In early 2015 the Lotteries Council of Great Britain commissioned Decaid Consulting to carry out a benchmarking exercise among its members, to identify attrition levels in lottery campaigns. The aim was to permit members better to plan, manage and advocate for their lottery product within their own organisation, and also to enable the Lotteries Council to strengthen its advocacy of charitable lotteries at a national level.

The study broke lottery entrants down by payment method – cash, direct debit, cheque, standing order and credit card. Anonymised data was provided by Lotteries Council members for the period 2010 – 2014. The measurement used was based on weekly draws, this being the most easily measured and accurate data recorded by charities. The results were weighted to take into account the vastly differing numbers of players participating in individual campaigns. Players who did not make their first payment were removed from the calculation, and recorded as “no-shows”: thus the attrition results were based only on players who paid for their first draw.

The results need to be considered in light of the fact that the respondent pool was relatively small: in total, 25 charities responded to the call to participate; however 4 did not submit any data ultimately, and 3 submitted data that was unusable. This left a pool of 18 participants. Of the total usable campaigns, 49% of entries were by direct debit, 39% by standing order, 7% by credit card and cheque and 5% by cash.

The study was keen to monitor the “no-show” rate for direct debit and standing order players, largely because a further contact with the player is often enough to prompt restoration of their instruction to their bank. The results, perhaps unsurprisingly, showed that standing orders perform rather better than direct debits in terms of player retention, with an overall decrease of 3.5% between 2010 and 2014, compared to an increase of 5% for direct debits.

Cash campaigns showed a relatively high attrition rate, but this is closely related to the success of the particular campaign. For example, of 8 campaigns, one showed an attrition level of 25% over 2 years, with another experiencing 45%. This has served to demonstrate the importance of charitable lotteries’ strategy, advertising and “message”, when seeking to attract cash players.

The results of the research demonstrate a completely different pattern for credit card and cheque players, by comparison with those who pay cash. Attrition rates for credit card and cheque appear to relate to quarters, 6 monthly periods and annual periods. Decaid conclude that this could be attributable to the fact that these players commit to a certain number of draws and then do not renew, or are not asked to renew. This finding clearly highlights an opportunity that is currently being missed by some charities, since by diarising the expiry of fixed periods and contacting the supporter again at the relevant time, support could be significantly enhanced. One charity lost 56% of lottery revenue between 2013 and 2014 as a result of the expiry of fixed periods. Hopefully the results of the research will focus minds in this respect.

The pattern for standing orders and direct debits is different, again, to cash, credit card and cheque, in that it reveals a very clear step-up in attrition after every 4 draws. Decaid explain this as representing players considering whether or not to renew every month. Again, the results should prompt charities to maintain regular contact with players, whilst all the time remaining aware of the current negative publicity surrounding overt “pushiness” and respecting the Institute of Fundraising Code of Practice.

The research also broke the results down by cause: air ambulances, hospices, other health initiatives and sporting bodies. Credit card and cheque payments markedly provided the most reliable source of income for air ambulances in terms of attrition. Across the board, standing order and direct debit players were observed as requiring less hands-on management, however.

The study also looked at payment methods by location. Here, the striking finding was that credit card and cheque payments work well in semi-rural areas, but appear to fail after 4 months in urban areas.

There is much to be learned from the detail of the report, but the gist is equally important: lotteries are undoubtedly an excellent stream of income for charities, and increasingly so, with a lot of new charities, particularly the larger national ones, entering the market. This report demonstrates the widely differing performance of various charitable lotteries and highlights opportunities for those encountering significant attrition rates to improve, including a better acquisition strategy and more attentive ongoing player stewardship.

Regardless of the performance of individual charitable lotteries, the report is clear on one thing: direct debit lotteries perform much better in terms of fundraising and attrition than door to door and face to face campaigns, run at the same time. Clive Mollett, Chair of the Lotteries Council, told me: “one of the benefits of this research is that it demonstrates the value of lotteries in fundraising for charities. It provides hard evidence that lotteries perform vastly better than other fundraising methods, in terms of attrition. For example, on-street canvassing, which some call “chugging”, has an attrition rate of 95% over 5 years – and it can take that time to recover the associated costs. There are still massive unexplored fundraising opportunities for charities in the lottery market.”

Should you have any queries on the research, or on raising funds for good causes via a lottery-type product, please contact me at anna@www.woodswhur.co.uk.

Colin Manchester looks at some amendments that are needed to temporary event notices and the new Part 5A notice which has not yet come into effect.

