Good and bad people, or what vested interests are not about

Good and bad people, or what vested interests are not about

Michael Egerer

In the name of problem-gambling prevention, the Finnish Ministry of the Interior has planned to introduce mandatory identification at the state gambling monopoly´s electronic gambling machines (EGMs). Maybe not surprisingly, the officials of the state monopoly are trying to prevent – or at least postpone – such a measure. However, if some are now hoping that a knight in shining armour is taking up the fight against this “evil” industry, they are mistaken. Civil society’s “good guys” are teaming up with the “bad guys” in this story. Still, is there something here that could lead to a happy ending?

Civil society is seen in many ways as promoting the public good. Their activities can take the form of grassroots political activism, but civil society also provides services normally associated with the welfare state. Its organisations help the poor, the elderly, the young and the sick – the often marginalised groups in society. While voluntary work can cover some of the activities, the organisations can only exist in the long run through continuous financing.

In many countries, gambling revenue serves as such a source.[1, 2] Finnish civil society, for example, receives a considerable amount of its financing from the state monopoly’s gambling revenue. Consequently, civil society organisations are encouraged to have an interest in ensuring a steady flow of gambling revenue.

Guarding your interests, showing your contribution
Last summer, the Finnish Ministry of the Interior requested from numerous stakeholders a statement on its regulatory proposal, which includes the introduction of mandatory identification at EGMs. Mandatory identification has been found to be a prerequisite for the effective use of spending limits and other player pre-commitments, and thus is a way to prevent problem gambling.[3] Among the stakeholders were several state institutions such as ministries, authorities and institutes, industrial associations (e.g. The Finnish Hospitality Association) and the state gambling monopoly Veikkaus. The majority of stakeholders, however, consisted of social, cultural and sporting organisations which can largely be seen as part of civil society.

None of these organisations denied the need to prevent problem gambling. However, except for a few organisations, their main concern was the risk of lower gambling revenue due to the proposed more restrictive gambling regulation. In order to secure their source of finance, many organisations have engaged in strategies similar to the gambling provider itself, for example expressing doubts that mandatory identification would make a difference (i.e. reduce gambling problems), demanding ever- more research and evidence, postponing or at least slowing down implementation of the policy, and individualising the problem (i.e. claiming that wherever gambling is, there are always problem gamblers regardless of regulations). Such argumentation brings to mind the tobacco industry’s resistance in the previous century’s later years to smoking restrictions.

In the project “Gambling Policy in European Welfare States” (funded by the Academy of Finland) we conducted key informant interviews, where we asked civil society representatives directly about their position towards receiving money from the state monopoly’s gambling revenue. Our informants expressed a more nuanced picture than in the statements concerning the regulatory proposal. Their position could be described as one of moral entrepreneurs, who, acknowledging the Janus-faced character of gambling, tried to demonstrate their contribution to the public good. As the natural partner in this endeavour they identified their funder, which at the time of the interviews was a department of the Finnish Slot-machine Association (the monopoly for EGMs and casino games until 2017). Funded organisations needed to report their activities to the funding department. By aggregating the data of the reports from the many civil society organisations, the grant department of the gambling monopoly could manage to show the accumulated public good created by civil society. In comparison, the moral entrepreneurs in the civil society organisations feared not being able to demonstrate such a contribution of their own.

Presenting one’s importance in fostering the public good could be seen as another – and in fact, seemed to be the main – strategy for the justification of taking gambling money: the benefits outweigh the costs. Then again, civil society representatives underestimated the true magnitude of the costs, namely the prevalence of problem gambling or the percentage of gambling revenue that originates from problem gamblers. In addition, they delegated the responsibility for preventing and caring for problem gambling to the gambling monopoly or to the gamblers themselves. Sometimes they began to discuss other problems such as “Playstation addiction” instead of tackling the question of problem gambling.

Many interviewed representatives openly confessed being dependent on gambling revenues. In some cases, an organisation’s existence – and at a very practical level, the bricks and mortar workplaces themselves – were described as being at the mercy of funding from gambling. This might explain why they were struggling with the alleged moral inconsistency, using numerous strategies to justify their conduct. Still, in the discourse as well as in practice (as many of the organisations’ statements concerning the new gambling law proposal show) they have often teamed up with the gambling monopoly.

Happily ever after
Maybe there are indeed good and bad people, but this is not the question here. The question is how to organise the regulatory context in a way that encourages people to do good. The different ways to channel gambling money towards  good causes have pros and cons, and risk turning “moral entrepreneurs” into persons or organisations that  put their interests ahead of the common good [1, 2]. A perfect solution might not exist. However, there are check and balances that make it unnecessary for people with good intentions to pit one weak group against another.

In Finland, such a balance could be achieved by the parliament agreeing beforehand on the amount of money to be allocated to civil society’s needs, instead of letting this depend on the amount of gambling revenue. We have also suggested a more radical measure [2]: the current gambling revenue is roughly equal to Finnish developmental aid. Using gambling revenue exclusively for developmental aid could help to considerably lessen the number of organisations dependent on gambling revenue. Naturally, it would need to be reliably guaranteed that the money consequently “saved” in the state budget would be instead used to continuously support civil society. Likewise, the suggestion to use gambling revenue for developmental aid should not be misunderstood as a devaluation of such foreign assistance, and must be understood here from the perspective of finding strategies to diminish vested interests. The current unhealthy trade-off between problem gambling prevention vs. revenue creation could be substantially reduced, and singular interests would not need to be put over the whole population’s welfare.

Finally, industry officials and lobbyists are no better or worse than other individuals. They are people embedded in an institutional setting, having responsibilities towards their employers; and the employers are bound by the rules and institutional background set by the legislator.

By ensuring well-designed rules for companies as well as ways to finance civil society, there is neither the need for a virtuous hero nor a reason to be afraid of an “evil industry”.

[1] Adams, P. (2008). Gambling, freedom and democracy. New York: Routledge.
[2] Egerer, M., Marionneau, V., & Nikkinen, J. (eds.) (2018a). Gambling Policies in European Welfare States. Current Challenges and Future Prospects. London: Palgrave MacMillan.
[3] Sulkunen, P., Babor, T. F., Cisneros Örnberg, J., Egerer, M., Hellman, M., Livingstone, C., Marionneau, V., Nikkinen, J., Room, R., & Rossow, I. (2018 Forthcoming). Setting limits. Gambling, science and public policy. Oxford: Oxford University Press.


Michael Egerer is a postdoctoral researcher at the University of Helsinki Research Centre for Addiction, Control, and Governance (CEACG). His research interests address gambling, gambling regulations and the concept of addiction.  He is editor with Virve Marionneau and Janne Nikkinen of the book Gambling Policies in European Welfare States, which was published by Palgrave in August 2018 and is available here