LONDON--Shares in bookmakers William Hill and Ladbrokes Coral plunged on Monday on a report that Britain will slash the top stake on high-street betting terminals to just 2 pounds ($2.78).
The bookmakers said the limit, if confirmed, would result in job losses and shop closures, while campaigners urged the government to hold its nerve.
The government said in October it would reduce the maximum stake on in-shop fixed odds betting terminals (FOBTs) to between 2 and 50 pounds from 100 to help tackle problem gambling after a consultation ending on Tuesday. The Sunday Times newspaper cited an ally of Culture Secretary Matt Hancock - appointed this month - as saying the limit would be set at the bottom of that range.
An FOBT is a touch-screen machine that allows players to bet on the outcome of various games such as roulette. Dubbed the "crack cocaine" of gambling, campaigners argue that the machines enable players to lose money too quickly, leading to addiction and wider social problems.
William Hill and Ladbrokes Coral, which have the biggest presence on the high street, were dismayed. "We are very clear that stake cuts will fail to adequately address any issue of problem gambling," said Ladbrokes Coral, which is being bought by the online gambling firm GVC for a cash-and-share sum that depends on the outcome of the review. Ladbrokes took about 800 million pounds of revenue from gaming machines in 2016.
Ladbrokes shares were down 9 percent at 166 pence at 1400 GMT and rival William Hill was down 12 percent at 295 pence, the biggest loser on the FTSE mid-cap index. Paddy Power was off 0.9 percent at 8,370p.
"The impact of this rumour on our share price this morning illustrates the drastic impact such a move would have on the retail betting sector," William Hill Chief Executive Philip Bowcock said in an emailed statement.
There are almost 8,800 betting shops in the UK and each is allowed a maximum of four machines. The terminals have helped to keep betting shops going when many younger gamblers have switched to betting on sports events using smartphones or tablets.
The Department for Digital, Culture, Media and Sport declined to confirm the Sunday Times report, saying that it would make a final decision "in due course once all the evidence has been considered". That could take weeks or months.
Campaigners against the machines - including politicians from all parties, city mayors, professors and senior clerics - said they were sending a letter to Prime Minister Theresa May to urge the government to cut the stake to 2 pounds.
"The government must not waver in helping the vulnerable," said a copy of the letter shown to Reuters. "It must not bend to the power of the bookmaker lobby. The time has come for the government to act. "The health and wellbeing of our country is at issue."
