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Chapter 4

Dynamic warnings, ATM withdrawal limits and other issues

4.1        This chapter will cover the remaining reforms: dynamic warnings on poker machines and an automatic teller machine (ATM) withdrawal limit, and issues raised with the committee in relation to them. It also covers other issues such as the new levies to be imposed and the establishment of an Australian Gambling Research Centre within the Australian Institute of Family Studies.

Dynamic warnings on poker machines

4.2        The bill proposes that dynamic player warnings be mandatory. The warnings must relate to the use by a specific person of a particular EGM or EGMs, or the potential harm and cost of using EGMs. Details such as form, frequency, content and position of the player warnings may be prescribed in the regulations.[1]

4.3        Work has been done in this area by Aristocrat which has trialled warnings and researchers found that:

• responsible gambling messages should be placed within easy sight of players and frequently changed to reduce habituation to their content; and
• responsible gambling messages tended to reduce the enjoyment of problem gamblers far more than recreational players. The potential therefore exists to use messaging in a targeted way to interrupt problem gambling.[2]

4.4        Professor Paul Delfabbro spoke about what type of messages are the most effective:

Simple factual information is not that useful. Problem gamblers often do know the odds; they do know something about how gambling works. They simply do not pay attention to it. Simply telling people to gamble responsibly is not enough. Even the word 'responsible' gets some people's ire up because it is imposing values. It is much better to talk about setting your own budget and putting the ball in their court. Having messages which people can personalise and which are also dynamic in a sense that they are very visible on the screen, I think, are going to be much more useful. If people can set their own message, it is them dictating for themselves rather than being told what to do. From our experience, that probably works a bit better.[3]

Committee view

4.5        The committee notes that this measure was supported in submissions. In evidence to previous inquiries, the committee heard that if there is no basic guidance on visibility, then the messages could be placed where they are difficult to see. The committee has also heard during previous inquiries that messages of a more generic nature about gambling harm are less likely to be effective.[4] The committee suggests that the location and content of messages should have to be changed regularly so players don't become habituated to them. Messages also need to have sufficient impact to reach people who are 'in the zone' with their playing and who are more likely to ignore them and keep playing. To this end the committee welcomes the research outlined above which noted the potential to use messaging in a targeted way to interrupt problem gambling.

ATM withdrawal limits

4.6        The Productivity Commission (PC) found that 'people experiencing problems with their gambling tend to make repeat visits to ATMs and make large withdrawals, whereas recreational gamblers tend to withdraw smaller amounts less frequently'.[5] The PC also found that 85 per cent of cash withdrawals from ATMs in gaming venues involved amounts below $250.[6] In its 1999 report, the PC also reported that 'problem gamblers were more likely than non-problem players to withdraw money from an ATM at a venue whilst playing the pokies'.[7]

4.7        The bill establishes that ATMs on gaming machine premises (other than casinos) must not allow a person to withdraw more than the cash limit of $250 in any 24 hour period.[8] The amount is to be indexed[9] and the implementation date is 1 May 2013. The limit will not affect any state and territory regulation that further restricts access to ATMs in gaming venues. For example, Victoria has legislated to prohibit ATMs in gaming venues from July 2012. In addition, Tasmania does not have ATMs in hotels or clubs.[10] The committee notes the table provided by FaHCSIA at the hearing which contains details of state and territory ATM restrictions.[11]

4.8        Regulations can prescribe exemptions for venues, after an application is made, if compliance would cause 'unreasonable inconvenience' to the community.[12]

4.9        This measure was welcomed in most submissions.[13] However, while supporting the $250 limit, the Australian Churches Gambling Taskforce stated that it believes the daily limit of $250 is too high and advocated for the removal of ATMs from EGM venues altogether.[14] A lower limit or removal of ATMs from EGM venues was also supported by the Australian Psychological Society.[15]

