SIMON THOMAS
Ask Simon
Normally, Hippodrome Casino’s Executive Chairman, Simon Thomas, answers your industry questions. This month, he is posing the question…
QUESTION: Are we scrutinising the evidence behind major gambling policy as rigorously as we should?
I
have recently read a paper co-authored by gambling analysts Paul Leyland and Dan Waugh of Regulus Partners in which they examine Government proposals to double Machine Games Duty on Category B gaming machines. Whether or not you ultimately agree with every one of their conclusions is almost beside the point. What struck me was the quality of the analysis, the depth of the research and, perhaps most importantly, the willingness to challenge assumptions that many people appear simply to have accepted. It made me think that, rather than answer someone else’s question this month, I should ask one of my own.
One of the things I’ve learnt over more than thirty years in business is that good decisions are rarely built on assumptions. They’re built on evidence. At the Hippodrome we test everything. We analyse customer behaviour, challenge financial forecasts, measure results and constantly ask ourselves whether the facts support the decisions we’re making. If they don’t, we change course. That is why Regulus’s latest paper made such an impression.
They have spent many years analysing gambling regulation, taxation and public policy, and what immediately struck me about this paper was not that it argued against a proposal to double Machine Games Duty, but the sheer depth of evidence assembled before conclusions were drawn.
Rather than relying on headlines or broad assertions, Regulus work through the economics line by line. They examine company accounts, Gambling Commission data, published research
and international experience before testing whether the assumptions behind the proposal actually stand up.
The first thing that stopped me was the scale of the potential consequences.
Regulus’s modelling suggests that doubling Machine Games Duty could put several thousand licensed venues at risk including adult gaming centres, betting shops, casinos and bingo halls as well as sports and social clubs, working men’s, miners’ welfare and Royal British Legion clubs. Around 40,000 jobs could be affected. More surprisingly still, they argue that the Treasury may actually collect less tax rather than more, as business closures shrink the taxable base itself. This is significant enough to deserve detailed examination before any policy is implemented. Regulus then turn to the assumptions that operators could simply absorb the increase. They examine executive remuneration, marketing spend, operating margins and machine economics before concluding that none of the commonly suggested solutions would realistically bridge the gap created by doubling Machine Games Duty. Their point is a simple one: commercial reality is often rather different from theoretical modelling. As somebody who has spent decades running gambling businesses, I recognised immediately the practical questions they were asking. The second part of the paper interested me even more because it moves beyond taxation and asks a much bigger question.
How confident are we that the evidence shaping gambling policy is as robust as many people assume?
Regulus examine the Gambling Survey for Great Britain together with estimates used to calculate the economic costs of gambling-related harm. They note that participation in some gambling activities recorded by the survey exceeds Gambling Commission participation estimates by several hundred per cent, while also highlighting concerns previously raised by both the Office for Statistics Regulation and the Office for Health Improvement and Disparities about interpretation of aspects of the data.
One example particularly caught my attention: The Social Market Foundation attributes around £2.3 billion of annual social and economic costs to machine gambling. Regulus then look at the people behind those numbers. Among respondents whose harms are
12 JULY 2026
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