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Wed 15th Jan 2020 - Legal Briefing

Three issues to keep an eye on in 2020 by Michelle Hazlewood

Of all the issues set to affect operators in 2020 from a legal and licensing perspective, three should be front of mind – the escalating problem of under-18s using pub and bar gaming machines; the prospect of England, Wales and Northern Ireland following Scotland with a deposit return scheme (DRS) to crack down on plastic pollution; and whether Wales’ introduction of minimum unit pricing (MUP) will hasten its arrival in England.

Gaming machine test purchasing
Under-age use of gaming machines in pubs and bars is going to be a big issue in 2020. All tranches of Gambling Commission (GC) test purchasing in 2019 saw worryingly poor results, with 20% to 30% of venues failing to prevent use of gaming machines by under-18s. 

That means pub machine use – and most test purchasing is conducted in pubs – is coming under closer scrutiny, which is set to intensify in the next 12 months. The GC isn’t going to let this issue go. After all, it’s the commission’s raison d’être to tackle problems such as this and, with the concerning figures seen from its test purchasing across the country, it appears to be an issue that’s getting more problematic and will only begin to improve if there’s a concerted effort from the industry.

However, preventing under-age use of gaming machines doesn’t appear to be a big part of pub and bar staff training, while high failure rates suggest children have easy and frequent access to machines they can gamble on.

Last year the British Beer & Pub Association and UKHospitality published guidance on under-age gambling in pubs, which among other things urged operators to ensure staff understood and met their legal responsibilities and co-operated with licensing authorities and the police. The jointly published charter followed test purchase operations at 170 premises across England and Wales, revealing a staggering 84% failure rate. Indeed, a number of local authorities have recently withdrawn gaming machine permits from pubs that have failed during test purchase operations. 

There is help on the way for operators, however, in the form of technology that alerts staff to illegal use of gaming machines on their premises. It’s a start, but there’s a long way to go.

Deposit return scheme
By this time next year Scotland is expected to introduce a 20p DRS for PET plastic bottles, steel and aluminium cans, and glass bottles containing between 50ml and three litres. 

Pubs and restaurants selling drinks opened and consumed on site won’t have to charge the deposit to customers, just return the containers they sell, but therein lies a problem many won’t have foreseen – what to do with all that recyclable waste until it’s removed?

With local authorities responsible for collection of DRS waste, operators could face a double headache – storage and risk of theft as suddenly bottles and cans have a commercial value that could make them a target for thieves.

Country pubs will probably fare better on the storage front but may be more vulnerable to theft, while town centre and community locals could struggle to find somewhere to store all that recycling. It could prove a massive logistical headache and have a significantly negative impact on smaller operators, which may be forced to pass on the costs. 

As for England, Wales and Northern Ireland introducing a DRS, it was part of the proposed Environment Bill referred to in December’s Queen’s Speech, which means it could take until the end of 2023 to be implemented. At a regional level, the Yorkshire Beer & Pub Association has already expressed concerns about storage and theft risk.

Minimum Unit Pricing
Something else that appears inevitably destined for England is an MUP for alcohol. Legislation is set to be introduced in Wales on 2 March after the Welsh Assembly approved an MUP of 50p, bringing Wales in line with Scotland, which has had MUP since May 2018.

While licensed operators would be well advised to keep an eye on developments in the principality, off-sales are where MUP has most effect. 

British Medical Journal research has shown there has been a reduction in the amount of alcohol bought but it’s among those individuals who consumed more in the first place and who’ve been forced to buy less because they’re from low-income households rather than a desire to consume less.

We expect the impact in Wales to be similar with those already on a tight budget the most affected but, as in Scotland, it will take much longer to derive meaningful trends. It really is too early at the moment to reach definitive conclusions. It’s a complex issue, with lots of levers to pull.

If it’s deemed a failure in Scotland, MUP supporters and the influential health lobby will argue it should have been introduced earlier and the MUP should have been higher than 50p. If it’s seen to have succeeded and brought health benefits, it will surely be a matter of time before legislation is introduced in England. One to watch closely.
Michelle Hazlewood is a partner at leading licensing firm John Gaunt & Partners

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