load cash over a counter'. These measures aim to help customers make 'clear and well-informed decisions about their gambling before they begin play'. 9. The Gambling Commission is also reviewing its licensing conditions and codes of practice aiming to: Require all players of Fixed Odds Betting Terminals to be provided with options to set voluntary limits during play; Ensure regular warning messages and pauses are provided during play; and Introduce an advanced system of voluntary self-exclusion. 10. The changes announced at the end of April do not include any substantial changes to Council powers under the 2005 Gambling Act. It appears that Government has accepted the view put forward by the Gambling Commission that Councils could use some of their existing powers (for example, the right to apply Premise Licence Conditions) more effectively than is currently the case. The Gambling Commission also believe that Councils could do more to hold the industry to account, for example, through the creation of Betwatch schemes that mirror local Pubwatch schemes. 11. In relation to the Government s announcement, it should also be noted that the National Centre for Social Research is currently undertaking an extensive piece of research focusing on use of Fixed Odds Betting Terminals and patterns of harmful player behaviour. This is due to conclude in October 2014, and will be shared with the DCMS Minister Helen Grant MP. Local Government Association Activity: 12. In early 2014, the LGA launched Rewiring Licensing, calling for a comprehensive review of the licensing system. It includes a call for: Health Objective a new public health' objective to be added to the Gambling Act 2005 and Licensing Act 2003 to allow health to be taken into account when reaching licensing decisions in a bid to tackle potential issues that may include problem gambling and Fixed Odds Betting Terminals. Cumulative Impact allowing Councils to consider cumulative impact' when making licensing decisions about betting shops and other facilities this would force betting firms to prove that new shops would not have a negative impact on local economic growth or existing businesses. Primary Activity incorporating the primary activity' test into the Gambling Act would enable councils to refuse a License where they do not believe the primary focus of the shop will be betting rather than gaming. Councils that have tried to refuse a License based on the references to primary activity in the Gambling Act guidance have been the subject of successful legal challenges. Licensing Committee 23/06/14-3 -

4 13. The LGA has also set up a Betting Commission to bring together Council representatives with the major players from the betting shop industry (namely, representatives from BetFred, William Hill, Coral, Ladbrokes and Paddy Power, as well as the Association of British Bookmakers). The objective of the Betting Commission is to establish a direct dialogue between Councils and industry at a national level, with the aim of identifying whether it is possible to address concerns about betting shop clustering and Fixed Odds Betting Terminals. The Commission will operate as a task and finish group over a period of around six to nine months. 14. The LGA advises that it is clear from the first two meetings of the Commission that industry does not speak with one voice on the issue of clustering; while the larger players do not expect overall numbers of premises to increase and would not necessarily oppose the return of the old demand test / introduction of a cumulative impact test, the challenger brand Paddy Power are still planning to expand and would actively resist any measures that hamper their ability to do this (potentially including the proposed planning changes outlined above). 15. The Betting Commission is therefore focusing on developing a set of principles for local engagement between Councils and betting shops, to provide a mechanism for Councils that are experiencing problems with betting shops (e.g., nuisance, littering etc.) to raise these with the industry. However, the LGA recognizes that this will not resolve the fundamental issue of clustering, but hopes that it will help to address some of the issues that may arise from clustering (e.g., nuisance or anti-social behavior). 16. The LGA are also refreshing their Councillor Handbook on the Gambling Act to provide clearer advice to members on how they can use their existing powers to best effect. This will give examples of where and how conditions such as double manning in shops have been introduced. It will also give some examples of how local areas can work with the industry to localise the industry commitments in the industry Code of Practice, covering things like self-exclusion and marketing. Member Training: 17. Members received a training session on 28 May 2014 from Leo Charalambides, Counsel, of Francis Taylor Building. During the training Members were advised that the Gambling Commission and the gambling industry strongly advance a narrow interpretation of section 153 Gambling Act 2005, which sets out the principles that a local authority is to apply when it considers applications for a Premises Licence, and which it is argued amounts to a presumption in favour of grant. 18. The industry position is that where an applicant jumps the statutory hurdles set out in the section, namely being in accordance with the relevant Gambling Commission Code of Practice and Guidance, being reasonably consistent with the licensing objectives and being in accordance with the authority s own Policy Statement the premises licence ought to be granted. Licensing Committee 23/06/14-4 -