Temporary event notices (TENs) have been subject to various amendments in recent years. There were several introduced by the Police Reform and Social Responsibility Act 2011 (PRSRA 2011) e.g. extending the right to object, originally confined to the police on the crime prevention objective ground, so that either the police or environmental health could object on any licensing objective ground (s 112), and extending the number of days in any calendar year on which a single premises can be used to carry on licensable activities from 15 to 21 days (s 115(3)). More recently, a further change has been made by s 67 of the Deregulation Act 2015, which has increased the maximum number of TENs that can be given under s 107(4) of the Licensing Act 2003 (2003 Act) for any one premises within the same year from 12 to 15. This recent amendment has led to a new TENs form being introduced by The Licensing Act 2003 (Permitted Temporary Activities) (Notices) (Amendment) Regulations 2016, SI 2016/20, to reflect the change. The new form duly reflects this change but a drafting error has been highlighted in a report of the Joint Committee on Statutory Instruments to Parliament. Section 9 of the new TENs form contains a declaration to be signed by the person giving the notice acknowledging that it is an offence to knowingly or recklessly make a false statement in connection with the TEN and that permitting an unauthorised licensable activity to be carried on at any place is an offence, but references in the form to the fine for these offences are incorrect. The form states that the fine for the former offence is one not exceeding level 5 on the standard scale and for the latter offence is a fine not exceeding £20,000 but these fines have been changed to unlimited fines by s 85 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 and para 33(2) of Sched 4 to the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Fines on Summary Conviction) Regulations 2015, SI 2015/664. References in the new TENs form should simply be to a fine and this has been recognised by the Home Office: ‘The error was an oversight which the Department will seek to correct at the earliest opportunity, which is expected to arise later this year’ (para 1.4 of the Joint Committee Report).

This is not, however, the only oversight which needs correcting in the area of TENs, as will be seen below. The power of entry in s 108(1) of the 2003 Act of a constable or an authorised officer of the licensing authority to premises to which a TEN relates is ‘to assess the likely effect of the notice on the promotion of the crime prevention objective’. This was the only purpose for which entry would have been relevant prior to the amendments to the TENs regime introduced by the PRSRA 2011, as only the police could give an objection notice on crime prevention objective grounds, but this is no longer the case. Under s 104(2) of the 2003 Act, as amended by s 112(5) of the PRSRA 2011, the police or environmental health can object on any licensing objective ground. If the power of entry in s 108(1) is to complement the amended provision in s 104(2), it should be available to assess the likely effect of the TEN on the promotion of any licensing objective and not just the crime prevention objective. It is difficult to resist the conclusion that s 108(1) remaining in its original unamended form was an oversight but, unless and until it is amended, it seems that the power will only lawfully be exercised if entry can be justified to assess the likely effect on promotion of the crime prevention objective.

An additional form of authorisation, which as in the case of a TEN does not require permission from the licensing authority but simply the giving of a notice, is the Part 5A Notice. This is a new form of authorisation in Part 5A of the 2003 Act which has been added by s 67(2) of and Sched 17 to the Deregulation Act 2015, although these provisions have not yet come into force. When they do, the Part 5A Notice will enable the licensable activity of the retail sale of alcohol to be carried out over a period of time by community organisations or small businesses that sell alcohol as an ancillary part of a wider service without the need for a premises licence, club premises certificate or the use of multiple TENs. The Part 5A Notice, the relevant provisions for which are contained in ss 110A-110L of the 2003 Act, is closely modelled on the TENs regime. Thus the notice is given to the licensing authority (s 110D), police and environmental health have an opportunity to give an objection notice based on any licensing objective ground (s 110I), and a counter-notice can be given by the licensing authority (s 100J). There is a power of entry in s 110L for a constable or an authorised officer of the licensing authority to premises to which a Part 5A Notice relates. You can guess what is coming next. Yes, this is closely modelled on the power of entry in s 108(1) for TENs, with s 110L(1) providing: ‘A constable or an authorised officer may, at any reasonable time, enter premises to which a Part 5A notice relates to assess the likely effect of the notice on the promotion of the crime prevention objective’. So, as in the case of a TEN, the power of entry is expressed to be to assess the likely effect of the notice on the promotion of the crime prevention objective, although an objection notice and a counter-notice can be given if considered appropriate for the promotion of any of the licensing objectives. If the position remains unchanged, this is what I plan to say on s 110L(1) in the 4th edition of Manchester on Alcohol and Entertainment Licensing Law when it is published next year:

The position here is the same as it is for the power of entry for TENs in s 108(1). That section was not amended following changes introduced for TENs by the PRSRA 2011 under which an objection notice and a counter-notice could be given if considered appropriate for the promotion of any licensing objective and the view was expressed that the failure to amend s 108(1) was an oversight. This view is reiterated here in respect of s 110L(1), which is expressed in comparable terms to s 108(1) and which compounds the failure.

If the failure to amend s 108(1) and s 110L(1) was an oversight, the Home Office may (if it is aware of this … ) seek to correct these provisions at the earliest opportunity, although it will not be as easy to do so as with amending the new TENs form to correct the oversight in respect of the level of fines. This is because the TENs form is contained in regulations i.e. secondary legislation but the provisions in ss 108(1) and 110L(1) are contained in an Act of Parliament i.e. primary legislation. Amendments to secondary legislation can be made by Government departments with the legislation laid before Parliament for a period of time for approval before it takes effect. This is a relatively straightforward process. Amendments to primary legislation, on the other hand, need to be made in an Act of Parliament, the passage of which will take a much longer period and the provisions of which are subject to detailed debate and scrutiny during the course of the legislation’s passage. Unlike the TENs form oversight, there is no ‘quick fix’ for the ss 108(1) and 110L(1) oversight(s). A good starting point, however, would be an acknowledgement of these oversight(s) and the need for these provisions to be amended, even if it may take some time before effect can be given to their correction.

