I beg to move,
That this Committee has considered the draft Casinos (Gaming Machines and Mandatory Conditions) Regulations 2025.
It is a pleasure to serve under your chairship, Mrs Hobhouse. I am pleased to be speaking to these regulations, which were laid before the House, in draft, on 12 May 2025, and to be talking about this package of measures that will unlock additional investment up and down the country. I will set out the aims of this package, including the linked statutory instruments, how they will benefit the casino sector and what protections will be in place for consumers.
I begin by drawing the Committee’s attention to other linked statutory instruments that have been published in draft in parallel to the regulations being debated today. The other instruments are the Gambling Act 2005 (Commencement No. 6 and Transitional Provisions) (Amendment) Order and the Gambling Act 2005 (Premises Licences and Provisional Statements) (Amendment) (England and Wales) Regulations. The Commencement No. 6 and Transitional Provisions Order extends existing gaming machine entitlements for converted casinos, meaning those not licensed under the Gambling Act 2005. The regulations that we are debating introduce protections for converted casinos as a result of the extended entitlements and are consistent with the protections provided to casinos established under the 2005 Act.
The Premises Licences and Provisional Statements Regulations amend existing procedures so that a converted casino operator can apply to its licensing authority, usually its local authority, to vary its premises licence to enable it to exercise the extended entitlement. Together, these three statutory instruments will make a number of important changes to the legislative framework for land-based casinos.
While only one of these instruments is being debated today, the other two will follow the negative procedure and were published in draft on 12 May, the same day on which the regulations that we are debating were laid. Given the linkages between these regulations, that was done to provide proper transparency about the range of changes that we are proposing, and to allow for proper scrutiny. If the regulations that have been laid using the affirmative procedure are approved by Parliament, it is our intention to lay the remaining two instruments using the negative procedure so that all three would then come into force on the same day, 22 July 2025.
I now move on to our aims for these measures. The Government are focused on economic growth, and I believe that enabling a responsible gambling sector to grow is compatible with an even safer one. We acknowledge the difficulties that land-based gambling businesses, particularly casinos, have faced since the pandemic. We have already brought forward measures to improve consumer protections, including the introduction of stake limits for online slot games and establishing a statutory levy on gambling operators to fund research, prevention and treatment of gambling-related harm. Therefore, following a consideration of the best available evidence, the time is right now to proceed with a series of reforms for the land-based casino sector.
The gambling landscape has significantly changed since the legislative framework was updated under the Gambling Act 2005. It had not envisaged the rise of online gambling and the unlimited availability of gambling at any time. Given the rise of smartphones, we believe that restrictions on product availability in casinos are now less important for protecting customers than factors such as the product design and quality of monitoring. Casinos are an important part of our late-night economy, provide thousands of jobs and contribute millions of pounds every year to the UK’s tourism economy, but they have been stifled by excessively strict regulations that mean the vast majority of our casinos can offer only 20 gaming machines. That makes no sense in venues that can be thousands of square metres in size and accommodate thousands of people.
While these venues offer a variety of ways to entertain their customers, including bars, restaurants and table games, the current rules mean that people are queueing for machines at peak times, which can mean that customers extend gambling sessions out of fear of losing their place at machines, and casinos miss out on vital revenue. These restrictions, combined with a variety of headwinds for businesses, most notably the pandemic, have seen 17 casinos close since 2020 and a loss of over 750 jobs.
This package of measures will put the casino sector back on a sustainable footing. It will give converted casinos the option of increasing their gaming machine allowance from 20 to 80, if they are sufficiently large. That will align with the different licensing regimes, as small 2005 Act casinos are already allowed to offer 80 machines. For converted casinos that are not able to meet the size requirements to site 80 machines, a sliding scale will apply in line with their size. This will allow slightly smaller casinos to site between 25 and 75 machines in total.
We are already making changes to allow real event or sports betting to take place in all converted casinos. The current rules prohibit these casinos from offering that, whereas venues licensed under the 2005 Act are able to. The prohibition no longer makes any sense, because a casino customer can place a bet on their mobile phone while in the venue, but not with the casino itself. The change will allow converted casinos not only to offer a new gambling product, but to invest in other parts of their venues, such as sports bars, which would be a natural companion to a betting offer.
As the impact assessment sets out, we estimate that allowing a modest increase in gaming machines will make a significant difference for casino operators. We estimate that the changes will increase gross gambling yield by £53 million to £58 million each year once the new rules have bedded in. We also expect much wider benefits across the casino ecosystem. The new rules will provide a boost for gaming machine manufacturers, and we expect a number of venues to be modernised and refreshed. We also anticipate that this capital investment will be spread across the country, not just in London.
It is also important to outline the protections that will accompany any increases in gaming machines under the draft regulations. As I have said, the Government believe that a growing gambling sector is compatible with creating an even safer one. The draft regulations therefore set out a number of requirements concerning table gambling and non-gambling areas, which casinos will have to abide by to access the new entitlement. They are vital to ensuring that customers are offered a mixture of gambling and non-gambling opportunities when they visit a casino.
The strict requirements on how much space can be allocated to each activity mean that, even with an increase in the number of machines, casinos and their customers will not be overwhelmed by an electronic offering. It also means that table games, which are more sociable in nature, and spaces for bars, restaurants and other non-gambling activities will be continue to be central features of our modern casinos. That approach is fundamental to protecting customers and ensuring that casinos provide a wide range of entertainment.
We will also put protections in place for casinos that decide to offer betting. We will restrict the number of separate betting positions or self-service betting terminals that casinos can offer. Casinos licensed under the 2005 Act are limited to a maximum of 40 separate betting positions. We believe that a limit of 40 betting positions is appropriate for casinos with a gambling area of 500 square metres or more, and a lower limit will apply for smaller casinos. That will ensure that there remains a link between gambling space and betting terminals, so that the electronic offering in a casino does not overwhelm the live table offering.
These changes are in addition to the range of measures already in place in casinos. These venues offer substantial supervision and oversight of any player’s activity. A number of features on the machines themselves can also help players to keep track of their play and spending. I also highlight that it will be completely optional for casinos to take up the new entitlements. Operators can choose to stay within their existing allowances or seek to increase the number of machines that they offer.
In addition to the changes for converted casinos, I would like to mention the two changes that the instrument will make to small 2005 Act casinos. Small 2005 Act casinos are currently required to comply with a maximum machine to table ratio of 2:1. That means that for every table that is in use, the casino is permitted to offer a maximum of two gaming machines. This ratio will be updated from 2:1 to 5:1, in order to align small 2005 Act casinos with large 2005 Act casinos and prevent operators from having to provide tables for which there is no customer demand. Small 2005 Act casinos are also currently required to have a minimum table gaming area of 500 square metres. That will change to 250 square metres, amending an anomaly whereby the minimum gambling area and minimum table gaming area were required to be of the same size.
This is a sensible package of measures that will update the outdated restrictions that currently apply to land-based casinos. It strikes the right balance between supporting the sector to grow and ensuring that those who visit such venues will be protected from gambling-related harm. I commend the draft regulations to the Committee.