Orders of the Day — Gambling Bill

House of Commons, 24 January 2005.

Clause 7 — Casino

Don Foster (Liberal Democrat, Bath)

I beg to move amendment No. 102, in clause 7, page 4, line 2, at end insert—

'(2A) In this Act "casino premises" means premises in respect of which a casino premises licence has been granted under section 146(1)(a).'.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this it will be convenient to discuss the following: amendment No. 101, in page 4, line 8, after 'of', insert 'casino'.

Amendment No. 96, in page 4, line 14, leave out paragraph (a).

Amendment No. 100, in page 4, line 17, leave out paragraph (d) and insert—

'(d) sub-small casinos previously licensed under the Gaming Act 1968.'.

Government amendments Nos. 2 and 8.

Amendment No. 93, in page 37, line 23, leave out Clause 85.

Amendment No. 97, in page 38, line 43, clause 88, at end add—

'(3) A casino operating licence may be subject to a condition imposed by virtue of section 73 or 75 specifying rules relating to—

(a) opening hours,

(b) smoke-free areas, and

(c) alcohol-free areas.'.

Amendment No. 103, in page 72, line 35, clause 161, at end insert

'or not to issue more than a specified number of such licences.'.

Amendment No. 104, in page 72, line 37, at end insert

'and in particular may take account of the likely social impact of permitting casinos or more than a specified number of casinos to operate in its area.'.

Amendment No. 105, in page 72, line 38, at end insert—

'(za) must specify the maximum number (if any) of casino premises licences that the authority is willing to issue.'.

Amendment No. 116, in page 73, line 29, clause 162, at end insert—

'(4) Each casino premises licence shall by virtue of this subsection be subject to the mandatory conditions that the licensee—

(a) shall not operate gaming tables or gaming machines of Categories A or B outside a designated gaming area prescribed in relation to the relevant casino premises under section 147.

(b) shall not permit any person other than the licensee or a person employed by the licensee to perform any function within the casino to enter a designated gaming area whilst the same is being used in reliance of the casino premises licence without the production at the entrance thereto of satisfactory evidence of identity; and

(c) shall maintain a condition of door supervision in respect of the designated gaming area at all times whilst the same is being used in reliance of the casino premises licence; and

(5) Regulations under this section may, in particular, add or exclude gaming machines of a particular category or categories from gaming machines which are the subject of subsection (4) of this section provided that such regulations shall not permit gaming machines of Category A to be so excluded.

(6) In subsection (4) "satisfactory evidence of identity" means evidence which is reasonably capable of establishing (and does in fact establish to the satisfaction of the person who obtains it) (a) the name, address and a photographic likeness of the person producing the evidence, (b) establishing that such person is over the age of 18 years on each occasion that satisfactory evidence of identity is required to be produced under this Act (including the proffering on a second or subsequent occasion of entry of a card or token issued to them by the licensee of the casino premises) for the purpose of verifying the identity of such person by reference to a photographic image.

(7) For the purposes of subsection (6) a photographic image may be an image stored (a) visually or electronically upon the card or (b) upon a system maintained by the licensee of the premises for such a purpose.'.

Government amendment No. 13.

New clause 7—Membership role—

'(1) No premises licence shall be granted if conditions are not in place for the effect that no person shall participate in gaming or gambling in casinos unless either—

(a) he is a member of the casino specified in the licence who, at the time when he begins to take part in the gaming, or gambling, is eligible to take part in it, or

(b) he is a bona fide guest of a person who is a member of that casino and who, at the time when the guest begins to take part in the gaming, or gambling, is eligible to take part in it.

(2) For the purposes of subsection (1) a member of the casino specified in the licence is eligible to take part in gaming or gambling at any particular time if he was admitted to membership of the casino in pursuance of an application in writing—

(a) made by him in person or on the premises, or

(b) sent by him to those premises and at that time at least 24 hours have elapsed since his application was made or received there.'.

New clause 11—Going equipped to cheat—

'(1) A person commits an offence if, without reasonable excuse (the burden of proof of which shall lie upon him), he has with him in a casino any article that is capable of or is intended for recording, analysing or predicting—

(a) the outcome of a game;

(b) any cards played or to be played in a game;

(c) the probability of the occurrence of an event relating to a game; or

(d) the strategy for playing a game.

(2) The provisions of subsection (1) shall not apply to any article which is used for making a handwritten record in respect of a game.'.

New clause 13—Gaming machines in established casinos—

'(1) A casino premises licence for an established casino shall, by virtue of this section, authorise the holder to make gaming machines available for use on the premises provided that—

(a) each gaming machine is of Category A, B, C or D; and

(b) the number of Category A gaming machines is not more than one-fifth of the total number of gaming machines of any Category made available for use on the premises.

(2) In subsection (1) references to a casino premises licence include any licence for an established casino which, by virtue of Schedule 18 or anything done under it, is treated as if it was a casino premises licence issued under section 169.

(3) In this section "established casino" means any casino premises which are in use or could lawfully be used for the operation of a casino under section 1 of the Gaming Act 1968.'.

Amendment No. 117, in page 65, line 36, clause 147, at end insert

'and

(i) specify an area (being all or part of the casino premises) for the purposes of section 162(4) in relation to those casino premises ("a designated gaming area") and identify the same upon or by reference to the plan to be included under paragraph (g) above.'.

Amendment No. 143, in page 77, line 2, clause 170, leave out 'eight' and insert 'four'.

Amendment No. 141, in page 77, line 3, after 'casinos', insert 'subject to subsection (3A)'.

Amendment No. 142, in page 77, line 7, at end insert—

'"(3A) In calculating for the purpose of subsection (1) the number of casino premises licences which have effect at any time, no account shall be taken of any established casino but—

(a) an established casino which meets the requirements of regulations made under section 7(5) as to the classification of large casinos shall for the purposes of section 167 be treated as if it is a large casino;

(b) an established casino which meets the requirements of regulations made under section 7(5) as to the classification of small casinos shall for the purposes of section 167 be treated as if it is a small casino; and

(c) an established casino which is below the minimum size for a licensed casino shall for the purposes of section 167 be treated as if it is a small casino.

(3B) In this section 'established casino' means any casino premises which are in use for the operation of a casino under the Gaming Act 1968 when this part of this Act comes into force.".'.

Amendment No. 119, in page 77, line 30, at end insert

'provided that no order under this section shall be made until the expiration of a period of five years after the granting of the eighth casino premises licence under subsection (1).'.

Government amendment No. 29.

Don Foster (Liberal Democrat, Bath)

The time it has just taken you, Madam Deputy Speaker, to read out the amendments in this first group reinforces the manner in which our proceedings will be dealt with.

Amendment No. 102 has been tabled in my name and that of the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) and others. The genesis of the Bill goes back to the Budd report of 2001, and it is worth reflecting that, in the early stages of his work, Sir Alan Budd sent a note to members of his committee that included a paragraph entitled "The Chairman's Dream", which optimistically stated:

"I hope we shall be able to establish principles which are acceptable to all sensible people and shall make proposals consistent with those principles. The (unanimous) report will then be published (to schedule) to widespread acclaim and all its recommendations will be accepted."

I suspect that Sir Alan and members of his committee will be bitterly disappointed that, following his report, as well as two detailed reports from the Joint Committee of both Houses of Parliament and endless discussions in Standing Committee, we are still a long way from achieving "widespread acclaim" for the Government's Gambling Bill. As you have just demonstrated, Madam Deputy Speaker, the Bill is characterised by innumerable amendments, many of which have been tabled by the Government. As we can see from the amendment paper, many more have still to be debated.

This first group of amendments deals with the important issue of casinos, and it is worth reflecting on the fact that there has been much support from all sides for the Bill's provisions, including the establishment of a new tough, independent regulator through the creation of the gambling commission, which will replace the Gaming Board. We understand from a press notice today that the new body is likely to be located in Birmingham. The measures to increase requirements in respect of social responsibility for all involved in the gambling industry, and to bring remote gambling—interactive television and internet gambling, for example—under regulation for the first time have also received support. Many hon. Members were delighted when the Secretary of State announced on Second Reading that casinos would be designated as a single-use category under planning regulations, although I hope that the Minister for Sport and Tourism will tell us when we can expect to hear more about that.

The Minister has often claimed, perhaps rightly, that as much as 90 per cent. of the Bill has the support of hon. Members on both sides of the House, but it is the issue of casinos that causes the greatest controversy. The Government's proposals on casinos came as a huge shock to many members of the public and many Members of the House. They simply could not understand why a Labour Government wanted to increase greatly the opportunities for gambling, and, in particular, launch a massive growth in the number of casinos, when, bizarrely, no member of the Government could even tell us with certainty how many casinos currently exist.

In particular, many of us simply could not reconcile the Government's initial plans to allow the unlimited introduction of new super-casinos, each of them having up to 1,250 new so-called category A machines—which are untried in this country—with unlimited stakes and prizes, with the statement made by the Secretary of State to the Joint Committee that,

"If this legislation gave rise to an increase in problem gambling then it would have failed and it would be bad legislation".

Stung by the criticism, the Government backed down and made a welcome U-turn—not all U-turns are bad—for which there was a great deal of support. The Government then told us, despite having told us previously that they thought that it was a bad idea, that they intended to cap the number of new regional super-casinos at eight. The Committee was much amused by the musings of the hon. Member for West Ham (Mr. Banks) on why the figure of eight had been chosen. He wondered, for instance, whether it was related to the atomic number of oxygen being eight, or whether it had some connection with the Buddhist eightfold path to enlightenment. Whatever the reason, however, the cap was a good idea. I note that there is an amendment in this group to reduce that number from eight to four. I want to make it clear that we will not support that amendment if a vote is called on it.

Perhaps more surprising, however, was the Government's announcement that it would also cap the number of new large and small casinos at eight. That now means caps of eight, eight and eight, which is remarkably reminiscent of the internet gambling site www.888.com. There are arguments for a cap on the number of large and small casinos if, crucially, that does not unduly prejudice the existing British casino industry. That is why amendments Nos. 141 and 142 are crucial, and why, if there is a vote on them, we will support them. After all, the British casino industry has an enviable record of being responsible and free of crime. It would be a huge mistake were we to allow the Bill to pass without ensuring that our industry is given a fair chance against the foreign competitors who are already at our door, seeking to pick up the spoils that the Bill creates. As the Bill stands, the indigenous industry could lose out significantly. If the hon. Member for Maldon and East Chelmsford catches your eye, Madam Deputy Speaker, I hope that he will explain in detail the nature of that threat and the solution to it.

I want to give one example of why, unless we guarantee both grandfather rights and the right to allow some trading up as proposed in those amendments, we could see many existing casinos lose some of their machines, while new casinos will be allowed a far greater number. At present, existing casinos are allowed 10 machines. They also have a number of electronic roulette or auto-roulette devices. A Bournemouth casino, for example, has 26 such devices, one in Birmingham has 38, and many others have 10 or more. In part 10 of the Bill, however, those devices are redefined as machines. Therefore, since casinos will only be allowed a total of 10 machines, unless we provide grandfather rights and the right to trade up, as proposed in amendments Nos. 141 and 142, every existing casino would see a reduction in the number of their current machines.

On amendments Nos. 102, 100, 101, 116 and 117, removing restrictions on casinos has been a key focus of this Bill since its inception. It proposes the removal of the 24-hour rule and membership of casinos. Following those relaxations, identification is no longer necessary for someone to enter a casino.

While liberalising the gaming industry has its benefits, we must be diligent about the possible dangers. Casinos without some form of identification requirement could easily attract criminals. As can be seen in the Treasury's anti-money laundering strategy document, the National Criminal Intelligence Service said as recently as 26 October last year:

"Money launderers can take advantage of the facilities offered by casinos to disguise the origins of their funds. Launderers can take 'dirty' cash into a casino, exchange it for chips, spend a few hours gambling, and then exchange the chips (with a gain or loss according to their play) for a casino cheque which can subsequently be presented as an apparently legitimate source of funds."

We tabled the amendments with the aim of preventing crime and money laundering from infiltrating our casinos. They clearly set out a system under which well-monitored areas in casinos will be designated for gaming. To enter such areas, gamblers will have to provide identification for the casino operators, who will then use the information from identification to keep track of those who frequent their casinos. Those measures will not only curb money laundering and crime, but help with problem gambling. We are well aware that many casinos currently operate self-barring schemes, enabling problem gamblers to request that their casino membership be suspended and entry denied to deal with their addiction. If there were no requirement for ID on entry to a casino, it would be very difficult for such schemes to operate. I consider that unacceptable, as many operators find the schemes particularly beneficial in combating customer addiction to the new high-price slot machines.

Lindsay Hoyle (Labour, Chorley)

I agree with what the hon. Gentleman says about problem gamblers, but how would he get around the problem of those who are refused entry at casinos but then use the internet to continue their gambling? That still worries me.

Don Foster (Liberal Democrat, Bath)

The hon. Gentleman is right to express concern about internet gambling. Recent evidence suggested that young children currently had no difficulty in gambling on the internet. The hon. Gentleman will be pleased to know that there is a great deal of support—in, I think, all parts of the House—for the clauses that will bring internet gambling under regulation, and that proposals in a later group of amendments will toughen the arrangements still further. There remains the problem of internet gambling operations that are based in the UK, but have a server based somewhere else. I know that the hon. Member for Maldon and East Chelmsford has tabled an amendment to deal with that.

The issue of children is clearly important. The amendments propose the establishment of a clearly identified area for high-stakes machines, which will be heavily supervised. Children will not be allowed into such areas, as long as we know who is defined as a child in the legislation. If we do not have a system of identification, it will be difficult for those doing the supervising to know who is under 18, for example. We have discussed that in other contexts, such as the licensing legislation: landlords will have a problem if there is no identification system. A number of benefits would accrue from the amendments, which would not only deal with money laundering but protect young children and help with problem gambling.

In Committee, the Minister said that although ID was currently required for entry to all casinos,

"we are not persuaded that it would be right in future to require identification on entry in all cases . . . The casinos of the future will not be the same as casinos now."—[Official Report, Standing Committee B, 2 December 2004; c. 351.]

But despite the complications and difficulties that I accept may well arise for the big regional casinos dealing with large numbers of punters streaming in on Saturday nights, I think it imperative for a mechanism to be established to protect the British gaming industry from crime, as well as protecting young people and problem gamblers.

The Minister may well tell us that the Government are awaiting the outcome of European Union deliberations on the third directive on money laundering, but one thing is clear: the Government themselves have accepted that the gambling commission must establish a clear set of guidelines. Indeed, clause 24 states that arrangements must be made for the purposes of

"ensuring that gambling is conducted in a fair and open way",

for

"protecting children and other vulnerable persons from being harmed or exploited by gambling",

and for

"making assistance available to persons who are or may be affected by problems related to gambling."

I genuinely believe that the provision of identification would help in all those cases, and that it would be consistent with the terms of the third directive and with what the Government claim that they wish to achieve.

I turn to amendments Nos. 103 to 105. Although regulating access to a gaming area is an important issue, so are the powers that we give to local authorities over the introduction of casinos in their area. Local authorities should be given as much freedom as possible, within the proposed caps, to take advantage—or not—of the increased gambling opportunities afforded by the Bill. As currently drafted, clause 161 empowers local authorities to say no only to any casino whatsoever; it does not enable them to say that they want, for example, only one casino, or only two or three casinos. Amendments Nos. 103 to 105 would enable local licensing authorities to place their own cap on the number of casinos in their area, and at a figure other than zero. When such authorities review premises' licences, they should have as much freedom as possible to determine what kind of premises they want in their area and how many there should be.

Finally, the purpose of new clause 11, which deals with cheating, is to make it illegal to carry articles into a casino that could help in analysing or predicting the odds or outcome of the game. It tackles the problem of so-called "advantage players", who use such articles to help them during the game, but who argue that they are not cheating because they are not interfering with the game. We tabled a similar amendment in Committee, but we withdrew it after the Minister assured us on 30 November last year that a gambler who does anything that unfairly increases his chances of winning is cheating and is therefore covered.

Despite that assurance and others given by the Minister in subsequent conversations, we are not convinced that the Bill as drafted would result in "advantage playing" being considered an offence. Current legislation certainly does not consider it so. On 6 December—only a few days after the Minister gave us that assurance in Committee—The Times reported an incident at the Ritz casino in which the use of a device in a mobile phone enabled the players in question to predict the outcome of every spin of a roulette wheel. As a result, they scooped £1.3 million. However, according to legal advice, because the device had not interfered with the game the gamblers were not in breach of current law, and were therefore able to hold on to their winnings. The purpose of new clause 11 is to change the system, so that we can be absolutely sure that so-called "advantage" cheaters will be unable to get away with such things.

Many jurisdictions—in Nevada, in South Africa and in a number of Australian states, for example—already explicitly legislate against practices such as that employed during the Ritz episode. They have laws that prevent not only the sort of cheating described by the Minister in Committee, but offences relating to the possession or use of the devices mentioned in our new clause. Our suggestion is therefore already in operation elsewhere, and its use would not be unprecedented.

There are a number of other amendments to which many Members will wish to speak, but I should make it clear before I finish that the part of the Bill dealing with casinos is still a long way from being likely to achieve the widespread acclaim that Sir Alan Budd referred to. I hope that our amendments are accepted, so that they can at least move the Bill in the right direction.

Win Griffiths (Labour, Bridgend)

I must admit that I am not an expert in all the complexities of the Bill. I was happy to see the extension of regulation of new forms of gambling, but—as I said on Second Reading when I voted against the Bill—I am very disturbed by the opening of the gates to super-casinos and the way in which the Bill will allow people to gamble much more easily than they can at present.

I appreciate that in Committee the Government have adjusted the likely number of super-casinos and have proved willing to experiment first, but I have still tabled amendment No. 96, which would delete regional casinos from the Bill. Other amendments to which I have put my name would provide for smoke-free areas, a ban on alcohol at the tables and limits on opening hours. The gambling commission will have control over those issues, but they should be covered by the Bill. There are some 13,000 casino workers in the UK at present, but the Bill would lead to a huge increase in that number. It is only right that they should not have to work in the smoke-filled rooms that seem to exist in many casinos. It is also right that no alcohol should be allowed at the tables. I understand that some casinos have been operating that policy for about 18 months. It gives people the opportunity to have a break from the tables and perhaps think about what they are doing. I believe that there should be a ban on consuming alcohol in the gaming areas. If alcohol is sold on the premises, it should be kept away from those areas. As I read the Bill, it would allow casinos to be open for 24 hours. The gambling commission should have the right to set opening hours, and I am willing to leave that to custom and practice. By and large, casinos are open from 2 pm to 4 am. That is way beyond any time that I personally would like to see them open, but if that is the rule of thumb that operates at present, I am content to allow that to continue. However, I do not favour 24-hour opening.

I wish to support the amendments tabled by my right hon. Friend the Member for Gateshead, East and Washington, West (Joyce Quin) to maintain the 24-hour membership rule—the cooling-off period. It protects the person who goes out on a Saturday night and has a few drinks, and then their friend says, "Come on, let's go to the local casino." Before they know it, they are inside. They may have already drunk too much, but still have money in their pockets—of course, under the Bill, they could even use their credit cards to get money to gamble. I have tabled some amendments on that point later in the Bill.

Jon Owen Jones (Labour/Co-operative, Cardiff Central)

I do not know whether there are any plans to build a super-casino in Bridgend. The nearest super-casino, if one is built, will probably be in Cardiff. Is my hon. Friend aware that the Liberal leader of Cardiff council has accepted a £6,000, all-expenses-paid trip to Las Vegas to inquire about casinos? Was it proper of him to accept that trip?