4.10      In contrast, clubs and hotels opposed this measure saying 'there is no evidence to show that withdrawal limits will have any effect on the prevalence of problem gambling, while imposing significant inconvenience to other patrons and club staff'.[16] Instead, industry called for problem gamblers to approach their bank or financial institution to lower their daily withdrawal limits.[17]

4.11      The committee heard from the ATM Industry Reference Group which advocated for a daily withdrawal limit of $400.[18] However, the Reference Group's most pressing concern was the implementation timeframe of May 2013 and it outlined a number of arguments for a 12-month lead in time.[19] These issues were discussed with the committee at the hearing where further detail was provided by Mr Paul Stewart, General Manager, The Banktech Group, ATM Industry Reference Group:

...our industry wants to ensure that any transition is seamless, and therefore we do need 12 months to assure that this will be the case for a number of reasons, including, firstly, clear identification of the appropriate locations to which any limit would apply. Because the legislation is national, it is a significant task with, as mentioned, over 5,000 ATMs. We need to build the technology in conjunction with different state and territory jurisdictions that exist with different requirements.

We have a range of contractual issues with individual locations, including those locations that may have multiple ATM providers and which may be put into a position of needing to break one or both of those contracts in order to comply with legislation. Payments industry technology moratoriums are a common practice throughout the Christmas-New Year period, and also through the Easter period, which limit our ability to make technology changes during these periods. Therefore, work could not commence until late January at the earliest.

Processing platforms that we use for ATM transactions are complicated, and they are not used exclusively for ATMs. They are often shared by multiple parties, and that includes some that are shared by financial institutions. Some of the locations where the limit would need to apply would require physical hardware upgrades, and a significant number would require software upgrades to those ATMs in order to deliver the legislated limit.

There are also a number of smaller of ATM deployers who would need to be involved in the process who are currently not engaged in any government process at the moment. Finally, we would have an obligation in terms of reporting and monitoring to ensure compliance against the legislation was measured and adhered to.[20]

Committee view

4.12      The committee appreciates the technical and other issues facing the ATM Industry Reference Group and its request for additional time to implement these changes. It notes the self-imposed moratorium across the peak processing period so work could not commence until mid-January 2013. Taking into consideration the timing of the next self-imposed moratorium, the committee does not oppose the industry being given until the end of 2013 to implement the changes. However, as the committee are not technical experts, it understands that government will be best placed to judge whether such a time extension is warranted.

Recommendation 5

4.13      The committee recommends that the members of the ATM Industry Reference Group be given until the end of 2013 to implement the $250 daily withdrawal limit on ATMs in gaming machine premises should the government believe such an extension would assist with the transition.

4.14      However, given the disparity of views regarding what the actual limit should be, the committee is inclined to support $250, noting that $250 is not the maximum amount of money a patron would be able to spend in a venue as they could also access EFTPOS or credit card facilities.

4.15      The committee notes that ATM transactions have no element of human interaction as there is with EFTPOS. However, the committee is concerned that not including EFTPOS transactions in the $250 per day withdrawal limit may result in unintended consequences and believes this issue should be included in the review of implementation to be undertaken by the Productivity Commission.

Recommendation 6

4.16      The committee recommends that the issue of including EFTPOS transactions in the $250 per day ATM withdrawal limit be considered by the Productivity Commission in its review of assessment of progress in complying with the requirements around the ATM withdrawal limits.

Privacy

4.17      Chapter 4 of the bill creates offences to protect information that has been obtained under the Act. The creation of a national database of information obtained from pre-commitment systems is ruled out.[21] However, disclosing information is authorised in a number of situations including for the purposes of the Act, for law enforcement purposes, statistical research or with consent. Clause 67 provides offences for unauthorised disclosure of protected information. These include imprisonment penalties.

