 Good morning and welcome to the 25th meeting of 2015. Everyone present is asked to switch off mobile phones and other electronic equipment as they affect the broadcasting system. Some committee members will refer to tablets during the course of the meeting because we provide papers in digital format. No apologies have been received for this meeting. I welcome George Adam to the committee. He replaces Clare Adamson, who has left us to join the infrastructure and capital investment committee. I would like to thank Clare for all her hard work on the committee and say how much we are looking forward to working with George. Our agenda item 1 is to ask George if he has any relevant interests to declare. Mr Adam? Thank you, convener. I refer you to my public declaration of interests, but I also add that I was down as a member of Remshaw leisure trust. I haven't been a member since May 2012 because it was a Remshaw council appointment, so I dedge this to make sure that you're aware of that. Thank you very much for that. We'll move on to agenda item 2, which is our main item of business today. It's to take evidence as part of our inquiry into fixed odds betting terminals. We're doing this in a round table format as it allows us to hear from as many people as possible in the short time that we have available to us. I welcome Councillor John McAlpine, representing Argyll and Bute Council, John Heaton, the Association of British Bookmakers, Miles Barron, the Bingo Association, Simon Storer, British Amusement Catering Trade Association, Adrian Parkinson, campaign... Matthew Zob Cousin, I'm standing in for Adrian today. Matthew... Matthew Zob Cousin, Z-A-R-B-C-O-U-S-I-N. Thank you. Okay, Councillor Paul Rooney of Glasgow City Council, Simon Thomas of the Hippodrome Casino, Stephen McGowan of the Law Society of Scotland, Souteris Scolarius National Casino Forum, and Andrew Lyman of William Hill. Before I start, I'd like to set out some of the ground rules for the discussion, as we have a lot of participants here today. I want to ensure that everyone gets the opportunity to participate. I'd be grateful if you could indicate to me when you want to speak, and I'll call the speakers in order. I'd also ask you to be mindful that this discussion is being recorded. You must ensure that the audio operator has time to switch the microphones on before you begin to speak. You don't have to touch any buttons, they will switch the microphones on for you. Saying all that, we do want the session to be as informal as possible, and we'll try to ensure that as many of you can contribute, and I would appeal to members as well to keep your contributions short too. Finally, as it's remembrance day today, the committee will conclude its session around about 10.45 to allow members to attend the commemoration event being held in the garden lobby. Anyone remaining in this room is welcome to observe a private two-minute silence. I'll kick off the discussion by asking the question, the devil's advocate question, if you like, are FOBTs the crack cocaine of gambling or harmless entertainment, and who would like to kick off in that one? I think that the simple answer is neither of those two alternatives. I think that the crack cocaine of gambling is a phrase used primarily by journalists, and there is no clear evidence that gaming machines in betting shops are any more addictive than any other product, any gambling product. If I can make the industry's position absolutely clear, any gambling product has the capacity to cause harm and does cause harm to a minority of our customer base. We are quite clear as an industry that it is not an especially addictive product, but at the end of the day any gambling product does have the capacity to cause harm to a relatively small minority of individuals. That is why the industry is so focused on harm reduction, which is perhaps a matter that we can return to later on in the discussion. Some of the comments that we have received in response to a survey that we carried out, one of the comments was, just get rid of the things, I would rather be dead given the financial haul. I think that it is right that we take cognisance of the fact that some people are actually harmed by gambling, and those who have responded, the industry is very much focused on harm reduction. If one looks at the evidence of problem gambling in Scotland, I think that the primary evidence is the Scottish health survey. Problem gambling affects about 0.4 per cent of the population. Thankfully, in Scotland problem gambling is low by international standards, but if one looks at the processes and procedures that are available in betting shops, then they are focused on harm reduction. If one goes into a betting shop, you will find that we fund problem gambling charities, we signpost people to therapy and treatment, we offer self-exclusion in betting shops, and from a William Hill perspective, for example. One of the other things that we found in the survey is someone who said that they have self-excluded themselves from every single shop in the area, but there are points where they still go in. There are no discussions with him about the fact that he has self-excluded himself previously. If we could examine self-exclusion for a moment. Self-exclusion works for many thousands of people. William Hill has 2,300 shops in Scotland, 2,300 shops in the UK, and we conduct about 500 self-exclusions a month. If one looks at the whole issue of addiction, the important step with addiction is when someone self-recognises that they do have a problem, and self-exclusion is a way of assisting people to help themselves to control their gambling. Self-exclusion at the end of the day is not a golden bullet. People do breach their self-exclusions, but from a William Hill perspective, for example, we think we managed to successfully exclude around 80% of people who have self-excluded, so it doesn't mean that people who are determined to gamble don't re-enter the premises, but if you are an addictive gambler, you should be seeking therapy and treatment, and self-exclusion is one of a range of tools that we can offer. That is an area in Glasgow that we took very seriously. We were observing a number of bookmakers, and we were getting total feedback from our communities that there was a growing concern about Fickstod betting. In 2014, we undertook a study in many of the members around the table who participated in that survey. In answer to your question, we do not really know the honest response. That is the reason why in Glasgow, in terms of our cross-party work, we have called for a commission to get the independent evidence that we all require in order to make a committed position one way or the other. We believe that that would allow firm policy to be put in place to assist in supporting those who wish to gamble, but also to make sure that we protect those who are vulnerable and have problems and have issues, as you have outlined. What is quite clear is that, in terms of those machines, there are some significant differences. The amount that is bet and gambled on those machines is greater than the combined total for any other form of gambling. It is important to remember when we talked about horse racing and football coupons that, indeed, the fact is that more has been gambled in terms of those machines. We are clearly concerned about the speed of play of those machines, the level of stake and, of course, the number. In Glasgow, we have now 800 fit-stod betting terminals and the 200 bookmakers, so that is certainly more than one in every community in the city. In the average, convener, we have established that the average bet is £12 every 35 seconds on one of those machines. The truth of the matter is that we do not actually know what impact they are having. We do know that they are popular, we do know that they are growing and we believe that this is an opportunity for Scotland to lead in terms of having an understanding of that. At that point, everyone around the table can say with confidence that the impact of those machines is to answer that very pertinent question that you have asked this morning. What we have just heard from Mr Lyman is an attempt to propagate the idea that gambling-related harm is experienced by a minority of what a termed problem gamblers or faulty individuals. That really does contradict international evidence, which shows that gambling related harm is caused by a multitude of factors including the product, its environment and, to some extent, of course, an individual's predisposition to it. Going back to the original question, whether or not those machines