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UK Gambling Watchdog Releases FY 2022/23 Performance Report
By Jeff Osienya Aug 23, 2023 IndustryUK’s gambling ombudsman has published a new report addressing market developments through the recently concluded 2022/23 fiscal year. Here’s a deeper dive into what the report is all about as we navigate a new financial year away from the pandemic.The UK Gambling Commission (UKGC), the leading authority in the UK gambling market, has published the 2022/23 fiscal year report, dated April 2022 to March 2023. This annual report is split into two sections: the performance report and the accountability report.
Its purpose is to outline all gambling activities carried out during the one year, including statistics on earnings and number of players in the industry. Additionally, the current report aims to provide information on problem gambling and the post-COVID recovery of the region’s gambling sector.
In the performance report, the UKGC mentioned that while it was a demanding year, it was also successful. It is the second report to be released under the tenure of UKGC Chairman Marcus Boyle and CEO Andrew Rhodes. Likewise, it is the second report published since the launch of the new Corporate Strategy: 2021 to 2024.
Drop in In-Person Gambling Activities
UKGC’s report notes that about 40% (23.6 million) of UK citizens have spent money on gambling and that the activities span several gambling niches with different products. In the 2022-23 fiscal year, the UKGC reported a slight decline in the number of people who opted for in-person gambling by 1%. According to the regulator, this was an ongoing trend observed over time. It stated in part:
Quote“Whilst the popularity of gambling in person has declined over time, retail remains a significant part of the sector and is showing signs of recovery following the pandemic.”
The onset of COVID-19 has dramatically influenced the dynamics of in-person and online gambling activities. Thus, from the differences in numbers, the sector will continue to feel the effects of the pandemic.
28.8% Increase in Total Income
The total income reported for the fiscal year was £26.09, higher than the £20.18 recorded in the 2021-22 fiscal year. This income excludes an additional £22.56 million that goes directly to Grant-In-Aid funding, courtesy of the National Lottery. Sports betting contributed 33% of the recorded revenue, casino betting 29%, slot machines 24%, lotteries 6%, and arcades and Bingo brought in 4% each.
The National Lottery
On its own, this is the highest income generator for the British gaming sector. As with other sections of the industry, the Gambling Commission's financial report for 2022-23 reveals a notable decrease in spending on the National Lottery.
National Lottery operations costs amounted to £2.4 million, which is £178,000 less than was recorded in the 2021-22 year. Concurrently, National Lottery Competition costs came to £19.1 million, down from £23.6 million in the prior year. This decrease in spending is attributed to several factors, including a change in the National Lottery licensee.
The selection of the fourth National Lottery license holder was also concluded in the fiscal year 2022-23. UKGC awarded the license to Allwyn Entertainment in September 2022, effectively ending Camelot's tenure as the previous license holder. It's worth noting that a legal battle arose between Camelot and Allwyn Entertainment after Allwyn was selected as the preferred applicant in March 2022. However, Camelot withdrew its legal challenge in September 2022.
There was also mention of a court hearing held at the end of June concerning a sub-contractor’s charges against the Commission, reading as follows:
Quote“The report also noted events that had ensued after the conclusion of the financial year, including the publication of the White Paper and plans to develop strategies to deliver accordingly.”
Tackling Problem Gambling
Problem gambling has always been one of the most discussed topics by the Commission, and over the years, initiatives have been launched to curb what has been termed a pandemic of some sort. As per the report, the problem gambling rate remained constant, with about 0.3% of people who spend money on gambling activities having difficulties controlling their gambling.
While the figure may seem low and has been labeled ‘statistically stable,’ it still represents between 160,000 and 340,000 individuals, as assessed through the Problem Gambling Severity Index (PGSI). Between 270,000 and 480,000 adults were classified as at-risk gamblers, meaning that hundreds of thousands of people have been negatively affected by gambling.
A new methodology for assessing the level of problem gambling had been evaluated in a pilot project during the past year. The report revealed that the UKGC had:
Quote“...successfully piloted a new Prevalence and Participation methodology this year, which will become the new standard for assessing the level of problem gambling as part of the new Gambling Survey of Great Britain.”
Impact of the Gambling Act Review White Paper
The UKGC's financial year ended shortly before the release of the long-awaited Gambling Act Review white paper, marking a new phase for gambling regulation in the UK. Tim Miller, executive director for research and policy at the Commission, stated that the regulator would have limited room to consider non-white paper-related policies in the coming years.
UKGC’s report also noted events that proceeded after the conclusion of the financial year, including the publication of the White Paper and plans to develop strategies to discharge its duties. It acknowledges that the full impact of the Gambling Act Review white paper on the industry remains uncertain. The report reads:
Quote"The medium to long-term impact of the Gambling Act Review white paper on the industry is not yet clear, but we will continue to review this and the potential impact on our future income.”
The Commission also pointed out that since the Gambling Act Review White Paper had not proposed any legal changes to the UKGC body itself. As such, there was no need to speculate that it won’t carry on providing ‘a statutory service in the future’. On the same, the UK regulator acknowledges that:
Quote“The publication of the Gambling Act Review White Paper represents a once-in-a-generation opportunity to deliver specific change for gambling in Great Britain, but also builds on a significant, long-term programme of measures we already have in place ..We have effectively navigated the period between the launch of the Gambling Act Review and the publication of the White Paper and the uncertainties this brought, and we have juggled resources, workloads, and priorities to lay the foundation for the White Paper and its proposed actions.”
Changing Tides in the UK’s Gaming Scene
The UK Gambling Commission's performance report for 2022-23 underscores the shifting landscape of the gambling industry. With changes in National Lottery operations, significant financial penalties, and the anticipation of the Gambling Act Review's impact on the sector, industry observers are waiting to see how the future will unfold.
As the comprehensive report highlights, the regulatory body has continued to work diligently to protect consumers, prevent problem gambling, and maintain the industry's integrity. While challenges persist, the commitment demonstrated by the UKGC is commendable and sheds light on the importance of a well-regulated gambling sector in the UK.
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