5 19. Counsel further advised that while this approach is largely reflected in the current local authority practice; this received orthodoxy is also reflected in the Elmbridge Statement of Principles (September 2013). However, the Council also make the rare, and in his view correct, statement that There will be an overriding aim on the part of the Licensing Authority to regulate gambling in the public interest and in doing so will act in accordance with the following [Licensing Objectives; Section 153 (aim to permit) and that demand cannot be taken into account] 20. A number of options for proposed reforms to the Gambling Act 2005 arise from this presentation and are outlined in points I-V below as options for Local Authority lobbying. However, the LGA advise that it should be noted that following the policy changes announced at the end of April 2014, it seems extremely unlikely that the government intends to make any further changes to gambling legislation, subject to the outcome of the Fixed Odds Betting Terminals research outlined above. I. Responsible Authorities: Public Health Body: Amendment of Section 157 so as to secure greater public health engagement in the licensing process; the legislation currently sets out the responsible authorities but these do not include bodies responsible for public health. It is suggested that as Government could enlarge the definition of responsible authorities under Section 157 to include the Public Health Authority. It is an option for the Government to affect an amendment either to the primary legislation or for the Secretary of State to prescribe in England & Wales the Director of Public Health or Local Health Board for any area in which the premises are situated as a responsible authority, II. III. Provision of Gaming Machines: The LHIN Report identifies Fixed Odds Betting Terminals in betting shops as a contributory concern to the perceived increase in betting shop and gambling prevalence. An option to consider is whether it is right for local authorities as Licensing Authorities to have the power to limit the number and categories of Fixed Odds Betting Terminals. Section 153 Principles Applied: By removing the so-called presumption the Gambling Commission and the gambling industry strongly advance a narrow interpretation of Section 153 which it is argued amounts to a presumption in favour of grant. The industry position is that where an applicant jumps the statutory hurdles set out in the Section, namely being in accordance with the relevant Gambling Commission Code of Practice and Guidance, being reasonably consistent with the licensing objectives and being in accordance with the authority s own Policy Statement the premises licence ought to be granted. An option to consider is whether Section 153 should be amended so as to amend shall aim to permit to read may permit. Such an amendment preserves the permissive nature of the regime. However it also re-balances the perception that this was an excessively permissive regime in favour of the industry. It has the Licensing Committee 23/06/14-5 -

6 further effect of clarifying the original intention of Parliament which was that local authority licensing is administered in the public interest where that public interest is balanced against the industries needs for certainty and consistency. IV. Section 153 and character of the area empowering local people etc Concerns have been expressed locally about the numbers of gambling premise and their effect on the character of the area. An option to consider is whether the Section 153 Principals need to be amended by the addition of the means for a Licensing Authority to consider the character of the area. V. Gambling Act 2005 Nuisance: A fourth objective: The Gambling Commission advises local authorities that disorder is intended to mean activity that is more serious and disruptive that mere nuisance. The rationale behind this advice seems to be based upon the contrast with the Licensing Act 2003 which contains an objective of promoting the prevention of public nuisance. It is an option to consider proposing an addition to Section 1 of the Gambling Act 2005 covering this matter. Financial implications: Environmental/Sustainability Implications: Legal implications: As set out in the report Equality Implications: Risk Implications: Community Safety Implications: As set out in the report Principal Consultees: Background Papers: Enclosures/Appendices: Appendix A: Minute extract from the Council meeting held on 2 April 2014 Contact Details: Environmental Health & Licensing Manager - itucker@elmbridge.gov.uk Head of Planning Services - kfossett@elmbridge.gov.uk Licensing Committee 23/06/14-6 -

7 APPENDIX A MINUTE EXTRACT FROM THE COUNCIL MEETING HELD ON 2 APRIL REPORTS OF CABINET / COMMITTEES / SUB-COMMITTEE ETC. LICENSING COMMITTEE 17 March 2014 Pages 343/344 LICENSING WORK PLAN In respect of the clustering of betting shops in high streets and the effect that this had on the vitality of those areas, the Licensing Committee Chairman, I. Donaldson advised that he had requested that officers prepare a report to be submitted to both the Licensing and the Planning Committees assessing what the Council was able to do to strengthen its controls but also to support the LGA s action to seek a change in the law so that local authorities secured the necessary powers to exercise controls around these issues. C.R. Sadler requested that thanks be extended to Licensing Officers for their advice provided to Members in this regard. Licensing Committee 23/06/14-7 -