Oireachtas Joint and Select Committees
Wednesday, 10 July 2019
Select Committee on Justice and Equality
Gaming and Lotteries (Amendment) Bill 2019: Committee Stage
This meeting has been convened to allow the committee to consider Committee Stage of the Gaming and Lotteries (Amendment) Bill 2019. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official either by name or in such a way as to make him or her identifiable.
We are joined by the Minister of State at the Department of Justice and Equality, Deputy Stanton, and his officials. They are all welcome. Does the Minister of State wish to make some opening remarks before we address the Gaming and Lotteries (Amendment) Bill in detail?
I thank the Chairman and colleagues on the committee for the opportunity to comment. The amendment proposed to our laws under this Bill comprises an interim reform measure. While it is limited, it will have the effect of modernising and clarifying the provisions of what is, as matters stand, greatly outdated legislation. I imagine everyone agrees with that. Work on comprehensive legislation and regulatory reform, to include the establishment of a new licensing and regulatory authority for gambling, has commenced in my Department. However, it is a mammoth task and it will take some time to bring the proposals to fruition. I do not expect a revised general scheme of the gambling control Bill to be presented this year because it is such an onerous undertaking.
No Government amendments are proposed to the Bill before the committee. I am looking forward to its examination of my proposals. I look forward to responding to the amendments proposed by Deputies. I hope that, with the co-operation of those on all sides, we can facilitate the swift passage of the Bill. As always, I welcome the opportunity to engage with colleagues and learn from what people have to say.
I wish to draw everyone's attention to the grouping list. There are five groupings. Amendment No. 11 is the only stand-along amendment. Amendments Nos. 1 and 2 are related and may be discussed together by agreement.
I move amendment No. 1:
In page 5, between lines 18 and 19, to insert the following:“ ‘Private Members Club’ means a voluntary and unincorporated association of persons over the age of eighteen years, not being a public body, formed for the purpose of gaming in premises to which the public does not access as of right, the affairs and management of which is governed by a committee in accordance with rules established by the membership body;”.
The amendment is partially exploratory and I am keen to ascertain the view of the Minister of State on it. I was contacted by the organisation representing private members' clubs. The clubs believe that it is not the intention of the Minister of State for this legislation to apply to them. However, they are concerned that, as they stand, the definitions will mean that gaming without a valid permit or licence will be a criminal offence. They fear that their premises will be considered places where criminal offences are committed. However, it is not possible for them to apply for either the gaming licence or permit. Their concern is that this will eliminate them. There is a view that they need a form of bespoke regulation and licensing to manage that particular sector. My understanding is that the Minister of State does not intend the legislation to apply to them but they are concerned and believe that there is need for legal clarity on whether it will apply to them.
I thank the Deputy for tabling the amendments. My response is similar to responses I have given to representatives of a private members' club on the text submitted.
I wish to provide some background. Early in the debate on the Bill, I made the point repeatedly that the existence of such clubs arises on foot of constitutional protection. Members' clubs are not governed by the Gaming and Lotteries Act 1956 or by this Bill. Thus, according to the advice of the Office of Attorney General, there is no need to accept amendment No. 2. I am told it would risk confusion and perhaps invite legal challenge. To the best of my knowledge, many of these establishments are not member-driven clubs in the same way as normal sports clubs. The membership is frequently not a stable feature and may vary considerably from night to night. I will outline some of the questions that could be asked. Who on the committee would be legally responsible for ensuring payment of any taxes to the Revenue Commissioners? Who would ensure adherence to any money laundering laws? Who would ensure that visitors to the premises do not engage in excessive gambling? Who on the committee would direct a sharing of any surplus made by the club between all members? Who might share the losses?
Many of these establishments hold themselves out to be casinos. I am not in favour of any measure that would facilitate casino operations by the back door. If we went down that road at this time, these establishments would not be subject to any licensing or regulatory constraints. I also fear that gaming arcades operating in areas where no local authority resolution is in place under the 1956 Act might be tempted to avail of the proposed exemption with the attendant negative impacts I have already outlined. I fully intend to address the issue of licensing and regulation of casinos in the context of the major reform work under way. I contend that is the appropriate place to deal with the matter. At that time, clubs would have the option to apply for a casino licence under regulation and so on.
I wish to make two other points. Amendment No. 1 proposes governing by committee. That is all; it goes no further. We are of the view that neither amendment is needed. Both amendments could open up all manner of unintended consequences. As matters stand, there is constitutional protection for private members' clubs. That is what they call themselves and that is what they are. The advice is not to accept or support the amendments at this time.
The Minister of State should consider tabling amendments on Report Stage, although I take the point he has made. There are well-run clubs and there are fly-by-night clubs. There are people who come along and join on the night and so on. There are major issues with some of the casinos. Some are better run and manage their members well and would be bona fides private members' clubs.
There seems to be something of a contradiction to my mind in what the Minister of State said. He referred to unintended consequences but such consequences could arise if matters are left as they currently stand. It seems that it could be a criminal offence to organise gaming even with a valid permit or licence. Would it not make sense to include in this Bill a form of licensing for the sector prior to whatever is eventually proposed in the gambling control Bill? Those who contacted me are concerned about the uncertainty. All the unintended consequences to which the Minister of State referred could arise as things stand. There is a justifiable call for clarity and reassurance. The best way to provide this would be if the Minister of State brought forward a regulatory framework for the sector within this legislation for Report Stage. That is what should happen.
It is welcome that we are trying to update our legislation on gambling. I mentioned this during the Second Stage debate. I think any of us who have been in touch with or contacted recently by individuals affected by the proposed legislation will be aware that this is a very unregulated yet highly competitive industry.
Regarding the legislation generally, I think we all agree that it would be preferable if we had very detailed legislation regulating the whole area of gambling and imposing a gambling regulator that could regulate issues such as private clubs, casinos and so on in a consistent way. I understand, however, that we do not have that in this legislation. I commend the Minister of State on bringing forward some amending legislation. I can see what he is trying to do.
Regarding Deputy Ó Laoghaire's amendments Nos. 1 and 2, I had considered tabling similar amendments in this format because I was also contacted by, I think, the Gaming & Leisure Association of Ireland GLAI. There are many different organisations in this sector. I did not table the amendments for reasons I do not need to go into. The GLAI's concern is that if this legislation is enacted, it will find itself outside its parameters. I do not know whether that is necessarily so. I know that the GLAI has legal advice stating as much. What it reveals is that we need to regulate all areas of the gambling business, but at present it appears to be the case that only some will be regulated. I note what the Minister of State says about private members' clubs. He seems to think it is not necessary for them to be dealt with in this legislation since they are not covered by it. There is a lot of strength in that argument, considering that they accept they are not regulated by the 1956 Act, which therefore raises the question, why would amending legislation affect them? I will give consideration to these issues as well. I may table amendments on Report Stage but, as Deputy Ó Laoghaire said, it might be beneficial if the Minister of State gave further consideration to this before Report Stage.
Reflecting on what my colleague said, I commend the Minister of State on taking the plunge. This is the first legislation in this area in a long time, and that is welcome as a start. There are many huge issues surrounding addiction, regulation and properly dealing with the huge amount of activity that is totally outside the scope of existing legislation, as well as the total lack of enforcement of that legislation. I would like an update on where we are with the principal legislation. Has drafting commenced? That is where the solution lies.
The Minister of State has tried to take this on. I understand that it is complex, but it needs to be accelerated.
I am coming to this as a new member of the committee. I take what the Minister of State says, that in his opinion this will be dealt with by later legislation and that that is what he intends to do, but the problem is when that legislation will come before us. Will it ever come? What is the Minister of State's timescale for it? It is vitally important. Regarding the private members' clubs, gambling is a huge problem in Ireland, bigger than drink or anything else, and we need to tackle it. I commend the Minister of State on taking these steps now to do so, but how long is his timescale for this happening in the future? Would what we are talking about affect, say, GAA clubs when they hold poker classics? Is that the same kind of thing we are talking about, or would this legislation affect organised businesses more?
I, too, welcome the Minister of State's statement on the need for further legislative solutions to the regulation of gambling, particularly in respect of the licensing and registration of casinos. I think all of us in this House would like to see a compendium of legislation that deals with all the issues, particularly online. Mobile technology is now moving at such a pace that regulations in certain areas are soon outmoded by dint of advances in technology. We should therefore take an overarching view.