are the crack cocaine of gambling, if we go back to the two most recent British gambling prevalence surveys in 2007 and 2010, secondary research on the 2007 British gambling prevalence survey found that fixed-on betting terminals were the only form of gambling that were statistically significantly associated with this ordered gambling, more so than any other type of gambling. The secondary research carried out on the 2010 British gambling prevalence survey found that 40 per cent of FOBT profits come from people who are either problem gamblers or at-risk gamblers, and profits from problem or at-risk gamblers from FOBTs are more than several leading gambling activities combined. This is the type of gambling that problem and at-risk gamblers gamble on the most, they lose the most on and the £100 stake facilitates harm. It allows a user to stake up beyond their means if they're starting to chase their losses or if they win a bit and then they become desensitised to lower stakes. The range from £1 to £100 means that they can stake up from what is affordable in the first instance to an unaffordable level. That's why we're campaigning for a reduction in the maximum stake. Obviously, I know that that power isn't going to be devolved, but this product is significantly associated with harm. The research from the responsible gambling trust found that 37 per cent of users experience harm while playing them. It is about the product as well and that's what the industry needs to recognise when they talk about responsible gambling. It's not just about gambling responsibly, it's about the industry behaving responsibly and are they doing so by offering a product where you can lose £300 a minute. To put in the record the context of these machines in casinos, just to give an idea, the point has been made that the environment is a very important factor and how the environment monitors the machines. In Scotland, there are only 10 FOBTs in the 14 casinos. The level of interaction between the customers and the managers and staff that are there to supervise the play of the machines and any problems that may arise out of the way that certain individuals gamble is at a completely different level. We also have a self-exclusion scheme. It's a mandatory self-exclusion scheme for all national casino forum members. It's independently audited and the evidence says that it's almost totally observed. It's a question of whether all gambling has to be monitored and managed responsibly within the casinos. All the safeguards are there and it's given the seriousness that it deserves. I think that the level of manpower and the level of supervision is the key thing. Just for the record, there are 10 FOBTs in the 14 casinos in Scotland. I thank you for the opportunity to speak here today. The most important statistic that I see in all the information that we have here is the comments that we have from the members of the public who have actually come back and said what this is doing to their lives and to their families. I think that that's the crux of the whole matter. I think that, for example, there's a lack of knowledge within councils, within MSPs, MPs, exactly what goes on in bootmaker shops. There's one of the reasons why I highlighted this to our council, because I don't think that they actually got the idea of just exactly how much people are spending in these premises. We're talking more and more about reasons why there's more uptake in food banks, we're relying on payday lenders and why, at the moment, we have more children in the care system. I'm a member of NHS Highlands, health board, and I know for a fact that that is the case. We say, why is children being affected, but if the main breadwinner of the family is not going home with the money to support his family, then, therefore, somebody is going to suffer. So from that point, I think that we really have to look at it. The industry here is well represented and it's nice to see that they're all getting on together and they're all singing from the same hym sheet, but they talk about the treasury and staff wages, where would that go, where would the money go, but our local economies are suffering, our high streets are suffering, every street that you see has got the next second shop is either a bookmaker's or a charity shop, and as a local councillor, I've seen my role as supporting the local economy and the money's not going back into the local economy, so I feel that we really have to look at that. I have other things here, which we'll look at. I think that those things will come up. Mark, the question still basically is, crack a cane or a harmless bit of fun? Thanks, convener. Well, in my opinion, it is a crack a cane and it's no longer fun. Thank you. Mr Heaton, please. Thank you, convener. You introduced me as a member of the ABB, which is true, but I'm also Chairman of Scotland, which is Scotland's largest independent betting chain. To echo some of the comments made by Mr Lyman, clearly there is an issue here. We do recognise that, and certainly at Scotland we have joined the Senate and we've done all that we can to make sure that if there is any problem gambling in our shops, it's addressed. There's a lot of comment about the amount that these machines take, and I give you the facts. I have three in my shops on average, we're allowed four. Frankly, they don't pay enough for me to put four in. We take on average per machine £425, which is a lot less than some of the numbers that I hear bandit about. These are Scottish numbers, and I'm giving you my figures. I take, in terms of profit, I make about 37 per cent from the machines. I don't make more from machines than I do from sportsbook. Recently, I've had to close eight shops because they were simply not able to pay for themselves. Sadly, the group has gone down from 75. We're currently now at 49, and there's probably four or five that are already looking likely to close. The idea that somehow we're targeting the less well-off that we are making fortunes out of the machines is simply not borne out by the facts, as far as I'm concerned. It may be the fact that you're closing shops because some of your competitors are clustering around your current businesses, as we seem to see in various places. Unfortunately not convenient. Most of the shops that I have been forced to close were in areas where they didn't have competition. On that point, Councillor Runie. I want to come back in. It's just to ensure that the committee is aware that the figures that I've quoted are available publicly. They come from the operators of the machine that was contained in the survey that Glasgow City Council published back in June 2014. The figures that I've referred to and the wider impact and the stakes being gambled in Scotland are available to the committee and to the public in Scotland, and they're verifiable. Although I can't discuss individual cases, bookmakers and machines, I can't give you a context of one city and Scotland as a whole. Thank you for that clarification. We'll come back to the sighting of shops and things later, I'm sure. Cameron Buchanan, please. Thank you very much indeed. Can I just ask you to comment on the effectiveness of the Senate group and how effective it is to curb regulating gambling? It's a group that promotes responsible gambling standards. I just wondered if people could comment about the Senate group. Well, let's finish off. Cameron, we'll come back to that point. I want to give the folks the opportunity to answer the first question, because we're still not quite there. Simon Thomas, please. Thank you, convener. Cracky Cain is a very emotive term, but actually the fobtes are quite an emotive product. To be honest, I've been involved in the gambling industry for over 30 years. I've never come across a situation where any one product is causing so much noise. It is impossible that there is not a problem associated with machines. To prove it definitively, it will be like the lung cancer. There's no causal link between smoking and lung cancer debate that went on for years, whilst everyone knew it was a problem. When you put the situation in a common sense context, gambling worldwide follows a pattern with a pyramid of regulation and player protection supervision. At the very top, you have casinos where hard gambling exists. People know they're going to a casino. It's a destination. They go with the budget in mind. There's very effective door control to keep young people out. There's a very effective supervision. I have the largest casino in London. I employ 600 staff. I have over 250 staff that are trained in problem gambling awareness. My