© Colin Manchester

Woods Whur solicitors advise the London Borough of Newham as the Olympic Stadium looks to a new premises licence for the sale of alcohol and provision of entertainment.

I am delighted that the London Borough of Newham has instructed me to offer legal advice as they consider a new application for a premises licence to allow the sale of alcohol and provide entertainment at the Olympic Stadium.

This is truly an iconic venue and it is hard to believe that it is already four years since those amazing golden Olympic moments in the stadium.

I was first instructed five years ago by the Mayor of Newham, Sir Robin Wales, to conduct a review of policies and procedures in Newham for licensing applications and procedures. Since then, I have gone on to deliver my report, conduct training to elected members and officers and advise the sub-committee on Licensing Act 2003 applications and Gambling Act 2005 applications. In addition, I have represented the Borough on appeals at Thames, Stratford and Waltham Forest Magistrates’ Court and also in the High Court on two occasions.

It is one of my most prized client relationships and has provided me with one of the best working environments over the past 25 years during which I have specialised in Licensing Law … and sometimes the most challenging.

It is fair to say that the Borough has its own challenges and was one of the first in the country to include off-licences in its Cumulative Impact Policy, due to problems surrounding street drinking and the sale of high ABV alcohol.

I am looking forward to the panel hearing in May of this year and it is fantastic that the regeneration continues the Olympic legacy in Stratford and the wider Borough.

London Borough of Newham Enforcement Manager Sheila Roberts said, “Paddy and Woods Whur have been our lead licensing solicitors for the last five years. Paddy has advised panels as legal advisor, represented us in appeals before the Magistrates Court and successfully defended our robust licensing stance in the High Court on two occasions. In addition, he has provided regular member and officer training which is always well received. He has provided a free telephone advice and support service to our officers whenever required which is hugely beneficial when dealing with urgent enquiries. A key value of the professional relationship is that he is very quick to respond to our queries and has contributed greatly to the confidence and expertise that officers now have when dealing with and identifying solutions to complex and challenging licensing issues. We have had a significant run of success in Magistrates Courts appeals, winning costs; and have accepted advice from Paddy to compromise certain appeals with a contribution to our costs by appellants. The most important feature is it feels like he is one of the team and we value his balanced judgement and advice.”

Here’s hoping that the Borough continues to flourish, along with its strategic relationship with Woods Whur.

 

 

We are delighted that Colin Manchester has committed to a new edition of Manchester on Alcohol and Entertainment Licensing Law, which will be the 4th edition, and will be published by Woods Whur Publishing in 2017.

Colin told us, “There continue to be changes to the primary and ancillary legislation, as well as development in the law through High Court and Court of Appeal decisions, all of which means that licensing law continues to be a fertile area for litigation. I am pleased that 2017 will see me release the 4th edition of my text. It is also great news that Woods Whur Publishing are reducing the cost of the current 3rd Edition to £40 per copy as a mid-publication discount.”

To place an order please email info@www.woodswhur.co.uk

As of 1 April, some 1.8 million workers in the UK are set to be better off as a result of the introduction of the new National Living Wage. Announced in the summer 2015 Budget as part of the “higher-wage, lower-benefit economy” initiative, it is set at £7.20 per hour and is compulsorily payable to all workers aged 25 and over. This is 50p higher than the National Minimum Wage payable to 21-24 year olds, meaning that a full-time, previous NMW worker aged 25 plus will earn £940 more over the course of the coming year. In addition to 1.3 million of those workers, approximately 500,000 workers who, up until now, earnt an hourly rate somewhere between the two figures will benefit.

The NLW is still somewhat lower than the voluntary Living Wage, which continues to exist, set by the Living Wage Foundation at £9.40 for London and £8.25 elsewhere. Some 2,300 entities are currently signed up to pay those rates, including Barclays and Aviva and large local authorities like Cardiff, Birmingham and Newcastle. They benefit from the Living Wage Employer Mark and Service Provider Recognition Scheme in return for doing so, and report the benefits of voluntarily participating: 80% say that the quality of their employees’ work is enhanced and figures show a 25% reduction in absenteeism for those taking part. Two thirds have noted a significant positive impact in terms of the recruitment and retention of staff.

The LWF’s rates are based on the actual cost of living, whereas the NLW is based on median earnings nationwide. The Government has asked the Low Pay Commission, which has fixed the current rate and will recommend new rates going forward, to aim for a NLW that attains 60% of that median by 2020. By that stage the NLW will stand at over £9 per hour, and the Independent Office for Budget Responsibility has estimated that a full-time NMW worker will have earnt £4,400 more in cash terms as a result. Despite this, the LWF has said that “the job has not been done” in relation to low pay, and has urged employers to continue to participate in the voluntary scheme, which has traditionally received cross-party support.