I seek clarification on this amendment. I note the Minister of State's comments on the 1956 Act. I would like his confirmation on the following question. Since the Bill does not speak specifically to private members' clubs, could it be said - and I will be guided by the Chairman on this - that one would in effect, by dint of supporting this amendment, be making new law if one were to seek to amend the Gaming and Lotteries Act? Nonetheless, I welcome the Minister of State's statement in the round.
I thank colleagues for their questions. I will do my best to respond to them. If I miss something, they might remind me of it.
Deputy Pringle asked about GAA clubs and so on. These amendments have nothing to do with any of them, so there is no cause for concern there.
A number of colleagues asked about timelines and so on. I said in my opening remarks that we would not see the heads of the Bill this year. I hope to have them early next year. Not only have we to draft the very complex legislation, to which Deputy Sherlock has alluded - it is extremely complex and is changing almost by the month as more things happen - but on top of that we must set up an authority comprising perhaps 100 people. It will be very expensive and very complex to make sure we have all the right skill sets in place. Work on both these aspects is ongoing. There is no point in passing legislation without having the regulatory authority in place to enforce it, regulate it, research it and so forth. I hope to have the heads of Bill prepared and ready to roll early next year. At the same time, we are working on the structure of the authority and what it will look like. As soon as we have that information ready, I would be interested in coming before the committee and getting colleagues' views as to what we propose to do. If people have suggestions at that time, I would be interested in listening to them. That gives the committee an idea of progress on the main Bill and where we are with the authority. They are two mammoth tasks and they must happen together. It is not a case of one or the other.
Regarding private members' clubs, my understanding is that if all of us here decided to form such a club, under the Constitution we could go away and engage in gambling, provided we are members of a private members' club. This comes under what is understood as free association. That is what these clubs in effect facilitate. They are private clubs made up of members on a list who come in and do their business. They are also businesses, by the way, and they need regulating. When the main legislation comes forward there will be an opportunity for such businesses to apply for casino licences, as will be provided for in the legislation. Such licences will be regulated. This whole area will be taken up at that stage. If, however, we take these amendments on board now, we will be moving into regulation and recognising these almost as bona fide casinos. I am slow to do that at this point. I do not think any of us wants to do it now when we do not have the regulation in place. We would also in a way be inviting other groups to come forward to apply to become casinos.
That is the effect this legislation could have. The committee itself is not defined as to how it is made up, what it is to do, how it will be structured and so on, and there are other issues in the legislation. I am always open to considering colleagues' suggestions or questions on Report Stage, and I have listened carefully to what Deputy Ó Laoghaire has said. If, however, between now and Report Stage, which will be in the autumn, other issues arise, I will certainly be open to doing things then. I contend, however, that the amendment, as presented, does not fit into the current Bill, which is very much an interim measure. The amendment would also have other unintended consequences that I am concerned about.
When we do this, I want to do it properly under the full gamut of robust legislation that covers everything, as I think Deputy Sherlock also said. We also need a regulatory authority in place to enforce the current law, research it and investigate what is going on out there. I have heard of casinos in other jurisdictions that are quite profitable but they are in large countries. In the UK, I think they are not and the big casinos have not opened there. As my colleagues said, an awful lot of stuff is moving online, which is where we are focusing much of our attention.
When we talk abut gambling, the issue of problem gambling and addiction, rightly, always comes up. It has been argued that any of us here has a right to go out and gamble if we want to. It is a free country. However, if somebody has an illness or an addiction, that becomes a health matter. People with such an addiction need treatment, therapy and counselling. Regulation can only go so far in protecting and safeguarding people but, if someone has an addiction, we must be careful and recognise that person has an illness, a sickness and needs counselling, therapy and professional help.
We can do a certain amount through regulation to safeguard people we have discussed many options previously. I have been at this for quite a number of years now since the hearing of the Oireachtas Joint Committee on Justice, Defence and Equality, of which I was chair, in 2013 when the heads of the Gambling Control Bill were produced. Some of the stuff works and some does not. We will have to be careful when we talk about addiction. We can do a certain amount to make gambling less attractive and glamorous but we must also be careful to make it fair so that a properly tabulated and regulated machine has correct odds and is fair to gambling punters as a business transaction.
Those are the reasons I am open to reconsidering anything my colleagues bring forward on Report Stage but, at this time, I am afraid that my advice is not to accept them.
I agree with an awful lot of what the Minister of State said. I agree entirely about the significant damage that can be done and all of the committee members have the same objectives for this and future legislation. I will not press the amendment but I ask him to consider it over the summer. He must understand the argument that is being made. He said that this legislation is not governed by the Gaming and Lotteries Act 1956 and, therefore, it does not affect him. If he is correct about that, all the arguments relating to unintended consequences apply all the same. By the same token, somebody could go away and set up that same private members club the Minister of State is talking about tomorrow morning and all the same unintended consequences that might exist if they were to be specifically excluded from the legislation could equally apply. What if the Minister of State is not right and private members' clubs are covered by this?
The argument that they are covered is that, until this legislation, it was not an offence to the same extent to be involved in gaming without a gaming permit or licence. It will now be an offence and whether or not one has a constitutional right to freedom of association, that does not entitle one to break the law in that environment. That is the concern. If the Minister of State is not correct, and private members' clubs are included, then they close down and there are job losses and all the rest of it involved in that. I would like it if he could take whatever preparations are happening in the Department with the Gambling Control Bill, grab that part of the legislation and put it in here. It is otherwise unfair to the people whose jobs are involved in these businesses because there is uncertainty which needs to be addressed. I will not press the amendment and will withdraw it.
The Minister of State mentioned the word "regulation" three or four times. I meet a lot of people who have problems with gambling and they have nowhere to go. What investment is the Minister of State going to make to help people with gambling addictions? The bookmakers and people involved in the gambling business are contributing money towards psychiatrists and so on but I have seen advertising on television lately about sex and bullying but gambling addictions have been going on a long time. The Minister of State is now coming out and talking about changing the entire system. What about these people who need help? Has he plans to look after people with addictions in the future?
The Gambling Control Bill provides for the establishment of a social fund through a levy on the industry, which will be used specifically to help people with gambling problems and addictions. It will also fund research which is important and provide information and education to people about the dangers of gambling. If someone has an addiction issue, that is a health issue and my colleague, the Minister of State, Deputy Catherine Byrne, is responsible for looking after addictions, including gambling addictions.
A private fund has been established recently by some elements of the industry to make funding available to some addiction services specifically ring-fenced for gambling and that is happening independent of me and the Department; we are not involved in that. I advise anyone who is a problem gambler or who has an addiction to go to a therapy centre, get assistance, meet a therapist or a counsellor and get help in that regard. It is a health issue at the end of the day and the Department of Health is leading on that and doing some good work.
I hope the Minister of State does not take this the wrong way but he is passing the buck. The Minister of State, Deputy Byrne, will say that the Department of Justice and Equality has a responsibility. He mentioned a levy. If a levy is going to be charged, the Departments of Justice and Equality and Health should work very closely together to ensure these addicts are being looked after. This has gone on far too long.
I will be honest that I gamble four times a year. I love looking at golf and I gamble on the four majors. I put a wee flutter on and that is probably how it all starts. We must run an advertising campaign and explain that the problems and serious issues related to gambling are similar to those relating to drink. I do not have a problem with gambling, and I am a pioneer and do not have a problem with drink. I realise that other people have problems and need help. The warning signs are there at an early stage.
I have been looking at television for the past number of years and I have seen nothing warning people about gambling addiction but I see advertisements about sex and bullying. The Departments of Justice and Equality and Health should work together and highlight the serious issues people are having with gambling. That might stop people at an early age.
Years ago, the biggest problem we had in this country was smoking and, all of a sudden, obesity and diabetes are bigger killers than smoking. People worked so hard on the smoking and, all of a sudden, we now realise we have problems with other issues. Prevention is the best cure and I would like the Minister of State's Department to work a wee bit closer with the Department of Health, using the levy and the moneys coming in to help addicts.
I thank the Deputy. Of course the Minister of State will reply but I need members to stick to the amendments as we go through the process. This is a select committee meeting on this specific Bill. I allowed Deputy Fitzpatrick to make his points so would the Minister of State like to respond?
Deputy Jack Chambers rightly pointed out earlier on that this is the first Bill since 1956 dealing with gambling. I have worked hard, as have many of us here, to get this to this point. The gambling levy is not there yet because the main legislation is not there yet but, when it comes in, it will be there.
