Senet Group – a good idea in theory
By Warwick Bartlett
Bookmakers in the UK could be forgiven from suffering from bunker syndrome. Not only have they endured a rise in machine tax from VAT at 15% to 17.5% to 20%, lost the reclaim on VAT with a move to MGD at 20% and now a 25% rate.
Add to that higher costs associated with regulation, a Point of Consumption Tax at 15% on Internet betting for UK customers, and now councils can now reject betting shop applications. The Prime Minister has a list of what he would like to see happen with gambling. He clearly does not like the concept of people gambling. But he finds the odds on election betting more accurate than the opinion polls. (Dave, you cannot have it both ways. Had you taken notice on the Scottish referendum betting you could have saved yourself an embarrassing trip to Glasgow).
But there is more!
That is just the UK Government, add to this the continual squawking from the Labour Party about under age gambling (have you ever seen anyone under the age of 48 in a betting shop?) and a willingness to re-visit dormant accounts if elected (god forbid, I could not take five years of the Labour Party). The message is clear – there are votes in being nasty to the bookmakers. It pleases those who do not bet, and the ones who bet and lose blame bookmakers rather than their own judgement.
It is against this background that bookmakers have had to do something. If you had said to the bookmakers all this will go away if you stand in the middle of the M1 motorway, naked during rush hour, they would do it!
Will all bookmakers sign up to this? I doubt it. The Big 4 are behind it – William Hill, Ladbrokes, Coral and Paddy Power and there is a lot of history between the Big 3 (excluding Paddy Power) and the independents. Satellite Information Service (SIS) supplies bookmakers with televised product. The original idea was to set the company up like a co-operative with all bookmakers as members. It ended up as a company owned by the Big 3. The independent bookmakers to this day believe they have been hammered by differential pricing.
Then we have 49’s a supply of numbers games to betting shops, again owned by the big bookmakers.
The independents have seen horserace betting levy deals move against them as the payments become less progressive where affordability to pay has been eroded.
The greyhound service in betting shops uses tracks owned by the big bookmakers.
While all of this is one hundred percent legitimate, the independents believe that anything offered by the Big 3 (now 4) is against their interests, and should be given a wide berth. The bad news for the Senet Group is that unless everyone does sign up it will never be effective. It will only be as strong as its weakest link.
The history of the form book tells the independents they are right and the Big 4 need to take note of their dissent or else they could become history themselves.