failure rate of letting under 18-year-olds in is zero, and I'm very proud of that. It works. We have machines—slot machines—a player at five pounds a game. Our roulette runs at about one game every 100 seconds. At the bottom of this regulatory pyramid, you have seaside arcades and whether or not you think children should gamble or not. There are low supervision environments where you have the penny falls and things like that, where children can play. In the middle, traditionally worldwide, you have the ambient high street gambling, bingo halls, arcades, betting shops, and worldwide, the average stake is around £2 per game. They are lower supervision environments where gambling is ambient. We've got a situation in the UK that is so out of kilter with the rest of the world, to have £100 ago roulette machines playing a game every 20 seconds on the high street in easily available sites. It is not surprising that it is causing a problem. When the figures are quoted of national figures averages, as soon as somebody starts talking national average, you have to go a little bit deeper. The prevalence study said that 11% of people playing FOB T's had a problem gamblers. When you look at problem gamblers, the law says that we have to protect the young and vulnerable. It does not talk about problem gamblers. Problem gamblers are the end of the scale. There is a huge chunk of problematic gamblers, like a binge drinker, somebody who will go in with their £300 wages and all of a sudden they have spent their money. They are not a problem gambler, but that machine has caused a major problem to them and their families. That level of gambling should not be allowed in easily accessible high street locations. When bookmakers did not have them, they were in very nice environments. There were places where people would go and have a ffiver on the horses and it was fairly benign. Now you've got a situation where 97% of call-outs to gambling premises by the police are to betting shops, where thousands of machines are smashed up every year by irate gamblers who have lost control. You've got situations in the press on a regular basis. There was a suicide from a chap in Aberdeen, citing the FOB T's issue. Without question, a problem. I admire Scotland for taking a stance and hopefully the rest of the UK will follow. Mr Lyman, is it in the original point? We firmly believe that problem gambling is about the person not the product. We think that if Scotland is to fashion a sensible harm reduction policy as far as problem gambling is concerned, it does not concentrate on a single product in a single sector, but it has a co-ordinated view around all gambling products. If one looks at the facts, the Scottish health survey tells us that about one in 20 regular betas and gamers that go into a betting shop may have a problem. The Scottish health survey also tells us that about 13% of multi-product gamblers, those gamble on six or seven different products across different gambling sectors, have a larger problem. It is right that we discuss gaming machines in betting shops, but I think that a more sensible approach is to look at a harm reduction policy across all products and concentrate on the person and not the product. What would you say in response to Mr Thomas, who is involved in another part of the gambling industry but has some experience and the comments that he has made about the dangers of those phob team machines and where they are located? They are a popular product. They are a digital product. Just because they are popular does not mean that they are right. Crack a cane is popular amongst some folk as we well know. At the end of the day, convener, with respect, it is a question of proportionality. I have heard the figures from councillor Rooney and Mr Heaton. Around 40% of William Hill's profits come from gaming machines. Around 60% come from traditional over-the-counter products. We have problem gamblers across the range of products. The idea that gaming machines are particularly addictive is simply not borne out by the evidence, the Scottish Government's own evidence from the health survey. I am not going to defend the accuracy or not of the health survey. I think that, in some regards, in terms of survey work, when it comes to addiction, some people try to hide that addiction and we know that all too well. I am going to take John Wilson now, please. John Wilson, on the original point, one of the submissions that were received from the questionnaire that the committee put out was the point about the use of FOBTs and the individual makes point about the worst harm that I have suffered has come from using my debit card on FOBTs. When my daily cash withdrawal from the ATM has been exceeded, I can go into any bookmakers and use my debit card on an FOBT without any limits. Surely that is feeding the addiction and its uncontrolled addiction if people can go into those FOBTs and just use a debit card. First of all, betting shops do not accept credit cards. One cannot use a debit card directly into a gaming machine. The only way that one can use a debit card is to present the debit card to the colleague in the betting shop and ask for some credit to be put on the machine. However, we are quite clear now that that is the continued use of debit cards. Can I stop you there, Mr Lyman? You will stop when I speak because I am the chair. You have just said originally that you cannot use debit cards in shops and then you said machine... No, I get the credit card point, but then you said that you cannot use it in machines and then you said that you could go to a colleague in store and get the credit off of that debit card. Now it is either one or the other. People can either do this or not do this because you seem to dismiss the original point that was being made by Mr Wilson. I am certainly not dismissive of the point. What I was merely trying to explain was the process and when one hands a debit card over the counter, it is a legitimate form of payment. Many people do not carry a huge amount of cash now and actually prefer to use a debit card rather than carrying large amounts of cash. Repeated debit card use is an identifiable marker of harm and certainly in our shops, our staff are instructed that when someone is using a debit card repeatedly for either over-the-counter betting or for gaming machine use, that is an opportunity to conduct a responsible gambling interaction with that particular individual. Mr Storar, is it still in this point because I want to get to Mr Buchanan's question. I think that we can bandy figures around and use them to support our particular position, but I think that and I know that the book is and others have brought in a number of schemes to protect the vulnerable and do all the things they say, but the fact is that if we had known then when these machines were brought in what we know now, they wouldn't be allowed and I think that's the key thing as to whether they are the cracker cane or whether they're harmless gaming. Clearly, the machines have caused a huge amount of problems. It's obvious from the coverage there's been nothing but negative stories for many, many months if not more than a year on these stories. I've not read anything that's positive about them. Most political groups within the UK, most local authorities, most groups are anti them. We can argue and use figures to support them and say, well, we're doing everything we can to protect the vulnerable and they don't cause the problem they do. Clearly, the majority think otherwise. When they were brought in if we had known the knowledge that we now know, then would they have been accepted and the answer is no, they wouldn't and therefore that must be the key issue as to whether they are actually a problem or not a problem. I'm going to come to Mr Buchanan's question now about Senate. Do you want to give us the gist of that again please, Cameron? Fine. Thank you, convener. Senate is the promoting responsible gambling standards and it's not everybody's has to belong to it as I understand it. I wonder if you would comment on what Senate actually achieves in this sense, because it says, when the fund stops, stop on their TV advertisements, but does it? Anyone want to answer that? Mr Zarb, cousin first please. Thank you, convener. I think this is part of an overarching strategy from the betting industry to introduce this issue to one of individual responsibility and not about the industry's responsibility to provide products that are safe and enjoyable. It's one thing to say when the fund stops, stop, but if you're addicted it's a lot more difficult than that. You're already