4.18      The committee notes that the Privacy Commissioner has reviewed the bill and raises a number of suggestions that may improve the effectiveness of privacy safeguards in the bill.[22] The Australian Churches Gambling Taskforce also raises some concerns in this area.[23]

Committee view

4.19      The committee suggests the government review the submission by the Privacy Commissioner and consider any necessary amendments to improve privacy safeguards in the bill. The committee also suggests the government respond to any issues raised by the relevant scrutiny committees.[24]

Imposition of new levies

4.20      Chapter 6 of the bill provides for levies to support the bill: the supervisory levy and the gaming machine levy.

Supervisory levy

4.21      Part 2 of Chapter 6 (see also National Gambling Reform (Related Matters) Bill (No. 1) 2012) imposes a liability for a supervisory levy which applies to all gaming machine premises to cover the regulatory costs to the Commonwealth of administering the Act.[25] The amount will be payable for a gaming machine for a levy period[26] if a person makes the gaming machine available for use at any time during that period.[27]

4.22      Industry raised concerns that the levy has no expiry date or cap and that it would be set after the legislation has passed the Parliament.[28]

Committee view

4.23      The committee notes that the method of calculating the supervisory levy will be determined by regulations and the government has undertaken to consult with industry to inform the development of the regulations that will determine the levy.[29] Additionally, the government has indicated that the supervisory levy will only be used to cover the costs of administering the legislation.[30] The committee emphasises that the levy will be determined in consultation with industry and until the regulations are made, the levy is not payable.

Gaming machine regulation levy

4.24      The gaming machine regulation levy (see also National Gambling Reform (Related Matters) Bill (No. 2) 2012) imposes a liability on a person who is entitled to gaming machine revenue, who is not a constitutional corporation. The Explanatory Memorandum notes that the purpose of the gaming machine regulation levy is to encourage compliance with requirements relating to pre-commitment systems and dynamic warning requirements by persons who are not constitutional corporations. It will be determined by reference to the amount of gaming machine revenue. It is not payable if a gaming machine complies with the pre-commitment system and dynamic warning requirements, or if the gaming machine is made available by a person who is, or is sufficiently connected, to a constitutional corporation.[31]

4.25      This is the first time the Commonwealth has taken national action in the area of gambling. Dr Anne Twomey agreed that the corporations power would 'cover direct regulation in relation to most entities that own or operate gaming premises'. Dr Twomey questioned how many entities are not incorporated and therefore will not be affected by direct legislation.[32] This question was asked of FaHCSIA on notice which responded that government analysis suggests a minority of venues are not incorporated.[33]

Committee view

4.26      The committee recognises that the levies address two separate issues. First, is how to cover the regulatory costs to the Commonwealth of administering the Act. This is addressed by using the taxation power to impose the supervisory levy on all licensees of gaming machines premises (contained in National Gambling Reform (Related Matters) Bill (No. 1) 2012). The second issue is around non-compliance. Civil penalties for non-compliance for constitutional corporations are contained in the bill.[34] The committee is pleased to note that the bill also recognises that there might be organisations operating gaming machines that are not constitutional corporations. The gaming machine regulation levy (contained in the National Gambling Reform (Related Matters) Bill (No. 2) 2012) uses the taxation power to encourage compliance with pre-commitment and dynamic warning requirements by persons who are not constitutional corporations.[35] The levy is not payable if they comply with the pre-commitment system and dynamic warning requirements.

Reviews

4.27      Chapter 9 of the bill provides for two inquiries by the Productivity Commission: in relation to any trial of mandatory pre-commitment systems; and an assessment of the progress gaming machine premises are making towards complying with the measures contained in the bill.