The IOBR has also warned, however, that by 2020 60,000 jobs could be lost, due to employers seeking to cut back their workforce as they struggle to pay the new rate. The Institute for Fiscal Studies has predicted that the NLW will have a “huge effect”. These warnings have been dismissed by the LPC – but it seems to be on its own. The Federation of Small Businesses has pointed to anecdotal evidence from its members that they will be cutting back on staff, and the Recruitment and Employment Federation has reported a drop in companies having recruitment ambitions for the next three months, from 74% in January to 62% in February.

Figures released by the Association of Licensed Multiple Retailers suggest that the NLW will hit the licensed hospitality sector particularly hard. It estimates that it will result in 4 million fewer hours a week being worked in the UK, with a colossal drop of hours worked in the trade of 11%.

Some organisations have pointed to an element of unfairness underlying the NLW – after all, a 24 year old will potentially earn 50p less an hour than a 25 year old for doing the same work. In addition, the new measure will undoubtedly have a greater impact in the North, North East and South West of the country than it will in London.

There are also various ways that employers can effectively get out of paying the NLW – quite apart from only employing those aged under 25. For example, if a business offers accommodation to its employees, it can deduct a charge (up to £37.45) a week from salaries – and this is not included in the calculation. Employers might decide to axe overtime and other perks, such as Sunday pay, bonuses and London weighting, in order to compensate. The retailer B&Q has already come under fire for cutting other employee benefits to enable it to pay the new rate, and there are doubtless others, whose employees might be too afraid to speak out.

Perhaps inevitably, the issue has been dragged into the Brexit debate, with some in the “out” campaign claiming that the draw of Britain’s new NLW – the fourth highest in the EU after only Luxembourg, France and Ireland – will outweigh any advantage that the “emergency brake” on migrant benefits, renegotiated by the Prime Minister, might achieve. Whilst it’s true to say that the minimum wage in Spain is just over €5 an hour, and in Greece and Portugal it is less than €3.50, while Romania and Bulgaria have minimum wages below €1.50, whether an extra 50p an hour will make any difference at all to immigration remains to be seen.

 

Remember, remember the 6^th of April 2016 does not quite have the same ring about it as “remember, remember the 5^th of November, gunpowder, treason and plot”. Just as the 5^th of November 1605 will be a date that King James will never forget, so the 6^th of April 2016 has to be a date that gambling operators should not forget.

The Gambling Commission’s recently published information (24 March 2016) about more independent gambling operators being prosecuted and having conditions attached to their licences relating to non-compliance with legislation. Paul Hope, the Gambling Commission Consumer Policy Program Director said that “the actions that Licensing Authorities have taken against gambling premises show that operators cannot afford to be complacent. They need to remember that where weaknesses persist, regulators will also consider other sanctions such as licence suspension or revocation”.

These sanctions could equally apply to the new measures which came into force on 6 April 2016, which include the requirement for Premises Licence holders to conduct a local risk assessment for their premises and for all non-remote operators who are Premises Licence holders in the arcade, betting, bingo and casino sectors to participate in multi-operator self exclusion schemes.

We have been aware for months that operators would soon be required to have in place a written local risk assessment for each of their current premises, and as from 6 April 2016, this is now a requirement. In addition, Ordinary Code 10.1.2 states that licensees should share their risk assessment with Licensing Authorities upon request, as best practice.

The local risk assessment must be unique to each premises and cannot be generic. It must specifically refer to local matters identified in the Licensing Authority’s Statement of Licensing Policy and by the operator itself and it must offer assurance that the premises have suitable controls and procedures in place which reflect the level of risk within the area.

It is necessary therefore to carry out a review of the risks presented locally, in particular relating to groups which are perceived as being vulnerable, and it may be helpful to attach a map to the risk assessment showing the position of local schools, churches, doctors’ surgeries, hospitals, homeless shelters, and so on. The aim of the requirement is described by the Gambling Commission as “to enable operators and Local Authorities to engage in constructive dialogue at an early stage, to reduce the likelihood of costly enforcement action at a later date”.

There is also a new Social Responsibility Code (3.5.6) in the Licence Conditions and Codes of Practice which also came into force on 6 April 2016, requiring operators to be involved in a multi-operator self-exclusion scheme which would allow an individual to make a single request to self-exclude from that type of gambling within their area. Operators who have not done so should register with the relevant scheme as soon as possible. The details of the relevant trade bodies are as follows:

Arcades/BACTA – Phil Silver, Head of Compliance, 29/30 Ely Place, London, EC1N 6TD. Telephone number: 0207 730 6444 & email: bacta@globalnet.co.uk

Betting – info@selfexclusion.co.uk

Bingo – Bingo Association, Cherry Hoskin, Lexham House, 75 High Street, North Dunstable, Bedfordshire, LU6 1JF. Telephone number: 01582 860921 & email: cherry@bingo-association.co.uk

Casino – National Casino Forum, Tracey Damestani, Carlyle House, 235/237 Vauxhall Bridge Road, Victoria. Telephone number: 0207 828 5410

If anyone needs help on any of these points please contact me at andrew@www.woodswhur.co.uk or on 07738 170138.