addicted. I personally got addicted to fixed odds betting terminals at the age of 16. I lost more than £16,000 and got into a lot of debt on them and if it was as easy as knowing well the fund stopped, the better stop now, then I wouldn't have got into that situation. I'm quite sceptical of the efficacy of these sorts of advertising campaigns. I do think that it'd be more productive to put restrictions on products and bring them into line with the machines that are found elsewhere on the high street. Thank you, Mr Heaton, please. We joined Senate voluntarily because I felt that we do have a responsibility to our customers. As far as Senate is concerned, we have removed all advertising material from our windows about the machines. We have responsible gambling messages in the windows and we have organised the TV campaign. I accept that for some people TV campaign messages about problem gambling may just wash over and they are addicted and have a problem with a wide range of gambling products. However, what we're trying to do is to stop people coming into our shops who might ultimately have a problem with gambling. I think that we have worked hard and our staff worked hard to make sure that if they see someone in shops who might have a problem, they will interact with them. Mr McAlpine, please. That's interesting what you say there, because you have one premise in Campbelltown. For example, there are four machines in that shop, albeit that you say that most of those shops are three. I could go into that shop and play any machine and the cashier would not even know that I was playing those machines because they are not even in sight of the cashier. Therefore, unlike casinos where you go and sign in at the door, you are pictured, you are either signed in by a guest or you sign a guest in, they vet you. In those places, you don't have any knowledge of what's going on. In regard to the interaction that Mr Lamann mentioned earlier, there is an issue with staff safety. For example, someone has access £300 from their bank and that's the limit for a day. They go to one of your shops and they deposit or they lift, say, £400-800 from the cashier. What is the limit that you would give them and at what point would a member of staff approach someone in the shop and say to him, I think that you've spent enough? From that point of view, I think that you're putting your staff at risk because that person does not want to leave at that point. You really have to consider the staff's safety and I don't think that it's responsible for interaction to expect maybe a single female or male late at night to go and approach that person and ask them to stop gambling because they want to recover what they've lost. John Wilson, thank you convener. It's just on that issue about the, we've heard about interventions, we've heard about interactions between staff and users of those machines. Mr Lamann made reference to, and what I would like to know is, do you record how many interactions or interventions that your colleagues make in relation to where you identify problem users of those machines? We've heard that no colleagues will monitor in terms of the William Hill situation, the use of the withdrawals from the debit cards or credits for the use of the machines, how do you monitor and how do you record the interactions that are taking place and how do you do sign posting if you actually find you may have a problem gambler using those machines? Okay, I've got Mr Scallarius next please. Just to say that in casinos we have a very formalised process for recording all interactions and they have to be, the evidence has to be available for the authorities to audit independently. Just in the general point in terms of the machines, we accept that they are a hard gaming product, I think that's the point that Mr Thomas has been putting across as well. We accept that they are hard gaming product and we in the casino industry believe very strongly that our customers need to be not so much given total left to their own devices. We believe that our customers need to be helped as well and on many occasions will be advised to discontinue their gambling and will be helped to put restrictions on their gambling. The general point being that casinos are very highly regulated, intensively regulated and we feel that is where these machines really belong. Mr Thomas, please. Thank you. The Senate group is recognised by the rest of the industry as a well-meaning but 100 per cent bookmaker membership smokescreen for the FOBT activity. The people in the Senate are good people but the issue is not being addressed that it is not all about the player. It is a very convenient argument for the bookmakers. Professor Mark Griffiths in 2005 said that problem gambling is product, location and player. Hence why you have that pyramid of regulation. Hard products have to be in well-supervised locations where the player is protected. The bookmakers have developed a new code through the Senate. It has been judged by the responsible gambling trust as ineffective. We have lots of talk of self-exclusion. Firstly, if huge amounts of people are self-excluding, there has to be a problem. The gambling commission statistics said that the number of people self-excluding from book has jumped over the last few years from 20,000 to 28,000 but there are 21,000 breaches. The bookmakers are doing schemes where they are broadening out self-exclusion across a whole region. Medway was the first trial where you can self-exclude from all the shops in Medway. A recent check on it said that there was an 80 per cent failure rate. It all comes down to a complete lack of supervision. When the bookmakers have opened 2 per cent more shops, that does not sound a lot, but the bookmaker opening hours have gone from being around the horse racing time of 10 or 6. They are generally open from 7.30 in the morning till as late as 11 o'clock at night. The number of hours has gone up dramatically and yet the number of staff has dropped by 8,000 in bookmakers. It is frequently that you have single manning in bookmakers. One of the chains does not allow its staff out of their protected cage after 6.30 at night. I am not quite sure how they are supposed to interact with customers and say that they might be spending too much money. It just does not happen. It is more of this smoked screen. Hard gambling should be in highly-supervised locations and FOBTs are not in the right location. Ironically, there are 180 FOBTs in casinos. If anywhere, they should be in casinos. Personally, they are too hard for a 100-pound spin on a 20-second spin. It is fast, hard gambling, but if anywhere, they should be in casinos because we have active control, active supervision. We do not have membership anymore. You can walk straight in, but you walk in through a dormant, you go through a reception area, and all the gambling is face-to-face. Even on the slot machines and electronic gaming terminals, there are slot hosts going round all the time. We do not have staff behind cages because it is such a dangerous environment. Our staff are out on the floor. To answer Mr Wilson's question, he raised two issues. One was reporting and one was staff safety. Certainly from a William Hill point of view, and I do not think that we are much different from any of the other major bookmakers, we have a comprehensive reporting system within our shops. A central compliance team monitors all of that reporting. In a shop, for example, you report the number of age verification challenges you make, you report the number of responsible gambling interactions that you have by way of narrative. That narrative is then recorded centrally. The figures that I gave you from a UK basis for 4,700 responsible gambling interactions a month and 500 self-exclusives are figures that are gathered from our central reporting system. We even monitor shops to find out whether those shops have failed to report, and then we challenge those shops. If they have not reported any incidents on the basis that we would expect at least responsible gambling interactions to be taking in a shop, and if a shop is not reporting at the sort of expected level, then we would challenge the shop and the management around that issue. Reporting in betting shops is fairly comprehensive. Indeed, in betting shops, the supervision of machines is a priority. One thing that we have not got to yet, of course, is the legislative change of the £50 restriction around gaming machines. If you now want to play a gaming machine above £50, you have to do that A by registered play, or B by handing the money over the counter, you cannot