21 April 2006
A tool for local economic regeneration or an antisocial licence to print money? As competition hots up in the bidding war for the UK's first 'super-casino', Peter Hetherington talks to the councils having a flutter
Stick or twist? For the 68 councils bidding for a slice of regeneration funding that once seemed beyond their wildest dreams, the answer is clear – no matter how questionable the source of the finance. With hundreds of millions of pounds at stake, town halls throughout Britain have launched a PR offensive to become part of a gambling revolution that has pitched council against council amid hopes that tens of thousands of new jobs will emerge.
At stake is the location of 17 casinos: initially one Las Vegas-style complex, with banks of 1,250 fruit machines, countless exotic games – and, doubtless, equally exotic hostesses – and 16 smaller ones. But more could be on the way. Ministers scaled down plans before the last election in the face of Conservative concerns – but councils point to hints from the Department for Culture, Media and Sport that a further seven big casinos, and more smaller ones, could be approved if cross-party agreement is forthcoming.
This has prompted feverish activity by authorities to present gambling as a consumer-friendly, seemingly harmless, package, in which the casino is just one element in a leisure-cum-entertainment, cultural and convention complex. For some, it is the key to turning depressed towns into tourist destinations and state-of-the-art conference centres and visitor attractions.
In the process, the much-vaunted concept of 'planning gain' – in which developers offer a range of public facilities as a price for planning permission – has been taken to a new plane. From Manchester to Birmingham, Newcastle to Sheffield, Cardiff to Glasgow and Middlesbrough, authorities have sent bids to the DCMS. An independent panel, chaired by the former chief planning inspector for England and Wales, Professor Stephen Crow, will assess them and make recommendations to ministers at the end of the year. Then they will have to decide on the location of the lucky 17, at least one of which has already received planning permission.
Stung by claims that all this will encourage poor and vulnerable people to go further into debt, the government has responded with a series of reforms included in the Gambling Act 2005. This is a long-overdue attempt to control gambling – particularly on-line betting with credit cards – and meet an apparent demand for more casinos with strict regulations and enforcement.
Richard Caborn, the minister in charge of gambling at the DCMS, insists that a special £3m-a-year fund, which will be financed by the industry to promote social responsibility, will prevent abuse. Drawing parallels with the new and much-criticised Licensing Act, which opened the way for round-the-clock drinking, he argues that the gambling addiction of a few should not prevent the many from enjoying a flutter. 'You could apply the same argument to drink, but it should not detract from people going out on a Saturday night and having a nice meal,' he insists.
For big towns and cities, the gambling is secondary to drawing millions of pounds from international gaming giants – offering, according to Caborn, 'very significant' prospects for regeneration through planning gain. Potential operators include Kerzner International, which has roots in South Africa's Sun City and owns the Atlantis gaming resort in the Bahamas. It has the enthusiastic backing of Manchester City Council for a complex in the east of the city.
Then there is MGM-Mirage, in the frame for a site at Birmingham's National Exhibition Centre. Elsewhere, Las Vegas Sands has already gained approval from Glasgow City Council for a £120m complex at Rangers Football Club, and the London-based Aspinall family has teamed up with Australia's Packer organisation to develop complexes in Middlesbrough and Cardiff.
Caborn, whose home city of Sheffield also has designs on a super-casino, insists the government has learned from experiences abroad. He has visited Australia on several occasions and says he's not impressed with its gambling emporiums. 'It's market forces gone mad over there and I was appalled by the number of [gaming] machines,' he confesses. 'It affected me.' Explaining how a new Gambling Commission to be based in Birmingham will issue operating licences for casinos and much else in the gambling world, he insists ministers will control the number of machines in Britain.
He rattles off the figures: 'There'll only be three allowed in a pub, four in a betting shop, 80 in a smaller casino, 150 in a medium-sized one and 1,250 in the largest.'
To drive home the point, he adds: 'You have to be fit and proper to get a gambling licence. The Gambling Commission will keep very firm regulatory control and have tremendous powers of enforcement. The key to the legislation is protecting the vulnerable, particularly children, and to keep gambling crime-free.'
In Middlesbrough, both the local council and the potential operator, Aspinalls, find it hard to contain their enthusiasm for a venture that could embrace a four-star hotel with conference facilities, bars, shops and a 7,000-capacity arena. Two thousand jobs have been mooted. 'The critical thing from the point of view of the council is that… there is a community contribution to the public sector from the operator for the privilege of having a licence for the site,' explains Andrew Herd, executive director of Aspinalls' casino arm, Aspers.
Tim White, assistant chief executive for regeneration with Middlesbrough Borough Council, adds: 'We are going for this because we believe the regeneration benefits and wider benefits for the (surrounding) Tees Valley will be very, very significant… this comes with a wide range of add-ons, which are desperately needed in the area.'
