Experts Warn UK Government Likely to Restrict FOBT Stakes
Experts have said that the UK’s hung parliament is more likely to mean an aggressive cut to the size of bets allowed on gambling machines.
At present, it is possible to bet up to £100 a time on fixed odds betting terminals (FOBTs). However, MPs have been considering a reduction in size as part of a wider review of the gambling industry by government.
Both Labour and the Liberal Democrats promised in their election manifestos that they would cut the amount it was possible to bet to just £2. If this were to become actuality it could see some of the UK’s biggest bookmakers loose hundreds of millions in pounds of revenue.
By contrast, the Conservatives did not mention any cut. However, the Democratic Unionist Party, which the Conservatives are relying on, has previously come out against gambling terminals.
This week analysts at Barclays said that the probability of maximum bets being cut to £2 has significantly increased, something that is likely to worry investors.
The same analysts think that Ladbrokes Coral could lose £439 million in revenue in 2018 if the stakes are cut while William Hill could lose £288 million and Paddy Power Betfair could lose £58 million. However, there is the chance that some of the lost revenue could be spent in the bookmakers in other ways. Furthermore, the bank said that the most likely scenario is for stakes to be restricted to £25.
Since the election, shares in both William Hill and Ladbrokes Coral have been falling and Barclays said that if stakes were cut to £2 then they expect shares to fall by up to 9%.