Deputy Fitzpatrick made some good points and I will contact the Minister of State, Deputy Byrne, but I have spoken to her about this issue already. We have carried out some studies on this and another one is ongoing, which I will refer to later, on the prevalence of gambling in the jurisdiction, which is quite enlightening and we look forward to the results of that study when it is made available. The Deputy made some interesting points and we should do more to educate people, inform and warn them about the dangers here and how they can get help if they need it. I thank him for his comments and take them on board.
I move amendment No. 2:
In page 5, line 26, to delete “offence.”.” and substitute the following:“offence.(3) This Act shall not apply to gaming or to the promotion of gaming in premises used for the purposes of a Private Members Club.”.”.
I move amendment No. 3:
In page 8, line 25, to delete “than €10” and substitute “than €2”.
The amendments seek to amend section 5 which inserts a new section 14 to replace section 14 in the 1956 Act. If we look at the 1956 Act, we will see that section 14 is in Part 3 which deals with the licensing of amusement halls and funfairs. We have all become aware of how unusual the legislation in this area is because local authorities can opt in to this Part of the 1956 Act - some have done so, while some have not - which means that different systems are operating throughout the country for amusement halls and funfairs, which is unusual from the point of view of legislation. The amendments arise from a concern that people are spending too much money in gambling. Section 14(b) of the 1956 Act states: "the stake in each game is not to be more than sixpence for each player...". That is still the law. At paragraph (d) it states: "no player may win more than the value of ten shillings...". That may have been amended subsequently, but it is still extremely low. The Minister has decided to insert a figure of €10 for the stake and €750 for the prize. I understand the logic behind this. The purpose of my amendment is to try to prevent people from spending too much money in gambling. However, since I tabled the amendment, I have been contacted by people who own arcades to say this would be very unfair on them because there is no restriction on those who gamble online in the bet they can place. They are asking why they will be being restricted under the new regime in the amount a person will be able to gamble on a machine. It is a further example of how complicated the issue is.
I will not push the amendments on Committee Stage. I will consider them further on Report Stage and the Minister should do the same. I am interested in hearing what the Minister of State has to say to them in response, but clearly we need to update the legislation to ensure it will be meaningful. If we are to provide in the Bill for meaningful stakes and prizes, they will have to be policed. I am interested in hearing the Minister's response on how he believes that will happen.
I will speak now, if that is all right.
I support Deputy O'Callaghan's amendments, with which I agree in principle. There is a need for consultation over the summer, including with people involved in the business but also, importantly, those involved in dealing with individuals with a gambling addiction.
I take Deputy O'Callaghan's point about fairness and having an equal playing pitch in online versus land-based gambling. I do not understand the science, but there is something about the dynamic of slot machines that results in compulsive behaviour. It is reasonable that there are maximum stakes and we need to make sure they are right. I do not believe the three cent, or sixpence, limit is applied in practice, but the rate proposed in the Bill is a huge increase on the rate in the existing legislation. We need to examine revising it downwards from €10, a proposal we would view favourably.
On a technical issue - I would like the Minister of State to examine this - I would have supported the amendments. If they are not being pressed, that is Deputy O'Callaghan's prerogative, but it is my understanding of the way it has been interpreted that, strictly speaking, every line is a game. One could have 25 lines, on each of which one could place a tenner. That issue needs to be examined. One can imagine the matrix in the different lines of fruit, other symbols and so on. The maximum stake is potentially substantially larger than what is officially set out in the legislation because each line is a game and one can win in each of the several combinations, similar to each line in a Lucky 31 being a separate bet. I would like the Minister of State to examine that issue as we need to make sure we get it right. It should involve consultation with the industry but also with those involved in dealing with individuals with a gambling addiction, particularly those who have experienced the dynamics of slot machines and so on.
There is very good value in Deputy O'Callaghan's amendments which he has decided to withdraw for now. In looking at something like an arcade which is referred to as an amusement arcade we must consider whether we are regulating an activity that is seen as gambling. I accept the point others involved in the industry make that there is no other activity that is comparable. One can buy a lotto ticket for €2 and win €250,000. However, there is something about the addictive nature of gaming and the actual process in an amusement arcade that makes it worthwhile examining the general idea of what the maximum payout versus the stake should be. I believe the figure €750 is a little too generous, but I am interested in hearing what is the Minister of State's thinking on the matter.
I am interested in hearing how the Minister arrived at the figures of €10 and €750. Thirty-five years ago in Killybegs I could have gambled £2 when the stake was 2.5 pence. There was no enforcement of the law. How do we know that there will be enforcement of the law now? If the law provides for a stake of €10, I am 100% sure one can gamble €100 in establishments because I know the way they work. That is the problem. I am more interested in hearing how the Minister arrived at the figures, but I am also interested in hearing how the law will be made workable and enforced. The figures of €10 and the €750 are more than enough, but, in reality, the amounts gambled will be much more.
I agree that we have to look at the stake and prize money. The Bill states a person who holds a gaming licence should not accept a stake from a person under the age of 18 years.
What enforcement is being done to ensure that these gaming establishments are not taking money from young people under 18 years of age? I do not know how any enforcement can be done whatsoever. This is part of the addiction problem. Is it the Department or the Garda which enforces this? As I said earlier, prevention is the best cure. It is okay reducing the stakes and the prize money. However, what are we doing to stop young people putting money in these gaming machines?
I welcome the withdrawal of the amendment to allow for a further discussion on this. Three cent to €10 per spin or per game is a significant increase. As legislators, we must consider the exceptions that can be created, no matter what type of figure one puts on the cost per game and the prize money. When legislating for specific figures, no matter what figure one puts in, even if it is low, one must not drive people into other forms of gambling. The advocates from the public health point of view, such as Mr. Barry Grant and Dr. Colin O'Gara, have made a legitimate case in terms of these specific figures. We have listened to them in that regard.
We are making gambling under 18 years of age an offence. It will not be allowed anywhere and it is the first time it is being done. Section 18 lists the offences and lays out the punishments. There are consequences if people break the law in this area. Enforcement is a matter for the enforcement authority, the Garda and others.
The amendments proposed relate to the maximum stakes and prices which can be played for on a gaming machine at a licensed amusement arcade under the terms of Part III of the principal Act. The only role for the Minister for Justice and Equality under that Part concerns stakes and prize amounts. Section 5 substitutes a new section 14 for that section of the 1956 Act. The amendment concerns, essentially, the updating of a maximum allowable stake and prize amounts. These are increased from three cent and 50 cent to €10 and €7.50.
Deputy Pringle asked how we arrived at these figures. There is no science. I have seen people, with sandwiches and flasks alongside them, sitting in arcades with bags of coins, just feeding them into machines all day. One can argue that, whether it is €2 or €10 at a time, people with a problem with gambling will keep going until the bag of money is gone. Gambling addiction is a problem area.
Deputy O’Callaghan mentioned that there are people employed in this area. As Deputy Fitzpatrick said, he gambles four times a year. We will not do a roll call of the rest of us but people have a flutter every so often. Some people gamble a bit more than others while others have an addiction problem and need help. It has been said that the stakes and prizes are totally unrealistic and out of date. We must bring them up to some form of realistic modern amount.
A new regulation in section 14 will allow the Minister to amend stake and prize amounts. Through a statutory instrument, the Minister of the day can actually increase or decrease stakes or prizes. This will be laid before the Houses of the Oireachtas. If whatever figure we finally arrive at is not working, the Minister of the day can change that in co-operation with the Houses.
In the past, the stakes and prizes were locked into legislation at three cent and 50 cent. There has been no primary legislation in this area since 1956. Deputy Pringle alluded to what was really happening on the ground which is another story. We are trying to bring it up to something realistic. The €7.50 prize is the maximum amount. Obviously, that will probably not happen that often. If people want to gamble, they will want some kind of incentive or thrill to do it. By having a realistic prize, people will be inclined to have a go and a bit of fun. It stops being fun when it becomes a problem.
The Revenue Commissioners issued 12,113 gaming machine licences and 94 licences for gaming premises in 2018. Within the past two years, it has undertaken a major enforcement drive against unlicensed premises and machines. I very much support this effort and hope it will deal with the issues in question. My own proposals seek to make it clear that licensed gaming machines should only be located in licensed gaming arcades where a local authority resolution is in place. Again, I hope the Revenue and Garda enforcement efforts will continue to target unlicensed machines and lead to their removal from public houses, take-away food shops and other such locations.
