§ 8.32 p.m.
§ Lord HARMAR-NICHOLLS rose to move, That an Humble Address be presented to Her Majesty praying that the Betting, Gaming and Lotteries Act 1963 (Variation of Fees) Order 1976 (1976 S.I. No. 593) be annulled. The noble Lord said: My Lords, I am afraid that I have to intrude on today's Business at rather short notice. I have to do so because this is the last day for praying against this Order. 1 could have included Orders Nos. 592, 623 and 616, but I have 1041 confined it to Statutory Instrument No. 593, as the principle on which I wish to argue is identical under all the orders.
§ I shall not be asking your Lordships to veto the terms of these orders, although there is some background to the way in which those terms were arrived at, a background which disturbs me and causes me to take this action tonight. I comment on them now with a view to trying to ensure that a more satisfactory procedure is adopted in future and with a view to speeding up a balancing factor, out of fairness to the promoters, a balancing factor which I believe is already in the mind of the Government, and I ask for that factor not to be unduly delayed in being brought into action. To be absolutely on the safe side, I should perhaps declare a marginal interest in that I am a director of a company which may have an interest in this field, although I am not sure. My purpose in undertaking this task on this occasion is purely a Parliamentary one; it is not the terms of the Order but the way in which the terms have been arrived at which has brought me to my feet on this last day.
§ I would remind your Lordships that when the Gaming Act 1968 came into force the position, so far as bingo is concerned, was, first, that promoters had to pay a fee to the Government to obtain a licence and, secondly, they were restricted by' Statutory Instrument as to what they could charge, and indeed under the order it was laid down that the entrance fee to the building and the cost of participation should not be more than 50p per head to the promoters to cover their expenses and give them their profits. That was the position in 1968 and last year, after lengthy consultations, the Government increased their licensing fee by 50 per cent. and at the same time allowed the maximum costs to be paid by clients to the promoters also to be increased by 50 per cent. That proper procedure, where alterations were made after detailed consultation, was accepted as being the basis for any future alterations, and there is no doubt that it was the fair way of doing it. It took into account the considered views of all sides and it maintained a spirit of co-operation, which is as valuable as it is desirable, between the promoters, represented by the British Bingo Association, and the Gaming Board. At that point it was a very good 1042 procedure because everybody was happy and it arrived at what all sides considered to be a fair decision under all the circumstances.
§ Bearing that in mind, in April of this year there was a tacit understanding between the promoters and the Gaming Board that any increase in the Government's licensing fee would come after consultation and, at the same time, that any increase in the cost of the Government licence would be taken into account together with other operating costs for the possible increase in what the promoters could charge their clients: again, moving together. Unfortunately—this is the reason for my raising the matter tonight--this orderly way of facing up to the consequences of inflation was thrown overboard by the Secretary of State. Without consultation, he arbitrarily increased the licensing fee by another 33⅓ per cent.—only 12 months after the 50 per cent. increase—but on this occasion he did it not after having consultations and, by doing it without consultation, he prevented the promoters from establishing their claim that they should be able to increase their participation charge to their clients.
§ This arbitrary decision by the Secretary of State was, I have every reason to believe. in no way initiated by the Gaming Board. Indeed, the Gaming Board has made it clear by letter that the Secretary of State based his decision on the normal overall report that the Board sends to the Minister and certainly not after a specific investigation as to the need for this one-sided decision. I attach supreme importance to the Government keeping to understood arrangements. If suddenly, by arbitrary Ministerial action, one ends a spirit of agreed co-operation between a Government agency, like the Gaming Board. and private enterprise licence-holders,. nothing but harm can follow. I believe that it is bad and dangerous for the Government to make decisions outside an agreed procedure as it is generally understood.
§ All that I wish to say now is that having been able to point out how this happened on this occasion—and I have intimated to the noble Lord who will reply the main reason why I am doing this tonight—I should like an undertaking that it will not be repeated and that 1043 consultations to rectify the balance as it previously existed, to allow promoters a fair increase, will be speeded up and acted upon. I have seen letters which indicate that this is the sort of thing the Government have in mind in any case, but it has been suggested that it might be 1977 or 1978 before this balancing factor is brought into being. For the good of maintaining proper relations between the Government agency, the Gaming Board, and the promoters, I hope that the Minister will he able to give me the undertaking I seek, which is that in future consultations will always precede decisions and that, in order to balance this quirk—this move away from what I consider to be the correct procedures—steps will he taken to rectify the position at the earliest possible moment. It is with that in mind that I beg to move.