Productivity Commission review of mandatory pre-commitment trial

4.28      The government has undertaken to sponsor a large-scale trial to build the evidence base for mandatory pre-commitment. It will be held in the ACT and run for 12 months. The trial will test the operational features of mandatory pre-commitment and assess whether mandatory pre-commitment delivers sufficient advantages to communities and individuals when compared to voluntary pre-commitment. The trial will assess the effects on problem gamblers, recreational gamblers, venues and communities. One or more independent bodies will be engaged to design, manage and evaluate the trial. After the trial has been completed the PC must inquire into the results as evaluated by the independent body.[36]

4.29      On 8 September 2012, the Minister announced a Trial Oversight Committee would be appointed to provide technical and implementation advice to the Australian and ACT Government and the independent contractors who will manage and evaluate the trial. Preparatory work for the trial will begin before the end of 2012.[37] FaHCSIA confirmed that the trial oversight committee has already met.[38]

Productivity Commission review of assessment of progress

4.30      The Productivity Minister must refer to the PC for inquiry, an assessment of the progress gaming machine premises are making towards complying with pre-commitment systems and dynamic warning systems, ATMs limits, requirements for manufacturing and importing gaming machines and any other matters the Minister considers relevant. This referral must occur no later than 30 September 2014.[39]

4.31      The committee has recommended that the following areas be included in this review:

•   the ban on the use of biometrics;
•   the linking of pre-commitment to loyalty schemes;
•   whether there are grounds for further exemptions for smaller venues in regional and remote areas; and
•   any unintended consequences of not including EFTPOS transactions in the $250 per day ATM withdrawal limit.

4.32      The PC must submit its report on both inquiries within six months.[40] As soon as practicable after receiving the report, the minister who administers the new Act must prepare a statement that sets out the government's response to each recommendation. The statement must be tabled in Parliament within three months after receiving the report.[41]

Research into gambling

4.33      Chapter 9 of the bill also establishes a new Australian Gambling Research Centre within the Australian Institute of Family Studies supported by an expert advisory group. The bill proposes that additional functions be given to the Director of the Australian Institute of Family Studies to establish the Australian Gambling Research Centre. The new functions will be to undertake or commission research into, or produce data and statistics about: the harm caused by gambling to problem gamblers, their families and communities; those at risk of experiencing harm; measures that might be undertaken to reduce that harm; and recreational gambling. The Centre will also seek to increase the capability and capacity of researchers to conduct this research and produce gambling data and statistics.[42]

4.34      An expert advisory group would be established to provide advice to the Director of the Australian Institute of Family Studies in their capacity as the Director of the Australian Gambling Research Centre in relation to: strategic directions, research plans and programs; and strategies for increasing the capability and capacity of researchers to conduct research and produce data and statistics about gambling.[43] The group would consist of at least 7 but no more than 11 members apart from the Director.[44]

The need to ensure independence and transparency

4.35      The proposed research centre was welcomed in submissions.[45] However a couple of issues were raised that the committee agrees warrants attention. First is the independence of the Centre, the academics and the expert advisory group. Dr Samantha Thomas outlined her concerns in this area:

As we have learned from many other public health issues, it will be important that the research institute is independent from the interests of the gambling industry. This includes ensuring that representatives of the gambling industry are not appointed to the board of the institute or any of its subcommittees - either through direct industry appointments, or through the appointments of academics or community groups who have existing or previous funding links to the gambling industry. Further detail is required in the Bill about the make up of the Board of the Gambling Institute to ensure its independence.[46]

4.36      This view was supported by the Australian Psychological Society (APS):

The APS strongly supports the establishment of an Australian Gambling Research Centre. In particular, we support a centre that:

• is completely independent from the gambling industry, including that no research is funded directly by the industry.[47]

4.37      The APS also made a number of other suggestions that the Centre:

• is adequately resourced to undertake the required research and the capacity to inform decision-making in relation to gambling-related policy;
• considers both the impacts and treatment interventions for individuals and their families, and the systemic and structural factors and solutions, in keeping with the WHO’s Social Determinants of Health Framework that has been endorsed by the Australian Government;
• prioritises research to understand the impact of emerging forms of gambling, such as the interactive and online gambling including saturated, integrated and impulse gambling marketing strategies in sporting matches and particularly with regard to the influence on children and young people;
• works collaboratively with the Problem Gambling Research and Treatment Centre to further research for screening, assessment and treatment of problem gambling; and
• conducts rigorous evaluations of current interventions and treatment services and undertakes independent evaluation and research into the impact of policies designed to reduce gambling related harm.[48]