This particular stake and prize amount has been in the public domain since we first published the proposals more than two years ago. This is the first time it has been examined by the Dáil. Some colleagues in the Seanad raised it as well. I am open to looking at this over the summer. We have to be careful that it is realistic. We are putting in the provision that it can be changed by ministerial order if it is found to be too high.
Several Deputies said there is a thrill to the arcades. There is as much a thrill in gambling online. It is silent and hidden, however. I am far more concerned with the migration to online gambling and how we deal with that. It is not going to be easy. I would contend far much more is lost online than in the arcades. The arcades are limited in their opening times and locations, whereas online is open 24-7. That is where we will put a lot of our efforts to see how we can deal with that.
I understand the amendments are being withdrawn. I agree to examine them again and communicate with colleagues in order that we can agree on some figures. We will certainly give it careful thought over the summer.
It is interesting to note that under the 1956 Act slot machines were prohibited and that was then changed in 1970. We are referring to slot machines and gaming machines. Section 149(2) states the Minister may, by regulation, vary the amount specified. I am not an expert in identifying what is the appropriate amount that will be effective in trying to tackle compulsive gambling. However, that is a matter the Minister of State might need to look at. It might be the case that one does not specify the amount in the primary legislation and leave it for ministerial regulation. Section 14(2) allows for that. However, it needs to be looked at.
I take the Minister of State's point that even if we say nobody can place a bet of more than €2 on a slot machine, there is nothing to stop a person from sitting at the machine all day and repeatedly putting €2 into it. What is the stake on slot machines in arcades at present? Presumably, it has to be in coins. There is a problem. Nobody wishes to stop summer time arcades where people can win and have some fun, but what we want to stop or deter is compulsive gambling. A bigger place where that can occur is probably online, but we must do something. We are withdrawing the amendments, but the Minister of State might give them consideration. We are all happy to discuss them with him.
I agree that the online sphere is massive, growing and insidious in some respects in the impact it has, but it is a particular type of addiction. There are people who get addicted to slot machines who might not be addicted to gambling in other forms. It is something that happens and we must be conscious of this. The Minister of State did not respond to the point I made about lines. I do not know if he can respond to it; if not, perhaps he might look at it over the summer. If that is the case - I cannot be certain that it is - it makes a significant difference in the decisions we have to make.
On another question, there is a difference between slot machines and what are called fixed odds betting terminals which are used for roulette, blackjack and the like. They are considered to be even more addictive. I read a story about somebody in Britain who lost £6,000 in 60 minutes on these machines which I believe are being banned there. They were not legal in this jurisdiction previously. Am I right that that remains the case?
Some attempts have been made in the media. On the situation in the United Kingdom, there is a category of machines colloquially known as fixed odds betting terminals, FOBTs. Four of these machines were allowed per shop, which led to a big increase in the number of pop-up bookmakers. The UK Government has reduced the maximum stake for the four category B gaming machines to £2. There were no changes to maximum prize amounts, which range from £400 to £500. Deputy Ó Laoghaire is correct that studies in the United Kingdom have suggested FOBT machines are highly addictive and can lead to serious problem gambling. Such machines have never been a feature of bookmaker shops in Ireland. Gaming machines are only allowed in licensed gaming arcades here. To return to what Deputy Fitzpatrick said, we must ensure our enforcement measures are robust. I encourage the Revenue Commissioners and the Garda to be extra vigilant in removing machines from unlicensed locations. Gaming machines have been available in licensed gaming arcades in the State since the 1956 Act was commenced.
The results of the 2014-15 survey of the prevalence of gambling which were published in February this year by the Department of Health show that the most prevalent forms of gambling engaged in were, believe it or not, those associated with the national lottery.
On the issue of unlicensed machines in premises, I hope the District Courts in dealing with applications for certificates under Part 3 of the legislation will be satisfied that such local authority resolutions are in place before issuing such certificates.
I am not an expert on lines and so forth, but I understand it can be per spin. We will do carry out research and refer back to the Deputy on the matter.
I move amendment No. 5:
In page 13, line 39, after “effect” to insert “, save where the licensee utilises an agent to conduct the lottery on its behalf”.
While they are not grouped, the amendments are closely connected to amendments Nos. 7 and 8 and it will be necessary to refer to them.
The amendment arises from being contacted by the Bingo Association of Ireland. Its concern is that the situation for bingo game organisations was not properly anticipated or considered adequately. Some of the organisations are commercial and often run bingo games on behalf of charitable organisations. Their concern is that they are not covered because they will not be the licensee but an agent of the licensee and will be unable to run the bingo games on behalf of the licensee. They believe they are not covered and are legitimately concerned.
With regard to amendment No. 7 and the dynamics of bingo games, under the legislation, as drafted, 50% is the maximum figure for prizes. The association's view - I am not an expert - is that for a bingo game to be attractive, the prize must be in the range of 60% to 70%. It believes an adequate number of people will not be got through the door, unless the pot is 60% to 70% because that is what is expected.
There is a difference between my amendment and that of Deputy O'Callaghan. My understanding is the figure of 40% included in my amendment and the expenses incurred in promotion and so forth includes the payments that would be made to the charitable organisation on behalf of which the licensee was acting. Perhaps the wording requires work to clarify-----
My amendment is similar, if not identical, to that of Deputy Ó Laoghaire, except for amendment No. 8. As Deputy Ó Laoghaire said, there are organisations which run bingo games for charities. For example, if a GAA club wishes to organise a bingo night event, it will need a certain amount of equipment and technology to run it. The concern is that under the legislation as proposed in the amendment to section 28, it will be precluded from obtaining a licence for the purpose of running this lottery. Our first amendment is to subsection (8) which states: "A person who holds a lottery permit shall not transfer that permit to any other person and any such purported transfer shall be void and of no effect".
What we propose is the insertion of wording to the effect of save where a licensee utilises an agent to conduct a lottery on its behalf. If an applicant which is a charity applies to the District Court for a lottery licence, it cannot then transfer it to somebody else under this legislation, and charities believe that will change the position that operates at present because currently they can be delegated to be run on their behalf. I would be interested to hear what the Minister of State has to say on that. As amendments Nos. 7 and 8 are in this grouping, my amendment No. 8 proposes that "in the case of the lottery conducted by an agent of the licensee [which is what we are discussing here], not more than 25 per cent of the gross proceeds shall be utilised for the expenses of promotion, including commission". Obviously, the legislation can and should place a limit on how much money collected can be used for the profits of an agent running this type of operation. The objective we want is to ensure that most of money will go to the philanthropic and charitable purpose. I await hearing what the Minister of State has to say in respect of this.
We are dealing with amendments Nos. 5 and 6 but reference has also been made to amendments Nos. 7 and 8, although they are not in this grouping. The Minister of State is welcome to reference those or to deal with them separately as they were structured in the grouping list.
I will start by dealing with amendments Nos. 5 and 6, which, as the Chairman said, are related. They concern section 12, which substitutes section 28 of 1956 Act with a new section that sets out the application process for a lottery licensed by the District Court. This section maintains the current maximum prize amount of €30,000. However, it makes provision for a prize fund limit of €360,000 where a once-off annual lottery is promoted under a District Court licence.
The District Court grants a licence to an applicant where the applicant fulfils the conditions laid down in the new section 28. There are significant additional conditions for the prospective licensee to meet. I contend these are necessary and legitimate requirements to ensure the best promotion of the lottery to guard against fraudulent behaviour and to prevent potential criminal behaviour, including money laundering.
Any lottery licensee may appoint an agent or agents to help promote a lottery. This is permitted by the current law and confirmed by court judgment. This does not mean, however, that the licensee can abandon responsibility or control of the lottery to an agent. This would undermine the policy and legislative intention of modernising the provisions on the better promotion of lotteries.
The amendments proposed by Deputies O’Callaghan and Ó Laoghaire would have the effect of allowing the transfer of a lottery licence issued to an applicant by the District Court to an agent to conduct that lottery. No checks or controls on such an agent, as are imposed on the licensee, are proposed in the amendment. There are inherent dangers associated with such an approach. The proposed amendments would appear to arise from representations from some associations which purport to run commercial bingo by acting as agents of lottery licensees. I have also received those representations.