There seems to be a significant amount to talk about at the moment in the licensing sector and leisure industry, with significant changes afoot. Spring is always an exciting time but this year is unusual in that we have seen a very productive start to the year. January to March 2016 have been busy….significantly busier than recent years. Operators seem keen to refurbish, ask for longer hours and we have seen an unprecedented rise in requests for new licences. Is the casual dining bubble coming to maturity? Is 2016 the year of the independent operator? How do you counter balance Cumulative Impact Policies with the desire of quality operators to come to where the night time economy is booming? A great time to be involved in the leisure industry.

One of those key changes will be the introduction of the national living wage and Anna Mathias has written an article on this change and how it could potentially impact in to the leisure sector. One thing is for certain, it is causing a significant raising of eyebrows and assessment of its potential impact. Time will only tell as to how this will affect the industry.

Another change which came in to effect on 6 April 2016 could have major implications. This is the amendment to class O (changing offices to dwellings) of the Town and Country Planning (General Permitted Development) Order 2015.

Amongst other things the main effect of this amendment will be that planning authorities will have to consider noise impact on new residents from existing licensed premises (and other businesses) when they consider new proposed residential developments.

These new regulations will mean that property developers will be required to seek approval on noise impact before a planning authority will change the use from office to residential building. This is a step in the right direction for a significant number of areas. I recently undertook an application for a fabulous new set of premises in Leeds called Archies run by Ossett Brewery. During the application before the licensing authority a number of residents objected to the granting of the licence (in former licensed premises). It was a breath of fresh air to hear one of the councillors on the committee ask the question of a residential neighbour complainant as to why they chose to live in the centre of Leeds surrounded by bars and restaurants and then complain about their impact. It has long been the case that the resident in these areas tends to take priority. It is a welcome development that the amendment to Class O applications now creates a burden on developers to demonstrate that such noise sensitive residential proposals will not be exposed to a high level of noise from existing, authorised licensed premises which have not caused difficulties/compromised the public nuisance licensing objectives previously.

What developments with the EMRO and the Late Night Levy? The most recent authority to look at an EMRO was Hartlepool. Although the police were recommending an EMRO to the licensing authority in February of this year the licensing committee met and resolved not to impose an EMRO suggesting that the Safer Hartlepool Partnership would need to produce better evidence that an EMRO was warranted.

This is the latest knock to the Home Office introduction of the Early Morning Restriction Order which still has had a zero take up.

With regard to the Late Night Levy the most recent areas to look at the levy have been:-

Liverpool City Council who rejected the introduction of the levy having listened to representations from national and local operators they came to the conclusion that the introduction of the levy would not have a significant impact on the late night economy and rejected the introduction of the levy.

Gloucester City Council are in initial discussions about the introduction of the late night levy but are also considering a business improvement district as an alternative to the levy.

This comes on the back of Brighton and Hove deferring their consultation along with Camden. Again the take up of the Late Night Levy has not been what the Home Office would have expected when they introduced the measure. I think that the prescriptive procedure and perceived net benefit are significant hurdles to a greater take up.

The Home Office are clearly looking at this particular issue in that they have launched a “Modern crime prevention strategy”. Within the strategy they have a heading “Alcohol as a driver of crime”. In this document the Home Office highlight the potential for making late night levies more flexible and placing cumulative impact policies on a statutory footing (they are currently the creature of the Section 182 Guidance document). An interesting suggestion is a “Group review intervention power” which looks like a licensing authority would be able to consider licensing conditions for a group of premises to address issues in a specific area (an EMRO by another name name?). This document is a recent March 2016 document and is worth reading. The link to this document can be found below.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/509831/6.1770_Modern_Crime_Prevention_Strategy_final_WEB_version.pdf

Interestingly, the Home Office contacted me recently after my article in which I was critical of the lack of statutory guidance as to summary reviews. I believe that the next issue of the Section 182 Guidance document will contain statutory guidance for the summary review procedure. This will be welcome to all who have to deal with them.

It looks like 2016 will continue to be an interesting year in relation to the regulatory framework of licensed premises. We will of course update any guidance / comment as soon as we are able to view further developments.

There has of course been a huge fuss in the media surrounding the 2016 Budget, proposed cuts in PIPs, the resignation of Iain Duncan Smith and the subsequent Government U-turn. Here, though, we take a look at the measures proposed that are of direct relevance to the gambling and licensed trades.

