Cumulative impact assessments and the duty to “aim to permit” premises to be used for gambling

DCMS White Paper, April 2023

Introduction

The Executive Summary of the White Paper sets out a “Key Proposal” in these terms –

“When Parliamentary time allows, aligning the gambling licensing system with that for alcohol by introducing new powers to conduct cumulative impact assessments.”

This article questions whether such alignment is realistic, having regard to fundamental differences between the licensing regime for the sale of alcohol (the Licensing Act 2003) and that for the provision of facilities for gambling (the Gambling Act 2005).

Cumulative Impact assessments

Under the heading “Licensing Authority Powers”, the White Paper announces –

“We will also bring the licensing regime into line with that for alcohol by legislating to introduce a formal system of cumulative impact assessments (CIAs), when Parliamentary time allows.”

The ‘formal system of cumulative impact assessments’ provided by the Licensing Act 2003 (section 5A) provides –

“A licensing authority may publish a document (“a cumulative impact assessment”) stating that the licensing authority considers that the number of relevant authorisations in respect of premises in one or more parts of its area described in the assessment is such that it is likely that it would be inconsistent with the authority’s duty under section 4(1) to grant any further relevant authorisations in respect of premises in that part or those parts.”

The reference to the authority’s duty under section 4(1) is a reference to the duty of a licensing authority under the 2003 Act to carry out its functions with a view to promoting the licensing objectives: namely, the prevention of crime and disorder, public safety, the prevention of public nuisance, and the protection of children from harm.

If cumulative impact alignment between the Gambling Act 2005 and the Licensing Act 2003 were to be attempted, the equivalent of section 5A might begin with the words –

“A licensing authority may publish a document (“a cumulative impact assessment”) stating that the licensing authority considers that the number of relevant authorisations in respect of premises in one or more parts of its area described in the assessment is such that it is likely that it would be inconsistent with the authority’s duty …”

… and there the alignment would falter. Duty to do what? The duties of licensing authorities under the Gambling Act 2005 are not the same as those under the Licensing Act 2003. And when one looks at those duties, it is legitimate to ask how might the grant of a premises licence be inconsistent with them?

Duties of licensing authorities.

Under the Gambling Act 2005, licensing functions are divided between two authorities: the Gambling Commission (responsible for operating and personal licences) and local authorities (responsible for premises licences). And their corresponding duties are markedly different from each other and from the duties of licensing authorities under the Licensing Act 2003.

Section 22 of the Gambling Act 2005 provides –

22        Duty to promote the licensing objectives.

In exercising its functions under this Act the Commission shall aim—

(a)   to pursue, and wherever appropriate to have regard to, the licensing objectives, and

(b) to permit gambling, in so far as the Commission thinks it reasonably consistent with pursuit of the licensing objectives.

And section 153 of the 2005 Act spells out the very different duty of licensing authorities (my underlining) –

153      Principles to be applied

(1)     In exercising their functions under this Part a licensing authority shall aim to permit the use of premises for gambling in so far as the authority think it –

(a)   in accordance with any relevant code of practice under section 24,

(b)   in accordance with any relevant guidance issued by the Commission under section 25,

(c)   reasonably consistent with the licensing objectives (subject to paragraphs (a) and (b)), and

(d)   in accordance with the statement published by the authority under section 349 (subject to paragraphs (a) to (c)).

It is worth flagging up that section 153(1)(d) means that a licensing authority’s policy cannot override the requirement to “aim to permit” the use of premises for gambling if it is “reasonably consistent with the licensing objectives”.

The licensing objectives of the 2005 Act are given by section 1 –

1        The licensing objectives

In this Act a reference to the licensing objectives is a reference to the objectives of —

(a)   preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime,

(b) ensuring that gambling is conducted in a fair and open way, and

(c) protecting children and other vulnerable persons from being harmed or exploited by gambling.

Assessment versus Policy

Cumulative Impact Assessments (CIAs) under the Licensing Act 2003 are often conflated, unhelpfully, with Cumulative Impact Policies (CIPs), as though they are one and the same thing: they are not. Westminster City Council’s licensing policy explains the difference succinctly: a Cumulative Impact Assessment provides the evidence to support a Cumulative Impact Policy.

A CIP will typically create a presumption that applications for new pubs and bars, fast food premises, etc., in an area identified in a CIA as already under stress, will normally be refused unless the applicant can demonstrate that granting the application will not add to the existing cumulative impact of licensed premises in that area.