Committee view

4.38      The committee notes that the Australian Gambling Research Centre will start work in July 2013. It will undertake and commission research and produce data and statistics on: problem gambling and those at risk; measures to reduce harm; and recreational gambling. It will create a more policy-oriented approach to research; improve data collection; increase transparency; and focus the research agenda on measures to reduce harm.  The Centre will help address the lack of robust evidence and consistent data to inform policy development. The Australian Institute of Family Studies is an Australian government statutory body and this will ensure independence from government while ensuring the support of an experienced and highly capable research organisation.[49] The issues of research independence and transparency were highlighted in the committee's third report. The committee notes that inclusion of industry can provide access to research opportunities and data. It therefore does not rule out the input of industry but would support transparency around this. The committee encourages the development of appropriate guidelines for the management and transparency of any potential conflicts of interest, for example as used by the Australian Research Council and the National Health and Medical Research Council.

Need to ensure adequate funding

4.39      The other area of concern was the amount of funding for the Centre and the need for it to be ongoing. The Gaming Technologies Association supported the establishment of an Australian Gambling Research Centre but expressed the view that its preliminary annual budget of $1.5 million would not be sufficient:

GTA’s view in relation to an AGRC budget is based on experience. The cost of the landmark University of Sydney research project which resulted in its report of November 2012 and is still widely referenced, exceeded $1 million in today’s dollars (including $260,000 to reconfigure a small number of machines). GTA anticipates that the AGRC would be requested to undertake several such studies in its first year; accordingly, its annual budget should be more than $5 million.[50]

4.40      The Australian Churches Gambling Taskforce also highlighted the need for additional funding:

...this provision will only have meaning if the Commonwealth Government provides the Australian Institute of Family Studies with additional funding to conduct such research effectively. Much of the research into measures to reduce the harms caused by gambling has been constrained by inadequate research budgets, forcing the use of methodologies that do not allow researchers to fully evaluate proposed measures.[51]

Committee view

4.41      The committee notes advice from FaHCSIA confirming that the Australian Gambling Research Centre will receive funding from the Australian Government of $1.5 million per annum on an ongoing basis.[52]

Need for a national prevalence study

4.42      The committee considers that as a priority, the Australian Gambling Research Centre should conduct a national prevalence study of problem gambling, using best practice screening tools,[53] to establish baseline data as the last such study was conducted in 1999. During its inquiries the committee heard of the difficulties in comparing prevalence data from the states and territories due to inconsistent methodologies. The committee is concerned that due to inconsistent measurements there may be groups of problem gamblers and vulnerable populations that are not being identified and this hampers our understanding of the extent of the problem.

Recommendation 7

4.43      The committee recommends that the Australian Gambling Research Centre should, as a priority, conduct a national prevalence study of problem gambling to establish baseline data (using best practice screening tools) that will enable comparison between jurisdictions and will include as many at risk groups as possible.

Conclusion

4.44      The committee supports the intent of the National Gambling Reform Bill 2012 to set the minimum requirements for the establishment of a state or territory-wide pre-commitment system that can be used by players as a tool to help them set limits around their play and to assist them to play within those limits. It trusts that its suggestions for additional functionality will be of assistance in providing the most helpful pre-commitment system for players which is simple and easy to use. The committee welcomes the complementary measures of dynamic warnings and limits on ATM withdrawals as well as the other measures announced by the government on 21 January 2012 to assist problem gamblers. It sees this legislation as a positive step to address a national public health[54] problem on a national basis.

Recommendation 8

4.45      The committee recommends that the bills be passed.

 

Mr Andrew Wilkie MP

Chair

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