load the machine if you want to spin at more than £50. There is a significant restriction or opportunity for interaction with the customers on that particular issue. Monitoring and supervision is as strong in the betting industry as it is in the casino sector and any other sector. I do not pretend that we are any better or any worse, but the idea that we are less supervised or that regulation is lighter in the betting industry is a complete misnomer. Mr Thomas points that staff and certain bookmakers cannot get out of their cage, so how can that supervision be taken place? One has to look at other control measures. For instance, within the William Hill estate, we have a third party monitoring system within all of our high and medium-risk shops. By quarter one of next year, we will have a third party monitoring system in all of a shop, so if people are alone working, then if there is any problem, they can sound an alarm or the monitoring service. That is all fine and that is for the protection of your staff and I understand that, but how can they monitor problem gamblers if they are locked in a cage? First of all, the machines are controlled from behind the counter, so all the machines can be disabled from behind the counter. I have seen that. I watched a programme about coral bookmakers that was on lately, where it has to be said that those machines were very rarely used, but cutting somebody off at a point is going to cause a huge amount of grief for your staff, who you have already said in those occasions, loan workers. Is it likely that they are going to cut off those machines knowing that it might all kick off? There is obviously a right and a wrong time for intervention convener, but in the majority of cases, our staff carry out effective, responsible gambling interactions across the piece. Every retail unit has someone in it whose mother never taught them any manners, so there will be difficult people who go into betting shops from time to time, but our staff are experienced and they do get the support if we have a difficult customer. For example, it may be inappropriate to challenge a customer at a particular point in time, but the challenge can be delivered the following morning, when the customer comes into the betting shop again. All the district manager can be called to go down and speak to that customer. That customer is in last thing at night when there is a loan worker, and then we will be in first thing in the morning. That kind of situation sums up where I think the difficulty in all of this is. Thank you very much. As part of our research last year, we did speak with trade renew representatives and staff representatives who were concerned about the single working fin stores. The situations that have been referred to are not uncommon where you have a single member of staff who has been asked to make those interventions and to take the responsibility of ensuring that the welfare of the gambler is upheld. For me, that is very questionable. We asked the question initially about whether the crack cocaine of gambling is appropriate. I am certainly content, as our colleagues in Glasgow City Council will determine many casinos because they are many casinos. It is a question of whether they are appropriate for communities across Scotland. Clearly, our position is that gambling is a public health issue and that it should be treated as such. The tragic circumstances that we referred to earlier in the meeting that were reported in the past few weeks demonstrate again that there is a lack of structured support for people who have gambling problems. I feel that it is appropriate that, at this time, we acknowledge during the discussion that there is a problem. What we need is an understanding of what the harm is and, after that, to make sure that we have the appropriate balances in place. What we have heard again from the industry this morning actually reassures my position that self-regulation is not the way forward. You are hearing again that the industry is saying that it is using advertising, that it is making more interventions than ever, but what we are not hearing is the difference that that is making. I think that what we require in Scotland is the ability to get that independent piece of research. My offer to everyone around the table is to support that position in that way. All of us, when we are reconvened, can be reassured that we have safeguards for people who have gambling problems and where fixed-log betting term was fit into that. I have a number of folk who have signalled, and some of them want to come in in specific points. Willie, was yours a specific point on something that has come up or on this? I just wanted to ask about the technology side of this convener. Can I come back to you in that regard then? John Wilson, please. Just to go back to Mr Lyman's figures, Mr Lyman, you made reference to 4,500 interventions by your colleagues in a month. Is that correct? That is a UK-wide figure. If we extrapolate those figures and then translate them into what would normally be seen as Scottish figures, we are talking about almost 5,000 interventions a year in Scotland. Is that recurring interventions or are those individual interventions within individuals coming into the shop and then being excluded for the shop? Some of those interventions will be in respect of the same individual. Those interventions cover a whole wide spectrum, because problem gambling covers a whole wide spectrum. There is addictive gambling, which is the top-end, which affects a very small percentage of gamblers. As Mr Zarb Cusin mentioned, there are people who simply spend too much time and money gambling. The issue is that the intervention will be appropriate to what has happened in the shop. Some of those interventions may be customer-generated. A customer may say, I have spent too much money, do not ever let me in here again, in which case we would point out how self-exclusion would take place. I think at the end of the day one can use those statistics as a stick to beat the industry with, but we are really proud of the fact that we make positive interventions with customers. Customers do self-exclude from our shops, and we help the minority of people who suffer from problem gambling. Mr Zarb Cusin, is it still on this point? Yes, it is. Mr Lyman mentioned the Government's measure, where you have to now sign up to a loyalty card if you want a bit more than £50 a spin or identify yourself to staff and alluded to the fact that this would be a better opportunity for interaction. What has actually happened, friends of mine have signed up to the loyalty cards in a display of egregious opportunism. As we have come to expect from the bookmakers, they have started to bombard these people with text message marketing. Bearing in mind that the Government introduced this measure on the basis or on the assumption that people who are betting more than £50 a spin are more likely to be the players experiencing the most harm, it is slightly irresponsible to say the least to start bombarding these players with text message marketing. The second issue is on the code of conduct. When the code of conduct was introduced in April 2013, it was billed as world-leading, and this would give customers the opportunity to set their limits and set time and spend restrictions. Obviously, the problem with it was when you reached the time and spend restrictions, you would get a message and it would say, do you want to continue and you could just press yes and carry on. The RGT commissioned an evaluation of this code of conduct. It was far from world-leading by December of that year, by December 2014, just 1,500 out of 4 million sessions used limit setting. Those that did set limits set them between £350 and £450. So, self-regulation is not the solution. It makes no sense to invest all this time and resource into mopping up the problems caused by this particular product. You might as well just deal with the product, reduce the harm that way, and then you don't have to then try and clean up the mess that it's created. Mr Stewart, please. Thank you. I also wanted to talk about the £50 regulation issue that's just been covered, and I'll add a little bit to what's already been said. When it was brought in, it was a sensible move from the Government to look at how they could begin to control some of the problems that were there. I'm sure that Mr Linham's company have endorsed it and run it very successfully. However, we know that a number of bookmakers have used it as a marketing tool. By signing up to it, you give your mobile number and, therefore, you are open to this