Dormant Betting Accounts [5 July 2016]


You can watch my speech and the full debate by clicking (here).

I beg to move,

That this House has considered dormant betting accounts.

It is a pleasure to serve under your chairmanship, Mr Hollobone, and I am grateful for the opportunity to lead this Westminster Hall debate. Members here today will know that problem gambling continues to blight too many communities across the United Kingdom. Like alcohol or drug addiction, gambling has the terrible power of being able to destroy a person’s life and inflict financial and emotional misery on victims and their families.

In recent years, there has been greater recognition of gambling-related harm and the damage that it can cause. Despite the greater awareness and increased funding for support services, it has been suggested that there are still around 450,000 problem gamblers in the UK. The sheer scale of the problem makes it clear that the UK Government have a responsibility to do more. I have devoted much of my time as a parliamentarian to pursuing this issue. I believe that the money contained in dormant betting accounts could, and should, be used as an additional source of revenue for organisations to assist people with gambling-related harm.

Julian Knight MP (Intervention)

I congratulate the hon. Gentleman on securing this important debate and I share his concern about the devastating impact of gambling addiction, but does he recognise that the gambling industry has started to take some measures in that respect, such as the “When the Fun Stops, Stop” campaign, which is very high profile? Betting is a private transaction between an individual and a bookmaker and we must be very careful about setting a precedent for the state confiscating private property, even in such a worthy cause.

Ronnie Cowan MP

I have no issue with what the hon. Gentleman is saying. I agree that “When the Fun Stops, Stop” is a very strong campaign led by the gambling organisations, and they should take credit for that. I am not here to lambast gambling as a concept; what we are looking at is problem gambling and facilitating a trigger that I believe we can use to help people who find themselves in that unfortunate situation.

Paul Monaghan MP (Intervention)

Does my hon. Friend agree that gambling and debt are often symptomatic of economic and social decline and that the creative use of dormant bank accounts could benefit and bring some relief to such communities?

Ronnie Cowan MP

I absolutely agree with my hon. Friend and colleague, and hopefully I shall shine some light on that later in my speech.

Why do dormant betting accounts exist? When I was a boy in the ’60s, I used to enjoy watching the racing on the television with my Uncle Charlie. We would spread out the pages of the newspapers in front of us and gamble. We would watch the racing, pick our horses and calculate how much to bet. Spread betting taught me more about checks and balances than my economics teacher ever did. Because Charlie was a regular gambler, he had an account with the local bookies. From the comfort of his living room he phoned the bookie and placed his bets. Charlie would drop into the bookies during the week and pay his debts or pick up his winnings. The bookie knew Charlie, and the books were balanced weekly.

As technology has advanced, so has our ability to access gambling, which we can do from our phones or tablets at any time of the day. We also now live in a more disposable world. People once worked their entire lives at the same company, lived in the same street all their married lives, banked with the same bank and went to the same place on holiday every year. Now it is easier to change, and we are encouraged to change and move and to take up new offers.

Betting companies tirelessly promote free bets and other generous offers to encourage new customers to sign up. It is not unusual for people to have half a dozen or more accounts with different companies to take advantage of those offers. People can only remember so many user names, passwords and accounts, and eventually, they lose interest or forget about an account that may only have a few pounds in it. Over the passage of time, the accounts become dormant, but do we know how many accounts there are and do we know how much money they contain? The answer to both of those questions is no.

In preparation for the 2010 Department for Culture, Media and Sport report, companies were approached to give a financial breakdown of the amount of money involved in dormant or similar accounts. A majority refused, either on the grounds of commercial confidence or because they claimed to be unable to produce the figures. Betfair provided data about the size and scale of dormant betting accounts, but on a confidential basis. Under the current arrangements, dormant betting accounts are simply reverted to the company profit line after a specified amount of time.

Julian Knight MP (Intervention)

Will the hon. Gentleman clarify what he defines as dormant betting accounts? For exactly how long does he think there has to be no activity on the account for it to qualify as dormant?