But what of the social risks? Joe Docherty, chief executive of the Tees Valley's local public-private sector urban regeneration company, which is planning the complex on an old dockland site beside Middlesbrough's Riverside football stadium, asks: 'Is there going to be increased gambling? It would not be honest to say there will not be. Will there be an increase in problem gambling? Not necessarily. If we do it properly, we can reduce problem gambling. We are not irresponsible.'
Middlesbrough knows it faces tough opposition – not least from nearby Newcastle upon Tyne, which sees the potential for a convention centre with the planning gain proceeds from a casino. But the city already has four, high-profile casinos, including a new one run by Aspers in a city centre entertainment complex. This was opened last October under 1968 legislation. On three floors, it includes 150 gaming machines, with jackpots up to £4,000, and 60 electronic gaming terminals linked to roulette tables.
Herd says this gives a glimpse 'in miniature' of what Middlesbrough will look like. Another Aspers casino is proposed for Cardiff, beside an international sports village. 'You can't just put up a shed and expect people will come… you need a compelling product. Our Newcastle casino has been a fantastic success and the three other casinos in the city, after an initial dip, have more or less recovered – so the arrival of a new facility tapped into a vein of hitherto unmet demand.'
So the big casino operators are clearly hitching their apparent largesse to what they see as a latent demand. But what are their market projections? Herd gives a clue. 'Very difficult to give a short answer to that… to win a competition you have to offer a decent slug of the pie to local communities. The one interesting statistic is that 3% of the population of the UK will visit a casino during the course of the year, while in parts of the US… penetration can be anything from 10%–25%. So if you took the view that, over a period of time, penetration in the UK was going to move in that direction – it might not go straight to 15%, but it might go from 3% to 6% to 9% – then suddenly the numbers start to look appealing.'
And, for a declining town such as Blackpool, which has seen a near-30% drop in its holiday trade since the 1980s, a casino complex tied to a badly needed new conference centre is certainly appealing. The eminent planner and geographer Sir Peter Hall, who was educated in the town and chairs Blackpool's urban regeneration company, insists that its case for a 'conference casino quarter' is far stronger than those of other contenders. The town is literally dead for much of the year, with a totally uneconomic base to maintain essential services,' he laments. 'This is a one-industry town and we have been losing that industry catastrophically. The only way to turn things round is to go for a different kind of tourist trade, in a very high-quality environment.' The plan is to build the casino – cost from £200m to £450m – partly on council-owned land and partly on a car park south of the existing Winter Gardens.
Like others, Hall is rattled that Manchester – Blackpool's main northwest rival – is fighting hard for a super-casino near its 'sports city' site beside Manchester City Football Club's Eastlands stadium. He says cities such as Manchester have become major tourist attractions in their own right and, unlike Blackpool – which has deliberately not opened negotiations with a casino operator – do not need the extra economic boost of a gambling-cum-conference complex. 'A casino is a minor add-on for one of these big cities, but it is crucial for Blackpool,' says Hall.
Richard Leese, leader of Manchester City Council, is not impressed. He says their proposal, which also includes a swimming pool, multi-purpose arena, bars, nightclub and hotel, offers a 'robust test bed for the successful implementation of an as yet untested concept in the UK'.
In what seemed to be a swipe at Blackpool, Howard Bernstein, the council's chief executive, told a conference last year that good transport links and 'strong evidence of commercial vitality' were essential to the success of a gambling complex. 'If a casino is located in an inadequately accessible location for the market it is intended for, it will begin to attract communities whose profiles are not suited to gambling as an occasional and recreational pursuit,' he warned.
Put less subtly, that means casinos are aimed not at the average punter but at people with higher disposable incomes. Critics argue, however, that some on lower incomes, alongside the unemployed, might find the lure of gaming machines hard to resist. In Glasgow, opposition to plans has come mainly from the Scottish Socialist Party, which has seats in the Scottish Parliament, and the Scottish Nationalists. They argue that the proposed complex, approved by the Labour-controlled council, will drive people into debt and 'make the poor even poorer'.
Around Britain, others have similar reservations – although, with some exceptions, the three main English political parties appear to have no overriding objections. One report this year, written by the Office of the Deputy Prime Minister and leaked to The Times, labelled the new casinos a 'licence to print money', with the prospect of 'enhanced socioeconomic problems' from crime, antisocial behaviour and alcohol abuse. It questioned whether the promised regeneration benefits would emerge, and – revealingly – claimed there are almost twice as many gambling addicts than the government has admitted (1% of the population in reality).
That has not shaken the resolve of councils and the DCMS. Ken Hardeman, the Conservative Cabinet member for regeneration on Birmingham City Council, speaks for many. 'The offer of millions of pounds from these casino people is one we had to take seriously.'
In short, it seems authorities are prepared to approve almost any 'leisure' development, whether tied to heavy drinking or gambling, if it comes with the promise of extra cash for pet projects. Those God-fearing civic leaders who built great cities a century and more ago would turn in their graves.
Peter Hetherington writes on community affairs and regeneration
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