Gala Bingo may be forced to close a number of its bingo halls, according to Gala Coral chief executive Neil Goulden. The admission comes despite repeated claims by Goulden that it had “no plans” to close any outlets.
Speaking exclusively to Marketing Week, Goulden admits that the company is on “red alert” regarding closures and that much will depend on whether the Chancellor eases the tax burden on the bingo industry in the Budget in March.
It is understood that five venues have been earmarked for potential closure. A month-long consultation process has begun on halls in Lakeside, Teesside, Bristol, Bournemouth and Edinburgh.
Gala Bingo reported a 10.7% fall in pre-exceptional profits for 2007. The industry has been hit hard by the smoking ban, which came into force in July 2007 and the loss of high-jackpot slot machines, as a result of the Gambling Act 2005, introduced last September.
Goulden says: “It is true our bingo business is suffering but not just due to the smoking ban and the removal of slot machines but through government policy and unfair tax regimes.”
Gala Coral, together with Rank, who between them operate almost half the country’s 600 bingo halls, have been lobbying the Government to reform the industry’s tax regime. Bingo operators say they are unfairly hit by a gaming duty of 15% as well as VAT. It is believed that their case has the backing of the Department for Culture, Media and Sport and has won considerable support among MPs, who fear sweeping closures and jobs losses.
Goulden adds: “The Government has got one opportunity to invest in the bingo industry. We have submitted plans to them that show they will make more money if they invest in bingo than if they don’t.”