marketing. Texts such as Big Men, Bet Big have been used by the bookies to encourage people to continue to bet. It's very disingenuous to assume that all of them have taken this scheme on board in a sensible way to try and actually deal with this problem. There's a lot of evidence that showed that it has been used very disingenuously. Big Men, Big, Bet Big. Do you think that that would get Senate advertising approval? You must ask them. I've got one thing before we move off the Senate subject and move on to Willie Coffey. I've never heard of Senate, to be honest, until very recent times where suddenly they wanted to talk to me. I wonder why that is. When I said no, not until after this inquiry was dealt with, because everybody has got the ability to put in written submissions and maybe be called to give evidence, I have to say that the response was fairly aggressive. Does that really strike both well for an organisation that is supposed to be dealing with trying to resolve problem gambling from the industry's perspective? I'll ask Mr Heaton and Mr Lime in that. You may not have heard of Senate so, but in fact you will have seen all the advertising that has been paid for by Senate and it wasn't branded Senate, but it nevertheless has been. No, but that was not my question. It's a fact that they make contact with you for the first time ever. A cynic would maybe say it's because we're conducting this inquiry and on this occasion I am a cynic. Well, I apologise for the reaction that you appear to have got from Senate. We have tried to make sure that it's an independent organisation. The board are all independent, the management are independent and if you feel that they've been overly aggressive then we'll certainly take that back. Mr Lime. I think convener there's a place for self-regulation and the association of British bookmakers are very focused on self-regulation, but I think it's also important to record that the industry is proud to be part of a regulated sector and I think it's good that we're sitting round the table talking about statistics being held to account by you and your other colleagues, but I think that one of the points that we haven't, we've missed, is that the fact is that these machines are supplied by a heavily regulated sector. We're moving off and I want to finish this part first and then get on to Mr Coffey. In terms of no, does the betting industry understand the term no? I'll give you my example here because none of your industry has been really interested in what I've had to say previously and then suddenly they're all over you like a rash. When I have said no, I will not be meeting anyone during the course of this inquiry because you have the ability to submit written evidence and then maybe called to give evidence your folk don't quit, do they? I think it's probably right that you said no because you have to main objective because you're chairing this committee, so I fully understand why you said no to previous approaches. Why is it that after I'd said no to William Hill that during the course of my party conference in Aberdeen one of your folk went out of their way to try and find me and speak to me? I wasn't at that particular event, convener, so I don't know, but I can see that you're objectively chairing this particular committee. Mr Buchanan, to be a member of Senate is voluntary, it's not compulsory, not all gambling people are members of Senate, is that correct? Thanks very much, convener. I was hoping to ask colleagues a wee bit more about the technology side of this business. We heard some questions being opened up by Mr Wilson that I think take me down in this pathway. Can more be done with the technology to protect people? It seems to me that the sophistication in the machines and the are very sophisticated is all focused on the experience that a person might have in the enticement to gamble and perhaps less so of a focus on the protection of the individual. So how could technology be better deployed to protect people from making increasingly more mistakes? The figures that I heard are quite worrying, convener. We heard Mr Zapkin's cousin saying that a person can lose £300 a minute. We heard Councillor Rooney saying that the average bet is £12 every 35 seconds. Surely the technology could be deployed in a wee bit more of a sophisticated fashion to protect people, so I appreciate ideas on that. I can talk about the technology in betting. Mr Leimann. If one goes back to the £50 restriction, what betting shop operators are focused on registered play? One of the challenges in betting shops is that a lot of the play is anonymous and therefore it is difficult to profile customers. We are encouraging registered play. Mr Zapkin has talked about the card and how customers are messaged. We are currently in a trial where the responsible gambling trust has identified the potential markers of gambling. We have developed algorithms, which are being trialled on both our online site and on our gaming machines, to identify harmful patterns of play. I use, for example, the example where, for example, increases in turnover for a customer or something like that. If it is registered, you can say that. What we are now doing is running a trial where we are messaging those customers who, on our algorithm, are engaged in potentially harmful play. The trials so far are suggesting that that is working well, that around 60% of customers who are messaged, who are engaging in registered play, are actually changing their behaviour. They are actually staking down or staking less or gambling less frequently. We are really encouraged by those trials. They are taking place online. They are taking place in retail. The responsible gambling trust has recently commissioned research to help us to develop that approach to technology. It is absolutely right that the industry should be held into account. We are a technological industry. We are providing a digital product both in retail and online. It is right that we should develop technological solutions to identify harmful patterns of play and then to be able to react with those customers and help them to change their behaviour. It is in its infancy but it is happening and it is meaningful and it is working. I have a question, Mr Lyman, because in this room there is somebody who likes a wee flutter, shall we say? Mainly online beta. Not a big gambler but he wins almost all of the time. The booties have developed the technology to ban that person from betting in certain sites. If you can develop that technology quickly to deal with and get rid of the small-time gambler who is winning a lot, why can't you just deal with the technologies that you have just talked about with Fopties right now? We are developing that technology and we are implementing it within our businesses. On this particular algorithm, the responsible gambling trust commissioned a feature space to investigate, which is a commercial company. The gambling commission noted that a significant proportion of problem gamblers still remained unidentified from the patterns of play that were supposed to indicate problem gambling. The algorithm, as Mr Lyman says, is certainly in its infancy. I would say probably about 10 years away from being effective. It doesn't really go to the crux of it, which is that you can identify harmful patterns of play but you are not addressing what is causing the harm in the first place. It is a combination of factors. It is the stake in range, £1 to £100, the roulette content, which is addictive anyway, but made five times faster than in a casino. The fact that it is a solitary activity. There are a range of factors that make this a particularly harmful product and reducing the stake would limit that harm. There is no good identifying harmful patterns of play if once you have identified people experiencing harm, you don't know what to do once you have identified those people. There is very little research or work that has gone into on the industry side, gone into finding out what would be effective in terms of an intervention. Problem gambling and algorithm. It is a lovely navana. It is a very nice way of pushing the problem down the line for another five or 10 years. The University of Las Vegas produced a paper a short while ago that made it very clear that an algorithm is not the solution. When you look at the test for problem gambling, the current one is called DSM-5. It has a number of checks. There are things like, have you missed time from work? Has your gambling caused you arguments? Do you borrow money to gamble? These are all the real-world things that you pick up through supervision