Gambling Commission & National Lottery Commission Merger
By Jana Sedlakova
One way of cutting public spending is to cut the number of public bodies along with the number of their employees. However, it is important to maintain efficiency, effectiveness, value for money and appropriate accountability – particularly when it comes to exercising public functions. The scheduled merging of the UK’s Gambling Commission and National Lottery Commission is by no means certain to achieve this goal.
Clive Hawkswood, CEO at Remote Gambling Association believes that “from what we have seen there will be very little saving from the merger. With regard to whether other savings can be made in the Gambling Commission it is always difficult to judge being on the outside and looking in, but the Culture, Media & Sport Committee has recently spent many months looking into this and related issues and they clearly concluded that the gambling regulator was not offering the best value for money. I’d be happy to trust their judgement on that one.”
Industry bodies have discussed the merger as has the RGA, as confirmed by Clive Hawkswood. “This idea is nothing new and our views have already been expressed to DCMS and the Gambling Commission so we probably won’t be putting in a response. The consultation is a formal process that has to be undertaken and it would be naive to think that the big decisions hadn’t already been taken.”
The National Lottery Commission’s offices have already been moved due to the expiration of its lease, and the so called co-location that comes with the merger is designed to help minimise costs although there is the anticipation of an early offset by alteration costs. This was further questioned and the information is in the associated impact assessment. Both, the Gambling Commission and the National Lottery Commission, are working closely with the government on this merger.
The Gambling Commission’s spokesperson said “The National Lottery Commission moved to join us in Birmingham in 2012 and we already share common services such as finance and human resources pending the proposed merger. The Gambling Commission has been closely involved in advising the government on these proposals and we’ll continue to work alongside DCMS and the National Lottery Commission as we move through the consultation process.”
Some issues may arise from a slightly different perspective. The Gambling Commission is purpose built for a private, commercial and a very competitive environment. The National Lottery Commission on the other hand, is not. The latter, as in the consultation, is purpose built for “public undertaking, run for public benefit in a non-competitive (monopoly) market”. Whilst in the case of the National Lottery Commission there is a ‘client like’ relationship between the commission and the outsourcer (Camelot), in the case of Gambling Commission there is no such relationship.
The question then will be to what extent the ‘client like’ relationship between the National Lottery Commission and the outsourcer will attribute a favoured standard of care compared to those governed by the Gambling Commission. The consultation acknowledges that this may suggest that “certain regulatory decisions were unfairly favourable to Camelot in an increasingly competitive and crowded market. There may also be a contrary concern that a single regulator is less able to prevent the encroachment of commercial gambling into the National Lottery territory, or that new and innovative National Lottery products could be unnecessarily constrained by an overly cautious approach in order to avoid accusations of bias.”
The consultation addresses the steps to minimise the risks and the importance of responsibility separation is highlighted along with the need of having a ‘wall’ created for cases where there is a possibility of existence of conflicts. The requirements how to manage the conflicts effectively were deemed ‘unnecessary nor desirable’ to be part of the Act itself. The regulation then may be seen as more adaptable to changing conditions and accordingly respond quicker.
The difficulties with the merger can be seen in terms of the different regulatory regimes and the different objectives between them.
Conversely, concerning the benefits of the merger, Clive Hawkswood added “I don’t expect the industry to notice any real difference or to obtain any measurable benefits from the change, but in the longer term it will hopefully make it more difficult for supporters of the National Lottery to seek to portray it as anything other than a pure gambling product.”