Most of you will have heard that alcohol duty on beer, most ciders and spirits has, again, been frozen. This is the fourth year in a row that the Chancellor has applied such a freeze. Duty on wine and higher strength sparkling ciders will, however, rise in line with inflation, leading to complaints from some that the distinction is discriminatory. The Government says that these measures are designed to help the nation’s pubs and “to support responsible drinkers”. However, the Alcohol Health Alliance has claimed that freezing the beer duty actually further harms pubs, by reducing the relative price of alcohol sold in supermarkets. The Government’s analysis of the changes acknowledges this, and the fact that the number of pubs will doubtless continue to decline.

The Government also admits that its measures on alcohol duty “are likely to lead to a minor increase in overall alcohol consumption in the UK” and that, with the freeze meaning that the price of a bottle of spirits will on average be 87p less than it would otherwise have been, it will cost the Exchequer £85 million a year.

The decision to freeze duty again has been met with howls of protest from alcohol harm pressure groups such as the AHA and the Institute of Alcohol Studies. They are frustrated by the Chancellor’s failure to accede to their demands, in lobbying leading up to the Budget, that duty be increased. They have accused the Government of missing an opportunity to protect children from alcohol-related harm, pointing in particular to cider being sold at “pocket money prices”.

Set against a backdrop of off-sales dominating alcohol consumption, whether these changes will actually help or undermine the pub sector remains to be seen.

Less well-publicised than the measures surrounding alcohol duty are those aspects of the 2016 Budget that will have an impact on the gambling sector. There are two main areas to focus on.

First, the Government plans to make free casino and bingo gaming subject to Remote Gaming Duty, thus bringing them into line with free bets being subject to General Betting Duty. This announcement has surprised bookmakers, who had feared that the Chancellor was planning instead to impose another increase in Machine Games Duty and place restrictions on online advertising. The fact that neither of these measures has come to pass has come as something of a relief, although the application of duty on free and discounted spins and bonus credits will certainly hit operators’ profits, potentially significantly so, given the extent to which the sector relies on such offers in the acquisition and retention of customers.

Whilst the new measure will not become effective until 1 August 2017, giving operators time to consider changes to their player incentive schemes, there is no doubt that this represents bad news for the industry. The Treasury estimates that the change will swell tax revenue coffers by some £345 million over the four tax years between 2017/18 and 2020/21 and all of this will come out of operators’ profits. The devil will be in the detail, though, and the precise way in which operators will need to adapt their marketing will depend on how the new rules are drafted.

The Budget notes also confirmed the introduction of the new Horseracing Betting Right on 1 April 2017. This follows on from the announcement at the time of the March 2015 Budget that the Government planned to introduce the Right, which surprised many at the time, coming as it did only 6 days after the last consultation on the subject had closed.

The Right will replace the Horserace Betting Levy, which has been in force since 1963. Moves have been afoot to abolish it since 2001, and momentum in that direction has increased since the increasing popularity of online gambling, which led to the implementation of the Gambling (Licensing and Advertising) Act 2014. The Government launched 3 separate consultations on, respectively, extending, modernising and replacing the Levy between June 2014 and March 2015.

The Levy currently does not apply to gambling operators who are based offshore, although some do make a voluntary contribution. The British Horseracing Authority has welcomed its replacement by the Right, under which all betting operators will be obliged to pay in order to be entitled to bet on British horse races, as representing “a fair and sustainable funding mechanism for British Racing” by “securing the long-term prosperity of our sport and those within it”. It also believes that the Right will enable British Racing to grow its already very significant contribution to the economy of £3.45 billion.

Perhaps unsurprisingly, the Association of British Bookmakers is less keen and has pointed out that its members already pay 10.75% of horseracing profits to the racing industry and £173 million to racecourses for the right to show their races in betting shops.

The Government has said that it will continue to recognise the unique position of on-course operators, and is considering how to factor into the new scheme the current arrangement whereby they only pay a de minimis flat-rate fee towards the Levy in addition to the fees they pay to individual racecourses.

It is intended that the Horserace Betting Levy Board will continue to exist and that it will remain responsible for collecting funds. These will then be passed to a new Racing Authority which will be responsible for making decisions on spend.

The ABB has claimed that “the Racing Right is unworkable and the detail will derail it” and indeed the precise way in which the new system will work remains to be seen. First of all, the Government faces the challenge of determining what the actual rate will be, and it is poised to enter into negotiations with the betting and racing industries surrounding that issue now. It has said that the rate “will reflect the degree of mutual interest between betting and racing” and is awaiting the report on independent research which it has commissioned into the funding of horseracing.

There is also the question of whether the EU will require VAT to be paid on payments made by operators under the Right – something that is not within the Government’s power to control. As a statutory levy, the Levy is currently not liable to VAT but, given that the Government says that the Right will be administered directly by the horseracing industry, it is possible that it will not be regarded as a statutory levy, meaning that it will be subject to VAT.

Various commentators have in the past expressed the opinion that primary legislation would be required to abolish or amend the Levy. However the Government appears to believe that it can introduce the Right using secondary legislation under s2 of the Gambling (Licensing and Advertising) Act. Approval of the new scheme will, however, require the approval of both Houses of Parliament.

We will update you further on the introduction of the Right once further details emerge.