Win Griffiths (Labour, Bridgend)

I can only thank my hon. Friend for providing me with that information. Given the context of the Bill, that decision is highly dubious, and I certainly hope that there will not be a super-casino in Cardiff.

There is much evidence about the impact of super-casinos. The famous Atlantic City survey showed that unemployment there fell by very little and that the nature of its businesses changed. By 1996, some 1,000 businesses had gone, and there are now only 60 independent hotels there.

Nick Hawkins (Conservative, Surrey Heath)

I know that the hon. Gentleman holds his views on the matter extremely sincerely. Will he accept that the Atlantic City survey to which he refers is extremely contentious? Those of us who compare the terrible state that Atlantic City was in during the 1970s—it was a run-down place of the past—with how it is after the huge amounts of regeneration that have resulted from the creation of resort casinos would certainly say that it is a more attractive, vibrant and successful place now. Many of us who believe that a good outcome of the Bill would be regeneration want to ensure that the one-sided picture of Atlantic City, as presented in the survey to which the hon. Gentleman refers, is not the only information before the House.

Win Griffiths (Labour, Bridgend)

I thank my honourable colleague for that description of Atlantic City.

Gwyneth Dunwoody (Labour, Crewe and Nantwich)

He is not your colleague.

Win Griffiths (Labour, Bridgend)

The hon. Gentleman is a colleague in the House—a Member.

Although I accept that the physical changes to which the hon. Gentleman refers have occurred, despite the creation of the super-casinos, the unemployment rate in Atlantic City has hardly changed—it has gone down by only 2 per cent. However, there are now 71 per cent. more bankruptcies recorded in Atlantic City than in the rest of New Jersey. Of course, we do not know the huge problems that super-casinos leave in their wake for gamblers whose lives have been destroyed, and so on.

Gwyneth Dunwoody (Labour, Crewe and Nantwich)

If the Government see fit not to accept the minimal protection that my hon. Friend wishes to build into the legislation, and given that it is not at all clear where this tacky Bill has come from, would it not be a good idea to vote against it?

Win Griffiths (Labour, Bridgend)

I voted against the Bill on Second Reading. One important consideration is whether the Bill will be amended in the other place to address my concerns. If that were to happen and the House agreed to such Lords amendments, I could support the Bill. However, I could not support it in its present form and without my amendments.

Teddy Taylor (Conservative, Rochford and Southend East)

I am interested in the points that the hon. Gentleman is making about Atlantic City. Will he make an additional point? Should we not bear it in mind that in the first few years after the super-casino went to Atlantic City, crime rose by 107 per cent.—that is a fact, not just an opinion? At the same time, crime in America overall increased only moderately.

Win Griffiths (Labour, Bridgend)

The hon. Gentleman is quite right. I would have made that point myself, but he has saved me the trouble.

Although the Government have moved their position somewhat, if they do not remove super-casinos from the Bill this evening, I hope that they will allow the other place to do so. I also support amendment No. 119, which would ensure that the pilot scheme to examine the effect of super-casinos—if they are created—would last for at least five years from the time at which the eighth such super-casino started to operate so that there could be a proper in-depth study of the situation.

I hope that the Government will react positively to this group of amendments, say that they have had second thoughts and will now abandon the idea of regional casinos altogether. That would lift my spirits. As I said on Second Reading, I blame myself in part for what has happened. I did not take a close interest in the proposals. I simply thought on reading them that no Labour Government would ever want to accept the opening up of the gambling business in the United Kingdom.

I certainly know that there is no public demand for such casinos. As far as I am aware, no one has commissioned a single opinion poll to suggest that any more of these casinos are wanted. In fact, the only poll that has been commissioned indicated that more than 80 per cent. of people thought that there were sufficient opportunities to gamble in the United Kingdom. I agree overwhelmingly with that response, and look forward to a positive reaction from the Government.

John Whittingdale (Conservative, Maldon and East Chelmsford)

Although we have to cover 12 groups of amendments before 9 o'clock, the group relating to casinos deals with perhaps the most contentious part of the Bill. In some ways, it is a shame that the Bill has come to be seen in the public mind as the casino Bill. It contains many other important measures about which there is little dispute in the House as to their necessity, but casinos have caused most of the argument.

Unlike the hon. Member for Bridgend (Mr. Griffiths), we are not completely opposed to the idea of regional casinos. We have always recognised that regional casinos could bring huge regeneration benefits to areas that are in desperate need of that investment. We supported the original concept when they were to be termed "destination casinos" simply on the basis that we could see that potential for regeneration. However, we have always been very much aware that they are a type of gambling institution that is entirely new and untested in this country. They represent gambling on a scale that we have never seen before. Therefore, we have always felt that it was sensible to proceed cautiously.

On Second Reading, the Secretary of State argued that the controls in the Bill at that time would be sufficient and that, as a result, the market would limit the number of regional casinos to perhaps 20 to 40, each of which would represent an investment of £150 million or more. The business model on which they are based requires 20,000 people or more each week to gamble in those casinos. That represents an increase in gambling on a scale not seen in this country before.

We felt strongly that the Bill contained no provision that would have necessarily limited the number to 20 to 40 and that in any case that was too high a number, particularly as each of the new regional casinos could have up to 1,250 category A gaming machines that have never been seen before in this country. There is a widely felt concern that that could lead to an explosion of problem gambling. That is why we have always argued for a cautious approach. Rather than rely on the Secretary of State's expression of hope that the proposal might lead to no more than 20 to 40 regional casinos, we believed that there was a strong case for the Government to introduce a pilot scheme to test the impact of a small number of regional casinos to see whether problem gambling increased as a result. That is why we proposed in Committee that there should be a pilot scheme with just four regional casinos.

Having argued on Second Reading that a pilot scheme would be a bad idea and was not necessary, the Government then did their first major U-turn of the Committee stage and announced a cap of eight on the number of regional casinos. At the time of that announcement, we made it clear that we welcomed the Government's surrender, but found it difficult to see where the number of eight had come from. The hon. Member for Bath (Mr. Foster) referred to some of the speculation that took place in Committee about why eight had been chosen. It certainly does not represent one per region, which would have been one way to proceed; instead, it appeared to be an entirely arbitrary figure. Certainly, the Government have never offered a real justification for choosing that number. The purpose of our amendment No. 143 is therefore, first, to press the Government to explain why eight is the right number.

Geraldine Smith (Labour, Morecambe and Lunesdale)

I welcome the fact that the Government are considering having just eight regional casinos instead of what they were proposing on Second Reading. Can the hon. Gentleman tell the House why he thinks that the number should be four and explain the logic behind the Opposition's thinking?

John Whittingdale (Conservative, Maldon and East Chelmsford)

I can, and was just about to. First, as I said, we want the Government to tell us why eight is the right number. They are, after all, the Government, and they must justify their proposals. We proposed four because we feel that it is much more sensible to start off with a small number, test the impact and, if it appears that there are no problems, increase. Although we recognise the possibility of the regeneration benefits which the Government hope for, and which we would certainly like to see, it is not right to risk a dramatic rise in problem gambling. We have to be satisfied that there has not been a massive rise in problem gambling before we go on to seek those potential regeneration benefits.

The Secretary of State said right at the beginning that if the consequence of the Bill were a rise in problem gambling, the Bill would have failed. Our concern is that eight regional casinos could lead to a significant increase in problem gambling, particularly because there could be up to 10,000 category A machines. At present, there are no category A machines in this country, yet as a result of one pilot scheme we could have up to 10,000 of them.

Also central to the purpose of our amendment is the fact that it is possible to start with four and increase, whereas it is not realistic to start with eight and go downwards. It is unthinkable that investors would commit the sums that we are talking about—£150 million per casino—if there were any risk that after a few years their licence would be taken away.

Richard Caborn (Labour, Sheffield Central)

The hon. Gentleman described category A machines as a potential problem that needs to be monitored. Does he believe that the scrutiny Committee was right to say that category A machines should go into large and small casinos? Does he believe that that is still the case today?

John Whittingdale (Conservative, Maldon and East Chelmsford)

We have tabled another amendment, to which my hon. Friend the Member for South-West Hertfordshire (Mr. Page) will speak, if he has the opportunity, which would allow a limited number of category A machines in large and small casinos. That would allow a proper test of their impact in each type of casino.

Richard Caborn (Labour, Sheffield Central)

Does the hon. Gentleman believe that category A machines should be allowed in the 136 casinos that currently operate under the Gaming Act 1968?

John Whittingdale (Conservative, Maldon and East Chelmsford)

As I said, we believe that a limited number of those machines should be allowed in large and small casinos in order for there to be a proper test. However, I point out to the Minister that amendment No. 143, by reducing the number of regional casinos from eight to four, would halve the number of category A machines to 5,000, as opposed to the 10,000 that the Government currently propose.

Richard Caborn (Labour, Sheffield Central)

Perhaps the hon. Gentleman will now answer the question. Does he suggest that category A machines should be not only in regional casinos but in large casinos, in small casinos and in the 136 casinos that operate under the 1968 Act? Does he agree that category A machines should also be in those places?

John Whittingdale (Conservative, Maldon and East Chelmsford)

Existing casinos are those that have never given rise to a significant gambling problem. We believe that if there is to be a proper impact test, it makes sense that there should be a limited number of machines tested in each type of casino. That is the purpose of new clause 13. I hope that we will have the opportunity to address that in more detail. However, the answer to the Minister's question is yes.

Richard Caborn (Labour, Sheffield Central)

On category A machines, there is an important difference between what the Government are saying and the Opposition's suggestion. The pilot or experiment is limited to category A machines at eight sites throughout Great Britain. The Opposition are now suggesting that we have category A machines in 150 sites. That is my understanding. If that is not proliferation of category A machines, I do not know what is.

John Whittingdale (Conservative, Maldon and East Chelmsford)

If the Government adopt our amendment, it would mean considerably fewer category A machines than if they were to proceed with the eight regional casinos. There are other safeguards that we strongly believe are necessary—I am about to refer to them—which would provide additional protection to that which is available under the Bill. Our concern is to take account of the warnings that have been given, especially about destination casinos—regional casinos, as the Government term them. That new type of casino has given rise to the concerns that have been expressed by many bodies, such as the Royal College of Psychiatrists, the British Psychological Society, the Methodist Church and the Salvation Army.

Existing casinos have not produced a major increase in problem gambling and have a good record of responsible behaviour. However, a cautious approach needs to be taken to the new regional casinos, which are entirely untried and untested. That is why we have suggested that the pilot scheme should involve only four casinos, perhaps two in major cities and two at destination locations. That would enable a proper trial to take place. If it is shown that there is no significant problem attached to those four sites, we could proceed to increase that number. To start with eight means a huge increase in the number of machines and it would be almost impossible to move down from that number.

Amendment No. 116 relates to an ID requirement. It provides for an important additional safeguard that we would like to see in place alongside the proposals to bring in regional casinos and introduce category A machines.

The hon. Member for Bridgend (Mr. Griffiths) said that he wished to retain the 24-hour rule. We see no great purpose in retaining that rule, which is now largely anomalous. Adults who decide that they wish to visit a casino should be able to do so without having to wait 24 hours in case they change their mind.

The arguments for retaining an ID requirement are much stronger. Such a requirement would provide an additional protection for those known to be suffering from gambling addiction. Existing casinos maintain a register of people who suffer from gambling addiction and who therefore cannot use their premises. It would also provide an additional means of ensuring that age restrictions are enforced. An identity requirement would mean that people under the age of 18 could not obtain access and use category A machines or the regional casinos.

Perhaps most importantly, it would help to prevent money laundering. The second money laundering directive requires ID for anyone using a casino in this country:

"A person who operates a casino by way of business in the UK must obtain satisfactory evidence of identify of any person before allowing that person to use the casino's gaming facilities".

The proposed draft of the third money laundering directive will change that identification requirement, so that it applies only to people who purchase or exchange gambling chips with a value of €1,000 or more. However, emails between officials in the Department and the American casino operators revealed that the Government were asking what figure they would regard as acceptable. It seems that the Government propose actively to lobby to try to increase that threshold to a much higher level, as the American operators believe that that is necessary for their business model to work. The domestic industry has no difficulty with an ID requirement. Rank is happy to retain such a requirement; indeed, it accepts that it could have positive advantages, as does the Casino Operators Association. Some operators of regional casinos are happy to accept an ID requirement. Sun International told us that its South African casinos that are equivalent in size to regional ones in the UK require someone to use a smart card, for which ID is necessary, before they can use category A machines.

Operators of regional casinos say that it is perfectly possible to have an ID requirement, and they accept that it would provide additional protection, both for people suffering from gambling addiction and as a measure to prevent money laundering. The amendment to reduce the number of regional casinos from eight to four and the amendment introducing a requirement for ID represent the cautious approach that, we believe, is necessary. We accept that there could be great benefits, but the last thing that we want is something that the Secretary of State spoke about when the Bill was introduced. If the Bill leads to an increase in problem gambling it will have failed. The amendments are designed to ensure that that is not the case.

Janet Dean (Labour, Burton)

My hon. Friends will be aware that from the brewing industry, which began in my constituency more than 1,000 years ago, grew the gaming machine industry, which originated in pubs. Leisure Link and other companies in my constituency service machines throughout the country, so I am keen to protect our home-grown casino industry, which has proved to be responsible over the years. I spoke to that effect on Second Reading.

I welcome the Government's decision to limit the number of regional casinos, but my hon. Friends will be aware of concern about the unlevel playing field that disadvantages the existing UK casino industry. There are anxieties that the introduction of category A machines in regional casinos—such machines are not produced by the home-grown industry and would have to be imported—would have an impact on other casinos, whether in their existing form or in the proposed arrangement of eight large and eight small casinos. I hope that when the Bill goes to the Lords there will be more discussion with the industry about how we can make sure that there is not an adverse effect on existing casinos.

Gwyneth Dunwoody (Labour, Crewe and Nantwich)

I have the greatest admiration for my hon. Friend, but is she suggesting that the House of Commons should pass sub-acceptable legislation on the assumption that another place will throw it out? That is a rather sad doctrine.

Janet Dean (Labour, Burton)

I accept that we should not have to rely on the other place to amend our legislation, but while the House of Lords exists and the business that proceeds through this House carries on there, I hope that gives the Government more time to talk to the industry. The Government have spent much time discussing all these matters with the industry over a long period. Hon. Members have commented that the Bill underwent pre-legislative scrutiny and that we have had Adjournment debates in Westminster Hall and elsewhere on the Budd report. There have been lengthy discussions, but more are still needed to ensure that we protect our home-grown industry.

It is ironic that people and organisations that oppose the development of casinos agree with those in the home-grown industry who want fewer regional casinos and more safety introduced into the development of those regional casinos. Both ends of the spectrum—those in the industry and those who oppose it—want us to proceed carefully. I hope the Government will make sure that we do that.

There are concerns about the development of regional casinos and the introduction of category A machines. The question was asked whether the Opposition support category A machines in all casinos. It might be better to go the other way, continue to have category B machines in all casinos, and support our home-grown industry. I hope Ministers will be able to provide the reassurance that I seek.

Richard Page (Conservative, South West Hertfordshire)

With the reform of gambling, and the broad agreement in most quarters, the House can welcome many aspects of the Bill—the establishment of a gambling commission, further help for problem gamblers and new forms of control of new gambling, such as the internet and betting exchanges. However, the Minister seems to have adopted the line—I have seen it manifest itself twice, first in response to me and then in response to my hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale)—that attack is the best form of defence. After his Committee performance, this is the only home he has to go to. He said that the Government had listened and that the statement that he made was a result of the Government listening. I have already expressed my sympathy to the Minister for being lumbered with the Bill. He is a nice chap and it was not his fault. I do not know who gave it to him and ordered him to take it through the House, but they are the smart ones. They got out of doing it and lumbered the Minister with it. Now he must live with it.

The Minister said that he had listened to concerns and produced what I call the 888 statement, but the existing casino operators said they had not been consulted. The statement came as a bolt from the blue. The point has been made by the hon. Member for Bath (Mr. Foster). I keep calling him my hon. Friend, because we had a relationship in Committee that grew warm and friendly as the days went by. No doubt an election will soon cause it to come asunder. He said, and I repeat, that the existing casino operators were not consulted prior to the 888 statement. Nothing that I have heard so far contradicts that. Perhaps the Minister will say that he consulted deeply with the casino operators before making the statement.

I support the hon. Member for Bath on the damage that will be caused to the existing industry. It is an industry that has a good reputation. To the best of my knowledge, it has caused no more than small problems in one or two areas. Compared with the industry in the rest of the world, we can feel pride in and respect for ours, so why are the Government trying to damage it? Normally, with any Government, I would think that there was a deliberate plan to knock the existing casino industry. But with the chaos and confusion that has surrounded the Bill's passage, I can only assume that this is a mistake—one of the many blunders that have been made along the road. I sincerely hope that, in the fullness of time, possibly when the Bill is in the other place, the Minister will table some amendments that will restore the balance for the existing casino system and its operators that they justifiably deserve. I hope that he will take that point on board and look after the industry that has served us well without letting us down and which has a good reputation.

I support amendment No. 143 and the move from eight to four casinos. I shall not reiterate all the arguments advanced by my hon. Friend the Member for Maldon and East Chelmsford, but simply say that destination resort casinos are a new phenomenon. We have licensing authorities with no experience and regeneration benefits that are as yet unknown.

The scrutiny Committee, chaired by my hon. Friend the Member for Ryedale (Mr. Greenway), who is sitting next to me poised to intervene later, to which I look forward, said:

"Whilst we acknowledge the Government's reluctance to publish national guidance relating specifically to regional/leisure destination casinos, we believe that it could help to ensure a consistent approach between regional authorities and avoid the need for applications to be called in for determination by the First Secretary of State."

The Committee was remarkably tactful in making that point, because it was saying that the Government have got it wrong and have no idea of the chaos and confusion that will be visited upon them if they do not have proper national planning guidance.

As we know, chaos and confusion did descend upon the Government, which is why I welcome the Minister's statement and the news that we will have an advisory panel to look at these matters. That is a substitute for planning guidance and procedures—the new way out of the bind that they have got themselves into. I support all that, but not the 888 proposal, because I think that that is too large a figure for the quicker process of evaluation and assessment that I want to see. In Committee, there was doubt about the timetable to be followed: whether it would be a drip, drip, drip affair, where assessments would take place as each casino ran up a number of years, or whether they would wait to the end. That is one reason why I support having four regional and leisure casinos. The assessment process would be quicker, we would get the results quicker and we could decide how to proceed on the basis of those results.

Lindsay Hoyle (Labour, Chorley)

If the hon. Gentleman is so concerned about the numbers, why did he not go for a further reduction to two of the large casinos, one in a town, and one a destination casino?

Richard Page (Conservative, South West Hertfordshire)

I do not know whether the hon. Gentleman has any statistical background, but the larger the sample, the better the result that one will get. However, at the same time, the larger the sample, the longer it will take, so we come to a trade-off. I could take his argument and say, "Why not have just one?" He might say that we need one in a town and one in a resort, such as Blackpool, which the hon. Member for Blackpool, North and Fleetwood (Mrs. Humble) would be only too glad to see. But what would happen if one of those samples was incomplete and inaccurate, not a fair one? By having two in each area, we can make a proper comparison. If they are vastly different, we might have to extend the cycle. I want to see the results as soon as possible, so that we can go forward as soon as possible. At the moment, we are in limbo and the quicker that it is resolved, and the quicker that we know where we are, the better.

Alan Howarth (Labour, Newport East)

I wish to speak in support of amendment No. 96 and new clause 7.

