Gambling is inherently exploitative and no amount of regulation will align the incentives for commercial operators. You also don't want to ban it outright, as it may descend into the underground otherwise, so this looks like a reasonable area for the govt to take direct control.
I think privatisation happened quite a while ago (mid to late 1990s) but my vague memory is that there was some sort of deregulation in the mid 2000s (or at least that's when I remember the ads becoming incessant) and that seems to have coincided with the endless offers of bonus bets, deposit matches, bet returns etc.