Daily Junction.mobi portalOpinion · April 1, 2024 · Daily Junction Editorial Team · 9 min
The 2019 reduction of maximum stakes on fixed-odds betting terminals from £100 to £2 was hailed as a landmark harm-reduction measure. Five years on, evidence shows FOBT losses fell 60%, but online gambling surged, raising questions about whether harm was reduced or merely displaced.
Five years ago, on 1 April 2019, the maximum stake on fixed-odds betting terminals (FOBTs) was slashed from £100 to £2, in what campaigners hailed as a landmark victory in the fight against gambling harm. The machines—dubbed the "crack cocaine of gambling" for their addictive design and capacity to drain thousands of pounds in minutes—had become a symbol of an industry that prioritised profit over player protection. The reform was expected to reduce harm, protect vulnerable gamblers, and force betting operators to rethink a business model that relied on exploiting addiction.
The immediate impact was dramatic: FOBT losses fell 60%, from £1.8 billion in 2018 to £720 million in 2023. Betting shop closures accelerated, with 3,000 shops shutting between 2019 and 2024, reducing the estate from 8,500 to 5,500 outlets. Treatment services reported a 35% decline in FOBT-related harm cases. By these measures, the reform was a success.
However, a closer look reveals a more complex picture. Online casino revenue grew 47% in the same period, from £5.3 billion in 2018 to £7.8 billion in 2023, driven largely by online slots that share many of FOBTs' addictive features but face no stake limits (until the 2024 white paper introduced a £5 cap). Problem gambling rates remained stable at 0.4% of adults, though the profile shifted from older men in betting shops to younger people gambling online. And the 3,000 betting shop closures disproportionately affected deprived areas, where FOBT density was highest, leading to job losses and reduced high-street footfall.
So did the FOBT stake cut reduce gambling harm, or did it merely displace harm from betting shops to online platforms? Five years on, the evidence suggests the answer is both—and that the unfinished business of regulating online gambling is now the central challenge.
FOBTs were introduced in 1999 as a way to diversify betting shop revenue beyond traditional sports betting. The machines offered casino-style games—roulette, blackjack, slots—with fixed odds (hence the name) and rapid play cycles (20 seconds per game). Initially, stakes were capped at £500, but this was reduced to £100 in 2005 following concerns about harm.
Even at £100, FOBTs were extraordinarily profitable. A single machine could generate £50,000-£100,000 in losses per year, with minimal operating costs (no staff, no inventory, just electricity and maintenance). By 2018, the UK had 33,000 FOBTs in 8,500 betting shops, generating £1.8 billion in losses—50% of total betting shop revenue.
The machines were also extraordinarily harmful. Research by the Gambling Commission in 2017 found that 23% of FOBT users were problem gamblers, compared to 0.7% of the general population. FOBTs allowed losses of up to £18,000 per hour (£100 every 20 seconds), and their design—near-miss programming, immersive graphics, rapid reinforcement—was optimised to keep players engaged and spending.
The Campaign for Fairer Gambling, led by former bookmaker Derek Webb, documented cases of individuals losing £100,000+ in a single session, often funded by crime, debt, or savings meant for rent or food. Betting shops in deprived areas had higher FOBT density, with some high streets having five or more shops within a few hundred metres, each with four machines.
Pressure for reform built through the 2010s, driven by campaigners, MPs, clinicians, and bereaved families. The Association of British Bookmakers (now the Betting and Gaming Council) fought back, warning that stake cuts would destroy the betting shop sector and cost tens of thousands of jobs. The industry proposed a voluntary £30 stake limit, arguing this would reduce harm while preserving viability.
The government commissioned a review of gaming machines in 2016, led by the Department for Digital, Culture, Media and Sport (DCMS). The review found that FOBTs were disproportionately harmful and recommended a stake cut to between £2 and £50. After intense lobbying, the government announced in May 2018 that the maximum stake would be cut to £2, effective April 2019.
The industry's response was swift: William Hill announced 700 shop closures, Ladbrokes Coral announced 900, and Betfred announced 400. The Association of British Bookmakers warned of 21,000 job losses and a £1 billion hit to Treasury revenue (from betting shop taxes). However, campaigners argued the closures proved the industry's business model was predicated on exploiting addiction, and that job losses were a price worth paying to reduce harm.
The stake cut had an immediate and sustained impact on FOBT losses:
The 60% decline from 2018 to 2023 suggests the reform was highly effective at reducing FOBT-specific harm. Treatment services reported a 35% decline in FOBT-related cases between 2019 and 2023, and GamCare (a gambling harm charity) saw a 40% drop in calls related to betting shop gambling.
However, overall problem gambling rates remained stable at 0.4% of adults (around 250,000 people), suggesting harm was displaced rather than eliminated. The Gambling Commission's 2023 survey found that the profile of problem gamblers had shifted:
The most striking trend since 2019 is the surge in online gambling, particularly online casino games (slots, roulette, blackjack):
The 47% growth from 2018 to 2023 far exceeds the growth in other gambling sectors (sports betting grew 12%, bingo declined 8%, lottery grew 3%). This suggests that some FOBT users migrated online, particularly to online slots, which share many of FOBTs' addictive features:
The Institute for Public Policy Research analysed anonymised gambling data from 50,000 customers and found that 18% of heavy FOBT users (those losing £1,000+ per year on FOBTs) increased their online casino spending after the stake cut, with average online losses rising from £800 per year in 2018 to £2,400 per year in 2023. This suggests harm displacement for a significant minority.
However, the IPPR also found that 60% of heavy FOBT users either stopped gambling entirely or reduced spending across all products, suggesting the stake cut did reduce harm for the majority. The remaining 22% shifted to sports betting or other betting shop products (virtual sports, lottery terminals).
The 3,000 betting shop closures between 2019 and 2024 were concentrated in deprived areas, where FOBT density was highest. Some towns lost all betting shops, while affluent areas retained theirs (often because they had lower FOBT reliance and higher sports betting revenue).
The closures had mixed effects:
Positive:
Negative:
The Campaign for Fairer Gambling argued the closures proved the industry's business model was unsustainable without exploiting addiction, and that the jobs lost were not worth preserving if they relied on harm. The Betting and Gaming Council countered that the closures punished communities that were already struggling, and that a more gradual stake reduction (e.g., to £10 or £20) would have preserved jobs while reducing harm.
The FOBT stake cut exposed a glaring inconsistency: betting shop gambling was now heavily regulated (£2 stakes, 18+ age verification, staff trained to spot problem gambling), while online gambling remained largely unregulated. Online slots allowed stakes of £100+ per spin, had no staff oversight, and were accessible 24/7 from home.
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