My right hon. Friends have already responded constructively to anxieties expressed by the public about their proposals to open the way for regional or mega-casinos. Instead of market forces determining how many such casinos there should be, there will now be eight in a first wave to be tested during a trial period, albeit a short one. Can we hope that my right hon. Friends might go further and withdraw their proposals for regional casinos all together? I am not very optimistic about that, as my right hon. Friend the Secretary of State was reported on 17 November as saying:

"I don't describe this as a cap . . . A cap is a once-and-for-all limit—what we are doing is introducing regional casinos more slowly than was the original intention."

I have had the opportunity to have some conversation with my right hon. Friend, for which I thank her, and she told me that the Government's view on the matter was neutral and that it remained to be seen how, under the dispensation that they are creating, regional casinos would eventually develop.

The question that I would like to put to Ministers is, who wants any regional or mega-casinos? The public do not. I understand that a national opinion poll survey found that 93 per cent. of respondents opposed the extension of casinos. Doubtless, the industry wants them, although it is interesting to note that it is not the United Kingdom industry. Some local authorities have expressed an intrigued interest and no doubt the Exchequer is attracted to the proposal. My right hon. Friend the Chancellor received £1.35 billion in gambling duties in 2003–04, and I fear that the Treasury's addiction to gambling revenues may grow. The Treasury should be encouraging saving, not gambling.

Why should the character and quality of life of our communities be at the mercy of the executives of Caesars International—it is a very long time since we were last invaded by Caesar, and we have taken some national pride in the fact that it is many hundreds of years since we have been successfully invaded—Las Vegas Sands or MGM Mirage? I hope that the latter name is apt. It certainly is as far as gamblers' dreams go: this is an industry that profits only as its customers lose. I hope that, similarly, the £1.1 billion and more that MGM Mirage promised, or threatened, to invest in Britain will prove to be a mirage.

I am not so puritanical or impractical as to seek to ban all gambling, but I believe that a responsible Government should tightly restrict it. Of course, that is what most of the Bill does, which is why I was content to vote for it on Second Reading. My right hon. Friends are right to take account of technical change, including the development of remote gambling and the arrival of video roulette games. I support their proposals on licensing, the establishment of the gambling commission, codes of practice and consultation of local authorities, the police and the public, but their proposals for mega-casinos—that we should have these casinos with up to 1,250 slot machines and £1 million jackpots—run entirely counter to the thrust of the rest of the Bill. I have noticed that the British Amusement Catering Trades Association, at some risk of self-contradiction, has described the machines as

"untried, untested and highly addictive".

My right hon. Friends say that their intention is to promote socially responsible gambling, but I find myself at a loss to understand the conception of socially responsible gambling. I have heard Ministers declare, perhaps somewhat romantically, that the poor should be enabled to enjoy the same pleasures as the rich, but I think we should ask the poor what they want. I noticed that women who were surveyed were particularly strongly opposed to the extension of gambling. So many women have seen the male so-called breadwinner taking a disproportionate share of the household income to the betting shop or dog track, and they know the consequences. According to the National Audit Office, gambling has a £53 billion turnover in Britain through betting shops, casinos and, of course, the national lottery. In passing, I wonder whether the proposals will not prove deeply damaging to the national lottery. That would mean a serious blow to culture, which it is my right hon. Friends' responsibility to defend.

The Methodist Church and the Salvation Army have urged the Government to exercise greater restraint and more care. They have been at pains to be reasonable and I go further than them. I joined the Labour party because I thought that it took the view that it is the Government's responsibility to protect vulnerable people. That is what this Government want to do and that is what they do so very well in so many fields of policy, but I cannot see how the creation of mega-casinos will protect vulnerable people. I understand that we have in this country some 300,000 problem gamblers, and members of their families, their employers and their fellow employees are, of course, affected.

Last November, the San Francisco Chronicle reported:

"Economist Earl Grinols has studied the rates of crime, lost productivity, domestic abuse and other social ills in counties with and without casinos. He found that the 3 to 5 per cent. of players who become problem gamblers each end up costing society about $11,000. States would need to seize half a casino's profits, calculates Grinols, to cover the 'social wreckage' it generates. In Missouri, for instance, gambling tax revenue brought in a 'seeming windfall' of $242 million in 2002, yet the state lost an estimated $572 million in related business failures, crime, unemployment and other social costs."

In contrast, in South Carolina,

"six months after it banned slot machines in 2002, two-thirds of the state's Gamblers Anonymous groups had disbanded and calls to help lines had plummeted."

Citizens advice bureaux have a great deal of experience of helping individuals who have got into severe multiple debt as a result of their gambling addiction. A citizens advice bureau in south Wales has reported a case that may be characteristic:

"A 62 year old pensioner approached a CAB in South Wales for advice about her debts. She had a problem with gambling and had built up £80,000 debt on various credit cards. When she got into difficulties she approached her bank who lent her a further £25,000, although her only income was £600 per month."

Mega-casinos have historically been associated with people's propensity to self-destruction, vice and crime. We are introducing 24-hour drinking at the same time as we are discussing the abolition of the 24-hour rule that requires people to have been members of a club for not less than 24 hours if they want to go into casinos and gamble. My hon. Friend the Member for Bridgend (Mr. Griffiths) spoke eloquently about that point in his advocacy of new clause 7, and he is right. One can imagine someone who has had too much to drink and who is armed with cash and a credit card going into a casino and ruining him or herself and their family. We should keep that sobering-up period. I am pleased to see that the British Casino Association itself wants the 24-hour membership requirement kept at all casinos.

Jim Cousins (Labour, Newcastle upon Tyne Central)

In focusing all his fire and attention on mega-casinos, my right hon. Friend opens up the possibility of no mega-casinos, but a proliferation of casinos that are merely described as "large". On 16 December, my right hon. Friend the Secretary of State clearly stated that a cap will be imposed on not only mega-casinos, but large casinos, which was a significant step forward.

Alan Howarth (Labour, Newport East)

I agree with my hon. Friend that that was a constructive step. I also appreciate his point that a good deal of the argument that I am developing in relation to mega-casinos is applicable to large casinos, and we must be equally wary of the dangers posed by a proliferation of large casinos.

On 31 October last year, The Observer reported on the situation in Australia, which is instructive. Gamblers in the mega-casino in Melbourne have incurred vast losses of more than £3.2 billion over the past 10 years. The article stated that that mega-casino is used for the laundering of drugs money, and I thought that the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) made some good points about the danger of crime associated with mega-casinos and the desirability of retaining an ID requirement, which, as he noted, would also help problem gamblers who are making efforts to exclude themselves from casinos and the policing of the age limit.

I wonder whether my right hon. Friends the Ministers noticed that when Judge Derek Inman sentenced a violent serial mugger who robbed to fund his betting shop addiction last November, he proposed that Parliament might wish to take that particular case into account in its consideration of the Gambling Bill. The hon. Member for Rochford and Southend, East (Sir Teddy Taylor) discussed the rise of crime in Atlantic City when a mega-casino was established. In Sydney, it is reported that a Russian mafia has been running prostitution rackets, which is exactly what one sees if one visits Las Vegas. The report in The Observer quoted an Australian academic:

"'It is a crime inflicted on the community by the government. It has been an absolute curse on the state of Victoria. It is a money-making venture that maximises returns by ensuring that people lose a lot of money'".

I have seen mega-casinos in Las Vegas, in Genting in the Malaysian highlands and in Australia, and they seem to offer death to the soul.

The only other country I am aware of that is energetically promoting large-scale gambling is North Korea—curious company for us to keep. There must be better ways in which to regenerate our cities. On 30 October, The Times reported the opinion of the respected venture capitalist Wilbur Ross, who said that the casino and gaming sector is the next to go belly up and that

"'That whole industry is based on junk bonds'".

Do we really want such developments in our great cities?

My right hon. Friend the Secretary of State said to me that it is better for people to gamble in mega-casinos than online, but I do not believe that the reality will be like that. If it is easy to gamble on the internet, why will people make a journey across the country to a regional casino or even across the city to a big casino?

My right hon. Friend the Secretary of State said that planning authorities will provide a safeguard, but I fear that local authorities will all too readily be seduced by the prospects of planning gain and the anticipated extra revenue as a result of the presence of casinos. The Local Government Association's so-called safer communities board, which seems a somewhat Orwellian title given the context, expressed disappointment at the limit of eight casinos. I impugn the integrity of no individual, but it is dangerous to put such temptation in the way of planning officers and members of planning committees. We are dealing with an industry that disposes of very large sums of money and that is prepared to be entirely ruthless.

My right hon. Friend the Secretary of State also said to me that the gambling commission will be the judge of whether operators are fit and proper, which is true, but the difficulty is that the unfit will gamble and the improper will batten on them.

If this is the first wave, I do not want the tsunami. If the Bill is carried, I hope that my more apocalyptic fears will not prove justified, but I cannot see how any good can come out of the policy.

Bob Russell (Liberal Democrat, Colchester)

The right hon. Gentleman has spoken for about 14 minutes and has not yet said a word in favour of the Bill. Will he sum up in one sentence why he thinks that his Government are introducing it?

Alan Howarth (Labour, Newport East)

I respond to the hon. Gentleman by saying that my right hon. Friends are good people and good Ministers who are animated by concern for public well-being, and I am completely baffled as to why they are putting forward this policy. I do not want it and I will not vote for it.

Malcolm Moss (Conservative, North East Cambridgeshire)

I propose to speak to amendments Nos. 142 and 116 and new clauses 13 and 11. We shall vote on amendment No. 116, and hope to press amendments Nos. 142 and 143 to a vote. I shall be relatively brief because I know that several Members wish to take part. That underlines the fact that the two hours that we have been given for this important debate on casinos is inadequate, as is the time allowed for the whole debate.

I begin by considering the issue of casinos in the round. The Government have changed tack dramatically—I will not call it a U-turn. Their proposals are predicated on trialling, or piloting, regional casinos. The Bill retains the proposal for having 1,250 category A machines in the selected eight regional casinos. The existing industry, which consists of about 136 casinos—the number is sometimes cited as 131 or a few more, but let us take 136 as a ballpark figure—and which has had an unblemished record for 40 years and done extremely well in terms of its social responsibility, has been completely and utterly ignored. The Bill makes no mention of it; it seems not to exist as far as the Government are concerned.

Through the 888 pilots, the Government propose a completely new situation with regard to category A machines, but the same numbers of category B machines in the eight new large and eight new small casinos as are allowed in the existing casino estate, where the maximum is only 10 machines per casino, irrespective of its size. That does not make any sense—it is illogical. The Government's idea of a trial does not stack up. If they want a real trial, they should put machines into the existing estate, not leave it without any extra machines and virtually no changes other than to membership requirements and the demand test. We should have a proper trial, but let us not ignore the existing industry, because the impact on it will be immense.

Lindsay Hoyle (Labour, Chorley)

Under the hon. Gentleman's proposals, would existing casinos be allowed category A machines?

Malcolm Moss (Conservative, North East Cambridgeshire)

I shall come to that in a moment, because it relates to new clause 13.

The Government's proposals on casinos are analogous to saying that if an American supermarket interest—I will not refer to any particular supermarket—wanted to come into this country in a huge way, and was allowed to do so on the basis of regeneration, it would be allowed to sell anything and everything it wanted, while the existing supermarkets were told that they were limited to selling, perhaps, tinned food. That is the kind of situation that we face. Existing casinos can have a maximum of 10 category B machines, while the new casinos that the Government propose under the 888 proposals will have 150 category Bs per large casino and 80 per small casino. That completely eclipses the existing casino estate. If the Government want to test these proposals, they should do it across the board and limit the number of regional casinos from eight to four. That would, at a stroke, reduce the number of category A machines available from 10,000 to 5,000.

Clive Efford (Labour, Eltham)

Is the hon. Gentleman aware that there are 131 existing casinos in Great Britain, and 24 across London alone? By suggesting that we should suck it and see, as it were, is not he promoting a proliferation of those machines all over the country?

Malcolm Moss (Conservative, North East Cambridgeshire)

I hope to show that I am not proposing any more machines than the Government are. I propose that the existing casino industry should be part of the trial. Why should it be dismissed? On the day the Government announced the 888 configuration, £0.5 billion was wiped off the share value of the four major casino businesses in this country—not £500,000 or £5 million, but £500 million. The Minister scoffed when that was raised in Committee, but it is a huge amount of money to be wiped off, and it happened because of the complete imbalance in the Government's approach to the future of the casino industry.

Lindsay Hoyle (Labour, Chorley)

I do not want to argue about whether there are 131 or 136 casinos, but would the hon. Gentleman limit the number of category A machines that they have? If he is saying that there would be no more category A machines than the Government propose, and possibly fewer, what number does he envisage?

Malcolm Moss (Conservative, North East Cambridgeshire)

I shall come to that when I have finished developing my argument. It is an important point, of course, and I will not leave the hon. Gentleman in suspense for long.

We propose that an existing casino that qualifies as a large casino in terms of floor area should be allowed to have, instead of just 10 category B machines, the number allowed to the new large casinos on a machine-to-table ratio of 5:1. With an extra, say, 20 large casinos, that would provide an extra 3,000 category B machines—or rather 2,800, as there are already 200. Under amendment No. 142, existing casinos with a 2:1 machine-to-table ratio would be categorised as small casinos. Those that do not qualify as large or small but are sub-small, and come under the 5,000 sq ft threshold, would have the same machine-to-table ratio. Many of them are very small and cannot get many gaming tables in, so, as the Joint Committee proposed, the limitation on machines would be a qualifying measure.

New clause 13 would extend the trial. It poses this question: why should the punters in existing casinos such as those in London—where we have, in the form of the membership clubs, some of the top casinos in the world—be restricted to playing category B machines, while a new regional casino somewhere else in London will enable people to play category A machines? New clause 13 would allow a fifth of all the machines in a casino to be category A. That would mean, for example, that the large casinos in the existing estate would have a total of 600 category A machines, or 30 per casino. For the small casinos, there would be 480, or 16 per casino, and for the sub-small, there would be around six per casino. The idea that such machines, with unlimited stakes and prizes, will pay out millions of pounds is nonsense, because they cannot be linked from casino to casino. If there are just six in one small casino, the stakes and prizes will be similar to those for the category B machines that already exist.

Don Foster (Liberal Democrat, Bath)

The hon. Gentleman knows that I have great reservations about his proposals for category A machines, and several hon. Members may be concerned about his earlier proposal for trading up. He mentioned the additional machines that would be introduced as a result. Will he confirm that the number will be about 6,000 or 7,000 additional machines, compared with the 10,000 category A machines that the Government propose and the approximately 33,000 fixed-odds betting terminals that currently exist?

Malcolm Moss (Conservative, North East Cambridgeshire)

The hon. Gentleman makes a good point, which I was about to cover. He has stolen some of my thunder, but he is right. We contend that the 10,000 category A machines in the regional casinos should be reduced to 5,000, and that more category B machines—and some category A machines—should be put into the established casinos. The total under Government proposals—I am now answering the question asked by the hon. Member for Chorley (Mr. Hoyle), so perhaps he will concentrate—is 10,000 category A machines and 3,240 category B machines. That encompasses the machines in the new casinos—the eight and eight—and those in the existing estate. Our proposals are for 5,000 category A machines in the new regional casinos and 8,540 category B machines throughout the estate, including the new eight large and eight small casinos. The total is 13,540. That should be compared with the figure of 13,240 under the Government's proposals, but with half the number of category A machines.

New clause 13 provides an alternative proposal and would introduce category A machines instead of category B machines in some casinos. That would mean 6,985 category A machines and 6,555 category B machines, and therefore a total of 13,540. We do not propose to increase the number of machines throughout the country; we are keeping to the Government's figures but contend that our approach, involving a trial of all casinos, is a better way of going about it, and a better test than the Government's proposal.

I promised to be brief. I have made my points and I simply reiterate that we shall divide on the three amendments to which I referred at the beginning of my speech.

John Greenway (Conservative, Ryedale)

I apologise for not being here at half-past 4 when proceedings started. I had to go to North Yorkshire today to attend the funeral of a close friend.

Ideally, we would have longer to discuss the Bill. However, I want to reflect on some of the issues that the pre-legislative scrutiny Committee considered and its general conclusions. I hope that that will be helpful. First, the Committee recognised that the decision to introduce category A machines into United Kingdom casinos for the first time was bound to be controversial, but we did not challenge the principle of that, as some now try to do. The policy decision seemed clear to us. From the Budd report, through the White Paper, the draft Bill and the Government's proposals that they presented to our second inquiry last July, there was a seamless robe of agreement that the proposal was a good idea and that it was time to relax some of the restrictions on our UK industry. The availability of category A machines was an example of that relaxation.

However, we also believed that key issues about numbers and accessibility to the machines needed to be considered. We established an important principle, which forms the basis of our debate tonight, that the original Budd and White Paper proposals for unlimited category A machines throughout the estate was neither necessary nor desirable. We also acknowledged that operators needed flexibility. I therefore believe that in the fullness of time, the Government have to resolve category B limits if there are not to be category A machines in the existing estate.

We also believed that the largest casinos, which the Government have chosen to call "regional", posed several challenges to policy across Departments. There is undoubtedly capacity for regeneration. The right hon. Member for Newport, East (Alan Howarth) asked who wanted the proposals. He should go to Blackpool, for which there is no plan B. Even the Churches, representatives of which met my Committee, said that they supported the proposals, because Blackpool needs jobs and regeneration. We believed that the number of large casinos would ultimately be limited by the market but that programmes of social responsibility, especially for operators from outside the UK, who have no experience of the UK market, are crucial. We are considering big leisure destination casinos and major leisure complexes, which would support and offer many other facilities. They would not need unlimited numbers of machines, but their location would be important, for the avoidance of easy access.

However, when the June proposals were published and the Government introduced the subject of size for the first time and the decision on category A limits, the Committee believed that the ideas had not been properly thought through and that the result was that too many casinos, which the Government initially envisaged as large, would be encouraged into the big regional category as a means of getting hold of the category A machines. We were also doubtful about the mechanisms for selection of sites through regional spatial strategies. The structure to do that simply does not exist.

The key question that hon. Members should ask me tonight is whether we would have perceived pilots as a good idea, had we been asked to make that judgment. Given the general tenor of the scrutiny Committee's comments, we probably would have found the idea of pilots attractive on balance, but we would have been worried about the competitiveness of the existing industry, especially with regard to machine entitlements. We did not consider keeping category A machines from the existing estate, but we said that the Government needed to be cautious. If there are to be pilots for the largest casinos, especially because of their size and the number of category A machines, is there also a case for trials for large and small casinos?

I have given much thought to that question, and the only basis on which one can justify trials is that the large casinos will have 150 machines and the smaller casinos will have 80. That is significantly fewer than was first envisaged, but many more machines than exist in the current casino estate, although we are considering category B machines. Professor Peter Collins told the Committee that there was no evidence that category A machines were more harmful than any other sort of gaming machine, including a category C machine with a £25 jackpot in your local pub, Madam Deputy Speaker—although I do not suggest that you would go there to play one.

The need for research, and to test the market and public reaction, was brought home strongly to us. Trials can therefore be said to be sensible. We are left to argue about two matters. First, what are sensible numbers for the trials? Secondly, what do we do about the existing estate? We felt all along that there was a need to be cautious. Once the genie is let out of the bottle, it cannot be put back in. I differ with my hon. Friends on the Front Bench about the figure of four; eight is a sensible number. On Second Reading, I urged on the Government a policy that would have limited the number to 20.

Win Griffiths (Labour, Bridgend)

Will the hon. Gentleman give way?

John Greenway (Conservative, Ryedale)

I have not got time—I shall wrap up my speech shortly.

We need a trial in seaside resorts, in urban areas and in city centres. Scotland and Wales will want to be part of the programme. However, we also need to ensure flexibility over time. Hon. Members must realise that we have the opportunity to make primary legislation only every 40 years or so, and the Bill must therefore create the blueprint for the gambling industry for the next 20 to 30 years, or longer. We must also trust the new gambling commission to do its job, and we need fairness for the existing industry. The Minister can use statutory instrument powers under the Gaming Act 1968 to increase the number of category B machines allowed in the existing estate. I know that he is considering that, and I urge him to do it.

My hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) spoke about amendment No. 116. It does not constitute a membership requirement, but supports the principle that the casinos should know their customers. I should have thought that gambling commission codes of practice were likely to incorporate similar provisions on age, money laundering and the supervision of areas where category A and category B machines are to be located. That principle applies now to arcades, to limit access to category C machines by children.

The Government now have difficulty with these provisions in only one respect: fairness to the existing industry. I hope that the Minister will give that question further consideration, and that even in the other place, there will be an opportunity to do more about it. The industry has a world-wide reputation for probity, and is respected across the entire casino world. We should therefore trust it to do a little more than the Government are currently allowing it to do.

John Pugh (Liberal Democrat, Southport)

I was on the Joint Committee and the reconvened Joint Committee, and I enjoyed a brief half-life on the Standing Committee until the Railways Bill was introduced. I know more about gambling now than I have ever done. The conclusion that the Joint Committee reached was that there should have been two Bills: a gambling Bill and a casino Bill. On the issue of a casino Bill, the Government disagreed with the Joint Committee, specifically in regard to the size, number and categories of machines. "Casino" was perhaps a misnomer all along; what we are talking about are sheds full of machines.

The Government took our advice and then kept changing that advice. It is really difficult to understand the twists and turns that they have made. Those moves are profoundly puzzling unless we decide that the script has been written around a particular outcome, and that the bottom line is that certain key players—Americans or whoever—must have their way. If we assume that to be the case, all else falls into place and things start to make sense.

My objection to the proposal for super-casinos is that there is simply no demand for them. That is an industry-led proposal. There is no necessity to use them as a regeneration tool. My constituency is regenerating itself without any proposal for a casino. The requirement in the Bill for regeneration is more notional than real. It is dependent on very weak planning controls and falls far short of what happens on the continent, where major revenue benefits are secured as part of the package. The assessment of the benefits has been extraordinarily partial. Neither the losses to small businesses nor the threat of ambient gambling to resort communities has been fairly considered.

I have concluded that casino developments are a licence to print money, a cash cow for the Chancellor. They represent a doubtful prospect for any community, and will aggravate problem gambling and lead to a further redistribution of wealth from the poor to the rich. Blue-collar workers from all over Lancashire are going to find recreation a lot more expensive. Despite such a dim prospect, I am fairly confident that there will be some tiny victories tonight. However, the thread running through the legislation tells me that the greatest satisfaction will be experienced by those in the corporate headquarters for whom the Bill seems to have been written. No amendment before us will change that.

Richard Caborn (Labour, Sheffield Central)

I would like to say to the hon. Member for Ryedale (Mr. Greenway) that, if one could respond in a fair way to the existing industry, one would do so. The last thing that we want to do is to put our own industry at a disadvantage. Equally, however, we must assure the House that what we are doing reflects what hon. Members want, not just in relation to certain proposals but the entire Bill.

The Government have tried to set out a cautious course of reform. When we debated the Bill on Second Reading, hon. Members gave us the clear message that they wanted us to be more cautious and to put in place a structure that would give people more certainty about the shape and size of the new industry. We listened to the House. It is patently obvious that we all agree with 90 per cent. of the Bill's provisions. The part that is under debate this evening relates to casinos and associated matters.

Our new proposals gave hon. Members what they asked for: controls on the number of new casinos and on the number of new gaming machines. Perhaps it would help if I started by giving the House a very brief explanation of the Government amendments in this group. Government amendment No. 2 is purely a drafting amendment. Government amendment No. 8 ensures that the gambling commission will focus on an applicant's commitment to social responsibility when considering applications for casino operating licences.

Government amendment No. 13 answers one point that worried the Standing Committee: what would happen to regeneration benefits if the casino owner were to sell on the casino and the premises' licence? Where the previous licence holder has entered into an agreement about local benefits, the substance of that agreement will continue to be a condition of the new licence. This means that any commitments will have to be fulfilled by the new operator. Government amendment No. 29 requires licensing authorities that are permitted to issue casino premises licences to publish a statement setting out the principles that they intend to apply when judging the licensing competition under schedule 9.

Amendment No. 96 is tabled in the name of my hon. Friend the Member for Bridgend (Mr. Griffiths) and my right hon. Friend the Member for Birkenhead (Mr. Field). I understand that they have a great problem with the whole notion of unlimited prize gaming machines in new-style regional casinos. They have explained that clearly, and they have every right to do so. However, unlimited stakes and prizes are by no means new to Britain. They are available every day in betting offices, at roulette tables and online. Gambling for unlimited prizes is open to the British public now.

I acknowledge, however, that new casinos will bring risks that are untested in Great Britain. That is why we took the decision to limit the numbers of these casinos to eight. It does need to be restated that these casinos will be subject to the most intense regulation. Every aspect of their conduct will be carefully controlled. Casino gaming in regional casinos is a legitimate leisure activity for adults, and at the end of the day, I believe that adults need to be treated like adults.

Lindsay Hoyle (Labour, Chorley)

Will the Minister give way?

Richard Caborn (Labour, Sheffield Central)

No, I do not have time.

Amendment No. 119, tabled in the name of my hon. Friend the Member for Selby (Mr. Grogan), goes a little too far. I made it clear in Standing Committee that the Government would take a commonsense approach to reviewing the impact of the regional casinos. We have also said that the review will take place no less than three years after the beginning of the new regime. However, we will not begin the review until we are confident that a good number of casinos are established and operating in a reasonable spread of locations. It would be foolish to speculate now on what the right number or spread would be, when we do not know where the casinos will be. But the Government will not rush into the review if we cannot be confident about the quality of data that we might get out of it. My hon. Friend's amendment is therefore over-restrictive. It might be possible to draw reasonable conclusions about the impact of regional casinos when, say, five or six are established and in operation.

Amendment No. 143 was tabled by members of the official Opposition, and returns us to a subject that we debated at length in Committee. The official Opposition want four regional casinos; we recommend eight. At the end of the day, this is a judgment call. It is not an exact science; far from it. What is important—and, indeed, what lies behind our decision—is the need to strike the appropriate balance between providing for a number that will enable a proper assessment of social impact to be made, while minimising the risk of social harm. We think that eight casinos will give a sound basis for a reasonable test. Four would be too few.

Amendments Nos. 103, 104 and 105, tabled in the name of the hon. Member for Bath (Mr. Foster), would give local authorities a power to determine in advance the exact number of casinos in their area. We think that that goes too far. We accept—indeed, it was we who proposed it—that some authorities should have the power to reflect strong local opinion and not allow any new casinos in their area if they are not wanted. The decision of local authorities can also reflect the view that there is a sufficient number in their area. We do not accept, however, that local authorities should be able to specify a number in advance. Amendment No. 104 would give licensing authorities a power that they already have, because clause 161 already gives them the power to have regard to "any principle or matter". That is intentionally very broad, and would clearly allow an authority to take account of the likely social impact of new casinos.

Amendment No. 100 was also tabled by the hon. Member for Bath, and I do not think that it is needed. Casinos that are licensed now under the Gaming Act 1968 will continue to be licensed after that Act is repealed through transitional provisions in an order made under schedule 18 to the Bill. The order will deem those casinos, under powers in paragraph 9 of schedule 18, to have premises licences under the Bill, but they will be limited to 10 gaming machines of up to category B1. Under the powers in paragraph 10 of the same schedule they will not be allowed to provide betting or bingo. Those provisions will provide a mix of casinos, on the basis of which the House, in future years, can make a sound decision on how it wants to move forward.

Clause 7(5)(d) makes it clear that a separate category of casinos, which are below the minimum size for a small casino, will exist under the Bill. Paragraph 3(a) of schedule 18 makes it clear that a casino premises licence may be issued for such a casino, despite the fact that it does not meet the size requirement. Clause 7(5)(d) is needed purely to exempt the casinos from the minimum size requirement that applies to new casinos. Nor does amendment No. 101 have any effect on the meaning of clause 7, as casino games provided on premises can only be provided on casino premises. Therefore, no harm arises from the single reference to "premises" in clause 7(4).

Amendment No. 102 is also unnecessary. The Standing Committee had concerns about multiple licences on a single premises, but as I have stated previously, such an arrangement is not possible under the Bill.

Amendments Nos. 116 and 117 lead us on to the linked topics of identity and membership. The amendments in the name of the hon. Member for Bath make two new proposals: first, that everyone entering the gaming area of casinos should show photographic ID to door supervisors; and secondly, that gaming machines should be allowed in what we have called the non-gambling area. The Government agree entirely with him that casinos have a responsibility to confirm the age of customers. That is why a person who fails to do that is guilty of a criminal offence under clause 46. I do not agree, however, that we must impose the requirement that he seeks.

The hon. Member for Bath is also concerned about money laundering and I agree that strong controls are necessary. I do not agree, however, that those controls should take the form of identification on entry. He misled the House, probably unwittingly, when he misquoted the second money laundering directive, which does not require ID on entry. Instead, it requires that ID must be given when buying and selling more than €1,000 of chips. As we discussed in Standing Committee, that is how money laundering controls are enforced now, but it is possible to maintain the same level of vigilance without checks on entry, and we should not impose excessive burdens on the industry without good reason.

On the other aspects of the amendment, I must disagree with the hon. Member for Bath. The non-gambling area of a casino should be exactly that—free from gambling of any type. The purpose of such an area is to give gamblers a readily available break from gambling, which is hardly possible if it is full of pub-style gaming machines.

I recognise that my hon. Friends have the best intentions in proposing new clause 7 and amendment No. 93, but I cannot agree with them. The current membership rule and 24-hour delay before play provide no significant protection to consumers, and nor are they practical to operate for any large casino when large numbers of people are likely to arrive at peak periods. I remind my hon. Friends that casinos provide adult entertainment, and if an adult wishes to enter a casino, it is not reasonable to ask that person to become a member, any more than it would be reasonable to ask someone to be a member of their local pub or betting office.

Amendment negatived.

It being two hours after the commencement of proceedings on consideration of the motion, Mr. Deputy Speaker put forthwith the Questions necessary to dispose of the business to be concluded at that hour, pursuant to Order [this day].

Clause 162 — Conditions

Clause 7 — Casino

Clause 68 — Consideration of application: general principles

Clause 179 — Transfer

Clause 83 — Equipment

Clause 89 — Bingo operating licence

Clause 266 — Bingo

Clause 272 — Bingo

Clause 58 — Age limit for Category D gaming machines

John Whittingdale (Conservative, Maldon and East Chelmsford)

I beg to move amendment No. 110, in page 24, line 34, leave out clause 58.

The last group of amendments concerned casinos. Casinos are an important issue, but the number of people in the country who use them is, in fact, relatively limited. We considered the potential impact if the new casinos were allowed, and there were a significant—

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. I am sorry to interrupt the hon. Gentleman, but will hon. Members who are not staying for the debate please conduct their conversations outside the Chamber?

John Whittingdale (Conservative, Maldon and East Chelmsford)

As I was saying, we considered what impact the new casinos would have in the event of a significant increase in the number using them.

Amendment No. 110 is of vital importance to the existing 960 family entertainment centres, many of which can be found in our seaside resorts. They are long established and play a vital part in the local economy of many such resorts. In total, they employ some 8,600 people and spend about £100 million in doing so. More importantly, perhaps, they are a central part of the traditional British seaside holiday. They have undoubtedly brought pleasure to the millions of families who spend their summer holidays at the seaside, and there is no evidence that they have ever led to any harm. It seems extraordinary that, at the same time as introducing a Bill that will allow new and untried casinos—potentially leading to a considerable increase in gambling addiction—the Government seem intent on striking a series of hammer blows to existing seaside arcades. Such blows will do enormous damage and perhaps jeopardise their survival, even though there is no evidence that they do any harm.

Several later amendments deal with specific matters relating to seaside arcades, particularly machine stakes and prizes and the question of trading up. Amendment No. 110, however, deals with a power in the Bill that many regard as a sword of Damocles hanging over the industry: the Secretary of State's having a reserve power to ban children from using category D machines. Let us be clear what such machines are. One example is the "crane grab", whereby the player manoeuvres a crane in an attempt to grab a cuddly toy from the collection within the machine. A further example is the "penny falls", which involves rolling a coin down a slide, in the hope that it will push a number of coins over the edge and one will get one's money back, plus a little more. Such machines are not exactly examples of the hard gambling that leads to the worst examples of problem gambling or addiction.

John Gummer (Conservative, Suffolk Coastal)

I wonder whether my hon. Friend can think of a worse example of the nanny state than the Secretary of State's taking the power to prevent a small child from grabbing a cuddly toy.

John Whittingdale (Conservative, Maldon and East Chelmsford)

This Government have come up with many different ways of imposing the nanny state, but I agree that this is one of the worst examples, particularly given that this provision appears to have been introduced without any supporting evidence whatever.

The whole point of such attractions is that they are part of what are called family entertainment centres. The latest published survey shows that some 47 per cent. of the population visited such a centre at least once in the past year. Like many people, I remember visiting seaside arcades during my childhood—in Weymouth and in Lyme Regis—and playing on the machines. Indeed, one of the strongest advocates of such machines, and opponents of this clause, is my right hon. Friend the Member for West Dorset (Mr. Letwin), who represents Lyme Regis.

In her letter to Labour Members, the Secretary of State made it clear that the Government are

"committed to taking an evidence-based approach to all gambling issues."

She continued by pointing out that

"low-value gaming machines have been available in amusement arcades for many years, and there has never been compelling evidence that it is harmful . . . for children to be able to play low-value gaming machines."

So the Government accept that we need to proceed on the basis of evidence, and that there is no evidence that such machines have ever caused harm to anyone.

Nick Gibb (Conservative, Bognor Regis and Littlehampton)

My hon. Friend will also be aware that, according to a survey carried out by the British Amusement Catering Trades Association, 90 per cent. of those of its members who run arcades in seaside towns will restrict their investment if clause 58 goes ahead unamended.

John Whittingdale (Conservative, Maldon and East Chelmsford)

My hon. Friend is absolutely right, and I shall come to the devastating effect that the clause will have on the industry if it remains in the Bill.

The only justification that the Secretary of State has been able to give for having this reserve power is the possibility that evidence supporting the need for it might emerge in future, or that some technological change might cause the Government to reconsider. However, as my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb) said, this power will threaten investment throughout the industry and 90 per cent. of such businesses will restrict their investment.

I received a letter from Mrs. Fletcher, of the Fletcher Group, who has been involved in the seaside entertainment industry for almost her whole life. She said that

"such a damaging clause hanging over the industry will cause a level of uncertainty that will restrict the level of long term investment. How can we be expected to plan and invest in the future expansion of our businesses if with one stroke the government can eradicate around 75 per cent. of our customer base? The potential loss of customer levels will eradicate the majority of seaside establishments as we know them today, the traditional seaside will no longer exist."

The British Association of Leisure Parks, Piers and Attractions, which represents amusements and other such attractions, says:

"We cannot accept it is necessary or desirable to grant the Secretary of State a reserve power to prohibit children playing Category D games . . . There is no academic evidence to substantiate such a draconian measure. Such a power will blight the industry and mean that our members will be unlikely to invest in new equipment."

Geraldine Smith (Labour, Morecambe and Lunesdale)

Does the hon. Gentleman agree that many find it rather strange that while the Government are saying that people can play category A machines in mega-casinos, they are also giving the Secretary of State a reserve power to ban children from playing category D machines and winning cuddly toys? The clause is crazy and should be removed, and it is indeed an example of the nanny state gone mad.

John Whittingdale (Conservative, Maldon and East Chelmsford)

I am extremely grateful to the hon. Lady for her remarks and I am delighted to learn that she supports our amendment. She is right: the clause is entirely crazy.

The clause is particularly crazy because although the Government have said that they need this reserve power in case of future technological developments, or in case evidence emerges supporting the need for such a power, there are other provisions in the Bill giving the Secretary of State powers that she could use in such circumstances. For example, clause 226(6) gives her the power to act if there are changes in technology, and clause 230(1) gives her other wide-ranging powers. So clause 58 is not only immensely damaging; it is also completely unnecessary.

Nick Hawkins (Conservative, Surrey Heath)

Does my hon. Friend recall that when he and I considered the Bill in Committee, the Minister himself said:

"We do not plan to use the power now or in the foreseeable future"? [Official Report, Standing Committee B, 30 November 2004; c. 267.]

In the light of what my hon. Friend and the hon. Member for Morecambe and Lunesdale (Geraldine Smith) have said, what on earth is the reason for the Government's including this provision in the Bill?

John Whittingdale (Conservative, Maldon and East Chelmsford)

My hon. Friend is of course right: there is no reason for this reserve power. Including such a power in the Bill sends the clear signal that there could be circumstances in which the Government ban children from using category D machines. Sending that signal will blight the prospects of many small businesses in seaside resorts throughout the country—businesses that are already struggling to survive—and as long as the clause remains in the Bill, it will cause real damage to them and will potentially deny enjoyment to many families. I therefore ask the Minister to think again and remove it.

Gavin Strang (Labour, Edinburgh East and Musselburgh)

I am happy to follow the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale), because I agree with much of what he said.

I am grateful for the opportunity to raise my constituents' concerns about the implications of clause 58 for family entertainment centres. My constituency contains Portobello, a seaside suburb complete with beach and promenade. Part of the fun of a day at the seaside there is a visit to one of our family entertainment centres. I was asked recently to meet the operators of Portobello's two family entertainment centres—Nobles and Lothian Amusements' fun park. The Noble family has been in seaside amusements for three generations, and the Portobello centre has been in existence for some 100 years. The fun park has been running since 1908, and my constituent Melvin Strand has been in charge of it for more than 20 years. A significant part of the operation of both of those centres is the category D machines. As the House knows, those machines currently have a maximum stake of just 30p and a maximum prize value of £5 in cash or £8 non-cash. Such low-value gaming machines have been part of seaside life for decades, and many people will have fond memories of them. My right hon. Friend the Minister said in Committee that

"arcades with category D machines are an important part of the economy, particularly in seaside resorts. Indeed, they are a part of our history and culture at the seaside. We want to maintain them as part of that structure."[Official Report, Standing Committee B, 30 November 2004; c. 269.]

As the House knows, clause 58 enables the Secretary of State to bring forward an order that would ban children and young people below a specified age from using category D machines. Clause 342 tells us that such an order would be subject to the affirmative procedure, meaning that a draft would have to be laid before, and approved by resolution of, both Houses. Not surprisingly, my constituents are profoundly alarmed at the implications of such an order for their family entertainment centres. Category D machines account for well over a quarter of their business, and Nobles estimated that in summertime such machines might account for three quarters or more of their trade.

I am aware, of course, that my right hon. and hon. Friends the Ministers insist that they have no intention of banning children from category D machines on current evidence. However, the very fact that the Secretary of State will have the power to do so is a matter of great concern to my constituents. I have seen the clause referred to as a sword of Damocles—indeed, the hon. Member for Maldon and East Chelmsford used the phrase. As any order would be subject to the approval of both Houses, this particular sword does have a safety net under it, but nevertheless my constituents are worried, and worry in an industry can translate into economic loss.

At present, the manufacturers of category D machines monitor children's interests and develop products that reflect current trends. The operators of family entertainment centres then invest in new machines to keep their facilities up to date, and that investment is serious money. A coin-pusher costs in the order of £10,000 to £15,000. Both family entertainment centres in Portobello renew a number of their machines every season, and expect a new machine to stay in place for around five or six seasons.

