REUTERS: Britain will cut the maximum stake on fixed odds betting terminals to just two pounds after the government rejected claims that it would damage the industry in favour of efforts to tackle problem gambling.
The decision follows complaints that the machines, which enable people to bet up to 100 pounds (US$135) every 20 seconds on electronic games such as roulette, were highly addictive and had led to gamblers building up big losses.
"These machines are a social blight and prey on some of the most vulnerable in society, and we are determined to put a stop to it and build a fairer society for all," Matt Hancock, Secretary of State for Sport, said in a statement.
The decision deals a blow to bookmakers however, who had argued that the terminals were a major source of income for high-street shops which are struggling to stay afloat as younger gamblers move online, putting jobs at risk.
According to the latest Gambling Commission data, there are over 182,000 gaming machines in Britain with Ladbrokes Coral-parent GVC, William Hill and Paddy Power Betfair generating a large chunk of their retail revenue from these machines.
Shares in all three fell in early London trading on Thursday, with William Hill hit hardest.
William Hill said the new regulation could lead to a 35 to 45 percent reduction in annual total gaming net revenue. It added that the limit could result in around 900 of its high streets shops becoming loss-making.
However, the announcement was widely welcomed by charities, the church and opposition politicians.
The government said the change would need parliamentary approval. It vowed to engage with the gambling industry to ensure it was given sufficient time to implement and complete the technological changes.
It added that the reduction would be linked to an increase in Remote Gaming Duty, a tax paid by online gaming operators, in a bid to protect the amount of income it gets from the industry.
The government said the Gambling Commission would also toughen up protections around online gambling such as stronger age verification rules and proposals that require operators to set limits on gamblers' spending until affordability checks have been conducted.
It also laid out plans for a major multi-million pound advertising campaign promoting responsible gambling that will be supported by the industry.
(US$1 = 0.7376 pounds)
(Reporting by Rahul B in Bengaluru; Editing by Kate Holton/Keith Weir)