Gambling giant blames job cuts on Burnham high street crackdown
Ladbrokes owner Entain has hit out at Andy Burnham’s plans to shake up the high street as the gambling giant blamed the Prime Minister for its decision to cut 400 jobs.
The group, which also owns Coral, has announced that it will cut about a fifth of the headcount of its global customer care team, which it said could mean around 400 jobs are lost.
Stella David, the firm’s chief executive, has blamed “a backdrop of rising costs and increasing pressure” on the gambling sector and Andy Burnham’s plans to crack down further on betting shops in his bid to revamp Britain’s high streets.
In a letter to the Prime Minister, the gambling boss warned Burnham against hiking machine games duty (MGD) from 20 to 40 per cent, which a thinktank has said could cost the sector £460m.
David said that this move would cause “substantial” job losses and shop closures across UK high streets, undermining Burnham’s attempts to boost town centres.
Burnham has vowed to crack down on betting shops and vape sellers, which he says have “hollowed out” high streets across the country.
Gambling shops part of high street fabric
The Entain boss told the Prime Minister that the firm’s gambling shops “have been part of their local communities for decades, providing jobs, supporting local economies and offering familiar, staffed places where customers meet and interact”.
She said the hike to MGD would cost Entain’s UK retail business £100m every year and threaten the group’s ability to hire young people, as the country faces a youth unemployment crisis.
“Ladbrokes and Coral betting shops are sports and racing businesses, with machine gaming only one part of a much broader offer,” she added. “They are long-established, staffed community hubs, many with roots stretching back decades in the same towns and high streets.
“A tax increase of the proposed scale would also risk pushing gambling activity away from the regulated high street rather than simply reducing it. […] The better outcome for communities and the public finances is to keep gambling within the regulated sector and, wherever possible, bring activity currently taking place illegally back into it.”
Burnham’s pledge to shake up British high streets has faced criticism from high-profile business figures, including Frasers Group founder Mike Ashley and JD Wetherspoon chairman Sir Tim Martin.
Martin told City AM last week that it is “not up to” the Prime Minister to choose which businesses are allowed to be on the high street.
Entain’s boss pointed to gambling tax hikes imposed under the government of Burnham’s predecessor, Sir Keir Starmer, which piled levies onto remote gambling.
“A further doubling of [MGD] would therefore add another significant cost to businesses already struggling to absorb major tax increases, stacking the odds against labour-intensive high-street operators and making it harder to sustain shops, jobs and investment in local communities,” David said.
An Entain spokesperson said its job cuts are “part of its ongoing efforts to address the impact of the UK’s increased gambling taxes, while also supporting our progress in becoming a sharper, fitter and more agile business”.
Shares in the group, which was demoted from the FTSE 100 to the FTSE 250 earlier this month, lost about 0.7 per cent to 494p on Wednesday morning.