In my view, despite any assertions to the contrary, no pathway was provided in the 1956 Act for commercial bingo as a profit-driven business for agents or operators acting for licensees. I do not propose to accept the amendments along the lines proposed for the reasons I have outlined.
The Minister of State seems to be making the point that if our amendments are allowed, it would mean an agent to whom the licence is transferred would not have to go though the vigorous process that is set out before the District Court. The manner in which we have drafted subsection (8) clearly implies there would be permission to transfer the licence from the applicant to the agent and the agent would then conduct the lottery on its behalf. Is the Minister of State saying that, as matters currently stand, even if a person is not the holder of the licence, he or she can still promote the lottery if that person is an agent?
The current position is that an agent can be appointed but, as the Deputy will have noted from my response, there are inherent dangers and risks around that. The amendment as drafted would allow the transfer of a licence to an agent who had not been through the checks and balances of the court. For example, Deputy O'Callaghan could get a licence and transfer it Deputy Jack Chambers who may or may not be of good character, and he would then operate it and the court would have no way of checking what is happening. That is the reason these serious safeguards are included. If somebody applies as a licensee, they can employ an agent to help them to run the licence, but transferring the licence is a completely different matter.
This is at the heart of the point I want to make. As I understand it, the way the amendments are phrased effectively puts a straight end run around the whole licensing process. It is not that we could see somebody doing this but an organisation or entity which fulfilled the criteria for getting a licence would then be able to transfer it to somebody in respect of which there was no vetting or regulation, which would almost nullify the process if people wanted to use it in a particular way. That is my reservation about these amendments. If there is an opportunity for an organisation to engage in a commercial arrangement with someone to engage in aspects of fulfilling the licence it has been granted, surely that meets the criteria of what people are seeking in this area who would legitimately want to operate it. However, I would have grave reservations about the amendments.
Valid points were made about creating a potential agent who is unknown to the court's process system. What if the wording stated "a named agent"? In that way, there would be a licensee and a named agent as part of that licence which would be transparent rather than giving unlimited control to the licensee to have a potential agent. If a named agent were incorporated through the courts awarding of a licence, it might be preferable.
Is the Minister of State saying this proposal is not necessary and, regardless of the current situation, when this legislation is passed, it will be possible without an amendment of this kind for a bingo hall to run a bingo on behalf of a charitable purpose? Will that continue to be possible?
With respect to Deputy Jack Chambers's question, the amendments serve to transfer the licence to somebody else who is not named and is unknown. If the person is party to the licence initially in the court, for instance, a person may apply to the District Court for a licence authorising the person to promote periodic lotteries in accordance with this Act. That is a different matter.
Would that preclude an agent from applying? If the wording of the proposed new section 28(1) was changed to "A person or their agent may apply to the District Court for a licence", is the Minister of State saying that the charity must apply for the licence? Subsection (3) of that new section provides that regard must be had for the character of the applicant.
If somebody applies as a licensee for a charity or for charitable purposes, he or she can do that and he or she can get an agent to support him or her, but he or she cannot transfer the licence to the agent.
In light of what the Minister of State has said, I will not press my amendment, although I may table an amendment on Report Stage giving entitlement to a person or their agent to make the application and then the District Court would be able to vet the agent.
I draw the Deputy's attention to section 28(3) which reads:
(3) In considering an application under this section for a lottery licence, a judge of the District Court shall have regard to the following: (a) the character of the applicant;
(b) the number of periodical lotteries already in operation in the locality;
(c) the purpose of the lottery.
There are various conditions in the Bill which the court will take into account before granting a licence.
Amendments Nos. 7 and 8 are related and may be discussed together. They have been discussed by both of the Deputies by whom they have been moved. Do they wish to make any further comment, or does the Minister of State wish to reply?
I move amendment No. 7:
In page 14, line 26, to delete “purpose.” and substitute the following:
“purpose;(f) in the case of the lottery conducted by an agent of the licensee, not more than 40 per cent of the gross proceeds shall be utilised for the expenses of promotion, including commission, and any free entry for the lottery shall be deemed to be a payment of commission to the extent of its value.”.
I would like the Minister of State to address the view, whether or not it is correct, that bingo is not attractive unless the prize fund is between 60% and 70%, and it is capped at 50%. That is roughly where the prize funds are. Did the Department consider that?
The amendments are familiar to me as I have had representations on them. I could agree with amendment Deputy O'Callaghan's amendment up to a point but the Bill also pitches an allowable expenses at a maximum of 25% reduced from 40% of total proceeds in the 1956 Act. Critically the Bill also provides for the first time the amount of the total proceeds that must be allocated to prizes, a maximum of 50%, and to the charitable or philanthropic cause a maximum of 25%.
Deputy Ó Laoghaire's amendment No. 7 has the effect of restoring the 40% expenses provision for agents. No guaranteed amount for the good cause of lottery was licenced for or intended to benefit is provided for either of the Deputies proposed amendments. What we are proposing is more positive in that regard.
In all stages of the debates on the Bill so far, no one has opposed the modernisation of the lottery licence application and issue process but it is useful to discuss it. The grant by the court of a lottery licence is a significant matter. The Deputies' amendments would effectively hand over lottery licences to agents who would not have to go through the licence application of the court.
The proposition in the Deputies respective second amendments would only guarantee an agent a fixed proportion of the total lottery proceeds while not giving any mandated return to the charitable or philanthropic organisation cause involved or to the prize fund. The impact would be that we would focus on the takings of an agent when we should focus on the good cause that needs the funds. That is why the amendments are not balanced. The Bill, for the first time, guarantees a maximum of 50% to prizes and 25% must be given to the charity.
I have no way of responding to that. I have no research or evidence as to whether a large pay out is necessary, however the Bill provides for 50% which, I contend, is quite substantial. In the past the agent got 40% and only 60% was left. If that was broken down, one would expect the charity to get a fair amount of that. This Bill reduces the amount the agent or promoter can take and ensuring that the charity gets a maximum of 25%. The rest must go to prizes. If I understand the Deputy correctly, the prizes must be pitched at a certain level in order to attract people to play. In this case 50% is the maximum that can be allocated.
I have a significant reservation on this. Is the Deputy suggesting that 70% or 80% should go on prizes, and that there is also an operator cost built in? The core reason for its existence, namely, that it benefits the organisation with the licence to run it, is almost zero. As good as it might be for those playing, the Deputy is saying that by the time the prizes are given out and the operator gets its cut, the amount given to the charity, must on those figures, be virtually zero or around 5%. If the beneficiary received so little, it would put into question the whole underlying basis of the licence being issued. If people playing the game marketed as operated in support of X or Y, and knew that X or Y only received 5%, we would be on a very dangerous road.
I move amendment No. 9:
In page 20, between lines 13 and 14, to insert the following: “(2) Section 7 of the Betting Act 1931 is amended by the insertion of the following section after section 7E:“Condition attaching to licences issued under the Act of 1931(3) Section 16 of the Betting Act 1931 is amended by the substitution of the following for subsection (2)(b):
7F.(1) This section applies to any bookmaker’s licence, remote bookmaker’s licence and remote betting intermediary’s licence issued under this Act.(2) A licence to which this section applies shall, by virtue of this subsection, be subject to the condition that nothing may be done, either directly or indirectly, in reliance on such licence in relation to any bet on the outcome or results of a lottery game.
(3) Subsection (2) shall apply to all licences, including a licence issued before this section comes into force, with effect from the date on which this section is commenced.
(4) In this section, the term ‘lottery game’ has the meaning given to such term under the National Lottery Act 2013.”.“(b) the holder of a licence under this Act has contravened sections 7D, 7E, 7F or 23.”.”.
The national lottery feeds hundreds of thousands of euro into communities every week, and millions of euro every year. In most countries betting on the national lottery is not allowed. Currently, there are several online ways to speculate or bet on the outcome of the national lottery which is money that could potentially go to the lottery itself. The lottery's own analysis is that it could make a €110 million difference to its good causes fund annually.
This could benefit community organisations, sporting clubs and charitable organisations. It is commonplace in other jurisdictions throughout Europe and the world. Ireland's lack of regulation in this area is unusual as I understand it. I would like to see us working towards some form of consensus in the area. It is an issue that needs to be explored and I will be interested to hear the Minister of State's view on it. It is a significant amount of money that could benefit charitable purposes.
