A Lancaster University expert has warned a House of Lords committee that existing regulation on the gambling industry is not doing enough to protect problem gamblers and children from harm.

Dr Carolyn Downs, a Senior Lecturer in Marketing in Lancaster University Management School, who has researched gambling since 2001, submitted her evidence to the Lords Select Committee on the Social and Economic Impact of the Gambling Industry.

Her written submission outlined problems with the 2005 Gambling Act when it came to protecting children and other vulnerable people from gambling, and that firms were not contributing enough to efforts to curb the industry’s negative effects.

Dr Downs said recent Gambling Commission fines issued to companies for breaching duty-of-care towards those affected by addition and problem gambling were not enough.

“The aim of the Gambling Act in protecting children and vulnerable persons from being harmed is not being upheld effectively,” said Dr Downs. “There have been some high-profile fines issued by the Gambling Commission over the last 30 months, but this hides ongoing problems. Social responsibility policies are only as good as the enforcement mechanism.

“There needs to be specific regulation about the duty to identify potentially vulnerable people and ensure they are offered suitable support.”

Dr Downs has previously served on the Gambling Commission advisory body on the structure of the UK Prevalence study, led the first UK study focused solely on gambling-related debt, and conducted the first UK research into virtual gambling among children, an area she highlighted in her comments.

“Until virtual gambling, video gaming and gambling advertising and promotions are properly regulated, children will continue to be at significant risk,” she said.

“It is well established that the earlier people become habituated to gambling, the more likely it is they will develop problem gambling. There should be significant restrictions on gambling advertising.”

The UK Gambling and Debt study led by Dr Downs identified a range of social and economic impacts of problem gambling. These range from recurring debt to the loss of homes through eviction or mortgage arrears, an increased risk of losing a job to serving time in prison, and from relationship difficulties and breakdown to personality changes and mental and physical health problems for both the individual and their family members.

Dr Downs added: “For each individual with a gambling problem, between four and 11 other people or organisations were directly socially and economically adversely affected. The impacts of problem gambling go beyond the individual, rippling out to the family, employers and local community.

“Measurement of the social and economic benefits of gambling should move beyond financial metrics and should include a cost-benefit analysis that takes into account levels of harm. The current means of measuring the social and economic benefits of gambling do not take into account differing levels of risk, types of social responsibility measures or the wider social and economic costs.”

In her evidence, Dr Downs said the present voluntary levy on gambling firms’ profits is ‘wholly inadequate’ to fund research education and treatment of around 450,000 problem gamblers, which she estimates would require a budget of £2.6bn per year, based on costs for treating dependent drinkers. The gambling industry contributes £10m annually, and the plan by larger operators to increase their donations to 1% of profits would increase this to only £100m.

She believes an industry contribution, weighted towards those gambling activities shown by research to have the highest risk of causing most harm, should be considered.

“The levy falls far short of what is realistically needed for a comprehensive treatment service,” added Dr Downs. “The UK is likely to be spending significant amounts on the consequences of problem gambling, but it will be coming out of general NHS, criminal justice and other budgets, undermining the ‘polluter pays’ principle of the Gambling Act.

“Establishing the true cost of gambling addictions to various services is critically important, as it is only through knowing the costs that a judgement can be made as to the level of contribution the industry should make.”