A committee of MPs has said that government proposals over the operation of gaming machines in its draft Gambling Bill are unfair and could place existing UK casino operators under threat.

The government intends to limit the accessibility of jackpot machines that have no limits on prize money – known as ‘category A’ machines – in order to avoid problem gambling, with only casinos with a space of 5,000sq m or more allowed to install Category A machines on their premises.

In a recent report, the cross-party committee expressed concerns that, by doing so, the government risks making smaller casinos less attractive.

As a result, larger casino resorts than originally expected would be developed in the UK with the committee claiming that the new Bill would consequently be balanced in favour of international gaming companies.

The committee was also ‘surprised’ at the stance the government has taken in relation to the existing industry, which it commended for developing a reputation for good governance and integrity.

The report said: “The new proposals significantly alter the product offered by existing casinos and any new smaller casinos.

“We have received evidence suggesting that this could have a very detrimental effect on the existing industry. We recommend that the Department for Culture, Media and Sport (DCMS) consults the industry to consider more appropriate minimum gaming table requirements and the provision of machines.”

Rank Group, which operates Mecca Bingos and the Grosvenor Casinos, welcomed the committee’s comments.

In a statement, Rank said: “The company is encouraged by the recommendation that small and large casinos licensed before August 2003 will be permitted a certain proportion of category A machines.”

Viscountess Cobham, chair of the British Casino Association, said she was disappointed by the lack of consultation between the government and the industry.

She said: “It is a great sadness that, having had four years of what in my view has been commendable consultation, there has been absolutely none regarding the latest draft.

“This has resulted in the industry being astonished by some of the proposals that the DCMS has conjured up.”

Under the government’s proposals, casinos would also be limited to a maximum of 1,250 gaming machines – a suggestion criticised by large international casino companies.

Las Vegas Sands and MGM Mirage both announced that this would limit inward investment and regeneration without significantly alleviating problem gambling.

This was challenged by a number of religious groups, including the Methodist Church, the Salvation Army, Quaker Action on Alcohol and Drugs and the Evangelical Alliance all expressed concerns that the proposed machine limit is far too high.

The report will now be studied by the government, which will respond to the issues raised by the committee.

The Bill is expected to be introduced to the House of Commons during the next parliamentary session.