Gaming chiefs step up lobbying

FOREIGN casino groups will step up their intensive lobbying of the Government this week when a leading operator sponsors a fringe meeting on gambling at the Labour Party conference in Brighton.

The controversial event, hosted by Sun International of South Africa, comes just days after Culture Secretary Tessa Jowell angered established British operators such as Rank and Stanley Leisure by paving the way for dozens of new, Las Vegas-style casinos. Jowell ruled that slot machines offering £1m jackpots would be available only in supercasinos favoured by big international companies such as Sun, MGM Mirage, Harrah's and Kerzner.

Her decision overturned the recommendations of an all-party committee of MPs and peers who, worried about an increase in problem gambling, wanted a more gradual relaxation of the 40-year-old laws.

Jowell's surprise verdict followed a successful multimillion-dollar lobbying campaign by American and South African gaming giants.

This included a visit earlier this year to 10 Downing Street by G Thomas Baker, chairman of American company International Game Technology, the world's biggest maker of onearmed bandits.

Lord McIntosh, the Minister responsible for drafting the Gaming Bill, recently admitted that his parliamentary colleagues had been 'lobbied fiercely'.

US casino giant Harrah's spent almost $20m (£11m) in 'development costs' last year. Much of the substantial increase in those costs was attributable to work being carried out in the UK, where Harrah's has a joint venture with regional casino operator Gala.

'It looks like the UK has been out-lobbied by the US,' said Ian Wilkie, head of leisure at accountancy firm Ernst & Young. He estimates that the number of slot machines will increase rapidly in five years under Jowell's proposals - from 880 to 50,000 - while the value of the gaming market will increase from £8bn to £10bn.

Neil Murphy, Sun's development director, declined to reveal how much Tuesday's fringe meeting would cost, but said: 'We're sponsoring a Social Market Foundation meeting about responsible gambling. I don't know if any MPs or Cabinet members are coming.'

Sun plans to spend £600m on its developments in the UK but it remains unclear what the planning and tax regimes will be for new entrants from abroad.

The Government's U-turn came despite peers and MPs recommending that casinos above a certain size would be limited to specific 'regeneration zones'

such as Great Yarmouth and Morecambe. But overseas operators wanted - and received - the freedom to build US-style casinos in or near cities. For example, London looks likely to see a huge casino developed by Sun City founder Sol Kerzner at the Millennium Dome and others at Earl's Court and Wembley.

David Boden, Rank's director of gaming, said: 'We have US companies saying that this will create new jobs and so on but there's nothing to back it up.

'One person's regeneration is another person's degeneration.'

Boden is pinning his hopes on the Lords to amend the Bill.

Additional reporting by Graeme Beaton in New York