Last year, I introduced the National Lottery (Protection of Central Fund) Bill, the purpose of which was to try to protect the central fund, in particular from offshore online speculators running bets on the outcome of the national lottery. They are perfectly entitled to do so but it is of public concern because when people buy a lottery ticket part of the money goes to the Central Fund, which is for the benefit of the public and we all know of good projects. If we have people drifting away from buying national lottery tickets to betting on the lottery online, they do not contribute to the Central Fund. This was the purpose of the Bill.
The Minister of State dealt with this a little in the Seanad so I will listen to what he has to say. There is a slight difference between Deputy Ó Laoghaire's amendment and mine. I have redefined the outcome of a lottery game so as to not catch those people who are not offshore online operators. Many people are affected by it or present themselves as being affected by it. I will be interested to hear what the Minister of State has to say.
If I may, I would like to seek clarification from the proposers of both amendments. Would the effect of the amendments be such that if my neighbour, who is of pensionable age and likes the odd flutter on a Saturday night, and who might purchase a lottery ticket but also likes to go to the bookies to bet on two or three numbers, be prevented from having that flutter? Would this be the effect of both amendments?
I do not think it is the effect of my amendment because I made a change and redefined the outcome of a lottery game as being the complete amount of numbers drawn in respect of which the top prize is awarded. That person would have to be betting on the six numbers to be prevented.
This is related. The national lottery is now controlled and owned by a Canadian pension fund. Will the Minister of State accept an amendment on Report Stage to ring-fence the unclaimed prizes, which are used for marketing purposes at present, so they go back to public or charitable projects? Will he agree to this amendment? Some of these amendments are about the national lottery wanting to stave off competition from other operators and I am not that bothered by this. I am bothered by the fact the national lottery uses unclaimed prizes to promote itself rather than the money being used for the purposes of charities or proper projects. It is a public issue with regard to the drafting of the Act. Is the Minister of State open to changing this so any unclaimed prize would have to be pooled towards charitable projects or go back to the State rather than being used by the private pension fund to promote its own activity? There is huge public concern about this. Huge amounts of money are being kept by the lottery operator and not going to this particular purpose. It is a separate argument but it relates to lotteries.
There are an awful lot of jobs involved in this. The Minister for Finance has doubled taxation on betting shops. They pay tax and create jobs, particularly in rural areas. There has been betting on the lottery for the past 25 years. It is completely different from the national lottery. Will we start to exclude competition? I come from a business background and competition is good. They are two completely different things and I cannot support Deputy Ó Laoghaire's amendment. We have to be very careful given the number of jobs this involves.
I thank colleagues for their comments and questions. This matter appears to be raised in almost the same terms by both amendments. As has been said, this was discussed extensively in the Seanad. I note the amendments are the same as the text of a Bill submitted by the national lottery to the Department in 2018 and similar to a Bill tabled by Deputy O'Callaghan at the same time.
We spoke to the Office of the Attorney General about this and it is in agreement with the position I set out in some detail in the other House. There is an issue whereby accepting the amendment might lead to further demands from the national lottery, perhaps seeking to prohibit the local lotteries that support sports clubs and community organisations. Many of our sports clubs and community organisations depend on lotteries. We could argue they are in direct competition with the national lottery. A similar argument to that made by the Deputies is that these lotteries for football, rugby, hurling and Tidy Towns also impact on the turnover of the national lottery. It could be argued they have an impact on sales. None of us could agree on doing anything to curtail this activity, which directly benefits local sports clubs and other organisations.
Deputy Chambers mentioned that the national lottery is now a private company. The essence of the amendment seems to be to enhance its position as a private company by seeking to end the possibility of licensed bookmakers, land based and remote, offering bets on the outcome of Irish national lottery draws as they might on any other probability outcomes. Deputy Fitzpatrick made this point. The Deputies' proposals would allow licensed land-based or online bookmakers to offer bets on any other lottery but not the Irish one. Should the Deputies' proposition be accepted, I foresee certain legal uncertainties and potential challenges from licensed bookmakers. I do not think it would achieve what is intended, which is possibly increased sales for the national lottery. For information, the turnover of the national lottery in 2015 was €670 million, in 2016 it was €750 million, in 2017 it was €800 million and in 2018 it was €805 million. There was a 20% increase over four years. This certainly does not suggest much impact since 2015 on the lottery operator arising from the licensing of bets.
The contribution of the national lottery to good causes increased each year. This is to be welcomed, although such contribution is surely critical to having a national lottery in the first place. The turnover is increasing every year and there is no convincing evidence that betting on lottery numbers undermines funding for good causes or that it threatens the profitability of the national lottery operator in the long term. As I said, it is now a private company.
In addition, there is no evidence that I am aware of that betting on lottery numbers leads to a loss of revenue to the Exchequer. Licensed remote bookmakers offering bets on lottery numbers and all licensed Irish betting shops must pay tax on every bet they take. They must pay the current necessary licence fee. Bookmaker shops also contribute to the Exchequer by, as has been said, providing many jobs in towns and villages throughout the country. The product offered in betting shops or online is a bet and not a ticket sale. I understand Irish bookmakers offer bets on one, two, three, four or five numbers being drawn. In terms of cost to customers, bookmakers accept bets of 5 cent and upwards while the national lottery minimum stake is €5 for two lines without the plus option.
Online operators normally offer bets on the outcome of the national lottery, EuroMillions and other lotteries, with players having to choose the corresponding numbers relating to those draws. I have not been provided with any information to suggest that the outcomes of the weekly national lottery draws are exempt from being bet on. Such is the position with football matches and races. I may bet on their outcomes without hindrance by the organisers of the events. I am aware of no argument to suggest the national lottery numbers are afforded some special form of legal or intellectual property protection. In any representations I have received on this matter, the national lottery operator has advanced no such arguments.
As I stated in the Seanad, I have no function in respect of the national lottery as such. Regulation of its licensing is a matter for the Minister for Finance under the National Lottery Act 2013. My Department's role concerning licensed bookmakers under the betting Acts is limited to the provision of certificates of fitness for applicants for bookmakers' licences, remote bookmakers licences and for remote betting intermediaries. The Revenue Commissioners issue licences after that. The Minister for Public Expenditure and Reform did not provide in the National Lottery Act for any prohibition on licensed bookmakers offering bets on the outcome of the national lottery draws on Wednesdays and Saturdays, nor did the Minister for Finance address this point during the preparation of the Betting (Amendment) Act 2015. To the best of my knowledge, there are no conditions or prohibitions imposed in the Betting Acts 1931 to 2015 in respect of the nature and extent of the bets that licensed bookmakers, land-based or remote, might offer. I am sorry for going on a bit but I feel we must ventilate this.
Deputy Jack Chambers asked about unclaimed winnings. While I agree with the sentiment he expressed, this is a matter for the Minister for Public Expenditure and Reform to deal with it.
I know. I will pretend that it was not parties in here which supported it. There are parties here that opposed it. The decision was a bad one. The company cannot be treated as any other private company because there is a good causes fund from which the public benefits. It is in the public interest that the fund remain at a high level. It is also in the public interest to renew the licence at some stage, potentially involving some other company. In the meantime, we want a healthy fund and as many clubs as possible to benefit. That is a reasonable public objective. I would not have chosen the private company route but that is how matters stand.
I listened to what the Minister of State said. Some of the provisions are technical but, on the principal point, it is increasingly the case that very many people are using online companies to bet on the lotto. There are other elements also, involving bookmakers and all the rest of it, but the question of catching the first element is the difficulty in drafting the Bill as a whole. A very substantial sum is potentially being lost out on. Most European jurisdictions protect their national lotteries and the funds that emanate from them. Could the Minister of state offer a comment on that or clarify matters? The current position might be healthy but if the drift continues in the direction of commercially operated lotteries with no public benefit, then the national lottery will be undermined. Nobody wants to go near a lottery of Bride Rovers or Terenure Tidy Towns, for example, and that is not proposed in this amendment. The Minister of State can speculate on what might happen in the future but it is not anticipated in this amendment. This amendment will not do what he describes.
Although the company is private, we have tabled the amendment because there is a central fund established in legislation. The national lottery is established under legislation so it is different from a private enterprise. There are moneys for the benefit of the public. As a result of what Deputy Sherlock stated about people betting on a couple of numbers, I am conscious that the amendment, as drafted, may go a bit further than anticipated. I tried to limit it a little in order that it would not cover such situations. The matter is complicated. We have had a fairly consensual meeting here. I might return to this amendment on Report Stage rather than pressing it now. I do not know whether I will necessarily win the argument in any event. The Government should, however, seek to determine what it can do to protect the Central Fund. The Minister of State gave statistics indicating the lottery is doing very well but we know from other jurisdictions that a lottery can be undermined by very effective offshore operators. We need to ensure that we do not permit this. If it happens, it will be too late to start introducing legislative measures to try to protect the national lottery. The harm will have been done. The Minister of State should give greater recognition to the need to protect the Central Fund.