The usefulness of a cumulative impact assessment that does not lead to the adoption of a cumulative impact policy is therefore not immediately apparent. The White Paper offers this –

“Empowering local leaders to take decisions in their area is a priority for this government and we support them in the use of the broad powers which the planning and gambling regulation frameworks give them to set licence conditions and consider applications. To increase their confidence in using these powers, we will align the regimes for alcohol and gambling licensing by introducing cumulative impact assessments when Parliamentary time allows.”  [italics added]

Whilst it is heart-warming to see the DCMS supportive of local decision-makers, I cannot recall many licensing authorities lacking the confidence to use the powers given to them – or even powers not given to them! As a reason for introducing CIAs, increasing the confidence of licensing authorities “to set licence conditions and consider applications” might raise a few bemused eyebrows. We stay closer to reality, perhaps, in another passage in the White Paper. Paragraph 152 reads –

“It was suggested that extending the CIA regime to gambling would enable licensing authorities to take more account of certain evidence-based factors in their decision making process and could allow them to establish a presumption against granting a premises licence in certain areas (for example, where that could undermine the licensing objectives.” [italics added]

This is the language of policy, not assessment. And the policy in question has nothing to do with giving licensing authorities the confidence to use existing powers.

When Parliamentary time allows

The use of that conventional language leaves no doubt that the intention is to legislate. There is no need, of course, for licensing authorities to ask Parliament for permission to make assessments of the cumulative impact of gambling premises in their localities: Westminster has already done so in identifying a number of Gambling Vulnerability Zones (GVZs) and requiring  applicants for premises licences to consider the specific risks that pertain to the zone in which they would like to open a new premises. Legislation is needed, however, in order to “align” gambling CIAs with alcohol CIAs, because section 5A of the Licensing Act 2003 is prescriptive rather than permissive. If there is to be anything of a like kind in gambling licensing, primary legislation will be needed to mandate it. Furthermore, the White Paper proposes that CIAs be made an additional statutory requirement of section 349 policy statements, so amendment of that section must be in the pipeline.

More importantly, if CIAs are intended to lead to CIPs with a presumption of refusal, such as we find in alcohol CIPs – and if CIAs are not intended as a stepping-stone towards a CIP, one wonders what is the point of them – section 153 will need some legislative adjustment.  A policy presumption of ‘refusing to grant’ does not sit happily with the statutory requirement of ‘aiming to permit’. Assuming compliance with Gambling Commission guidance and the Licence Conditions and Codes of Practice (LCCP), section 153(1)(c) requires licensing authorities to aim to permit premises to be used for gambling if that use is reasonably consistent with the licensing objectives. And as we have seen, no licensing authority policy is permitted to trump section 153(1)(c).

I think it is inescapable that if there is to be equivalence between CIPs in gambling and alcohol licensing, section 153 of the Gambling Act 2005 will need significant amendment or repeal.  But removing the “aim to permit” provision is firmly resisted by the DCMS. Paragraph 156 of the White Paper explains the reason –

“Some submissions from licensing authorities suggested the ‘aim to permit’ provision should be removed altogether from the Act. However, this change would challenge a principle at the core of the Gambling Act, that gambling should be permitted where it is consistent with the licensing objectives and the rules set by the regulators to prevent harm.”

Surely a cumulative impact presumption of refusal would challenge precisely the same principle?

Conclusions

I fear that the DCMS has not sufficiently thought-through the difficulties of introducing CIAs within the current framework of the Gambling Act 2005.  It seems not to have taken on board that if a CIA is to have any practical utility in local authority decision-making it needs to be supplemented by a CIP.  And that, in my opinion, will require amendment or repeal of section 153 – which the DCMS resists not because section 153 is compatible with mandatory CIAs in licensing authority gambling policies, but because it enshrines a core principle of the Gambling Act.

But what if that core principle is misguided?

Section 153 is much-criticised as standing in the way of local decision-making. There is force in the criticism. It baffles me that a Conservative government should be so loath to acknowledge and redress the mistakes of the Labour administration responsible for the 2005 Act. A possible explanation (because it demonstrates consistency of approach: by no means do I suggest it is probable) might be that the 2005 Act was actually the brainchild of the Civil Service, and behind the scenes is a parental Civil Service which now fiercely defends its offspring.

But that, as they say, opens ‘a whole ‘nother can of worms’.

 

Gerald Gouriet KC

Inner Temple

18 May 2023

 

The full text of the White Paper can be found here