William Hill revealed its plans to close 700 UK betting shops after the FOBTs maximum stake slash generated losses in the millions.
UK.- The reduction of maximum stakes at fixed-odds betting terminals (FOBTs) from €116.5 to €2.3 was enforced in April. The decision may have a hugely negative impact on the industry, causing not only a loss of profit but of jobs as well.
William Hill announced it will close 700 UK betting shops due to regulatory changes. They posted losses for €913 million, which pushed them to shut down hundreds of venues. That puts 4,500 jobs on the line.
However, according to former sports minister Tracey Crouch, the bookie’s argument is “too convenient.”
“While I am sorry to hear of job losses, the truth is there was huge overinflation in the number of bookmakers on our high streets because of the profit-making capacity of FOBTs.
“The closures shouldn’t only be blamed on stake changes though – that would be too simplistic.
“There has been consolidation within the industry and a drive from the bookmakers themselves to less costly online gambling for some time now and mass closures were predicted in the industry-funded KPMG report, even without stake reductions.”
Tom Blenkinsop, operations director at the betting shop workers union, Community, asked William Hill to find alternatives where possible.
“The government also has a role to play and must look at what support they can offer to workers whose jobs are threatened as a consequence of changes to the law around FOBTs,” he said.
“Betting shops provide an important source of local employment and many of our members have served the company loyally for years. Workers don’t deserve to be the victims of the changes happening in the industry as a result of either government policy or the significant shift towards online gambling.”
As the company told media outlet The Sun, Ladbrokes will close up to 1,000 shops, putting 5,000 jobs at risk. They currently operate 3,475 stores but will lose out on cash from regulation changes, which will force them to reduce.
“As announced during a recent trading update we expect up to 1,000 shops to become loss-making,” they said. “Closures at this level would place up to 5,000 jobs at risk over the next 18 to 24 months,” the company added.
Furthermore, the Association of British Bookmakers (ABB) stated: “There will be a significant impact on the number of shops and people employed in our industry as a result of the stake cut.”
The FOBTs slash down
After years of discussing what the maximum stake on fixed-odds betting terminals (FOBTs) should be, UK politicians determined that it must be lowered from £100 to £2. Monday, April 1 saw this come into force.
The UK Gambling Commission (UKGC) revealed that it wrote to bookmakers to remind them of their responsibilities in ensuring that consumers are protected during the implementation process and after.
The new rules are intended to reduce the risks that players can lose large amounts of money in a short space of time. Ahead of the implementation, the Gambling Commission’s Chief Executive has reiterated to bookmakers the regulator’s expectations about how the changes should be managed.