Ronnie Cowan MP

I shall certainly go on to do that because it is an area of some concern. There is no definition of that as yet and I think there should be.

Companies have different definitions of “dormant”. For instance, Gala Coral define it as 400 days of no activity whereas Ladbrokes define it as 12 months. The report commissioned in 2010 for the Department for Culture, Media and Sport proposed that when a betting account became dormant, 25% should be added to the company profit and 75% should be transferred to good causes. The report also concluded that if a voluntary scheme could not be established with betting companies, legislation should be enacted requiring them to contribute 75% of the unclaimed amount. Dormancy in this instance was defined as 18 months of no activity and the money was only taken once all efforts had been made to contact a customer regarding their account.

In April this year, I wrote to Ladbrokes, Gala Coral, Paddy Power, William Hill and Betfred regarding their policy towards dormant betting accounts and problem gambling. Unfortunately, Betfred and Paddy Power did not respond to my letter. William Hill, Gala Coral and Ladbrokes gave me the courtesy of a response, but all strongly rebuked my statement that the issue of gambling is one that blights a number of communities and households.

The response from Ladbrokes was perhaps the most insightful for people wishing to learn how gambling companies view their own services. It said that,

“rather than a blight on local communities and individuals as you suggested in your letter, I strongly believe that our shops are a real part of their local areas. Many of our colleagues know their customers by name and face and our shops often provide a social outlet for customers to meet other people, over a cup of tea or coffee, whilst having a flutter on their sport of choice.”

Betting companies may paint a rosy picture of gambling as a harmless pastime, but that is a misconception. The reality is that the proliferation of betting shops on our high streets is seen by my constituents as an unwanted symptom of economic and social decline.

Online betting accounts are also part of the problem, making it easier than ever for problem gamblers to become bankrupt, fall behind on their mortgage payments or experience divorce or family troubles because of addiction. Is that the experience of most gamblers? No, it is not. Do the majority of punters bet responsibly? Of course they do. The experience of the problem gambler—that is who we are seeking to help—and the wide-reaching ramifications of their actions far outweigh the experiences of the majority of punters who visit the bookies for a cup of tea and a £2 bet. For example, I am aware of one problem gambler who stole almost £850,000 to fund his addiction. The Gambling Commission concluded that Gala Coral had failed in its duty to prevent money laundering and problem gambling and added that the company’s safeguards against both were inadequate. Gala Coral agreed to pay back £850,000 to the victims of the crime and to pay £30,000 to the commission for the cost of the investigation.

Some will say that enough has already been done to tackle problem gambling and that adding money from dormant betting accounts is not necessary. They will highlight the financial contribution that betting companies already make to organisations that assist with gambling addictions. Figures released by the Gambling Commission show us why we should be sceptical of those who say that enough is already being done. Last year, British gamblers lost £12.6 billion and losses have risen every year since April 2011. Online betting accounted for a third of the total losses. In 2014-15, the charity GamCare reported an 18% increase in calls from problem gamblers and a 39% rise in clients receiving treatment.

We can conclude without hesitation that betting companies have no interest in voluntarily signing up to a dormant betting account scheme such as that envisaged in the 2010 Government report. Their view has been unambiguously stated through their unwillingness to outline how much money is in dormant accounts and their hesitation in engaging with me on the subject.

In conclusion, I hope that the Minister takes away three points from my contribution. First, the UK still has significant and worrying levels of problem gambling. Secondly, betting companies have no interest in voluntarily signing up to a scheme as proposed in Don Foster’s 2010 report. Thirdly, only the UK Government have the power to ensure that good causes benefit from the potential funding locked in dormant betting accounts. The UK Government have a duty of care and the time for paying lip service is over. It is time for the UK Government to act on the recommendations laid out in the 2010 report, and in turn help the many individuals and families who have been affected by gambling-related harm.