10 Jan What Is the Relation Between Charity and Gambling in the UK?
To any person who does not gamble, gambling is a futile exercise. It is a waste of money, and the only ones who benefit from it are the winners and the casinos.
On one side of the coin, this is true. Many gamblers lose and fall victim to addiction. But on the other hand, gambling is one of the highest-grossing industries in the world and also the top source of funds for charity organisations.
The best thing that can happen is that a huge chunk of gambling profits go to charity institutions. Such is the relationship between the gambling industry and charity organisations in the UK. However, many people do not know this.
What the Law Says About It
In the UK, charity gambling is permitted. What this means is that a gambling organisation, even if it is not sanctioned by the UK Gambling Commission, can apply for a permit to hold gambling events, provided that they donate a portion of their proceeds to charity.
This is called incentivised giving. In events like this, it is the charity organisation that oversees the event, not the private casino. If this happens, there are many options that these organisations can host. Examples of such gambling events are:
- Slot machines
- Race nights
The proceeds go to the budget of these charity organisations, and nobody will pocket a profit from it.
By law, the UK government mostly allows charities to hold and oversee lottery gambling. In here, the charity must get at least 20% of the ticket’s value. If it is sold for £2 each, then the charity has a guaranteed donation of £0.40 per ticket. The rest of the money will go to the prize pot or will be distributed to the expenses that the event incurred, such as printing the tickets and paying the employees.
The thing is, charity events like this are more heavily regulated to prevent abuse. Also, the tickets are sold in competition with the National Lottery tickets. In most cases, the prizes for gambling for charity are limited to existing casino customer base, while that of the National Lottery does not have limits.
Online gambling does not go through the same regulations because these are private institutions. Most are non-profit organisations, and they have no limits. They are free to run their online casino organisations, and they can even offer casino bonus codes for existing players or no deposit casino bonus codes for newbies.
The proceeds of non-profit organisations go to the chosen charity institutions. For example, BigHeart Bingo is an online bingo website that raises money for several charity institutions, like:
- Cancer Research
- Age Concern
- National Society for the Prevention of Cruelty to Children
- Great Ormond Street Hospital
- Save the Children
- Royal National Institute of Blind People.
In some cases, the gambling facilities donate money to other non-profit groups. Examples of these are:
- Born Free Foundation
- World Wildlife Fund
- Dogs Trust and Cats Protection
- Battersea Dogs Home.
As you can see, these institutions were not formed for profits. While there are players who lose, there are certainly many people who benefit from their losses.
A Few Statistics
To help you understand further, below are some statistics about gambling and charity in the UK.
- Charity institutions received £9 million from the gambling industry between 2018 and 2019.
- GambleAware now requires the industry to donate £10 million in 2020.
- The organisation is asking all gambling institutions in the country to donate at least 0.1% of their gross yield.
What does this all mean?
It means that there are regulations in the UK that strictly require gambling institutions to donate to charity. Again, while many players lose money, a chunk of that money will go to charity institutions, and Gambleaware is the primary recipient of that. A casino would only have a yield if a player deposited and did not win. A player who won causes a loss to the casino.
Between October of 2017 and September of 2018, the country spent £14.5 billion on gambling. A huge chunk of that is from online gaming, where the operators raked about £6 billion. The people who gamble the most are men, accounting for 37% of the players.
Here Lies the Problem
At a gross of £14.5 billion that went to the coffers of gambling facilities, £9 million went to charities. In percentage, that only accounts for 0.06%. So, while the gambling industry gives to charity, it does not put a dent to the industry’s income. This tells us that gambling institutions can do more.
Perhaps, this is the reason why many charitable institutions decide to raise money themselves. Instead of waiting for paltry alms from the gambling giants, they form a group that can work with government-owned gambling institutions to raise money.
But again, the underlying problem is that charitable organisations face more scrutiny from the government if they do this. While privately held gambling institutions enjoy liberal treatment, the charity foundations have to comply with various rules, thus preventing them from raising more money to advance their mission. For example, a lottery held by a charity organisation can only give a maximum prize of £200,000, while private casinos can give out millions.
So What Happens Next?
The government should take a look into these laws, as casino customers may not know what is going on behind the scenes. To the common man, they may think that the money they lost goes to charity institutions anyway, not knowing that the private institutions keep more than 99% of their gross yields.
As of today, charity gambling is only allowed as fund-raising activities. It means that after the event, there is no sustainable source of funds for these charitable institutions.
There are also so many laws that govern different gaming activities. For example, there are different laws for:
- Lotteries or raffles
- Fundraising involving 100, 200, 500 clubs
- Raising money on race nights with horses
- Small lotteries in small societies
- Raising funds with bingo, casino, or poker games
- Raising funds with colleagues or in a corporation.
The government may look into them and create a consolidated document that should make it easier for charity institutions to raise funds through gambling. If not, then action should be taken to raise the amount of money that private gambling institutions give to charity.
Gambling is a lucrative industry. While it may look like a zero-sum game, it isn’t. At the end of the day, there are many children and institutions that benefit from it. However, £9 million is paltry if you take a look at the £14.5 billion that the country spent on gambling. With these figures, one cannot help but ask himself, are we really doing justice to the poor and those who are in need?
It is this kind of situation, the government should step forward and do something to even out the playing field. While private institutions have all the right to keep their profits, then, by all means, there should be lesser regulatory requirement for charity institutions that are raising funds.