How Much Does Gambling Cost the Country?

There are few of us who consider what effect gambling has on the UK expenses. It is much more common to consider gambling as a pastime that some people enjoy. This includes sports betting, casino gaming, bingo, and more. While gambling on these options is entertaining, there is another side to it.

Gambling generates a lot of money and contributes a lot in tax but it also has a negative side that can be an issue for the country. With so many viable options, addiction is a significant problem problem. Yet, how much of an issue is this and how much does it cost the country and its taxpayers?

Various studies have taken place on gambling-related harm to see where the figures stand and to track them over time. Gambling addiction and harm related to it have been on the up and down over the years. Figures for March 2021 suggested that those between the age of 35-44 years old were the most affected. Yet it is also important to consider how much gambling costs the UK overall. After all, there are many people who become addicted in all age groups that want to get help.

The UK is in a position to offer free treatment via its National Health Service (NHS) and through this, gambling addiction treatment is available. This isn’t something that any country can provide for free, however, so how much is the taxpayer forking out to contribute to the treatment?

It is also important to consider that it isn’t only gambling addiction treatment that contributes to the cost of gambling to the country as a whole.  There are also the effects of criminal activity relating to gambling to take into account including fraud. There are also societal costs to consider, which may not necessarily be a financial burden but can have negative impacts, such as the effects on communities from the negative effects of gambling and addiction.

Evidence of Gambling-Related Harm

In recent years, various concerns have risen about gambling-related harm. In March 2018, Public Health England (PHE) put forth its priorities for the 2018-19 year. This saw an inclusion for information and support on action to tackle such harm. As a result, PHE conducted an evidence review of the health aspects of addiction. This would help it to inform on action that should occur to prevent and treat it.

It’s true that the UK gambling market generates around £15 billion annually. Yet at the same time, previous research dictates that gambling harm is wide-ranging. While it affects the individual involved, it also affects their family and friends. The UK ahs experienced growing calls for someone to tackle these issues. Before this could occur though, it required evidence of the depth of the problem. The government undertook its own study to determine various things and this included the prevalence of gambling harm, risk factors, harms to those affected, and so on.

The Office for Health Improvement & Disparities (OHID) published its own report in January 2023. This focused on the economic and social cost of harms associated with gambling in England.

Within that report, it noted that the original evidence review came about from PHE in 2021. Yet that organisation no longer exists, instead being overtaken by the OHID. It is this office that now continues the work of PHE. When it comes to the cost estimates highlighted in the report, a quality assurance (QA) test occurred. It also made some minor improvements to the method in use.

Costing Gambling-Related Harm in England

The harm associated with gambling isn’t only a case of someone becoming addicted. It extends beyond this into various areas, the government discovered. Combining all evidence together estimates that the annual excess financial cost equates to £412.9 million. The table above explains this figure in more detail.

Within that table, any instances of “N/A” mean that analysis was not undertaken. It also displays the annual societal value of health impacts equates to between £635 million and £1,355.5 million. Thus, a combined estimate of around £1.05 billion to £1.77 billion is a figure that stands out.

The column for ‘Wider Societal Costs” may seem varied. Yet this includes an estimate on the societal costs of suicides from gambling harm. The cost appears as a range, which exists as such following advice from an expert panel. This, they suggested, represents the uncertainty around the costs of suicide. The size of the range also reflects the limits due to evidence available.

Further to this, the study undertaken includes individuals screened in three brackets. They are “low-risk”, “moderate-risk” and “problem gamblers”. The Problem Gambling Severity Index (PGSI) determines these levels. Estimates suggest that England features 1.76 million people partaking in harmful gambling. Of those, around 168,000 are experiencing problem gambling.

A range of costs within the table are not quantified or are but only in-part. This includes crime, education, cultural harms, impacts on relationships, and more. Thus, the figures of £412.9 million and £635 to £1,355.5 million are underestimates. At least, when it comes to the total economic burden relating to harmful gambling.

Further Insight into Analysis and Types of Costs

Gambling-related harm is, of course, both a public health and wider societal problem. Various potential harms can come from it.

There is a framework in place that separates these into types and temporality.

The types exist as:

• Financial
• Relationship disruption, conflict, or breakdown
• Emotional or psychological distress
• Cultural
• Reduced performance at work or study
• Criminal activity
• Detriments to health

Regarding temporality, this refers to the notion that a harm can occur on the first time gambling. They are:

• General
• Crisis
• Legacy

As it stands, cost-of-illness analyses only incorporates external costs caused by the illness. Private costs falling on the individuals are not included.

Financial Harms

The government looks at financial harms from two different perspectives. They are:

1. An overview of the evidence on the cost to the individual.
2. The direct costs to government to provide support to people who are homeless.

The first of these perspectives is not something included in the OHID analysis, while the second is. Each perspective has undergone discussion. Yet the focus remains higher on the latter perspective.