§ Moved, That an Humble Address be presented to Her Majesty praying that the Betting, Gaming and Lotteries Act 1963 (Variation of Fees) Order 1976 (1976 S.I. No. 593) be annulled.—(Lord Harmar-Nicholls.)
§ 8.39 p.m.
§ Lord HARRIS of GREENWICH
My Lords, I am glad of this opportnuity to explain the Order which the noble Lord, Lord Harmar-Nicholls, is seeking to annul, I am bound to say that when the noble Lord uses terms like " arbitrary action ", I take the view that he rather overstates his case, as I shall seek to demonstrate. The Order we are debating tonight increases from £2 to £2.50 the fee for a permit for amusements with prizes. What we are talking about here is chiefly prize bingo. This fee has always been the same as the fee for a permit for amusements with prizes by means of gamine machines which was increased by the Gaming Act (Variation of Fees) Order 1976, Statutory Instrument No. 592. Therefore I shall, as the noble Lord has, direct my explanation to both of these Orders.
It was the intention that the full cost of administering the gaming controls introduced by the Gaming Act 1968 should he borne by the gaming interests concerned and not become a charge on the taxpayer. In accordance with this principle, my 1044 right honourable friend the Home Secretary made regulations which increased, with effect from 1st May 1975, various fees payable under the relevant legislation. At the same time, increases were authorised in charges payable by the public and the prizes awarded in various forms of gaming. These changes in fees, charges and prizes, which were, as the noble Lord rightly said, of the order of 50 per cent., were the first changes of such a nature since the Gaming Act 1968 came into force. They took account of the increase in the costs of administering the controls which had taken place between that time and December 1973.
The recent increases in fees which were authorised by the two Statutory Instruments No. 592 and No. 593 were necessitated by further increases in the cost of operating the system of gaming controls which have occurred since December 1973. Inevitably salaries are a major item in these costs. I am sure that it is right that the cost of the gaming controls should not become a charge on the general body of taxpayers. In April of this year, the Gaming Board was authorised by the Home Secretary to consult gaming trade associations on the increases in charges and prizes which might be made at the same time as the next increase in fees. I understand that the trade associations have made representations to the Gaming Board that increases in charges and prizes should not be held back until May 1977 but should be authorised as soon as possible. But I am afraid that, if it is being suggested—as I think the noble Lord has this evening directly suggested—that every increase in gaming fees must be accompanied by simultaneous and proportionate increases in charges and prizes, I cannot accept that argument. The noble Lord has referred to there being some form of understanding that licence fees and charges should be increased together. I am not aware that any undertaking to this effect has ever been given. As I shall explain in a moment, I do not think that any such automatic linkage is justified as a matter of policy, but, if the noble Lord has any particular evidence about this, I shall certainly be ready to look at it, as, I am sure, will my right honourable friend the Home Secretary.
The factors which govern changes in fees are not identical with those influencing the proper levels of charges and prizes. It is because the Government recognise the 1045 need for further adjustments in these various levels that discussions with the trade associations have been authorised, and we will certainly bear in mind, when we receive whatever recommendations the Gaming Board may make about the future level of charges, the argument that any increases in charges should apply before May 1977. But the immediate issue is that of increases in gaming fees to help meet the cost of administering the gaming controls, and 1 would suggest to your Lordships that the increases in gaming fees made by these two Orders are amply justified.
§ Lord HARMAR-NICHOLLS
My Lords, I believe that the noble Lord accepts the main purpose of what 1 had to say. I have never suggested that there had been a written understanding to continue the procedures I have described. I used the words " tacit understanding " to make it quite clear that it was a sensible arrangement which seemed to work and which should continue to work. It was certainly not a written understanding. Nor did I for a moment suggest that, just because the licensing fee had been increased, the promotor's charges should automatically increase. I chose my words very carefully. The noble Lord may remember that I said that what I objected to was not having consultations before increasing the fees. My words were:In order to give the promoters a chance of seeing if that increase justified their having the extra payment.All I would say to the noble Lord is that the considerations which caused the increase in the fee—increase in salaries and in administrative costs—apply also to the promoters. If it is necessary for the Government, in order to be fair to themselves, to increase the fee, the least they can do is to have consultations to see whether the other side in the partnership has not on the same grounds a reason for the same sort of consideration in order to remain in business.
I believe that the point is made. I feel that the noble Lord has taken my point and I hope that the general basis of what I have tried to say will be taken into account by those who will operate the arrangement in the future. The scheme which has operated until now has been a good one. The understanding between the two sides has been very friendly and it would be a pity to injure it. I hope that the message 1046 which I have tried to give on those lines will be taken into account and acted upon. I beg leave to withdraw the Motion.
§ Motion, by leave, withdrawn.