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Spending review? New opportunity, more like

Former UK Shadow Gambling Minister Nick Hawkins sorts the wheat from the chaff in his bi-monthly column…


Nick Hawkins is a Barrister specialising in Gambling and Leisure law. In his 13 years in Parliament previously, he held roles in Government and Opposition, including Shadow Solicitor-General and Shadow Sports Minister. He is now Legal Director for a gaming company.

’m writing this the day after George Osborne, new UK Chancellor of the Exchequer in the Coalition Government, made his much-heralded and long-awaited Comprehensive Spending Review announcement – with all the cuts in

state spending of taxpayers’ money. Comment today in the press, after immediate headlines using the word “axe” a lot, is suggesting the population is dividing roughly 50/50 in reacting pro- or anti- what he announced; no great surprise. If you have a secure good private sector job you probably feel there’s been lots of waste in public sector administration and cuts are needed; if you are dependent on the state for work or benefits you’ll be much less keen on, or more worried by, the Chancellor’s decisions. Regardless of my own political background, I’m very glad indeed he used one phrase: “To Govern is to Choose”. Once a Government is elected it should make decisions (in the last 15 years there’s been too much deferring for ‘consultation’ – though often more apparent than real – and at least we now know those decisions and can plan accordingly.

The implications for gaming and casinos are firstly on the “macro-economic” level; the good news is that the stock markets and the OECD have responded very favourably to such firm action, so I believe the risk of the UK being forced into the parlous position of the “PIGS” (Portugal, Ireland, Greece and Spain), now seen to be ‘basket-case economies’ has receded. I never thought we would get that bad – because of the importance in world terms of the UK, and the strength of the City – but there could have been a risk without firm action. The UK still has the 6th largest economy in the world and now it should, in four years, avoid unsustainable levels of debt. In more local terms, we know that all previous

recessions have led to an increase in gaming activity and I think this will continue. The cuts are said to be the biggest in the UK since those forced on Denis Healey, then Chancellor, by the International Monetary Fund in 1976 (I remember that vividly as a politically-involved Oxford undergraduate at the time; it showed how weak the then-Government was). There is however a huge opportunity both for the

12 NOVEMBER 2010

gaming and wider leisure industry, if it is played correctly. The Government is saying it needs the private sector desperately, to create jobs; especially since the state sector is forced to cut employment. It seems to me that the bigger players in our field should be going to see Ministers, particularly Vince Cable MP, Business Secretary and his team, to say: “We could create X hundred jobs, but you and the Treasury must give us Y (special tax arrangements, for example); or we can’t/won’t”. This could be a once-in- a-lifetime opportunity to strike deals, when the Government (as the cuts really start to bite, and protests begin – perhaps not on the scale of France today, but there will still be a lot) will desperately need some good news to announce. As is often said up North where my company HQ is: “Think on” is the message to CEOs, Chairmen, Strategic Planners, and corporate advisers… Of course, it won’t be appropriate to put it forward

as any kind of “deal”, more a pointing out of salient facts. This might be set out thus: • If the taxation and regulatory climate is

favourable, expansion of leisure and gaming can create lots of jobs (and this can be proved) – if it isn’t, those jobs won’t be created. • If there had been a desperate need to create lots of jobs at the time the Labour Government got cold feet about the Daily Mail ‘crusade’ against the resort casino plans in 2004, then the Government would probably have withstood the pressure and gone ahead.

Another gaming issue has cropped up in the UK at the time of writing this. Ridiculous stories equating the CEO of the Tote’s salary with those of civil servants, saying he’s the most highly-paid Government person, which ignores the fact that it is really a private sector job, and is only in the public sector still because of the previous Government turning down sensible proposals! There appears, more happily, however, to be a real willingness on the part of the new Minister, officials at the Department of Culture Media and Sport and senior policy people at the Gambling Commission to “change the narrative” on gambling and look at the whole matter more positively. However, for sports betting, the Pakistan cricket spot-fixing scandal will sadly cast a long shadow, I fear.

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