I was asked to advise this week on the potential for service of a S161 Closure Notice under the Licensing Act 2003. The officer was somewhat shocked when I advised that the power no longer existed and had been repealed by the Anti-Social Behaviour, Crime and Policing Act 2014. This prompted me to remind myself of the powers that now exist and they are worthy of closer attention as they are now starting to be used more frequently and have quite serious consequences.

When you analyse the text of the new powers they are much wider and potentially damaging to licensed premises and the old legislation. The old S161 Closure Notices for “spontaneous disorder” were very useful but we always advised a voluntary closure rather than having to go down a full S161 due to the fact that there would need to be a hearing in front of the Magistrates Court and a review for every S161 Closure Order. Clearly it would often be in the interests of the operator to voluntarily close the premises rather than have to face a Magistrates Court and Local Authority Review Hearing.

Here is the new procedure.

S76 Power to issue closure notices

A police officer of at least the rank of inspector, or the local authority, may issue a closure notice if satisfied on reasonable grounds:

• that the use of particular premises has resulted, or (if the notice is not issued) is likely soon to result, in nuisance to members of the public, or
• that there has been, or (if the notice is not issued) is likely soon to be, disorder near those premises associated with the use of those premises and;
• that the notice is necessary to prevent the nuisance or disorder from continuing, recurring or occurring.

A closure notice is a notice prohibiting access to the premises for a period specified in the notice.

For the maximum period, see section 77.

A closure notice may prohibit access:

• by all persons except those specified, or by all persons except those of a specified description;
• at all times, or at all times except those specified;
• in all circumstances, or in all circumstances except those specified.

A closure notice may not prohibit access by:

• people who habitually live on the premises, or
• the owner of the premises, and accordingly they must be specified under subsection (3)(a).

A closure notice must:

• identify the premises;
• explain the effect of the notice;
• state that failure to comply with the notice is an offence;
• state that an application will be made under section 80 for a closure order;
• specify when and where the application will be heard;
• explain the effect of a closure order;
• give information about the names of, and means of contacting, persons and organisations in the area that provide advice about housing and legal matters.

A closure notice may be issued only if reasonable efforts have been made to inform:

• people who live on the premises (whether habitually or not), and
• any person who has control of or responsibility for the premises or who has an interest in them, that the notice is going to be issued.

Before issuing a closure notice the police officer or local authority must ensure that any body or individual the officer or authority thinks appropriate has been consulted.

The Secretary of State may by regulations specify premises or descriptions of premises in relation to which a closure notice may not be issued.

S77 Duration of closure notices

The maximum period that may be specified in a closure notice is 24 hours unless subsection (2) applies.

The maximum period is 48 hours:

• if, in the case of a notice issued by a police officer, the officer is of at least the rank of superintendent, or
• if, in the case of a notice issued by a local authority, the notice is signed by the chief executive officer of the authority or a person designated by him or her for the purposes of this subsection.

In calculating when the period of 48 hours ends, Christmas Day is to be disregarded.

The period specified in a closure notice to which subsection (2) does not apply may be extended by up to 24 hours:

• if, in the case of a notice issued by a police officer, an extension notice is issued by an officer of at least the rank of superintendent, or
• if, in the case of a notice issued by a local authority, the authority issues an extension notice signed by the chief executive officer of the authority or a person designated by the chief executive officer for the purposes of this subsection.

An extension notice is a notice which:

• identifies the closure notice to which it relates, and
• specifies the period of the extension.

In this section “chief executive officer”, in relation to a local authority, means the head of the paid service of the authority designated under section 4 of the Local Government and Housing Act 1989.

S78 Cancellation or variation of closure notices

This section applies where a closure notice is in force and the relevant officer or authority is no longer satisfied as mentioned in section 76(1), either:

• as regards the premises as a whole, or
• as regards a particular part of the premises.

In a case within subsection (1)(a) the relevant officer or authority must issue a cancellation notice. A cancellation notice is a notice cancelling the closure notice.

In a case within subsection (1)(b) the relevant officer or authority must issue a variation notice. A variation notice is a notice varying the closure notice so that it does not apply to the part of the premises referred to in subsection (1)(b).

A cancellation notice or a variation notice that relates to a closure notice which was:

• issued by a local authority, and
• signed as mentioned in section 77(2)(b), must be signed by the person who signed the closure notice (or, if that person is not available, by another person who could have signed as mentioned in section 77(2)(b)).

A cancellation notice or a variation notice that relates to a closure notice which was:

• issued by a local authority, and
• extended under section 77(4)(b), must be signed by the person who signed the extension notice (or, if that person is not available, by another person who could have signed the extension notice).

In this section “the relevant officer or authority” means:

• in the case of a closure notice issued by a police officer and not extended under section 77(4)(a), that officer (or, if that officer is not available, another officer of the same or higher rank);
• in the case of a closure notice issued by a police officer and extended under section 77(4)(a), the officer who issued the extension notice (or, if that officer is not available, another officer of the same or higher rank);
• in the case of a closure notice issued by a local authority, that authority.