of the player, human supervision, and you cannot pick them up through an algorithm. The potential for an algorithm is fairly small. I am happy to copy the paper from the University of Las Vegas. It is very low. I think that you quite correctly identified also the algorithm. There is a bit of divided loyalty. I am sure that the book is putting lots of money into algorithms, but the algorithms are used to promote the business. In the same way, I, too, joined M, Mouse and D Duck in two of the bookmakers, gave my phone number and email address. I am bombarded daily with adverse pressure to spend money offers. That is not exactly the way to use technology. Additionally, the staff who are supposed to carry out all of this supervision and player interaction following any algorithm popping up from behind their bandits screen, in some of the bookmakers, they are also incentivised on the machine's performance. Aside from being on minimum wage late at night, they are often female with a lot of things to do. They are supposed to do all this, and they are also told that they are going to get more money if those machines take more money. It does not add up. Does anybody else want to come in on the technology point then? Sorry, I am a councillor, do any of you? I want to thank you very quickly for the response to the coffee's question. I mean quite rightly that he is identifying the technology. My response would be that the technology is already in place. Part of our consideration in our research is whether or not it is required if we are having such machines that we have compulsory membership. That would allow us to be able to monitor exactly the place that is taking place. What you are hearing at the moment is different parts of it. It is always the individuals that we do not know who perhaps are making the significant losses. What I would say going forward is that if those machines continue to exist in our communities, we have to have access to that data. As I have already indicated, we have the overall position that is already stated, and that is giving us an understanding of the losses. Even to the extent that it is 12 pounds and 86 pence per average spin, so that is the level of detail that already exists. The industry knows their customers very well, convener. I think that the difficulty is those who are not part of the industry need to get that understanding. You talked about communities in some of the written submissions that we have. It seems that bookmakers seem to be clustered in certain communities, city centres, but poorer communities. You do not see many bookies in the west end of Aberdeen. It has to be said from my observations. It is being said by some that planning policies should be used to deal with that situation, but we all know that that is almost nine-year impossible. Do you have any comment on the cluster or the planning aspects? Thank you, convener. In terms of planning, my first observation is that, if you look at most communities in Scotland, you will see a clustering effect. If I may speak about my own community, Nightswood and Glasgow, there are three bookmakers in one row of shops. That is the reality, so each of those bookmakers has four fixed-odd betting terminals. Two of them have four? Yes. So 12 in one parade of shops? Yes. That is the position in one community in Glasgow. I have already made the committee aware of the fact that we have 200 bookmakers in Glasgow and 800 fixed-odd betting terminals, so that is the scale. My position and position of the council, as I have said on a few occasions, is a cross-party position that we have taken. We want to do whatever we can at local government level. We also clearly require the support of Governments both at Scottish and UK level. Clearly, we would like to make sure that the powers are with local government to ensure that appropriate decisions are taken. There still remains issues around categorisation of bookmakers as opposed to other categories, such as banks. That is something that I believe we can address quickly. The complexities of the discussion that we are hearing this morning is not straightforward to say that it is one thing or another. It is a combination of things, and that is why I continue to reiterate that position of having independent research in where a commission would support a position going forward. That is without taking a step back from my pragmatic approach, which is to work with campaigners and the industry, but without that independent research convener, it is very difficult to make firm conclusions. Instead of us just carrying out this inquiry into FOBTs, you would like to see a broader discussion about the movement of power from government, whether that be Westminster or here, to local government, to allow you to have more of a say in what is going on in this particular industry. If I could just quickly respond, my position is always that the power should sit at the appropriate level. On this occasion, I certainly believe that local government is best placed to make decisions on planning matters that are associated with the appropriateness of bookmakers. That is a position where we see voids of replaced by bookmakers, despite the fact that there may be one or more bookmakers in the close proximity already. It has been argued that the planning system alone is not enough in terms of being able to regulate goods and services. My position is that when we are talking about fixed-odd betting terminals, per se, it is a range of issues that include planning and licensing. The point that I am making here, convener, is that we have to understand those complexities in order to get the appropriate policy going forward. Mr McAlpine, do you want to come in on that point? The original question was regarding technology and where it fits in with the fixed-odd betting terminals. We had a problem with alcohol in this country, but we set time limits on when you could buy alcohol in the morning or when you could buy it at night. I do not think that we need to get into technology. I think that we will have to look at the men or the women queuing up at 9 o'clock in the morning to enter the bookies' licence premise. That, to me, would indicate that there is a problem in our communities. I think that staff should pick up on that. I do not know why we have shops open at 9 o'clock in the morning, because sometimes we do not even have shops open at that time. I think that we have to try to tighten up the laws on the opening hours of shops as well. Mr McGowan, please. Good morning, convener. I am hoping to piggy back on to the comments from Councillor Rooney about local government regulation. It is something that I feel alive on behalf of the Law Society, which you can comment on. If you are with me on perhaps being away from the technology question, I can comment on that. I think that we have moved away a little bit anyway, so on you go, Mr McGowan. I am grateful for that. I would like to make a very important point about local regulation. That is that the Garmling Act 2005 has a very significant drafting error in it, which the Law Society, the Scottish Government and the Garmling Commission have all tried to have remedied for many years. That is an error that results in a situation that licensing boards in Scotland, the authorities that issue licenses under the Garmling Act, are not entitled to regulate premises. That drafting error relates to the authorisation of officers, licensing officers, who go out to premises and ascertain whether or not they are adhering to the law. That happens under alcohol licensing and other forms of licensing across the country. Under the Garmling Act, there is a problem because the original Act ignored the fact that, in Scotland, licensing of gambling premises is dealt with by the board and not the local authority. Of course, the licensing board in Scotland is a separate legal entity, so I am sure that most members will be aware of that. That situation persists. To give you one example of the benefit that local regulation may be, if we manage to convince the Westminster Government to amend the Act and Ian Murray MP has tried with an amendment until it was not taken forward in the recent Scotland Bill debate, that would allow local officers at the local government level to be trained appropriately in relation to the Garmling Act and would allow them to conduct enforcement and compliance activity, which is not being conducted at the moment. The Garmling Act came into force in 2007. Since that time, my understanding is that there has been one review of a Garmling licence since 2007. That suggests that there is a wide