Mark Simmonds (Conservative, Boston and Skegness)

Is the right hon. Gentleman aware that investment decisions are already being delayed because of the uncertainty that the continued inclusion of clause 58 is having? It is not only future investment decisions that are being affected, but today's investment decisions, which will affect tourists in UK seaside resorts in the immediate future.

Gavin Strang (Labour, Edinburgh East and Musselburgh)

The hon. Gentleman makes a fair point.

My constituents tell me that the effect of clause 58 will be that investment in the development of new category D machines will cease, and that investment by operators will dry up, to the obvious detriment of jobs in the industry.

Malcolm Moss (Conservative, North East Cambridgeshire)

Does the right hon. Gentleman agree that it is slightly perverse that the Minister with responsibility for tourism should also be responsible for a Bill that would decimate whole swathes of the seaside resort industry?

Gavin Strang (Labour, Edinburgh East and Musselburgh)

The hon. Gentleman overstates his case. I do not believe that my right hon. Friend the Minister wants to decimate the industry, but I do think that the Government need to think again.

The British Amusement Catering Trades Association's survey of its members indicated that 90 per cent. of owners are less likely to invest in their businesses in the light of clause 58. That would be the direct effect, but there could be more general effects. For example, if a family entertainment centre owner needed to invest to refurbish the centre, he might find that his chances of getting a bank loan could be damaged by the threat posed by clause 58. And what about an owner seeking to sell his business? Could the price of that business be reduced by the threat of a clause 58 ban? The owners of both seaside amusement centres in my constituency are firmly of the view that the clause would have such an impact on their sector. If one adds to that the proposed reduction in stakes and prizes for category D machines in clause 226, the Bill has given my constituents great cause for concern.

Neither of my constituents is given to overstatement or melodrama. Both are knowledgeable businessmen with a wealth of experience in their field, and both are firmly of the view that clause 58 as it stands will be damaging to their industry. Ministers insist that they have no intention of using their reserve powers to ban children from using category D machines, and perhaps the impact of the reserve powers on the industry was not foreseen. However, the industry is very worried that just by taking those reserve powers the Bill will have a harmful effect on their sector. I hope that my right hon. Friend will recognise that Members on both sides of the House have expressed concern about this measure, and I urge him to listen to those concerns.

Don Foster (Liberal Democrat, Bath)

The House will be well aware that earlier we debated the issue of casinos, when many hon. Members expressed considerable concern that a Labour Government had sought to introduce an unlimited number of new untried super-casinos with up to 1,250 untried category A machines. Fortunately, as a result of pressure, the Government were prepared to change their mind on that issue. Many Members who were surprised by those proposals were puzzled that, at the same time, the Government were making huge attacks on traditional seaside resort entertainment facilities.

As the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) pointed out, this issue is not the only problem. Those hon. Members who have not studied the deliberations of the Committee in great detail may be surprised to learn that the Bill still contains a proposal that the cuddly teddy bear that can be won from a grabber machine should have its possible value reduced from £8 to £5. That is from a Government who happily proposed to introduce 10,000 new category A machines with unlimited stakes and prizes. The Government's thinking on the matter is bizarre.

Several hon. Members have already made the point eloquently that the reserve power in clause 58 simply is not necessary. Other parts of the legislation give the Secretary of State the power to make changes in the light of advice from the new gambling commission. No doubt whoever is Secretary of State at the time will do that in regard to many different aspects of gambling, so why is it necessary to single out, in this bizarre way, that one aspect of the industry, especially as not a shred of evidence exists to show that it contributes to problem gambling?

David Heathcoat-Amory (Conservative, Wells)

Is not the simplest explanation that the proposal is part of the murky agreement between the Government and the large casino operators? If those casinos do not produce the revenue that the Treasury wants, the Government want to retain reserve powers to extinguish what remains of the competition.

Don Foster (Liberal Democrat, Bath)

If the right hon. Gentleman is right, he is failing to acknowledge that by leaving these measures in the Bill—this sword of Damocles hanging over the heads of such establishments—the chances of family entertainment centres making any money for regeneration in the future are very slim. It is worth reflecting that in a recent survey, 47 per cent. of families reported visiting such establishments at least once in the past 12 months. Some 90 per cent. of those who run such establishments believe that if the powers remain in the Bill, they are likely to affect their investment potential for the future. As other hon. Members have said, that is already beginning to have a huge impact.

If the Secretary of State were to invoke the powers, meaning that only over-18s could use category D machines, there is little chance that families would bother to visit places with such machines. As a result, such centres would no longer be viable and no investment would come in from them. There is no evidence to suggest that such reserve powers are necessary in addition to the existing powers that the Secretary of State will be given by the Bill. I hope that in the same way as the Government have been prepared to listen to the concerns expressed by many people about super-casinos, they will be prepared to consider the concerns expressed on this issue. Let us hope for another welcome U-turn.

Lindsay Hoyle (Labour, Chorley)

It is obvious that many hon. Members are worried about the future of category D machines. One might ask why people in Chorley have an interest in the matter because it is not by the seaside, but my constituency contains Camelot, which is a theme park with category D machines. Another group that is concerned is travelling showmen—the funfairs. Travelling funfairs such as Greens and Silcock based in Chorley have category D machines, and many showmen go around the country with those machines. Will my right hon. Friend ensure that people who follow the great tradition of travelling around the country and those in seaside resorts do not have to worry about their future and livelihoods, because they are being put at stake?

We know about the proposal to reduce prize money, but there is a problem with that because there is no way of allowing it to increase with inflation over the next 15 to 20 years. A mechanism should be built into the Bill to allow category D machine prizes to increase over the long term. I hope that my right hon. Friend will think about what hon. Members have been talking about: the future viability of category D arcades, whether they are owned by travelling showmen or sited in seaside resorts and theme parks. Why does he want such special powers and does he really need them? Will he think long and hard about the travelling showmen, the seaside and theme parks?

Richard Caborn (Labour, Sheffield Central)

I rise at this point to try to be helpful because I know that hon. Members wish to speak to other amendments.

Amendment No. 110 would remove the Secretary of State's power to restrict children's access to category D gaming machines. I want to clarify a few points on the Government's attitude to low-prize gaming machines, because the debate has reflected the fact that there has been much frenetic lobbying on the matter, which has resulted in misunderstandings.

Many people have said that the Government are unfairly singling out category D machines with the reserve power in clause 58, but that is simply not true. Under the Bill, as, indeed, under the present law, every type of gaming machine except category D machines has a statutory age requirement for play, which is 18 years. Category D gaming machines thus single themselves out as a matter of fact.

The Government's policy over all the years covering the gambling review, the White Paper and the draft Bill has been that children should continue to be allowed to play those machines. We have taken that view because the amounts of money involved are modest and there is not yet a substantial body of compelling evidence to make us think that children's access to category D machines is truly a problem. However, contrary to what one might have thought after hearing the debate, there is a body of opinion that disagrees with the Government. There are serious academics who doubt our conclusions. There is also a strong body of public opinion that children should not be allowed to play gaming machines at all. Indeed, by far the largest number of responses to the public consultation on the draft Bill were from people who did not want children to be allowed to play the machines at all. The Government needed to make a choice between the options, so we have chosen to continue with the status quo, with children being allowed to play the machines.

We believe that the amendment goes a little far. I have to ask the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) whether he thinks it right for the Government to ignore those who hold strong views or offer different evidence. Is it not better to hold powers in reserve that will be subject to the approval of the House, using the affirmative procedure, so that we could act to protect children better? The Bill already provides for that, so it will give the Government and the gambling commission the powers needed to protect the public now and in years to come.

Geraldine Smith (Labour, Morecambe and Lunesdale)

Does my right hon. Friend accept the problem of blight on the industry? Many small amusement arcade owners are worried about reinvesting in category D machines because they would become obsolete if children were prevented from using them.

Richard Caborn (Labour, Sheffield Central)

I hope that what I will say will reassure my hon. Friend and other hon. Members. I am trying to balance the debate because alternative arguments have been advanced, which the Government have weighed up before reaching a view.

It has been alleged that the Government are plotting to take the industry by surprise and use the power suddenly to strip away the right of children to use the machines, but that is not the case. With respect, it is a fanciful idea. I remind the House that the Government, in response to the Budd report, reaffirmed the view that children should continue to play these machines, even though chapter 23 of Sir Alan Budd's report showed that he was highly sceptical about whether children should be allowed to continue playing. The Government made their position crystal clear in chapter 7 of the 2002 White Paper, and that position has not changed.

Teddy Taylor (Conservative, Rochford and Southend East)

Would the Minister like to run a business, which is quite a difficult thing to do, if the Government could use reserve powers to put him out of business by simply laying an order before the House of Commons? Surely that is a real problem.

Richard Caborn (Labour, Sheffield Central)

I said in Committee that uncertainty is one of the worst things for a business. If the hon. Gentleman will bear with me, I shall try to clear up that uncertainty.

I am happy to give a pledge today, on behalf of the Government, that we will, of course, never use the power in clause 58 without a strong new body of evidence to support that. We would always consult both the gambling commission and representatives of the industry before coming to the House, as I said clearly in Committee.

We have listened carefully to the debate and strong representations on the matter that my hon. Friends have made over the past few weeks. I appreciate that there are strong views and many legitimate interests, especially among my hon. Friends who represent seaside constituencies. Although I cannot accept the amendment at this stage, I am happy to make a commitment that the Government will review carefully the need for the reserve powers included in clause 58, and that they will report their conclusions and any alternative proposals to the House of Lords if the Bill receives its Third Reading tonight. We need to consult several constituencies with legitimate views on the matter. The Government want to work with the British amusement industry to ensure that it remains an important part of our leisure and tourism industry—yes, the tourism industry, to respond to the hon. Member for North-East Cambridgeshire (Mr. Moss)—and that the leisure and tourism economy have a bright future.

Lindsay Hoyle (Labour, Chorley)

My right hon. Friend mentioned seaside towns, but does he accept that we also represent theme parks and travelling funfairs?

Richard Caborn (Labour, Sheffield Central)

I do, but I was referring to the strong representations that have been made by Labour Members with constituencies containing seaside resorts. I hear what my hon. Friend says and confirm that we will examine the situation not only in respect of seaside resorts, but of category D machines. Given my reassurances, I hope that the hon. Member for Maldon and East Chelmsford will withdraw the amendment so that we may report back to another place.

Nick Hawkins (Conservative, Surrey Heath)

Although the Minister's words were helpful, he is somewhat friendless on the Government Benches because all three Labour Back Benchers who have spoken were critical of the reserve power. If I may add to the speeches and interventions that have been made, independent research by the Henley Centre concluded that up to a third of family entertainment centres throughout the country could well close as a result of the Bill, if it were not amended. I hope that the Government will decide, on reflection, to remove the clause in another place, and that hon. Members of all parties will send a firm signal to another place and the Government by voting for the amendment this evening.

It is not only clause 58 and the singling out of category D machines, which have been enjoyed by many children for generations, that could damage family entertainment centres, because a raft of measures in the Bill will affect those centres and members of the British Amusement Catering Trades Association and the British Association of Leisure Parks, Piers and Attractions, with which I have worked for many years.

One must consider the cumulative effect of everything that the Government have done. They have reneged on promises that arcades' existing entitlements would all be grandfathered under the Bill. We may come back to that matter later, but the Government's ridiculous guillotining and programming of the Bill may not enable us to debate that, so I mention it now.

Despite previous assurances that they would not, the Government have limited the ability of families to exchange two smaller prizes for one larger one—a long-standing practice in the business known as trading up. The Government set out their intention in the regulatory impact assessment to reduce, in the absence of any evidence to justify it, by 66 per cent. the level of stakes and by 40 per cent. the prize levels available on the lowest stake and prize category D machines, threatening the profitability and viability of many arcades The Government have also refused to implement the normal triennial increase in the levels of stakes and prizes as recommended by the Gaming Board to reflect increases in running costs over the period.

Mark Simmonds (Conservative, Boston and Skegness)

My hon. Friend is making a series of excellent points. Is he aware that, in seaside resorts such as Skegness in my constituency, the category D machines account for a substantial proportion of turnover and profit in many of the family entertainment centres? The Government seem to think that the machines are a tangential or marginal part of many of these businesses when they are critical to the future dynamism and success of tourist resorts such as Skegness.

Nick Hawkins (Conservative, Surrey Heath)

I agree with my hon. Friend. As he knows, in my first five years in the House, I represented Blackpool, where exactly the same concerns exist. It is not surprising that Labour Back Benchers are responding to those concerns. As my hon. Friend the Member for Rochford and Southend, East (Sir Teddy Taylor) pointed out, it is simply not possible to run one of these small businesses—most are small family concerns—if they have such a threat hanging over them. Once again, it is a reflection of the fact that far too few Ministers in the Government have ever had a single day's experience of running a business. They do not understand the effect of what they have done.

It is exactly the same as the point that was made in the previous debate when we heard the revelation that £500 million was knocked off the stock market valuation of the British casino industry in the 24 hours following the Government's change of policy. It is another example of how they do not care about businesses, large or small, because they have no comprehension of the worries that people running businesses have.

We have seen a chink of light, no doubt influenced by the fact that the Government are aware that many of their Back Benchers are prepared to contemplate rebellion on this issue and that the only Labour Members to speak in this debate have spoken against the clause. The Government may decide in the end that they have this wrong. I certainly hope so. There is every reason to think that family entertainment centres—they are a crucial part of our tourism both inland, as the hon. Member for Chorley (Mr. Hoyle) said, and at the seaside—desperately need the clause to be taken out. I hope that it will be in another place. The Government would be wise to do that.

Teddy Taylor (Conservative, Rochford and Southend East)

I hope that the Minister will clarify whether it is his intention to withdraw the clause and remove its effect in the House of Lords or whether he is saying that he will just have another look at it.

I want to make three points. First, I represent Southend-on-Sea where we have a large amusement industry, which is rather different from the casino industry. I had the pleasure of speaking to two Americans who were making applications for one of the gigantic casinos and they seemed to know everything about everything. They belong to massive companies and, to my surprise, they told me that we would have to change the way in which regional casinos were being allocated, because of the decision to give Sheffield one. I pointed out how the organisation had not even been established and how the factors in the Bill had to be taken into account, but they seemed to know everything about everything. I genuinely say to the Minister that if Sheffield, which is the most outrageous place even to be considered for a casino, gets one, my faith in democracy will be undermined. If it does not get one, my faith in the American gambling industry will be undermined.

Richard Caborn (Labour, Sheffield Central)

As the hon. Gentleman knows, we have to set up a small committee to look at the location of the 24 casinos. Will he put his name forward to be a member of that Committee?

Teddy Taylor (Conservative, Rochford and Southend East)

The Minister is aware that I am always interested in taking a look at anything.

I want to make two further brief points. The people who run amusement arcades are nice family people and have massive numbers of visitors at weekends. Southend is not a tourist resort, but people go there for a day out and families go there and enjoy themselves immensely. The Minister's proposal will affect machines such as the cranes that grab toys, the coin-pusher games involving 10p and 2p coins and redemption machines that issue tickets as prizes. I do not think that there is any way at all that the Minister can say that there is evidence that such machines cause damage. We should encourage families to go together in visits to the seaside.

Finally, I hope that if the Minister is thinking of going ahead with the proposal, he will wonder how on earth he will apply it. Regulations are very difficult for businesses to operate, particularly since we joined the European Economic Community, and I hope that he will bear in mind how he would operate the scheme. Is a father allowed to play a machine with his son standing beside him or is the father not allowed to do that? Must there be a separate place in amusement arcades for such machines? I hope that the Minister will realise that the proposal is a mistake, but I greatly appreciate the kind response that he has given.

Lindsay Hoyle (Labour, Chorley)

Does the hon. Gentleman want an addition to the Bill that says that no machines can be converted to take the euro?

Teddy Taylor (Conservative, Rochford and Southend East)

Our machines cannot be converted, and I hope that the Minister will bear in mind the massive costs the industry is facing because of the EU. If the euro is introduced, it will impose massive costs on the industry.

I hope that the Minister can make it clear that his intention is to remove the powers of the clause when the Bill goes to the House of Lords. If he said that, we would all be grateful and say that he had done a good job. If that is not done and we lose the opportunity, we will have no further chance. Once the Bill leaves the House of Commons, we will not have another chance to look at it unless there is an astonishing amendment in the House of Lords.

In view of the fact that the Minister has said that he is prepared to reconsider the issue, if he is willing to visit Southend-on-Sea to visit our arcades, he would be very welcome and I would give him a splendid lunch on the seafront. It takes only an hour to get to Southend and an hour to get back, so I hope that he will come there and realise that the clause was a great error.

John Gummer (Conservative, Suffolk Coastal)

I would like to press the Minister. I represent the seaside town of Felixstowe, which is a place for day trips and weekend, weekly and fortnightly stays. Indeed, I am told that it is safer to rely on having two full days of sun in Felixstowe in the first two weeks of September than anywhere else in the United Kingdom. I am proud to represent it, not least because Charlie Manning and his friends produce some of the best seaside entertainments available. Not only are they family entertainments, they are run by families.

I am not always flabbergasted by the Government, but I find it difficult to understand why they have introduced the clause. One usually understands the nefarious reasons why they have decided to do something that is manifestly unpopular and extremely unproductive. Why they have done it on this occasion defies all reason. That is why I became even more worried when the Minister did not actually say that he would introduce an amendment to delete the clause in the House of Lords. I would be very unhappy to go without voting on this amendment unless we had an absolute undertaking that the clause will be removed. It is not good enough for the Minister to cite a series of mythical people who are opposed to cranes that catch woolly animals.

Richard Caborn (Labour, Sheffield Central)

Before the right hon. Gentleman describes the cranes, will he tell me whether he has consulted other constituents, such as the faith groups, that he also represents? I do not know whether he has spoken to the Methodist Church or to the Salvation Army in his constituency. Discussions are going on between BACTA and the faith groups about the effect of gambling on young people. I have known the right hon. Gentleman for some time, and I do not think that he would dismiss organisations such as the faith groups. They have a point of view and that must be factored into the decisions that the Government take.

John Gummer (Conservative, Suffolk Coastal)

As the proud relation of a sister-in-law who is a Methodist minister, I would find it difficult not to consult the Methodist Church in my constituency. I merely say to the right hon. Gentleman that, although I am a Catholic and therefore take a rather different view of these matters from Methodists, I have taken other views into account. I would be sad if our whole public life were organised in such a way that it was not possible to say a very simple thing: for many years the majority of people in this country have managed to grow up in peace and tranquillity while using penny-in-the-slot machines or their modern equivalent.

I am not sure that I would put the cranes that catch woolly animals high up on the list of all the things that have done me harm in life. Indeed, a number of things that have done me harm are not banned. The Minister is not taking reserve powers to protect me and my children against a whole range of other things, which he could do were he concerned about the matter. He should consider that, in a society in which he seeks to extend choice and allow people to do what they want to do—in some areas rather dangerously, in my view—it seems very odd that he should stop children playing these machines. Worse still, he is not actually going to stop them. He will have a reserve power to do so, thereby blighting the industry without having the courage of his convictions.

I simply say to the Minister that, if he agrees with the small number of people who think that the machines should be banned, he should come out and tell us. If he does not agree, he should say, "Right, the machines will go on." I will tell him what I will do: if it emerges, amazingly, that the possession of a woolly bear taken from one of these machines by crane damages the psyche of individuals, I will ask my hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale) to agree to rush emergency legislation through the Commons to ensure that, forthwith, woolly bears may not be put in such machines. If the Minister agrees now to withdraw the measures in the upper House, we will agree to facilitate emergency legislation should some miraculous new information be brought forward by Methodists, the Salvation Army, Jehovah's Witnesses or any group he likes. In the meantime, can we please have our cranes?

