Published on 2 April 2019
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More troubles for the High Street: What are the odds of that?…

…Quite likely as it turns out! This April betting shops across the UK are bracing for a hit in their profits as a new policy severely limits the maximum stake for betting machines: Fixed-Odds Betting Terminals (FOBTs). Following years of research, a long campaign from dedicated activists and a ministerial resignation, the amount people can spend per bet on FOBTs has been reduced from £100 to £2 across the UK.

In this busy and fractured moment in politics it is important to recognise that there are multiple voices weighing-in on the pros and cons of the change to betting policy. Research has found that FOBTs are particularly attractive to problem gamblers because of their quick spin time, high stakes and high concentration in deprived neighbourhoods .

The new policy, applied UK-wide as of the 1st of April, aims to reduce the potential for these machines to exploit people who are vulnerable to problem gambling. While this may be an urgent intervention which has huge successes, FOBTs make up 50% of profits in some betting shops and industry leaders are quick to point out the threat that this policy change has on jobs and store closures.

What is missing from the debate, however, is any consideration of the inequalities associated with the geographical location of the majority of these outlets.

When understanding the threat of closed betting shops we ought not to view the whole of the UK in the same light. The towns with the highest density of betting shops across the nations in mainland UK include: Llandudno, Porthcawl, Stranraer, Clydebank, Newmarket and Skegness. These are smaller towns, perhaps more remote and often with a strong heritage linked to industrial employment.

Research we are developing at the Bennet Institute higlights these issues. The graphs included here show that the concentration of betting shops is not random. Higher levels of income deprivation are positively correlated with betting shop density in Scottish, English and, to a lesser extent, Welsh towns.

Graph 1 - More troubles for the High Street

Meanwhile, the same correlations do not apply for cinemas, charities, youth organisations and arts schools. There are even some cases, such as sports facilities, where it seems there is a negative correlation between income deprivation and service density.

Graph 2 - More troubles for the High Street

Similar stories are true when tested against the education levels of towns as well as unemployment levels.

Towns at risk of losing the most in terms of closed betting shops do not have high levels of alternative artistic and entertainment venues to replace their service and jobs. The unequal potential effects of the new gambling policy become more evident when grouping towns into categories based on income deprivation levels. The raw data with repeated observations over four years highlight that, on average, towns that have a greater proportion of poor people living in them,  have high streets that are much more densely filled by betting shops.

Graph 3 - More troubles for the High Street

There are various possible explanations for these trends. One such idea has been to test if changes in unemployment causes different entertainment services to thrive in town centres. We have found significant positive correlations between changes in numbers of Jobseeker’s Allowance claimants with changes to betting shop density. It would appear that towns with increasing or decreasing levels of unemployment have systematic, and sector specific, changes to their footprint of entertainment services.

Policymakers and academics should work to find ways to rebalance the economy if the change in FOBT stake does lead to betting companies shutting up shop. Some towns – and some populations within towns – will be affected far more than others: perhaps leaving unemployed people with fewer entertainment options and poorer towns with fewer jobs. These towns also happen to be towns with fewer highly-educated people and more unemployment. Furthermore with trends going in the opposite direction for sports facilities, a clear picture is beginning to build about how even seemingly small-scale policies such as changing the maximum stake for a FOBT can add up to a systematic, geographic imbalance.

With five times more men than women using betting machines in 2016, the losses in betting shops may prove the loss of an exclusively male space from our towns. Despite the concerns this blog has touched on, what this presents is an opportunity to find effective solutions that create sustainable and inclusive environments that are tailored for the needs of each specific community. To those ends and now a decade past the 2008 financial crisis, it is time to roll the dice in favour of towns in the UK whose numbers haven’t come up in far too long.

All graphs © Crown copyright and database rights 2019 Ordnance Survey (100025252)

The views and opinions expressed in this post are those of the author(s) and not necessarily those of the Bennett Institute for Public Policy.

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