misunderstanding or perhaps fear of what the Garmling law is by licensing authorities in Scotland because they are so busy and focused with alcohol licensing. There is a solution to part of what I suggest are the issues about local problems. That is for this committee to hear what I say and to join the Westminster Government to amend the Garmling Act to allow proper local enforcement to be conducted by licensing officers. We want to work in a well-regulated sector. If amendments have to be made to give licensing officers the right powers as they have in England, that should be done forthwith. I am sure that the committee will take that on board. Mr McGowan, there is no point in having your expertise here without asking you further. Do you think that there are any other measures available to the Scottish Government at this moment in time or with the new powers about the perceived proliferation of fobties? There is a difficulty over using terms that are not defined legally. Of course, that is what you would expect the Law Society to say, but I think that it is a good point because we prefer law to be made as good law. If we are using terms such as clustering and proliferation, those terms have to be identified and measured. What I would say is that we would support Councillor Rooney's call for wider research, and that wider research might educate everyone involved in the process as to what those terms might mean in reality. Under alcohol licensing, licensing boards are very used to the concept of over-provision, which is the idea that there are too many alcohol licence premises within a given area. That is a term that is under the Alcohol Licensing Act, which is within this Parliament's control, but, even at that, there are on-going cases and disputes over what over-provision may or may not look like, some of which has been addressed recently in the Air Weapons Licensing Act. It is a very difficult topic to get clarity on unless it is looked at properly and is based on evidence that is probative. I think that the only way that we are going to get to that is by a review that Councillor Rooney has suggested, and the committee would support that and certainly has done in its response to this committee. Can I ask whether there would be greater scope to review existing licensing if we had a further look at the Gambling Act? The existing provisions for review allow licensing boards to call for a licence in on the idea that there is someone somewhere alleging that harm is occurring or that there is a problem. As I said, in my own experience—I may be wrong, but in my own experience, there has only been one such hearing across the 32 licensing boards since 2007, and I put that down to the lack of ability of local government officers to conduct enforcement and compliance processes. Unfortunately, the only way that we can remedy that is by having Westminster amend the Gambling Act itself. Or for the Gambling Act to be devolved? That would be a separate solution that would allow this Parliament to then amend the legislation as this Parliament sees fit. Do we have a difficulty in some regards over this area, because there is that division of responsibility? There are two difficulties with that, convener. There is the constitutional law difficulty and then there is a licensing law difficulty. If I can focus on the constitutional difficulty, there is a perceived issue with having some premises that are licensed in Scotland controlled by one part of the law, which may be Westminster, and some other machines or other premises that exist in Scotland that would be controlled by other law, which may arise as a result of the Scotland Bill. The law society's position on that is that that is a constitutional problem, because it creates a situation where you have perhaps one premises, and a premises next door to it, and they are both regulated under separate areas of law, and that is not good. Thank you, Mr McGill. Mr Zarb Cusin, please. Thank you, convener. Just picking up on this point about what constitutes over-provision, so the context within which we operate at the moment has been identified by the Association of the Town and City Management, who released a report this year and found that between 2004 and 2012, the number of betting shops in our town and city centres in the UK has increased by 43 per cent, and in Scotland that growth rate has been 80 per cent. This has been driven by fixed-odds betting terminals, which should be an ancillary product to a betting shop's core business of over-the-counter betting. Obviously, for many operators, particularly the corporate operators, they now account for more than 50 per cent of their profits and more than 80 per cent of their turnover, but clustering only occurs. Certainly in the cases where one operator will open two shops within walking distance of each other, that only occurs because they are trying to increase the number of machines in a particular area, which is driven by what should be ancillary product. We obviously support restrictions on this product, and we want to see betting shops return to their core business of betting. We are not an anti-gambling group at all. We are now getting really tight for time, and I may choose to reconvene, depending on where we are at, but Mr Storer. Convener, thank you. As far as the number of betting shops and the number of machines, I think that the issue is much more about the level of stake. If the stake was brought down to be in line with other high street activities, the number of shops and the number of machines would become irrelevant. I think that it is all to do with the stake, and I would support that. We are pushing the British Government to bring that in line so that that stake is brought down. I think that a lot of the problem would disappear if that was the case. There would be less reason for them to have so many machines and so many betting shops. Mr Madden, I am aware that you have not contributed. Have you got anything that you wish to say or do not feel forced into it? No, I thank you for the opportunity, convener. I am here to represent the bingo industry in the UK, of which there are 50 bingo clubs in Scotland. We do not currently have FOPT machines, and we do not wish for them. You may ask the question, why am I here? Why did we respond to the consultation? I am here because we are concerned in the bingo industry that any unintended consequences or actions taken around FOPT machines may indeed affect our industry. What else the Scottish Government can do? We are all, perhaps with the exception of the bookmakers, quite convinced that there is a problem that it needs to deal with. It is not clearing up the mess, it is actually going to the core of the problem. Councillor Rooney is absolutely right that the effect on communities is damaging and needs to be addressed. In the UK, 93 councils representing their communities have put forward a Sustainable Communities Act motion asking for the stake on FOPTs to be dropped to £2. The Scottish Government has an amazing network and great power. If it can add pressure to that system, then clearly that would help to sort the problem. Lord Tim Clements-Jones has a private member's bill going through Lords. Again, if the Scottish guns could be turned to support that, it would be very welcome. If the FOPTs are cut down to £2, what happens? There are a couple of reports, one by Landman and one by Nira, that are referred to in my evidence. The Nira report said that, if it goes down to £2, the effect on the communities will be the number of betting shops that will reduce, particularly where there are unwelcome clusters, and the effect on the community would be that there would be 2,000 more jobs on the high street, because money would go either on to over the counter back to the traditional betting or to other more labour-intensive high street activities, so it would be very positive for the community. I will take you if you are very brief. I just wanted to add a very short comment about planning law, which was mentioned. I forgot to say that. My understanding is that this Parliament did look at amending planning law, and it decided in April of this year that there was no change made to planning laws in respect of betting premises. I just thought that I should put that in make-up. It may be an idea that some of us may want to have a discussion with a panel that is currently looking at reviewing planning, if we have anything to say on that point. I thank you all for your evidence today. That has been extremely useful. The next meeting of the committee is on Wednesday, 18 November, and I now close this meeting.