Lindsay Hoyle (Labour, Chorley)

Has the right hon. Gentleman ever won a furry bear playing a crane machine?

John Gummer (Conservative, Suffolk Coastal)

I was not going to enter into that, but it is hard to find someone clutching such a bear, because the bears seem to remain, week after week, inside the machines. All I know is that, for a very small amount of money, the machines give a great deal of pleasure to people hoping for a teddy bear. Why does the Minister want to take away from small children the chance to hope? Is he not the kind of nanny who would be had up under today's laws for cruelty to children?

John Greenway (Conservative, Ryedale)

My right hon. Friend talks about whether new evidence will emerge in a blinding light and persuade him to change his mind. A number of organisations told the pre-legislative scrutiny Committee that such machines were damaging to children, but in my judgment and that of the Committee, that was pure assertion. There was not a shred of evidence that it was true. If it were true, we would have more problem gamblers than other countries, which we do not.

John Gummer (Conservative, Suffolk Coastal)

My hon. Friend is perfectly right. I say to the Minister that I have seen no evidence—I have seen opinion, but no evidence—that these machines do any harm. All our experience, of our own childhood and that of our children, and, in my case, that of my constituents' children, is that they do no harm at all. I know of no body of academic research to the contrary that stands up.

The right hon. Gentleman is in danger of being laughed out of court on this proposal. If the blight cast over businesses by the proposals were not so serious for my constituents, those of my hon. Friend the Member for Rochford and Southend, East (Sir Teddy Taylor) and others, we would laugh, rightly, at a Government who hold reserve powers to protect children from the dangers of machines that have been part of their inheritance for this and most of the last century. What is the House of Commons doing debating woolly bears in crane machines on the front in Felixstowe? Surely we have many more important things to discuss, and the Minister should say now that he will withdraw the proposal.

Geraldine Smith (Labour, Morecambe and Lunesdale)

Many of the points have already been made, but I must say a few words, as I represent the seaside resort of Morecambe. Many of my constituents who own amusement arcades have lobbied me about the issue. The possible blight on their business is of great concern to them and they are worried about investing in new category D machines. I can assure the Minister that those do absolutely no harm to children. I have played on them many times, and I have to declare an interest and say that I have won, so it is possible to win on such a machine. The House may be interested to hear that I won a cuddly bulldog with a Union Jack, which I passed on to the hon. Member for Romford (Mr. Rosindell) as a Christmas present.

The machines provide a great deal of fun for children. They make a rainy day in Morecambe. [Interruption.] Of course, it rarely rains in Morecambe, but when it does people can escape into the amusement arcades and have some harmless fun. I hope that common sense will prevail.

Lindsay Hoyle (Labour, Chorley)

As somebody who has owned up to winning a prize, will my hon. Friend share her knowledge with the House so that we can all win?

Geraldine Smith (Labour, Morecambe and Lunesdale)

I will be happy to give Members lessons if they see me afterwards.

We have had a laugh and a joke, but this is a serious issue for seaside arcade owners and the people who work for them. I am glad that the Minister appears to have taken the concerns on board. I hope that we can make progress and that clause 58 can be deleted from the Bill.

Henry Bellingham (Conservative, North West Norfolk)

I declare an interest in that two towns in my constituency, Hunstanton and Heacham, have a large number of amusement arcades, which are, in the main, family owned. Many have been in those families for generations, and they employ, directly and indirectly, up to 250 people, which in small seaside towns is a significant number.

I have been lobbied by a number of arcade owners. I had the opportunity of going around an arcade only recently, as a guest of Mr. Michael Thomas and Michelle, his daughter. I, too, have a confession to make: I won a cuddly bear—but I was given an unlimited number of goes on the crane. Had I been a young child, persevering so long would probably have cost me four years' pocket money.

The Minister has given us an assurance that he will review the powers, but I do not feel that that is enough. He said that he would revisit the matter, but why can he not say that he will withdraw the clause? He has no friends whatever in this place, and the explanation that he gave was pretty unconvincing to me. Is it not ironic that the Government are giving substantial extra gambling opportunities in the small number of mega-casinos and in the machines that will offer unlimited prizes, yet doing significant harm to small family-owned arcades?

A constituent told me the other day:

"My 9 year old daughter will win a smaller teddy bear than she can at present, which will apparently stop her becoming a gambling addict. It's ludicrous."

As Michelle Thomas said, "Costs are going up at a time when seaside economies are struggling. Why give them a kick for no reason? We feel very strongly indeed that this is wrong."

The Minister is friendless. Some powerful arguments have been advanced—I refer to the remarks of my hon. Friend the Member for Surrey Heath (Mr. Hawkins) about the other clauses that affect family-owned amusement arcades. I hope that the Minister will listen to what has been said and have the good sense to withdraw the clause or accept the amendment.

Lewis Moonie (Labour/Co-operative, Kirkcaldy)

I represent a constituency that has probably the longest continuous fair in Europe. It goes back 800 years. Clearly, when it started grab machines were not part of the entertainments. However, for as long as I have known it, they have been. One of my earliest memories is of walking through the amusement arcade in Dundee, which was in the basement of the town chamber—an odd place for it to be. The machines always fascinated me. Unlike other Members, I have not won anything on them. However, I have tried them for years. My misspent youth was completely unrewarded, and my misspent middle age likewise.

Rather than to descend into burlesque, I shall make some brief points. I ask my right hon. Friend the Minister to think carefully about the implications of the clause, and related clauses, for small businesses. I know owners in my constituency. The fair comes once a year, in April, and it always rains. The wind cuts through us like a knife. I can tell the House that when the wind does that in Kirkcaldy, we really feel it. Despite the fact that we are on the east of the country, it rains much more in Kirkcaldy than it does in Morecambe—or at least, it seems to. That being so, amusement arcades serve a useful function. In the small town of Burntisland in my constituency, and at other places along the coast, the machines provide a worthwhile service for families, given the state of the weather in Scotland. Roll on global warming. Many of us say that there is no sign of it where we come from.

It has been asserted that the machines are harmful. I entirely agree with the hon. Member for Ryedale (Mr. Greenway), who spoke about pre-legislative scrutiny. It is easy for those with strong views to make assertions about the effects of this and that, and how terrible they are. When we seek to examine objective evidence, we find that none is forthcoming.

The machines provide relatively simple amusement. As I, as a psychiatrist, would know, they provide nothing of the reinforcement so essential to problem gambling—quite the reverse. Two Members have claimed that they have won something from the machines but I have met far more people who have not. If we are to rely on anecdotal evidence and opinion, the fact that so few people seem to win, and thus receive the reinforcement that they would need to continue playing, would seem to suggest that the machines perform a public service at remarkably little cost.

To reduce the price of playing the machines is a serious issue. To reduce the price of such an entertainment from 30p to 10p is ludicrous. I know many of the proprietors, and they do not strike me as numbering among what I would charitably describe as the filthy rich. They run family businesses. They usually live in the towns where they run their businesses and they have a responsible attitude to the gambling that takes place in their establishments. To reduce their charges to those that prevailed 20 years ago would be unfair, especially in comparison with the rides at the fair that I mentioned. The whole point of the Links market in Kirkcaldy is that every new ride for the fairs in Europe comes up to the mile-and-a-half-long display. It now costs £2 to go on one of those things.

Having too great a concern for my own well-being, I am unlikely ever to be persuaded to take a ride. Given the speed at which they fly and the number of dimensions in which they seem to operate, it is probably worth while to take that approach, especially for someone of my size. When we are reflecting on the price of the entertainment provided by the machines, we should compare it with the price of the other entertainments available, and get a sense of proportion.

What are reserve powers for? They have to be provided. They are not just a cover-your-arse method—if that is parliamentary language; if it is not, I will withdraw it. Somebody in the Department has put in the provision because they think that it might be a good idea for the future. There must be reasonable grounds for supposing that reserve powers might be needed at some time. I know that my right hon. Friend the Minister has said that he wishes to be reasonable and to think again, and we are grateful for that. We certainly should think again. In the absence of anything other than prejudice and anecdotal opinion, let us leave these harmless pleasures alone and continue to gratify the tens of thousands of people who use the machines every year.

Mark Simmonds (Conservative, Boston and Skegness)

When the Minister made his short statement earlier, I hoped that he would say unequivocally that he would withdraw the clause. I understand, however, that that is not what he actually said. He said that he would review the position and consult further, which will not put at rest the minds of the family amusement centre owners in Skegness or any other successful UK seaside resort.

It is not only those who own the family amusement centres who are concerned. Their concern is shared by many of the people who work in the amusement centres, and by those who visit successful seaside resorts such as Skegness. They are deeply concerned that their exciting and vibrant holidays may be destroyed by the sword of Damocles—to quote my hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale)—hanging over many successful businesses and successful seaside resorts. I hope that when the Minister replies he will go even further than he did earlier by stating clearly that when the Bill goes to the other place the clause will be removed in totality.

Category D machines are the fundamental lifeblood of tourist resorts such as Skegness. Members of all political parties are in their places tonight because they are concerned on behalf of their constituents that the clause could have a devastating impact on the tourist industry. Generations of families have enjoyed the facilities that we are discussing, which are at the centre of successful family resorts. Families return year after year to Skegness, not only to play on the same machines, but to use the new machines that have been put in place to create entertainment and vibrancy for the UK tourist. That activity could be decimated by the clause.

The clause is already stopping investment. I held a meeting in my constituency with between 25 and 40 amusement arcade owners. They told me that they had already stopped orders for new machines while the clause remains in the Bill, so this is not something that will have an impact only in the future. It is already starting to have a serious negative impact on resorts such as Skegness.

Despite the Minister's assurances about a review and deeper and wider consultation, I do not understand why the clause is in the Bill. If the evidence does not exist, and almost every body that has considered the issue has come to the same conclusion, why should we have the clause? The Budd report, the Culture, Media and Sport Committee, the excellent Joint Committee on the Draft Gambling Bill, chaired by my hon. Friend the Member for Ryedale (Mr. Greenway), BACTA and the British Association of Leisure Parks, Piers and Attractions have all concluded that there is an absence of evidence to show that playing category D machines under the age of 18 has any knock-on impact on future gambling problems. Indeed, I would argue that the evidence is to the contrary. Category D machines allow families to participate together in harmless fun and enjoyable entertainment.

John Gummer (Conservative, Suffolk Coastal)

Why does my hon. Friend think that the Minister was entirely willing to listen to those who wanted him to hit at category D machines, but until the furore, was entirely unwilling to listen to those same people when they told him, with much greater evidence and much firmer statements, about casinos?

Mark Simmonds (Conservative, Boston and Skegness)

My right hon. Friend makes a good point, as there is a contradiction in the Bill. The Minister or a future Secretary of State can invoke clause 58 to ensure that children are not allowed to play on category D machines, but no such clause exists for category A machines, which may create far more serious gambling problems for the adult population.

If the Minister or his successor invokes the clause, what is a family supposed to do on a day out in Skegness? It rarely rains in Skegness, but when it does, are mother and father supposed to go into the family amusement centre and leave the children outside, because they are not allowed to play on category D machines? In fact, families will no longer come to UK tourist resorts such as Skegness. With the clause hanging over amusement centre owners, there will be a spiral of decline. There will be a lack of investment, and tourists will go elsewhere—probably abroad, where they can take advantage of such facilities. I very much hope that the Minister will reconsider his position and remove the clause from the Bill.

The Government do not pretend that there are any arguments or evidence to support the inclusion of the clause in the Bill. In correspondence on this issue, the Minister for Media and Heritage said:

"Currently, there is no clear evidence that low stake and prize machines played by children lead to problem gambling."

If that is the Government's view, what on earth is the clause doing in the Bill? It should not be there at all but, as it is, it should be deleted.

In conclusion, family amusement centre owners in Skegness, as elsewhere, are extremely concerned about the future of their businesses. They will not commit to investing money in those businesses until they are sure that the clause has been deleted. Like many other Members, I would like the UK tourist industry to maintain its vibrant family atmosphere, and in particular, I would like Skegness to retain its vitality as a successful family resort. Clause 58 will do nothing but harm to its reputation, so I hope that the Minister will agree to delete it.

Sandra Osborne (Labour, Ayr)

I would like to add my concerns to those expressed by other hon. Members. I speak as someone who represents three seaside towns on the south-west coast of Scotland, and who hopes to represent even more seaside towns there in future. If the Minister has not visited Ayrshire, I can certainly recommend it to him. It certainly does not rain there has much as it does in Kirkcaldy. When it does rain, however, family amusement centres are an important mechanism for supporting tourism and small businesses in those towns.

I recently visited Girvan, which is currently part of the constituency of my right hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), to remind myself of what family amusement centres are like. It is some years since I frequented them, but in common with other hon. Members, I enjoyed the experience and it did not do me any lasting damage. As other hon. Members have said, the fact that there is not any evidence that category D machines are harmful is significant. When I went to Girvan I could not think of a logical reason for the Government's proposal to ban children from traditional games such as "grab a toy", penny falls, ticket redemption games and Derby races, all of which seemed to be quite harmless.

However, I draw Members' attention to the briefing from the Methodist Church, in which it draws a distinction between different category D games:

"Category D machines, which can be played by children, include the harmless teddy-bear grabber machines and "penny falls", but also include certain fruit-machines."

That sheds light on the reasons for the Government's proposals. We have all had a great laugh this evening about "grab a teddy", but that does not necessarily reflect the views of the Government or the Churches. We all accept that some games are harmless, but the Churches are concerned about children playing fruit machines, and we should not ignore or discount those concerns. We all want to do everything that we can to protect children.

Don Foster (Liberal Democrat, Bath)

The hon. Lady is making an important point, and has drawn our attention to the distinction made by the Churches. However, does she not accept that any changes in the categorisation of category D machines could be covered by changes made by the Secretary of State on advice from the gambling commission, which is already covered by other parts of the legislation? The sword of Damocles approach goes much too far.

Sandra Osborne (Labour, Ayr)

I agree, and I hope that the Government will take that into account when the Bill goes to the Lords. I hope that the Minister will give us such an assurance tonight. I am merely trying to shed light on people's concerns, and on why the Government have introduced the measure.

Finally, I think that I am right in saying that everyone who has spoken on the amendment tonight is concerned about clause 58. I do not think that anyone was in favour of it. I am reassured by what the Minister has said, and I wait to see what happens when the Bill goes to the Lords.

Richard Caborn (Labour, Sheffield Central)

With the leave of the House, I will say a few words of, I hope, reassurance.

I have said that the Government will review carefully the need for reserve powers, including clause 58. The length of the consultation was conditional on that review, and we will report our conclusion and any alternative proposals in the House of Lords, if the Bill completes Third Reading this evening. I went on to say that the Government wanted to work with the British amusement industry to make sure that this important part of the leisure and tourism economy has a bright future. My hon. Friend the Member for Ayr (Sandra Osborne) has lobbied very hard indeed, and as I said earlier, we have taken on board the comments that she and other hon. Members have made. They would like the Government to consult people who have concerns and to give them reassurance about clause 58. We will review the reserve powers in clause 58 very carefully indeed. When we have completed our consultation, we will report to the House of Lords, so there is a time limit on our review. I hope that I have been as helpful as possible. The last thing that the Government want to do is harm that part of the tourism and leisure sector. I have gone as far as possible in my reassurances, and have taken into account the fact that other people need to be consulted. However, we will report forthwith in another place.

John Whittingdale (Conservative, Maldon and East Chelmsford)

I welcome the Minister's remarks, as far as they went. However, we have been expressing these concerns since the Bill was published. There has been ample opportunity to review the position. The Minister and the Secretary of State have consistently argued that the reserve power is necessary, despite all the evidence to the contrary. Even tonight, when the Minister sought to make a statement, he prefaced it by explaining why the Government had included a reserve power in the Bill. In his intervention, he again defended the inclusion of that power. If he wishes to accept that it is not necessary, he should do so tonight. While I welcome the fact that he has agreed to review the power and consult on it, the Opposition do not believe that a further review is necessary. The evidence all points one way: there is no need for the clause whatever, and its retention will do serious damage to seaside resorts throughout the country. I welcome the Minister's comments, as far as he was prepared to go, but they are not sufficient, and we will press the amendment to a vote.

New Clause 1 — Prize gaming permit

New Clause 2 — Delegation of functions under Part 8: Scotland

New Clause 3 — Delegation of functions under Part 9: Scotland

New Clause 4 — Permits: special provision for Scotland

New Clause 5 — Operating and personal licences: appeals: enforcement

New Clause 6 — Operating licences: rules for particular kinds of licence:betting on the National Lottery

Alan Haselhurst (Deputy Speaker, Saffron Walden)

With this it will be convenient to discuss the following: New clause 9—Meaning of ticket—

'In Part 5 "ticket" means a ticket or chance'.

Amendment No. 148, in clause 14, page 6, line 38, leave out paragraph (d) and insert—

'(d) of the processes referred to in paragraph (c) the process involving the majority of persons participating in the arrangement relies wholly on chance.'.

Amendment No. 149, in page 7, line 7, leave out 'significant', and insert 'substantial'.

Amendmdent No. 150, in page 7, line 10, leave out 'significant' and insert 'substantial'.

Government amendments Nos. 3 to 7 and 51.

Amendment No. 152, in clause 96, page 44, line 45 at end insert—

'(11) The Commission shall review the monetary limits laid out in subsection (3) on a triennial basis.'.

Amendment No. 153, in page 113, line 28, leave out clause 254.

Amendment No. 151, in schedule 2, page 159, line 8, at end insert—

'(e) the numbers of those who participate by sending a communication represent a substantial proportion of the total of those participating.'.

Government amendments Nos. 56, 58 and 59.

Malcolm Moss (Conservative, North East Cambridgeshire)

I wish to speak to amendments Nos. 148, 149, 150, 151, 152 and 153.

Amendment No. 148 relates to clause 14, which defines a lottery. Subsection (3) defines a complex lottery as one which relies on a series of processes rather than just one. The amendment to subsection (3)(d) is designed to close a loophole. In most cases where prize competitions are effectively lotteries it is not the first stage that relies wholly on chance—this stage is often a simple multiple choice question—but the decisive stage is the one where a computer selects one of several hundred or more correct answers to win. This relies on chance alone and is usually the final stage. As this subsection stands at present, it would seem possible for a prize competition to evade the regulatory requirements applying to lotteries by contriving a first stage that relied on some notional element of skill, which in reality eliminated very few participants, if any. This would take them out of the definition of lotteries altogether, provided that they complied with subsection (6). They would then proceed to the later stages relying on random computer selection from among the remainder, which would form the vast majority of the original participants. Our view is that the Bill should provide explicitly that the elements of the process relying wholly on chance should involve the majority of the participants.

Amendments Nos. 149 and 150 should be taken together. They seek to strengthen the definitions provided by the Bill. In the view of the Lotteries Council, the use of the word "significant" in subsection (5) is just as ambiguous as the Government allege the present law to be and sends a weaker signal. The intention of the law should be that prize competitions that seek to evade being called lotteries, and thus evade the regulatory regime, should be required to embody an element of skill that is very much more than merely derisory. It is hoped that the Government will endorse that statement of the Bill's intentions. The word "significant" does not at present carry that connotation. The amendment suggest the substitution of the word "significant" by "substantial", which is the word used in the present law.

Amendment No. 151 relates to schedule 2, which deals with the definition of "payment to enter". Paragraph 8 deals with the arrangements that offer a choice of free entry. The amendment is designed to close a loophole. As it stands, the paragraph would seem to enable the organisers to limit the free entries to a very small proportion of those wishing to take part, leaving the rest to pay in the usual way. If this is the case, the effect would be that they could run what are in practice ordinary pay-to-enter lotteries, but in the guise of free-entry lotteries, thereby escaping the regulatory requirements that apply to lotteries as a whole. The amendment seeks to clarify the issue by in effect providing that a substantial proportion of participants in this type of arrangement should be non-payers. Indeed, since the 1976 Act, case law has established that the number of free entrants should not be de minimis—insignificant—in relation to the number of paid entries. The Bill as drafted reflects no such provision.