Some of the key issues that we need to concentrate on are as follows:

• An inspector may issue a Closure Notice (where it is a Superintendent for a Summary Review)
• A Closure Notice can prohibit access to the premises for a period specified in the notice not exceeding a maximum of 48 hours. This is more impactful than the old S161 Closure Notice which only forced the operator to cease Licensable Activities
• The Local Authority can also issue the Closure Notice.

Once the notice has been served then S80 of the legislation gives the power of the Magistrates Court to make a Closure Order.

S80 Power of court to make closure orders

Whenever a Closure Notice is issued an application must be made to a Magistrates Court for a Closure Order (unless the notice has been cancelled under S78).

An application for a Closure Order must be made –

• By a constable, if the Closure Notice was issued by a police offer;
• By the authority that issued the Closure Notice, if the notice was issued by a Local Authority.

The application must be heard by the Magistrates Court not later than 48 hours after service of the Closure Notice.

In calculating when the period of 48 hours ends, Christmas Day is to be disregarded.

The court may make a Closure Notice if it is satisfied –

• That a person has engaged, or (if the order is not made) is likely to engage, in disorderly, offensive or criminal behaviour on the premises, or
• That the use of the premises has resulted, or (if the order is not made) is likely to result, in serious nuisance to members of the public, or
• That there has been, or (if the order is not made) is likely to be, disorder near those premises associated with the use of those premises, and that the order is necessary to prevent the behaviour, nuisance or disorder from continuing, recurring or occurring.

A Closure Order is an order prohibiting access to the premises for a period specified in the order. The period may not exceed 3 months.

A Closure Order may prohibit access:

• By all persons, or by all persons except those specified, or by all persons except those of a specified description;
• At all times, or at all times except those specified;
• In all circumstances, or in all circumstances except those specified.

A Closure Order:

• May be made in respect of the whole or any part of the premises;
• May include provision about access to a part of the building or structure of which the premises form part.

The Court must notify the relevant Licensing Authority if it makes a Closure Order in relation to premises in respect of which a premises licence is in force.

We are aware that these powers are being used, particularly by the Metropolitan Police Service in London.

These are interactive powers which can really lead to huge potential loss at licensed premises.

They are a useful tool for police and the Local Authority to take out repeat troublesome venues. However, we would always still expect to see a graduated response to premises that are causing nuisance/disorder and we would hope in the circumstances that operators would be given the opportunity to improve their trading style to ensure that the public disorder subject to the police or Local Authority attention could be removed before the need for serving Closure Notices/Orders under the Anti-Social Behaviour Crime and Policing Act 2014.

The Local Government Association has responded to the Institute of Alcohol Studies report on the Licensing Act. One area which the LGA comment on is the issue of fees for licensing applications, “The LGA has long argued that locally set licensing fees will enable councils to recover the cost of applications better and it is encouraging that the report recognises this issue must be resolved”. Followers of the licensing legislation will know that locally set fees were being mooted up until the late night levy started to be promoted by the Home Office. However, with the late night levy stuttering around the country there is now some growing pressure to look at locally set licensing fees again. This could well be a bespoke solution to some localised issues. We will obviously keep an eye on this and see what future developments take place.

Councillor Tony Page, Licensing Spokesman at the Local Government Association, went on to say “While councillors do not shrink from fighting legal appeals, there is no doubt that there is sometimes an imbalance in the resources available to councils and the trade when approaching legal hearings. This is not helped by the fact that councillors are already subsidising licences to trade because current fee levels, set way back in 2005, are too low compared with the costs of running the system”.

This is clearly an interesting feature and there is sure to be greater pressure to increase these fees if the LGA feel that the cost of running the system is disproportionate to the revenue created by the fee structure.

He went on to say “This report also follows calls by councils for greater powers to limit the opening of late night premises where there are concerns about the impact of alcohol on public health. Nine out of ten directors of public health say adding a public health objective to the Licensing Act would help them do their jobs more effectively by helping curb the saturation of communities with pubs, clubs and off licences selling alcohol”.

This again brings the issue of a fifth licensing objective back in to the debate. We had the introduction of the Local Health Board as a responsible authority, but not the introduction of the promotion of health as a licensing objective, which has always, in my experience, made it very difficult for the health body to put in a relevant representation without the “hook” of a licensing objective to hang their representation on. Tony Page went on to say “Public health funding issues make it even more important for government to ensure local authorities have the same powers as those in Scotland which have been able to consider health implications – such as hospital admissions and local addiction levels – in relation to licensing applications since 2005. Giving councils new powers to refuse licence applications on health grounds where there are grounds to do so will also save money from the public purse by reducing NHS costs dealing with alcohol related issues”.

We will continue to monitor all developments and potential changes to the licensing landscape.

The full Institute of Alcohol Studies document “The Licensing Act (2003): uses and abuses ten years on can be found at the below link.

http://www.ias.org.uk/uploads/pdf/IAS%20reports/rp22032016.pdf