More than 39,000 jobs could go and nearly 8,000 betting shops closed if the Government gives in to demands to curb limits on stakes and prizes for electronic gaming machines, according to Britain's bookies.
The Government is under intense pressure from anti-gambling campaigners to reduce the maximum stake from £100 to just £2, while keeping the prize money at £500, as part of a review of gaming machine limits that closes for consultation this week. Campaigners are looking to tackle the huge amounts punters are losing in a time of economic crisis – around £250m is thought to have been wagered on yesterday's Grand National alone.
In a submission seen by The Independent on Sunday, the Association of British Bookmakers (ABB) cites research that shows that any significant reductions would be "disastrous" for an industry which provides the Treasury with £1bn in tax. Around four-in-five jobs in the industry would be lost.
Many betting shops are on very low margins and researcher RS Business Modelling found that 7,880 shops would make an average loss of £58,900 if ministers bow to campaigners. This would cost the Treasury £650m in tax and councils £60m in business rates.
The association's chairman Neil Goulden said: "Any material reduction in stakes or prizes would undoubtedly have a devastating impact on licensed betting offices with multiple shop closures, increasing retail vacancies on the high street and thousands of lost jobs, many among young people and part-time female workers."
The £2 stake limit is in line with levels at bingo halls, which campaigners believe would help combat gambling addiction that, for example, sees £190m a year frittered away at betting shop terminals in the centre of Manchester alone. The area's MP, Lucy Powell, said last month that she was working with House of Commons colleagues to "tighten regulation of these dangerous machines".
However, in its submission, the ABB insists this is a "catastrophic proposal" for an industry where nearly 18 per cent of even the biggest five chains, including William Hill and Paddy Power, make an average operating profit per week of just £256.
The submission reads: "The proposal to reduce the stake to £2 is estimated to cause a 68.6 per cent drop in machine gross win. With machine related costs and taxes falling by a similar amount the overall impact is disastrous."
The ABB is supported by 7,000 employees and punters who have written to MPs arguing against the limits.