Amendment No. 152 relates to clause 96. The Lotteries Council has urged Parliament to allow society lotteries to establish their own proceeds and prize limits for some time—that is, with no specific limits in the Bill, subject to the licence requirements regarding the minimum proportion of proceeds from ticket sales that go to good causes. The Budd report recommended that they should be able to do that. The Government have decided, apparently in order to protect the national lottery against a totally notional threat from charities, to ignore this recommendation. If these limits are to continue to be applied, it is important that they should be capable of amendment by subordinate legislation and that they should be regularly updated. The first of the requirements we believe has been conceded following representations, but we believe that there has been no assurance forthcoming on the second, and we hope that the Government will consider the amendment seriously.

Amendment No. 153 leaves out clause 254. The Lotteries Council is fully supportive of measures aimed at countering the threat of problem gambling. However, no link has ever been established between society lotteries and problem gambling. There is no academic research to support the proposition and the view of experts is that lotteries are way down the list of potential causes of this phenomenon. Why lotteries should be the only form of gambling singled out for this treatment in the Bill is open to question.

Clause 254 could impact on the future ability of society lotteries to raise money for good causes. If the Government are concerned about particular types of lottery played on particular types of premises, they should bring forward proposals to address these issues specifically, either directly in the Bill or by restricting the scope of regulation-making power. The regulation-making power provided for in this clause goes far too wide and is open to abuse.

Don Foster (Liberal Democrat, Bath)

I wish to speak briefly to new clause 9, but I begin by saying that I entirely support the comments made by the hon. Member for North-East Cambridgeshire (Mr. Moss) and his amendments. The House will be aware that my name and that of my hon. Friends is linked to those amendments.

In Committee, it became clear to a number of us that ticketless lotteries that are run by charities, in many cases hospices, would be required by the Bill to increase significantly bureaucracy and administrative costs. That is the case because ticketless lotteries are run in such a way as to ensure that those who participate in them agree to do so week in, week out, paying up front a lump sum for every week's amounts, and get a single document informing them that their name will be included in the draw every week. It became apparent, however, that the wording of the Bill would have ensured that the organisers of such lotteries were unable to continue to do that and made it necessary for them to send out a document to every participant each and every week.

Hence the increase in bureaucracy and administrative costs. Many of us on the Committee were extremely grateful to a number of the people who run such lotteries, in particular the Ty Hafan children's hospice in Wales, which worked very hard to raise its concerns with members of the Committee. It is worth bearing in mind that, over the past 10 years, some £100 million has been raised by hospices using this fundraising approach. The Minister acknowledged that there was a problem. In Committee, he said:

"naturally, we do not want to subject any hospice lottery to the cost and inconvenience of unnecessarily printing many thousands of tickets on a weekly basis. That would be stupid . . . The object of the exercise is to make it as simple as possible for charities to run such lotteries, but equally, to provide the protection covered in clause 92(5)."—[Official Report, Standing Committee B, 2 December 2004; c. 309–310.]

I was grateful to him for that, and I note that he has tabled some alternative amendments covering the issue, for which I am also grateful.

Although I shall continue to press new clause 9— I shall probably not press it to a vote, however—may I ask the Minister to give me some assurance that, after his consultations with the relevant lottery organisers, he believes that they are now satisfied with the amendments that he has tabled? In particular, I draw his attention to the reference to electronic storage of information. Has he consulted on whether such provision is future-proofed? With the development of mobile phone technology, it is likely that, within a few years, some of those organising such lotteries might wish to use mobile phones. Would that be acceptable? The development of interactive television is a further example that we have already seen. Again, it may be possible to use such technology as a means of providing the necessary information. Will he assure me that those issues are covered by the terminology used in his amendments?

John Greenway (Conservative, Ryedale)

This is a vital part of the Bill, which I think many colleagues will overlook at their peril. I endorse what the hon. Member for Bath (Mr. Foster) has just been saying about the importance of hospice lotteries to the hospice movement. The Government are to be congratulated on their intentions in the clauses relating to society lotteries. This is a highly desirable piece of work, because the present law on scam lotteries, which masquerade as prize competitions, is not being properly enforced, and society lotteries are hugely frustrated that they are required to be regulated as lotteries and that this Bill requires them to submit themselves to all the new proposals in respect of operating licences and personal licences, to face the wrath of the gambling commission and perhaps to be fined if they get things wrong, while lotteries masquerading as prize competitions are not to face any requirement at all. It is therefore crucial that the wording of the various clauses meets what the Government are trying to do.

We must understand the mischief that is involved. A number of the prize competitions are decided—let us make no bones about this—by chance. The real question is how we can include in the legislation a wording that requires a skill test that is easily understood by the courts and is meaningful. Skill is not skill if the test is derisory and just a handful of people would fail. I suppose that one could never anticipate that absolutely everybody would get things right. The example that was constantly put to the pre-legislative scrutiny Committee was that, on asking whether the capital of France was Paris or Berlin, one would assume that 100 per cent. of the population would answer correctly. There may be the odd person who, for whatever reason, might say Berlin, but that is not a skill test, and the Government are clear about that.

What we are faced with—this is the crucial aspect— is the wording in clause 14(5). I shall not read it out, as I have done so several times in several forums where I have been asked to speak about the issue, and people have smiled. I think that the wording is a genuine attempt to resolve the issue, but my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) has done the House a service in tabling his amendments, which I am sure that he does not intend to press to a Division. In suggesting that we change the words "significant proportion" to "substantial proportion", he is trying to raise the bar to ensure that a lot of people would fail and that the skills test is not derisory.

The various legal luminaries to whom I have spoken about the matter all rightly say that, in the end, the courts will decide. The value of this debate is in ensuring that the courts understand what Parliament was trying to say. That is the value of this short debate: what Parliament is trying to say is that the skill must be substantial or significant, not derisory. I hope that the Minister will agree with those remarks.

I wish to make one other little point. My hon. Friend the Member for North-East Cambridgeshire suggested that, as there appears to be no evidence of problems with rapid draws, clause 254 might be deleted. I am not sure about that. The clause is permissive, and uses the word "may" in relation to making regulations or the gambling commission making recommendations. I know that the Government have a worry about some rapid draw schemes, but as was pointed out earlier in relation to category D machines and children, there is no evidence of a problem. None the less, from the point of view of the pre-legislative scrutiny Committee, the clause is a clear improvement on what went before, which included a 24-hour rule that was clearly a mistake. I suspect that the Minister will have to concede that this will be one of those issues at which the other place will have to take a look. I guess that the other place will also make other suggestions about the skill test and the wording that is used.

I hope that, if a change is made in the other place to improve the wording of those parts of the Bill, it will be made with the agreement of those on both Front Benches, so we will not get into difficulty towards the end of the Session.

Richard Caborn (Labour, Sheffield Central)

While we are discussing lotteries, and in particular charity lotteries, I want to put on the record that we will protect the national lottery.

Government new clause 6 delivers our commitment to retain provisions that make side bets on the national lottery illegal by including conditions in general betting, pool betting and betting intermediary operating licences, which is consistent with the Betting, Gaming and Lotteries Act 1963.

As the hon. Member for Bath (Mr. Foster) has said, Government amendments Nos. 3 to 7 are technical drafting amendments to ensure that clear and consistent language is used in those clauses that refer to participation in all lotteries, which follows up the commitment that I made after the Standing Committee on 9 November.

The Government agreed to revisit the provisions relating to lottery tickets after the Committee raised concerns that it would be difficult for societies that run membership lotteries to comply with the Bill. In a membership lottery, a letter is issued to a member when they first sign up, and it acts as a ticket for the purpose of each lottery that the member enters. Government amendments Nos. 51, 58 and 59 will allow that practice to continue, and they will also permit lottery tickets to exist in paper or electronic form. An electronic ticket must be capable of being printed out or stored electronically to ensure that entrants can retain proof of their entry in the lottery.

Don Foster (Liberal Democrat, Bath)

Will the Minister give way?

Richard Caborn (Labour, Sheffield Central)

If the hon. Gentleman bears with me, I may be able to clear up the matter.

Amendment No. 56 delivers on our commitment to include national lottery licensees within the proposals for a statutory problem-gambling levy. It provides that the Secretary of State may introduce a levy on holders of national lottery licences only if she has already introduced a levy on holders of gambling operating licences and after consulting the national lottery commission.

Turning to amendments tabled by other hon. Members, the Government believe that amendment No. 148 would add an extra layer of complexity to a necessarily complicated clause.

On clause 14, I think that there is general agreement that arrangements in which the first process relies on skill or knowledge are competitions and not lotteries, and we do not want to prevent or regulate such arrangements.

I have some sympathy with amendments Nos. 149 and 150. However, clause 14(5) has been considered carefully, and it now strikes the right balance. We accept that the words "significant proportion" are likely to be subject to interpretation, but we anticipate that they will be subject to commission guidance, which is important. We do not think that a change to "substantial proportion" would add clarity to the clause. Indeed, there is a danger that such a change would permit competitions that are in fact commercial lotteries to continue to operate.

Amendment No. 151 would require companies offering prize competitions to ensure that a substantial proportion of those entering do so through a free entry route, rather than by paying via a premium rate telephone line. Although I understand the good intentions behind that amendment, it is misguided. Companies would be put in a position in which they might find they were inadvertently in breach of the law if, despite their best efforts to encourage free entries, not many people chose to participate in that way.

Amendment No. 152 would enshrine in the Bill the need for the gambling commission to carry out a triennial review of the limits on proceeds placed on large society and local authority lotteries. However, I firmly believe that there is no need to make the triennial review a binding, statutory obligation. Until now, the review has been a matter of custom and practice: it has worked satisfactorily on that basis in the past; we propose that it should continue to operate in that way in the future.

We cannot agree to amendment No. 153. Regulations under clause 254 can be made only with the intention of reducing repetitive-play lotteries. Such lotteries can be run swiftly, and are therefore very similar to gaming. They are often run in non-gambling establishments such as pubs, and could create great opportunities for chasing losses. We consider that they are a danger to the public and that it is imperative that the Secretary of State has the power to control them.

Lastly, new clause 9 would insert the concept of the sale of a "ticket or chance" into the Bill. That language is used in the current law and we have already ruled it out. We agree, however, that one document should be capable of permitting entry to a number of lotteries. I have explained how we propose to amend the Bill to achieve these outcomes. We also agree that electronic tickets should be permitted, and I have moved amendments to achieve that.

Don Foster (Liberal Democrat, Bath)

I receive receipts for paying my congestion charge on my mobile phone. I am not required to retain those receipts for a particularly lengthy period—in a sense, it is my choice if and when I want to have a battle about my congestion charge. The Minister has indicated that it is necessary to store electronic information. How long would somebody have to store such information if they were to use, for instance, a mobile phone or interactive TV?

Richard Caborn (Labour, Sheffield Central)

I should make it absolutely clear that the Government amendment will allow lotteries to operate by mobile phone and other remote media. I shall write to the hon. Gentleman about the storing of information and the time for which it will run, and place that correspondence in the Library. I have no doubt that that issue will be taken up by the gambling commission.

We need to close the loophole in relation to non-school competitions that lead to a draw. Clause 14(5) provides that where the first stage in a competition is multiple choice or involves a derisory level of skill or knowledge, it is classed as a lottery.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 8 — Days on which gaming and gambling shall not take place

Win Griffiths (Labour, Bridgend)

I beg to move, That the clause be read a Second time.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this it will be convenient to discuss amendment No. 99, in page 34, clause 79, leave out line 41 and insert 'shall prevent—'.

Win Griffiths (Labour, Bridgend)

I shall be brief. New clause 8 would bring casinos within the laws that apply to shops under the Christmas day trading legislation. I hope that that will not cause a problem. I thought that while I was doing that, I would propose that the gambling commission be given the power to decide whether it would be right for casinos to close on any other day of the year, especially if there was a big groundswell of opinion regarding a particular day.

Amendment No. 99 underscores the issue of problem gambling. As it stands, the Bill allows people to use credit cards to raise money in order to gamble in casinos. I am completely opposed to that. According to Gamblers Anonymous, someone who is involved in problem gambling often has six or seven credit cards with which they can play about and run up debts that we can hardly bear to think about. My amendment would ensure that someone who is gambling could not raise money with their credit card. It is okay if they use their debit card to get money from their bank account, although I would not like to do it myself, but if they use a credit card they can build up huge debts.

I hope that the Government will accede to those modest proposals.

Richard Caborn (Labour, Sheffield Central)

I thank my hon. Friend the Member for Bridgend (Mr. Griffiths) for tabling new clause 8. As he knows, I have met faith groups several times during the passage of the Bill, and I have sympathy with their concerns about gambling on Christmas day. At present, betting offices and betting tracks are prohibited from offering bets on Good Friday and Christmas day. There is no equivalent prohibition in relation to gaming or lotteries.

Times have moved on since that restriction was put in place in the 1960s, so the Government did not propose that it be replicated in the Bill. However, I recognise the strength of feeling about Christmas day in particular, and I am happy to agree that it might be appropriate to enable the commission to prescribe certain days on which operators should be prevented from providing facilities for gambling. I am therefore happy to give the issue further consideration, but in the meantime I ask my hon. Friend to withdraw the new clause.

On amendment No. 99, I understand my hon. Friend's concerns, but we see no reason for imposing a blanket ban on all operators to prevent them from offering credit to their players. We agree that such matters must be regulated; that is what clause 79 is intended to do. It gives the commission the powers to attach appropriate conditions to licensing; to control when and, indeed, how credit is offered, and where inducements to gambling are perhaps provided. The clause expressly prevents casinos and bingo operators from offering credit to players. That is currently the law and will remain the law.

The Gaming Board has a successful track record of controlling improper inducements and I am sure that the new gambling commission will continue that. If problems emerge in future, the gambling commission will not hesitate to impose licence conditions that better protect consumers. I hope that, with those reassurances, my hon. Friend is content to withdraw the motion.

John Gummer (Conservative, Suffolk Coastal)

I ask the Minister to think again about his refusal to prescribe in the Bill days on which gambling may not take place. It is odd that we protect people from having to open shops on specific days, yet we are not prepared to do the same for gambling establishments. Times may have moved on since 1960, but I am not sure whether they have always moved in the right direction. However, decisions about shop opening times were made much later than the 1960s and the Minister was one of those who took a strong view about protection for specific days. Is it reasonable to ask the gambling commission to do that? If that is all that we can get, I suppose that it is okay, but I should like the Minister to reconsider and ascertain whether the same restrictions that pertain elsewhere can be introduced in another place for gambling. Perhaps the gambling commission can also be given the ability, as the hon. Member for Bridgend (Mr. Griffiths) suggests, to extend that further. It would be odd not to do that, and the Minister goes in not for the odd but for the sensible and moderate answer.

Win Griffiths (Labour, Bridgend)

In this case, I believe that I can rely on the direction that the Government are taking and, although it is not especially pleasant to look to the other place to put things rights, at least we will get the provision, and I am therefore happy for us to proceed to the next group of amendments.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

New Clause 10 — Gaming machine permit held by on-premises alcohol licence holders

Don Foster (Liberal Democrat, Bath)

I beg to move, That the clause be read a Second time.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this, we may discuss the following: amendment No. 120, in page 23, line 21, clause 53, leave out 'A,'.

Government amendment No. 87.

Amendment No. 121, in page 26, line 21, clause 63, leave out 'A' and insert 'B'.

Amendment No. 122, in page 27, line 32, clause 66, leave out 'A' and insert 'B'.

Government amendment No. 88.

Amendment No. 123, in page 75, line 4, clause 167, leave out 'A,'.

Amendment No. 98, in page 75, line 43, clause 167, leave out 'B,'.

Government amendment No. 89.

Amendment No. 118, in page 105, line 4, clause 226, leave out from 'defining' to 'B' in line 5 and insert

'three classes of gaming machine, all of which shall be subject to a maximum stake and prize level, for the purposes of this Act (to be known as Categories'.

Amendment No. 106, in page 105, line 11, at end insert—

'(c) provide that the practice of allowing prizes to be exchanged known as "trading up" shall continue to be permitted without restriction.'.

Amendment No. 144, in page 105, line 11, at end insert—

'(c) not unfairly discriminate between equivalent adult only gaming environments, and

(d) provide that adult gaming centres and betting premises shall be entitled to the same categories of machine.'.

Amendment No. 130, in page 105, line 19, at end insert—

'(e) the price level for a category C machine which shall be not less than £35.'.

Amendment No. 109, in page 105, line 19, at end insert

'provided that regulations shall not reduce the level of stakes and prizes from those already in existence at the date of Royal Assent to this Act.'.

Amendment No. 1, in page 105, line 19, at end insert—

'(4A) Subject to subsection (4B)—

(a) the maximum amount paid in respect of the use of a machine shall be £1; and

(b) the maximum value of a prize for any machine shall be £2,000.

(4B) The amounts specified in subsection (4A) shall be varied by the same percentage increase between the retail prices index for January 2005 and the retail prices index for the base month in relation to the revision date in question.'.

Government amendments Nos. 90 and 91.

Amendment No. 124, in page 149, line 3, clause 340, leave out 'A' and insert 'B'.

Amendment No. 125, in page 149, line 3, leave out 'B,'.

Amendment No. 126, in page 149, line 4, leave out 'A (or B,' and insert 'B (or'.

Don Foster (Liberal Democrat, Bath)

The long string of amendments may appear to deal with rather technical issues, but many are important. The shortage of time means that I shall not do justice to them all, but I want to give other hon. Members an opportunity to raise issues about which they are specifically concerned.

Amendment No. 106 covers an issue that has been mentioned many times: the level of stakes and prizes in family entertainment centres. It deals with the value of a cuddly teddy bear in the grab machines that have been discussed. I therefore hope that we will have an opportunity to express a view on at least that amendment.

New clause 10 tackles an issue that we picked up in Committee. "Pub gaming machine permit" is the term in the Bill that covers a machine permit that is held by on-premises alcohol licence holders. The name is somewhat misleading since the permit does not apply only to pubs. It could apply to a range of other facilities, including bowling alleys, sports centres and so on. When I raised the matter in Committee, the Minister agreed with me. He said:

"we are aware that the name 'pub gaming machine permit' . . . appears to limit the premises that may apply for it. That is not the intention, and we shall table further amendments to rectify that."—[Official Report, Standing Committee B, 14 December 2004; c. 559.]

Unfortunately, the Government have tabled no such amendments, so I have done it for them in an effort to be helpful.

Amendment No. 106 deals with another issue of great importance to the family entertainment centres, namely "trading up", in which a number of prizes in the form of a token or voucher can be collected and swapped for a larger prize. The Bill discontinues that practice, despite the fact that there is no evidence that it causes any harm. This is a similar issue to others that have already been raised, and the amendment seeks to enable the continuation of the practice. All the evidence suggests that discontinuing it would lead to problems.

Amendment No. 109, on which I hope hon. Members will have the opportunity to express their view, relates to the present level of prize values. The Government's argument is that those levels should be reduced. They have not provided for that in the Bill, but such a provision has been mentioned in the background papers and it is clearly their intention to introduce such a reduction. All the evidence suggests that reducing the value of prizes would be likely to affect business, which would reduce the profitability and viability of the organisations concerned.

