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UKGC accounts reveal high costs of 4th National Lottery competition

The UK Gambling Commission (UKGC) has cited progress on achieving the priority areas of its new ‘three-year Corporate Strategy’, helping improve the governance of licensed gambling businesses. corp

The Commission published its 2021/2022 ‘Annual Report & Accounts (April 2021-March 2022)’ assessing its performance, measures and compliance work to make gambling safer in Britain.

The compliance work was undertaken over the past 12 months, despite the challenges of the COVID-19 pandemic continuing to impact local communities.

The reporting period saw the regulator toughen its operating guidance on online gambling operators via tightened compliance measures to counter an increase in customers shifting online.

Despite pandemic circumstances, compliance and enforcement remained unaffected, summoning total industry penalties of £26m.

Year objectives saw the Commission underline that it had achieved better monitoring of online gambling incumbents and their consumer activities, as it now provides a breakdown of industry information on a quarterly basis.

A snapshot of UK gambling detailed that there were 156 casinos, 648 bingo venues, 1,640 licensed arcades, 7,683 betting shops and 186,832 gaming machines currently operating across Britain.

Gambling participation (retail and online) per month remains at around two-fifths of the UK’s adult population of 22.5m, of which approximately 13.4m have gambled online (circa 9.5m excluding National Lottery draws).

On problem gambling, the Commission noted that whilst ‘measurement was complex’ it continued to reference Health Survey for England estimates that “between 160,000 and 340,000 adults in England are problem gamblers” and” between 270,000 and 480,000 adults in England are classed as moderate risk gamblers”.

An assessment of ‘key deliverables’ saw it deliver 40 key initiatives across the Corporate Strategy priority areas of protecting children, creating a fairer market, keeping crime out of gambling, optimising returns for good causes and improving gambling regulation.

On 2021/2022 objectives, the regulator outlined that the majority of work had focused on improving gambling regulation, in which it registered 16 fully completed directives.

It outlined: “Our risk-based and evidence-led approach to regulation continues and we have continued to develop our teams within the Commission to ensure that we have the right foundations to regulate effectively and ensure high standards are maintained by all operators who are licensed by us.”

“We continue to set the direction for others in the industry to follow as we work to ensure gambling is safe, fair, free from crime and free from the risks of money laundering.”

A breakdown of financial accounts saw the UKGC generate a total income of £20.1m, a figure that does not include £27m of grants in aid funding contributed by National Lottery functions and Gambling regulations reserves.

Operator annual licence fees that totalled £18m accounted for the majority of the regulatory agency’s income.

The reporting period saw the UKGC’s expenditure increase to £45m (2020/2021: £38m).

Higher expenditure was attributed to National Lottery functions totalling £26m (2020/2021: £17m) – which included a £23m outlay on the National Lottery 4th licence competition (2020-21 £14.8m).

Employee costs for the year were £19.17m (2020-21 £21.26m), a decrease of £2m – of which 13.8m accounted for staff costs on gambling regulation and a further £3.2m on costs related to the National Lottery competition.

Employee costs for gambling regulation were £13.80m (2020-21: £15.80m) and National Lottery regulation £5.36m (2020-21: £5.45m). Of this, £3.23m related to the National Lottery 4th licence competition (2020-21 £3.19m).

Closing its accounts, the Commission cited a total income and expenditure deficit of £25m, including regulating the National Lottery.

2020/2021 was marked as a transformative period for the regulator that will now be led by the new leadership duo of CEO Andrew Rhodes alongside Chairman Marcus Boyle.

“We would like to say thank you to the hugely committed and professional team across the Commission for their ongoing work and achievements over the past financial year,” read Rhodes’ CEO statement.

“Overall, against a testing and fast-paced background, everyone across the Commission has performed exceptionally this year to ensure our tight regulation has been improved and communicated. We look forward to further success in the coming year.”


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