For 2020 to 2021, GambleAware released statistics on its treatment service. From 7,726 English residents under treatment, data displays information of the following:

• 63% of the 7,726 people had debts due to gambling.
• 23% of the 7,726 people had debts of up to £5,000 relating to gambling.
• 40% of the 7,726 people had debts over £5,000, were bankrupt or were in an Individual Voluntary Arrangement (to pay back debts over time).

Those costs are not something that the government factors in, though. Instead, the financial costs surrounding gambling-harm come from homelessness. There is a link between this and homelessness, according to the report. In the study, there was a measurement of levels of gambling by people accessing housing services in Westminster. This found that of the homeless population, 8.3% were low-risk gamblers. A total of 3.3% were moderate gamblers and 11.6% were problem gamblers.

Support for homeless people has changed in a considerable way over the past decade. The average time spent in temporary accommodation within a year could be longer than 4 weeks. So, the annual cost per case has gone through an uprating, using the HMT GDP deflator. As a result, the cost equates to £3,091 per person in the 2021 to 2022 period.

The table below displays the excess cost of homeless services associated with at-risk and problem gambling in England.

Health Harms

Both the physical and mental health of an individual can suffer from gambling. Happiness and wellbeing problems impact not only the individual, but family and friends. It negatively influences the economy and affects wider society as well. International studies say that gambling problems have a link with poorer health.

Studies infer that there are links between gambling with suicide attempts and deaths by suicide. Depression, drug use and alcohol reliance are also linked. The link is much clearer when compared with non-gamblers in the United Kingdom. The estimated health and healthcare costs associated with gambling include:

• Deaths by suicide
• Treatment of depression
• Health impacts of depression (from 2023 update)
• Treatment of alcohol dependence
• Treatment of illicit drug use

Each of the elements appear in turn within the report from the government. On suicides, there is growing evidence about the relationship between gambling and suicide. Yet studies within England on such are quite uncommon. Thus, alternative proxies had to come to the fore. An expert panel looked at two papers – Karlsson and Hakansson as well as Wardle and others.

These looked at the relationship between suicides and people with gambling disorders. This helped to establish a rough cost within the UK for such situations. The table below displays information on the excess cost of suicides from problem gambling in England.

An article published by The Guardian in 2019 suggested that problem gamblers are 15 times more likely to commit suicide. Depression usually comes before this eventuality. This doesn’t tend to affect those engaging in low-risk gambling. The annual direct cost of depression came from a study by PHE. This cost includes primary care, secondary care, and prescription costs. It also relates to the total healthcare costs of an individual suffering depression. That is instead of the basic cost of treating it. In 2015 – 2016, this figure stood at around £1,392 for men and £1,686 for women.

Estimates suggest that England treats almost 70,000 people suffering gambling-related depression. This means costs of about £114.2 million in excess healthcare.

Regarding alcohol dependency and illicit drug use, the costs are much less. Analysis estimates that around 20,658 harmful gamblers have alcohol dependence. This equates to £3.5 million in costs, based on 2021 to 2022 prices. This is a financial cost to the government. Illicit drug use relates to an individual using cocaine, crack, and other drugs. The annual cost per case for an individual in drug misuse treatment stands at around £2,644. That figure bases itself off 2018 to 2019 prices. Community drug treatment for the 2021 to 2022 period stands at £1.8 million.

The final figure for health stands at £754.4 million to £1.4 billion. This incorporates deaths from suicide, illicit drug use, depression and so on. Yet it also incorporates gambling treatment undertaken by players. The NHS funds eight clinics, with a commitment to roll out seven more in England. Combining everything together, costs relating to health are primary in ranking.

Employment, Education and Criminal Harms

Various studies have taken place about gambling activity reducing productivity in work. Education is also affected by this, according to reports. This can result in absences from work, the inability to work and even unemployment. Work is, of course, linked in a close way to financial harms. Loss of employment and, as a result, loss of wages, exacerbate those harms. A recent study concluded that gambling has an association with a risk of future unemployment in the UK.

Is a gambler more likely to claim unemployment benefits, though? In comparison to a non-problem gambler, it is 2.65 times more likely to occur. England now has its Universal Credit system in place, replacing the previous Jobseeker’s Allowance (JSA). Data shows that between 2019 and 2020, 2,896,988 people claimed unemployment benefits. An unemployed individual costs the government £13,721 per year.

An estimated excess cost to the government of unemployment benefits linked to problem gambling is £77 million.

As far as criminal activity goes, for some people in the UK, problem gambling is instrumental in this. It’s not always the case, but it can be. Estimates suggest this costs £167.3 million per year. This figure surrounds criminal justice system costs associated with problem gambling in England. The analysis estimates the direct cost of imprisonment with the estimated prison population who have committed offences linked to problem gambling.

In December of 2020, a report from Forward Trust said that almost 1/4 of prisoners have a gambling problem. Over half of these inmates believe support to address gambling harm should be available in prison. The likelihood of this coming into effect would push costs up even more.