Before Report Stage, could the Minister of State provide statistics on the opportunity cost of the facility to bet on the Lotto numbers in a bookmaker's? Determining the cost is quite difficult, and possibly insurmountable — I do not know. One would have to go into every single bookmaker's shop in the country and seek to measure the revenue arising from bets on the Lotto numbers on Wednesday and Saturday nights. I am not sure how feasible that is. The Minister of State might have a response to my remark nonetheless.
In fairness to the Minister of State, he has already provided some statistics. He gave a figure of €670 million for 2015. In 2018, it was €802 million. That is an increase of €132 million in a short period, which is great. The Irish betting shops have been doing this lottery for the past 25 years. Many people are dependent on the shops for jobs. Are we actually thinking about what we are doing? Next we will be chasing the GAA clubs and Tidy Towns committees. It is all right stating it will not happen but that is the way things go. Suddenly, there could be a drive to get rid of betting shops or Internet betting. The next thing, charities would be the focus. It is wrong. The betting shops are paying their taxes. The tax was increased by 100% recently. There is an anti-betting shop trend. I have met people involved in the industry, especially in my county, Louth. What is being proposed would be a bad influence.
I do not see the logic of the provision at all. I do not gamble at all so I may not understand the associated mentality. Surely if somebody wants to have a bet on the generation of six random numbers, his or her convenience point comprises the Irish lotto numbers. If we say he or she cannot bet on the lotto, the most likely next course of action will be to bet on the generation of six random numbers in, say, the UK lotto, rather than change over and make a decision to buy a lottery ticket. Therefore, I cannot see the purpose of the amendments. I do not see what they will achieve at all. I do not even believe that, if accepted, they would protect the fund or increase the profitability of the national lottery. It is so marginal that the gamblers will just switch over to betting on something different. Six numbers are six numbers.
I agree with Deputy Ó Laoghaire in that the sale of the national lottery was a mistake. That it is owned by a Canadian pension fund demonstrates the difficulty. My issue is not with what has been specifically submitted through these amendments. As mentioned, €16 million that was inherited by the private operator from An Post was meant to go into the public fund for charitable causes but is instead being used by the private operator to promote itself. It is also claiming unclaimed prizes in order to promote itself.
I take the point made regarding turnover, but I do not have much sympathy for either of the amendments. Would the Minister accept an amendment to mandate the operator to ring-fence unclaimed prizes for public causes? Neither the regulator nor the Minister for Public Expenditure and Reform, Deputy Donohoe, are dealing with it and this might be an opportunity to do so. It seems that nobody is willing to provide better oversight. There are millions of euro at stake which could be allocated to good causes but are being hoovered up by the operator because of the ambiguity of our current legislative position. I raise this issue now because we need to deal with the fact that the operator inherited €16 million of public money and is able to use it to promote itself, which is shocking. This is a good opportunity to deal with it.
On the final issue raised by Deputy Chambers, I have much sympathy for the points made in this regard. I will communicate them to the Minister for Finance and Public Expenditure and Reform, under whose remit the national lottery falls. I am slow to stand on his toes at this stage, but I will bring the Deputy's points to his attention and ask him to consider them in his overall view. The Deputy's proposal is not in line with the intention of the Bill, which is to do with gambling rather than unclaimed prizes in the national lottery, but I will raise the issue with the Minister.
The 2014-15 survey of gambling prevalence published in February of this year by the Department of Health indicates that the most prevalent forms of gambling engaged in were games associated with the national lottery. The operator has quite an aggressive ongoing advertising campaign and I have certain issues with some of the messages portrayed, such as winning islands and so on, which glamorise gambling. As I stated, turnover has increased every year. The betting on lottery numbers with other betting providers is not impacting on the turnover of the national lottery. In fact, it is going the other way.
I am taken by Deputy Sherlock's comment that the impact of these amendments would be to prevent people having a flutter on the numbers on a Saturday night or a Wednesday. The citizen who wants to have a small bet on the outcome would no longer be permitted to do so under the amendments. We would curtail that freedom and those placing such bets would move elsewhere. The amendments would not have the desired impact except in terms of taking away the freedom of our citizens to have a small flutter, to use Deputy Sherlock's words, on the outcome of the lotto. If we pass the amendments, those are the people who would be affected. It would not make any difference to the turnover of the national lottery. There is no guarantee that people who currently bet on the national lottery numbers would not decide to bet on something else instead. The amendments would not have the desired effect.
I will draft an amendment to address the issue I raised. My proposal has received the widespread support of the House. There is an abuse of the licence by the current private operator. All members agree that it is exploiting the loophole of unclaimed prizes and I intend to draft an amendment to deal with the issue. It falls within the general remit of the forthcoming courts and civil law (miscellaneous provisions) Bill which is so broad and all encompassing in draft form that my proposal could be included. It is time that we addressed this issue. I do not have any sympathy for the pensioners in Canada and what they are getting out of the Irish lottery system. We need to narrow the interpretation in respect of what unclaimed prizes may be retained.
It seems unlikely that an amendment such as my amendment No. 9 would not benefit the national lottery, given the sums involved in betting on its numbers, primarily through online operations. A significant number of companies are making big money out of betting on the Irish and various other lotteries. My understanding is that most European jurisdictions have legislation to protect their lottery. Is that the case? If it is, how is it done?
We have chosen not to go down that route for the reason I outlined. Not every country has such legislation. Some countries have different reasons for doing different things. I outlined why our citizens should be free to place small bets on the outcome of the lotto.
All licensed remote bookmakers and betting shops must pay tax on each bet they take as well as paying the current licence fee. The Exchequer gains from people placing bets on lottery numbers and we must bear that in mind. Bookmakers provide jobs in towns and villages across Ireland and are worried about the sustainability of those jobs if the amendments are passed.
I move amendment No. 10:
In page 20, between lines 13 and 14, to insert the following: “(2) Section 7 of the Betting Act 1931 is amended in subsection 7 by the insertion of the following section after section 7E:“Condition attaching to licences issued under the Act of 1931(3) Section 16 of the Betting Act 1931 is amended by the substitution of the following for subsection (2)(b):7F.(1) This section applies to any bookmaker’s licence, remote bookmaker’s licence and remote betting intermediary’s licence issued under this Act but shall not apply to any lottery licence granted by the District Court under section 28 of the Principal Act or to any lottery permit issued by a Superintendent of An Garda Síochána pursuant to section 27 of the Principal Act.
(2) A licence to which this section applies shall, by virtue of this subsection, be subject to the condition that nothing may be done, either directly or indirectly, in reliance on such licence in relation to any bet on the outcome of a lottery game.
(3) Subsection (2) shall apply to all licences, including a licence issued before this section comes into force, with effect from the date on which this section is commenced.
(4) In this section the term—
‘lottery game’ has the meaning given to such term under the National Lottery Act 2013;
‘outcome of a lottery game’ is defined as the complete amount of numbers drawn, in respect of which the top prize is awarded.”.“(b) the holder of a licence under this Act has contravened sections 7D, 7E, 7F or 23.”.”.
I move amendment No. 11:
In page 20, between lines 13 and 14, to insert the following: “Reports of Minister27.(1) The Minister for Justice and Equality shall, not later than 3 months after the commencement of this Act, seek a report regarding the prevalence of gambling on an all-island basis.(2) The Minister for Justice and Equality shall, not later than 2 years after the commencement of this Act, cause a report to be prepared on the operation of the Act and shall cause copies of the report to be laid before each House of the Oireachtas.”.
I had forgotten that I had tabled this amendment. It is very straightforward. I raised the point on Second Stage that we are limited in terms of our data in this jurisdiction. Some of the data seem to be at odds with those in neighbouring jurisdictions such as the North and Britain. We need a report such as that proposed by the amendment. It would inform policy and would need to be of very high quality. That is the purpose of the amendment. I would like the Minister to seek such a report.
