Sam Coates, Times Correspondent, explains that the Government is expecting a billion pound tax bonanza by liberalising the gaming laws, but may pay for it by creating 400,000 new gambling addicts.

Why is the Government shaking-up the gaming industry?

Britain's laws relating to gambling are nearly 40 years old. Before 1961, casinos were illegal. In 1968 the Government allowed a limited number of premises to be licenced, with heavy regulations and only in certain areas. These rules have remained in place ever since. New developments, such as the rise of internet gambling, are currently unregulated. Both the domestic gambling industry and the large US casino operators have long lobbied for a more liberal regime.

What will happen after the law changes ?

We will see casinos springing up across Britain. The biggest change will be the arrival of the super-casino like those in Las Vegas, offering million pound slot machines, and with hotels and conference centres attached. Tessa Jowell, the Culture Secretary, told The Times that there could be up to 40 such casinos, although without an upper limit on how many there can be, many believe that the figure could be much higher.

But the Government has upset domestic operators by demanding that ordinary slot machines which pay out small prize money must be removed from taxi offices and take-aways. They Government has also said that the lucrative million-pound slot machines can only appear in casinos bigger than 5,000 sq meters, and few British operators currently have premises that big.

How does this fit in with the Government's agenda?

The Government insists this Bill is essential to protect the public. Anti-gambling groups such as the Salvation Army insist that any liberalisation is a bad thing.

The Department for Culture, Media and Sport has refused to de-couple urgently needed parts of the Bill, such as those which will regulate internet gambling, from the sections paving the way for super-casinos.

Both local and national government stand to make a lot of money from the new rules. All councils that agree to a casino stand to make millions under the controversial Section 106 agreements, in which developers promise regeneration benefits (affordable housing, money for small businesses etc) to smooth through planning applications.

At a national level, central Government stands to benefit from billions a year in terms of tax on these new casinos, although Gordon Brown, the Chancellor, has yet to say what the tax levels will be.

Is there a risk of a gambling epidemic?

There are 300,000 gambling addicts in Britain. The Government claims, astonishingly, that liberalising casino rules will not result in a single extra "problem gambler".

The Henley Centre, which forecasts future trends, estimates that the new laws will create 400,000 extra problem gamblers by 2010. Without the laws, the Henley Centre said the number of addicts would rise by only 100,000.

The new Gambling Commission will be charged with safeguarding the vulnerable. But it has a tough job ahead. As The Times revealed yesterday, all the expertise from the current Gaming Board, which has 40 years' experience in dealing with casinos, is likely to be lost because the Gambling Commission is to be based outside London, probably in Newcastle.

Isn't this all about big business?

The UK gaming industry is worth £8.5 billion. There are 413,000 gaming machines in 120,000 locations across the UK. Two thirds are in pubs and family entertainment centres, such as seaside arcades. Remote or internet gambling is worth an estimated £10 billion globally.

But this is dwarfed by the size of the US giant casinos. MGM Mirage, the largest casino company in the world, says it expects 10 per cent of its worldwide revenues to come from Britain by 2010.

The Government denies being in hock to these big businesses. But together the gambling corporations have undertaken an estimated £100 million lobbying effort to ensure the relaxation of the gaming laws - and they appear to have been successful.

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