I note that several amendments in this group seek to withdraw any mention of category A machines from the Bill altogether. I was initially sympathetic to such proposals and, indeed, I tabled a number of amendments in a similar vein in Committee. However, the Government have subsequently introduced the concept of a pilot scheme or trial, and said that category A machines will be used only in the casinos in the pilot areas. In the light of that, we have agreed that it would be sensible at least to try these machines in the limited number of casinos that the Government are proposing. I am therefore unlikely to be sympathetic to the amendments tabled by the hon. Member for Bridgend (Mr. Griffiths).

The basis of many of the amendments in this group relates to what are known in the trade as grandfather rights. These rights are covered in schedule 18 of the Bill, and we hoped to have heard much more from the Minister on this subject. We have teased out some of the issues in earlier debates and the grandfather rights of some casinos are clearly fairly well covered. I hope, however, that the Minister will use his response to these amendments, which are in part about continuing existing practice, to say more about this.

I have been very brief, and I would have liked to raise a number of other issues. However, I know that other hon. Members want to raise other important matters and I want to give them the chance to speak.

Frank Doran (Labour, Aberdeen Central)

I want briefly to refer to a point raised by the hon. Member for Bath (Mr. Foster), namely on the issue of prize values. In my constituency, there is a long-standing family business called Codona's seaside resort, which has been there for more than 30 years—long enough, perhaps, for my right hon. Friend the Secretary of State to have paid a visit to it when she was a young girl growing up in Aberdeen. I am sure that she will be familiar with it. It is a traditional business with a seasonal fairground alongside an all-year-round covered area that supplements and pays for the improvements to the traditional fairground. As with many such enterprises, the business is fairly fragile.

A key part of that business depends on the category D machines, which are mainly an attraction for children. As the hon. Member for Bath said, it is quite clear that the Secretary of State intends to reduce the maximum value of the prizes in such machines from £8 to £5, although there is nothing about it in the Bill. This would create a major problem. The main difficulty that my constituents would face is that the vast majority of the prizes are things that today's children want, which tend to be branded goods. It is no good just throwing in cuddly toys, teddy bears and so on. People now expect prizes that are linked to things that they want, which tend to be commercial goods linked to television programmes but, mainly, to films. They want models of Shrek, Spider-Man and so on. Because of the licensing costs, and the fact that those goods are now a major part of the marketing of any film, they are very expensive. Some costings have been done, and with a maximum value of £5, it will be impossible for the business to provide the sorts of toys that customers demand. As I said earlier, this business, like most such businesses, is fragile, and it is deeply concerned about the future.

I have considered carefully the various statements made by the Secretary of State, and I understand and support totally the precautionary principle. It strikes me, however, that the precautionary principle has gone a little too far here. I voted with the Opposition, if one likes, on amendment No. 100, as it is important to have such a reserve power if there is any evidence that this sort of gaming has an effect on children. The Secretary of State has sufficient powers, in terms of her ability to regulate prize levels, possibly when the Bill is enacted to bar children up to a certain age from using such machines. To strike now, at a time when the industry is learning to adjust to new legislation, and to threaten a significant reduction in prize money of more than 30 per cent., would be destabilising.

Nick Gibb (Conservative, Bognor Regis and Littlehampton)

What the hon. Gentleman says is absolutely right, and rings true with the experiences conveyed to me by my constituents who run Harbour Park in Littlehampton. It also rings true with the British Amusement Catering Trades Association survey, which showed that 88 per cent. of such businesses believe that if stakes and prizes are reduced, the impact on them will be hugely negative.

Frank Doran (Labour, Aberdeen Central)

Obviously, I agree, at least on this one occasion, with the hon. Gentleman.

The Minister has been conciliatory tonight, and all that I can ask is that he take away this issue and consider it. If there is evidence that the proposal is necessary in the interests of protection of children, let us see it, because I am not aware that we have been shown any.

Alan Simpson (Labour, Nottingham South)

I wish to speak in support of my amendment No. 1, and with your permission, Madam Deputy Speaker, I hope to put it to a vote. It gives the House an opportunity to place an upper limit on the level of prizes that can be awarded under the Bill as part of the gaming machine process. It seeks to challenge the presumption, which the House is being asked to contemplate, that there is pressure from the public for unrestricted prizes in the gaming industry. Ninety per cent. of the public believe that there are perfectly adequate gambling choices at present. There is no demand outside the House for the introduction of super-casinos. Under my amendment, category A gaming machines would be allowed, but the upper prize limit would be the same as for category B—£2,000.

We are set to face a dramatic increase in gaming machines. At the moment, we have about 800 category B machines in the country, but a single super-casino could have more than that on its premises alone. Does that bring any economic benefit to our society? The Henley Centre suggests not. There will be gainers and losers, however. The gainers will certainly be the casino owners, and probably the Chancellor, with extra income for the Treasury of perhaps £400 million a year by 2010. What the gaming industry would make is its own calculation. Who would contribute to that? The level of Exchequer revenue is dependent on the punters being losers: people must lose that amount and more for the Chancellor to be able to take the Government's scoop. All the evidence from Australia suggests that the deregulation of the gaming industry caused a massive increase in gambling debt and that the biggest single contributory factor was the introduction of category A gaming machines with unlimited prizes.

According to the Budd report,

"A central question for us has been whether increasing the availability of gambling will lead to an increase in the prevalence of problem gambling. The weight of evidence suggests that it will do so."

The report also said:

"The possibility of winning a sufficiently large sum for it to effect a life changing experience seems to encourage a suspension of judgement in terms of making a balanced evaluation of the expenditure."

We now know that in Australia people spend more on gaming machines than they spend on food. That is the distorting impact that gambling has on the way in which Australia's economy works. We are told that the cost to Australian society is some 5.6 billion Australian dollars a year, with a further 1 billion Australian dollars of losses. In terms of scale, the cost to the UK economy would be comparable or larger. Do we need that in our society? We need it like a hole in the head.

Angus Robertson (Scottish National Party, Moray)

Will the hon. Gentleman give way?

Alan Simpson (Labour, Nottingham South)

I will allow a soupc"on of time.

Angus Robertson (Scottish National Party, Moray)

Is the hon. Gentleman aware that the Association of Chief Police Officers in Scotland fears that deregulation will lead to a surge in organised crime? It is not just an issue of personal debt.

Alan Simpson (Labour, Nottingham South)

That is a real fear, although I do not know how much weight should be given to it. According to a fair amount of evidence that we have seen in the House, we have proceeded with legislation against the advice of chief constables, and society has had to pay a heavy price.

Debt in our country is increasing by £1 million every four minutes. Today a statement from the Government considered ways of making it possible for low-income families to gain access to social housing by offering them discounts, but how can people pay for the mortgages that they have managed to acquire when they are running up debts? And the debts will be accumulated by the poorest: all the statistical evidence shows that three times as much gambling money comes from members of households earning less than £15,000 a year as comes from those earning over £32,000 a year.

The Chancellor's scoop, and the industry's scoop, of society's wealth will come disproportionately from the poorest. This is not a measure that will benefit the poor, redress inequalities in society and lift people out of poverty. It dangles before those people an inducement to gamble away the meagre incomes that their families have to survive on. We should be ashamed of feeling that we are under any pressure to introduce it in the interests of society. The only lobby in its favour that I have received has come from the gaming industry, and I am told that £100 million has been spent on its lobbying.

Not one person from the poor areas in my constituency has said, "Give us a break, guv, and bring this one in." In fact, we have been asked to put the brake on—and if 90 per cent. of people in the country are asking us to do that, that is what the House should do.

Malcolm Moss (Conservative, North East Cambridgeshire)

Amendment No. 106 is fairly straightforward. Its purpose is to ensure the continuation of the current practice known as trading up, which allows prizes, tokens and vouchers won on category D machines to be collected and swapped for larger prizes. Amendment No. 144 attempts to establish a level playing field between betting shops and adult gaming centres, especially in the context of fixed-odds betting terminals.

We tabled an amendment in Committee and there was a good discussion on it, but the Minister could offer no explanation in relation to adult gaming centres. He restricted his explanation of why a distinction was being made to bingo halls only. He said:

"Betting shops are adult-only and do not have a licence to sell alcohol." [Official Report, Standing Committee B, 2 December 2004; c. 379.]

We already knew about that point, which was made in the context of bingo halls, but he gave no justification as to why fixed-odds betting terminals were banned from adult gaming centres.

We are not saying now that we want the current number of FOBTs in betting shops—

It being one hour before the moment of interruption, Madam Deputy Speaker, put forthwith the Questions necessary for the disposal of the business to be concluded at that hour, pursuant to Order [this day].

Motion and clause, by leave, withdrawn.

Clause 170 — Casino premises licence: overall limits

Frank Field (Labour, Birkenhead)

On a point of order, Madam Deputy Speaker. An amendment has been moved to limit the number of category A gambling machines. Will you be putting that to a vote?

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

Amendment No. 1 has not been selected for vote. I will not be putting it to a vote.

Frank Field (Labour, Birkenhead)

Further to that point of order, Madam Deputy Speaker. But it has been moved. I thought that, if it had been moved, we would have a chance to vote on it.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

It was taken with a new clause and discussed, but it was not moved formally. It was grouped with other amendments and new clauses.

Amendment proposed: No. 142, in clause 170, page 77, line 7, at end insert—

'"(3A) In calculating for the purpose of subsection (1) the number of casino premises licences which have effect at any time, no account shall be taken of any established casino but—

(a) an established casino which meets the requirements of regulations made under section 7(5) as to the classification of large casinos shall for the purposes of section 167 be treated as if it is a large casino;

(b) an established casino which meets the requirements of regulations made under section 7(5) as to the classification of small casinos shall for the purposes of section 167 be treated as if it is a small casino; and

(c) an established casino which is below the minimum size for a licensed casino shall for the purposes of section 167 be treated as if it is a small casino.

(3B) In this section 'established casino' means any casino premises which are in use for the operation of a casino under the Gaming Act 1968 when this part of this Act comes into force.".'.—[Mr. Moss.]

Austin Mitchell (Labour, Great Grimsby)

On a point of order, Madam Deputy Speaker. It was my impression that, previous to the votes on this group of amendments, my hon. Friend the Member for Nottingham, South (Alan Simpson) discussed amendment No. 1 and began and ended by expressing his wish to move it. In that circumstance, should we not be able to have a vote on amendment No. 1?

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

I advise the hon. Gentleman—I do not think that he was in the Chamber at the time—that I have already dealt with this point of order and explained why no vote was called on amendment No. 1.

Clause 226 — Gaming machines: Categories A to D

Tessa Jowell (Labour, Dulwich and West Norwood)

I beg to move, That the Bill be now read the Third time.

I thank hon. Members on both sides of the House who have brought the legislation to this stage, and in doing so I should like to recognise that this is an issue that for many presents fundamental difficulties and conflicts of moral principle, but I am grateful to the House for the spirit of tolerance in which all stages of the Bill so far have been conducted.

It is important to recall the principles that underpin the legislation—that children and vulnerable adults should be protected, and that gambling in Britain should be kept crime-free, and conducted according to the principles of fair play. Everything in the Bill will be judged against those principles. If we secure the legislation, we shall have the toughest, most comprehensive regulatory framework in the world to protect the public interest and to prevent the exploitation of children.

This is legislation that has been shaped over the past five years. A major contribution has been made by the Joint Committee, to whose members I pay tribute, particularly to the hon. Member for Ryedale (Mr. Greenway). I hope that hon. Members on both sides of the House will recognise that the Government have listened to the concerns raised, as we undertook to do on Second Reading.

It is a curious thing in modern British politics that in one breath Ministers are accused of being arrogant, out of touch and refusing to listen, and in the next breath, when they have listened and responded positively, they are accused by the same people of a humiliating climbdown or a screeching U-turn. Ministers are damned if they do listen and damned if they do not, so they may as well listen—otherwise, what is the point of Parliament? We have listened to the concerns raised about the Bill, and it is a better Bill as a result, in relation to casinos, bingo, charity lotteries and the important issues raised by colleagues in connection with seaside arcades.

Dennis Turner (Labour/Co-operative, Wolverhampton South East)

I rise briefly to express the sincere thanks of the parliamentary group for non-profit-making members clubs to the Minister, and to the hon. Member for Barnsley, Central (Mr. Illsley), for accepting in Committee the amendment increasing the clubs' weekly bingo jackpot from £1,000 to £2,000. That will be welcomed by the whole clubs movement. May I say that I never cease to be amazed at the fairness and reasonableness of this Government and this Secretary of State?

Tessa Jowell (Labour, Dulwich and West Norwood)

I thank my hon. Friend; I am tempted to stop now, while I am on top.

I believe that we now have a Bill that will give greater protection to the public, a vital role for local authorities, a fair deal for the industry and the prospect of more and better jobs for industry employees. Indeed, right hon. and hon. Members on the Labour Benches will know about the strong support given to the Bill by the GMB and the Transport and General Workers Union, and also by the Labour group of the Local Government Association, all of which I warmly welcome.

In conclusion, the Bill is essential because without such legislation, gambling technology is leaving the law in its wake. If we do not modernise, people will not be protected. Without the Bill, there would be no gambling commission with the objective of social responsibility in gambling at its heart, internet gaming would continue to go unregulated, and there would be no powers to deal with roulette machines in bookmakers' shops, or the chain gifting schemes about which I know hon. Members will have received representation from constituents, and which continue to exploit women.

For all those reasons and many others, I commend the Bill to the House and ask that it be read the Third time.

John Whittingdale (Conservative, Maldon and East Chelmsford)

We have always made it clear right from the start that there is much in the Bill that we agree with. It contains a number of important measures that will help to introduce controls over remote gambling, for instance, and give new powers to the gambling commission. Since Second Reading there has, however, been the most extraordinary saga.

The Government rightly began their preparation of the Bill by consulting widely and then subjecting the draft Bill to scrutiny. I join the Secretary of State in paying tribute to my hon. Friend the Member for Ryedale (Mr. Greenway) and his Committee for their work. There is no doubt that the scrutiny Committee improved the Bill. Indeed, the Government's troubles started when they departed from its recommendations on regional casinos. Having done that, they appeared surprised at the chorus of opposition that they encountered. That led to not just one but two U-turns, reverses or whatever the Secretary of State chooses to call them, during the Committee stage.

The Government certainly appeared for a long time to be in a state of blind panic. What they have done has completely changed the whole thrust of the Bill, and at the very last stage of its passage. They have done so without any consultation with the industry and without any proper scrutiny. In some areas, they have turned a Bill that began life as a liberalising measure into one that will put in place a more restrictive regime than exists at present. By doing so, they have ended up satisfying almost no one. The overseas investors who were led to believe that there would be an opportunity for them in this country now feel betrayed because they will be restricted to a small number of locations. The domestic industry saw £0.5 billion wiped off its share values as a result of the Minister's statement in the Committee. The local authorities, many of which looked on the Bill as offering potential regeneration benefits, also feel let down. Those who are concerned about the dangers of gambling addiction still feel that the Bill may allow too many regional casinos and too many category A machines.

David Winnick (Labour, Walsall North)

The Government should listen. As there was so much criticism from both sides of the House—indeed, more criticism probably came from the Labour side—about the unlimited number of casinos, what is wrong with the Government responding to the views of Members of the House of Commons? They have taken the right turn, and I therefore support the Bill.

John Whittingdale (Conservative, Maldon and East Chelmsford)

In some areas, we welcome the fact that the Government have listened—indeed, we would have preferred them to listen rather earlier. As I said earlier, many of the problems would have been avoided if the Government had listened to the Joint Committee's original recommendations. Obviously, we welcome the fact that on some matters, the Government have moved in the direction in which we have urged them.

The Government have now agreed to introduce a pilot scheme for regional casinos, but the proposed number of casinos is still too large. We also regret the fact that they are unwilling to introduce or maintain an identity requirement for those using casinos.

On seaside arcades—a matter of great concern to many hon. Members—I welcome the commitment from the Minister for Sport and Tourism this evening to conduct a review. However, we would have liked him to make it clear at this stage that the Government will remove the clause giving the Secretary of State reserve powers to ban children from using those machines. Because of the movement by the Government, and because we support the measures to give powers to the gambling commission and to tackle remote gambling, we do not intend to vote against Third Reading.

Despite the enormous amount of preparation time, the Bill has not received proper scrutiny. It was changed dramatically on the last day in Committee, when we did not have a proper opportunity to examine those changes. Even tonight, there were five whole groups of amendments that the programme motion did not allow to be debated. I hope that those in another place will now subject the Bill to the scrutiny that it still badly needs. I accept the Secretary of State's point that the Bill is better than when it started, but it is still flawed, and the fact that we do not propose to divide the House tonight does not mean that we do not believe that the Bill is capable of significant improvement in another place.

Win Griffiths (Labour, Bridgend)

My remarks this evening are tinged with sadness. Although I recognise that the Government have moved significantly on a number of important issues, as the hon. Member for Ryedale (Mr. Greenway) said in support of the number of experiments, once the genie is out of the bottle, it is difficult to put back.

The concept of responsible gambling is a contradiction in terms. All Governments have a pathetic history of dealing with addiction problems—for example, alcohol. We are not coping with the problems. I tabled amendments, which we unfortunately failed to reach, to introduce specific references to finance and expertise, both to try to prevent gambling problems from developing and to treat people with gambling problems.

When my hon. Friend the Member for Nottingham, South (Alan Simpson) spoke to amendment No. 1, which unfortunately, we did not have an opportunity to vote on, he mentioned that there are three times as many problem gamblers in households earning less than £15,600 a year as in households earning more than £32,000 a year. A wide body of opinion suggests that the Bill will at least double the number of problem gamblers to about 750,000; some estimates are even higher. For each problem gambler, the lives of half a dozen people in their immediate vicinity are seriously damaged, so the Bill will affect millions of people. As the Opposition do not intend to vote against it, it will go to the other place, where I sincerely hope that it will be substantially amended.

I remain unable to support the Bill. In many ways, it does a lot to control gambling, but it throws open the barn doors for casinos, and I find that totally unacceptable.

Don Foster (Liberal Democrat, Bath)

The Secretary of State began by saying that the Bill had been a long time coming, and she was right. I, too, pay tribute to the many people who have been involved in the deliberations that have gone on during those years. In particular, I praise the hon. Member for Ryedale (Mr. Greenway) and members of his Committee for their work. It is interesting to note that we have needed all that time just to work out the precise number of casinos in this country—only tonight did we finally get the definitive answer of 136.

As the Secretary of State observed, many parts of the Bill have a great deal of support on both sides of the House, and outside the House—for example, the provisions concerning internet gambling, tougher social responsibility requirements, and a tougher regulator in the shape of the gambling commission, which will replace the Gaming Board—but many people have deep concerns about other aspects. That is particularly true in relation to casinos. The Secretary of State said that the Government should listen. Of course they should, but the real question is this: to whom were they listening when they first came up with those proposals? I know of very few people who have expressed any real desire for the massive increase in gambling opportunities proposed by the Bill in its initial form.

I am delighted that the Government have belatedly listened and made a welcome U-turn. It is right to have a pilot period, and a cap on the number of casinos during that time. However, much remains to be done in another place. The hon. Member for Bridgend (Mr. Griffiths) raised several issues, not least trying to ensure that casinos do not open on Christmas day. Because of the shortage of time, or the Government's unwillingness, we have been unable even to determine the value of a teddy bear in a family entertainment arcade.

Although a great deal of work remains to be done, I have no doubt that the Bill is far better than it was on Second Reading. I pay tribute to all those who have worked to make it a better Bill during its passage in Committee and tonight.

Tessa Jowell (Labour, Dulwich and West Norwood)

The House has had an opportunity for full discussion. Clearly, there are issues to be raised in another place, but I echo the sentiments of several hon. Members of all parties who have said that scrutiny has made the Bill a better measure. The people of this country need the protection that the Bill offers, and I commend it to the House.