There are two elements to the amendment. Subsection (1) states: "The Minister for Justice and Equality shall, not later than 3 months after the commencement of this Act, seek a report regarding the prevalence of gambling on an all-island basis." Subsection (2) states: "The Minister for Justice and Equality shall, not later than 2 years after the commencement of this Act, cause a report to be prepared on the operation of the Act and shall cause copies of the report to be laid before each House of the Oireachtas." The issue raised in subsection (1) of the amendment was also raised in the Seanad, as I am sure members are aware. It regards the prevalence of gambling in general rather than solely problem gambling. I share with the Deputy and other members of the committee deep concerns regarding how we can best address the issues of harmful gambling which affect the lives of persons so addicted, their families and wider society. We are at one in that regard.
I always place our approach on this matter in a healthcare context and as being for the attention of relevant qualified professionals. We must be careful not to come to the view or let others think that if we set up our gambling regulator, that will assist problem gambling to a significant extent. If a person has an addiction, it is a health issue and we must focus on it from that point of view. A regulator will only go so far. If a person has an addiction, no amount of regulation will help; rather, he or she needs treatment. I agree that we must seek to better understand the issues involved and obtain credible evidence on the nature and extent of the problems arising. As stated by colleagues, gambling is complex and increasingly taking place in an online environment. It is a matter for the Department of Health. Obviously, it is not within my remit to carry out a report on the prevalence of gambling in Northern Ireland. That should go without saying.
The drug prevalence survey for 2014-15 published on 27 February 2019 by my colleague, the Minister for State with responsibility for health promotion and the national drug strategy, Deputy Catherine Byrne, contained the first set of data on the extent of gambling in Ireland and Northern Ireland. The data are based on fieldwork carried out between August 2014 and August 2015. This general population survey of more than 7,000 persons was a collaborative project between the National Advisory Committee on Drugs and Alcohol and colleagues in the public information and health research branch of the Department of Health in Northern Ireland.
Ipsos MRBI carried out the field work and my Department contributed to the cost of the survey. While I accept that the survey is perhaps a little dated now, it provides a baseline of data to assist in policy formulation and future planning and action on gambling. The survey found that the prevalence of problem gambling in the general population was 0.8%. Problem gambling is most common in young males, at 1.9% among males aged 18 to 24 and 2.9% among males aged 25 to 34. The Health Research Board is now undertaking a prevalence study for 2018 and 2019. This will further assist in policy formulation, planning and action in this area. Results are expected in 2020. This survey will contain a specific section on gambling prevalence with an extended range of questions. My Department is contributing to the costs of that survey.
While I welcome the concerns that motivate the proposed amendment, I believe that the Government is addressing those concerns through the large-scale professional work by the Health Research Board which is now under way. We should await those results. I do not think there is any point in duplicating it. The first part of the Deputy's proposal risks imposing a significant cost on the Exchequer. As we are doing it already, I do not see any reason why we should do it twice. The second part of the proposal seeks to impose a requirement to carry out a two-year review of the operation of the Act. This period is one normally found in legislation. My Department will review the provisions of the amended Gaming and Lotteries Act as we work to bring forward proposals for the comprehensive reform of licensing and regulation of gambling in Ireland. I do not see any particular need to impose this review provision. I hope that comprehensive legislative proposals for reform will be published in this period. We are doing substantial work in tandem with this. I ask the Deputy to consider withdrawing the amendment because this is only an interim measure. I want to have the limited resources that we have focused on getting the regulator established and the larger Bill drafted and enacted. If we were to take resources away to do a review of this Act while doing the other at the same time, it may be counterproductive. I can see the intention of the Deputy's amendment but I think it will happen anyway as we work on the larger Bill.
We have to be careful. I have raised the issue of gambling addiction with the Minister of State, Deputy Catherine Byrne. The Department of Health has no interest in dealing with this issue. The Department of Justice and Equality can keep deflecting from gambling addiction but the Department of Health and the HSE have no interest in doing anything for anyone with a gambling addiction. If one talks to any front-line health professional, there is no support at all for people with an addiction related to gambling. As someone who is preparing to regulate the industry and potentially impose levies on it and provide a social fund for it, I think the Minister of State is obliged to front up on the healthcare aspects of this. We are all fed up with hearing the old Whitehall model of excuse, that it is a different Department's responsibility. We hear about interdepartmental collaboration and cross-departmental engagement in respect of climate change in particular. The Minister of State should take the lead on the addiction issue because the Department of Health has no interest. It has not implemented Crystal Fulton's recommendation on a gambling addiction strategy. I do not believe that the health system will provide for those with a gambling addiction in the short to medium term. It is an opportunity for the Department of Justice and Equality to do something. Perhaps it could develop a private pathway for those with a specific addiction. It is not good enough to keep deflecting to the Department of Health because, as the Minister of State knows as well as I do, it will not do anything about the problem. We have to flag that now because if any of us are here in years to come, the Department of Health will have done nothing about this. Together with my former colleagues, Mick Wallace and Clare Daly, I submitted parliamentary questions on it to which the Department did not even respond. We need to see more from the Minister of State and his Department, which is trying to do something about it. I support the amendments from Deputy Ó Laoghaire because if it gets the Department to start fronting up, that may be good for people in future.
I take on board what the Minister of State has said about the amendments and that work is ongoing on the other Bill, such that there is no need to proceed with these amendments because there is a duplication of work. I take it from that that this provision will be included in the new Bill. The Minister of State said he is doing that work for the next Bill and does not want to duplicate it here. Therefore, he would have no problem with this amendment if it was in the next Bill.
I thank the Minister of State. It is my first time being on this committee. It is interesting to listen to the discussion. With regard to that review, I hope that Deputy Ó Laoghaire would push it or, if not, that we would come back to it on Report Stage. I think it is essential to have a review clause in all legislation. I hear what the Minister of State said, as my colleague has said, that this is interim legislation and that he will come back to address the area again. I echo what Deputy Pringle just said. Is the Minister of State against the idea of a review in principle? I understand that he is saying this is interim, so there is no need for it. We asked for a review of the Parole Bill and the Minister said no. Standing Order 164A was quoted, stating that reviews take place anyway. That review is extremely limited. There is an attitude among various Departments that a review is not necessary because it is an extra burden on the Department. It seems to me that it is an essential part of any legislation if we are genuinely interested in effecting change although I understand the caution if this is interim legislation.
On the issue of gambling addiction, research and treatment, the Department of Justice and Equality does not have the health expertise to deal with treatment. As Deputy Jack Chambers alluded to, we have stepped up by providing funding for research to find out what the issue is. As colleagues know, this Department has as much legislation as the next five Departments put together. We do not, nor should we have the expertise to deal with treatment. The main legislation which we are working on will provide for a social fund. There will be levies on the industry, which will be made available for treatment, research, education, raising awareness and so on. When it comes to treating people who have an illness, I respectfully suggest that this is not the remit of the Department of Justice and Equality but of the Department of Health. I cannot agree with the Deputy that the Department of Health is not interested. I know that my colleague, the Minister of State, Deputy Catherine Byrne, is very interested in addiction services and is doing much work in that area, bringing forward some very innovative and radical proposals on addiction.
With respect to the first amendment proposed, we are carrying out research on drug prevalence under the Health Research Board. I agree with Deputy Connolly that legislation should be reviewed to see how effective it is. This is a small Bill. It updates an existing 1956 Act. It does not do anything major. We are undertaking major reform in this area and that is the legislation which should be reviewed after it is published. This is a small, interim Bill and it does not do much at the end of the day, though what it does is important. There will not be much to review. We will have to come back to what changing the stakes and prizes will mean. We are saying that people under 18 cannot place bets. There are other conditions too, as the Deputy has seen here.
There is not a great deal to review there. I want to focus on the main legislation. To answer the Deputy's question, I agree that legislation should be reviewed but primarily major Acts that have a significant impact. This legislation is interim and while it is important, it will not make a major difference.
I will be anxious to ensure that the next Bill, which will establish a regulator and add many more conditions in respect of gambling, will be reviewed after an appropriate period. The period, be it two, three or five years, is to be decided. Whoever is here at the time can decide on it.
I was not aware of ongoing gambling prevalence studies. Could the Minister of State keep the House updated on this? I am willing to withdraw my amendment. If there is to be a review mechanism in the Gambling Control Bill, when it comes, it should take account of the Bill before us also. I acknowledge it is an interim measure. There is an element of licensing and so on involved in this. This needs to be kept under review, but as part of a broader review of the gambling Acts. That is for future reference.