1.4 In
response, Clubs Australia and the Australian Hotels Association launched what
was nothing more than a scare campaign against the reform, targeting Government
members in marginal seats. Assertions from these organisations included the
claim that people would need a ‘licence to punt’, that the Government was going
to track people’s gambling activity, and that any type of gambling reform would
see clubs no longer able to make contributions to their local communities. I
have attached a letter sent from Mr Wilkie and myself to all Members of
Parliament in 2010, refuting those claims.
1.5 It
is worth noting at this point that several studies, including one by the
Productivity Commission, have raised concerns about how much sporting clubs
actually return to their local communities in exchange for the tax breaks they
receive as not-for-profit organisations. Most recently, a report commissioned
by Uniting Care and undertaken by Charles Livingstone, Chebiwot Kipsaina and
Angela Rintoul of the School of Public Health and Preventative Medicine at
Monash University found that, on average, clubs in New South Wales returned the
equivalent of only 1.3 per cent of their poker machine losses to the
communities they claim to support.[4]
1.6 However,
in early 2012, the Government gave in to the pressure from the gambling
industry, following the recruitment of the Member for Fisher, Peter Slipper MP,
into the Speaker’s Chair. No longer in need of Mr Wilkie’s support to stay in
government, the ALP withdrew support for mandatory pre-commitment and instead
said it would trial mandatory pre-commitment in the Australian Capital
Territory, and work towards implementing a form of voluntary pre-commitment
across Australia. This was a blatant breach of the agreement Mr Wilkie had
entered into with the Prime Minister.
1.7 It
is also important to note that the Opposition has sided with the industry
throughout this process. It did briefly consult with the intention of forming
its own policy for reform, but it appears this has not progressed.
1.8 Ultimately,
this issue must be about problem gamblers and those directly affected. I
acknowledge the Committee for the time they have taken to speak to people who
have been affected by addiction, either directly or indirectly. I thank the
Committee for its efforts in this area, because those discussions have played a
vital part in informing Committee members and putting a human face on this
issue.
1.9 Sadly,
however, what should have been about human suffering and a dangerous product
has now become all about vested interests. Instead of being a fight for what is
right, it has become a fight for what is least offensive to those with the most
money.
1.10 I
wish to formally note that I consider both Mr Wilkie and the Australian Greens
have acted in good faith throughout this process. I believe them when they say
this is only the first step and they will continue to fight for reform.
1.11 However,
I am fundamentally unable to support this bill. I cannot support legislation
that is so qualified and conditional, and fraught with technical difficulties.
It will also not help problem gamblers in any significant way. Further, this
legislation is a direct result of a fundamental breach of trust on the part of
the Government and, as is set out below, the Government cannot credibly explain
its position.
1.12 Voluntary
pre-commitment does not work. Formal studies have repeatedly shown that these
systems are not effective at limiting losses.
1.13 A
study into poker machine pre-commitment schemes prepared for the Nova Scotia
Gaming Foundation in Canada found that voluntary schemes consistently failed
because they relied on the willpower of players.[5]
1.14 The
Nova Scotia study found that high risk players were unlikely to use a voluntary
system. It also found that high risk players would often continue to gamble
beyond their limits unless they were locked out of play and that they lost more
money than they intended "most times they play".[6]
1.15 The
take-up of voluntary pre-commitment schemes has also been shown to be woeful.
In South Australia, Worldsmart Technology’s J-Card loyalty scheme allows a
player to set self-imposed limits on time and spending. After reviewing
Worldsmart’s scheme, the Productivity Commission reported:
“Relatively few
consumers have enabled their loyalty card for pre-commitment features. By
mid-September, 233 of just under 32,000 loyalty card members (or 0.7 percent)
had enabled pre-commitment options.”[7]
1.16 Ultimately,
the idea of voluntary pre-commitment seems to be based on how governments
believe people should behave, rather than how they actually
behave.
1.17 Beyond
this fundamental issue, it is important to note that the bills also contain
significant flaws and weaknesses. I will be moving a number of amendments in
the Senate to highlight these, but my main concerns relate to the structure of
the pre-commitment systems and the lack of incentive for any party to establish
such a system. For example, the penalty provisions in the National Gambling
Reform Bill 2012 contain an exemption for where ‘there is not an approved
pre-commitment system for a State or Territory’.[8]
A similar exemption applies to the gaming machine regulation levy, which is
designed to encourage compliance among organisations that are not
constitutional corporations.[9]
1.18 The
the only place FAHCSIA could point to a requirement for a pre-commitment system
to apply across a whole state or territory (and therefore cover all machines in
that state or territory) is in the Explanatory Memorandum to the bill.[10] Further,
the penalty provisions to require compliance do not apply if there is no
system, so it is hard to see how this legislation could be enforced at all.
1.19 Most
importantly, this legislation will not provide immediate assistance to problem
gamblers, or those at risk of problem gambling. The fact that the voluntary
systems are not required even to have a default loss limit is very problematic.
1.20 I
would have been more inclined to support this legislation if it had also
mandated that machines at least should be capable of being limited to $1 bets
and hourly losses of $120, as recommended by the Productivity Commission.[11] This
measure was intended to work in conjunction with pre-commitment, and is vital
in reducing the intensity of play. Poker machines in Australia operate at an
incredibly high intensity, which many consider increases their addictiveness.
1.21 For
a product that is touted as ‘entertainment’, it seems unbelievable that
gamblers can lose up to $1,200 an hour.[12]
This cost can hardly be considered a form of recreation. Limiting losses to
$120 an hour will not only reduce the harm caused by these machines, but bring
them more into line with an average person’s idea of ‘recreational spend’. The
Commission’s research indicates that some 88 per cent of recreational players
and about 80 per cent of all players never spend more than $1 per button push.[13]
1.22 Not
only has the Government disregarded this key reform, it refuses to give the
reasons for this policy position. Previously, it has claimed that the cost of
implementation will be excessive, with the Minister for Families, Community
Services and Indigenous Affairs, the Hon. Jenny Macklin MP, claiming in January
this year that it would cost $1.5 billion.[14]
However, despite promising at that press conference that the Department would
release the basis for those figures, they have never been publicised.
1.23 Indeed,
two Freedom of Information requests from my office failed to reveal the basis
for that figure, and resulted in documents that were more redactions than
information.
1.24 Further,
the Government has not explained with any credibility how it willing to make
the machines mandatory pre-commitment ready (at the ‘flick of a switch’) but
refuses to do the same for maximum $1 bets. The maximum $1 bets reform was the
primary reform recommended by the Productivity Commission, yet the Government
refuses to even have machines capable of supporting it.
1.25 I
understand that this has become a difficult political issue for the major
parties. Tragically, it appears this has now become a ‘tick and flick’ exercise
for the Government, just to get the ‘problem’ off the table.
1.26 However,
this issue will not go away. Earlier this year, the Stop the Loss Coalition
released data from a survey by AMR Research that revealed over 70 per cent of
Australians want poker machine reform, and only two in ten believe no further
action is needed. Further, over 80 per cent supported the introduction of
maximum $1 bets, which rose to a massive 90 per cent for intending ALP voters.[15]
1.27 To
put this in context, most Australians would know of someone who has been
affected by poker machine addiction. The Productivity Commission figures from
2008/09 indicate that over $10 billion a year is lost on poker machines,[16] with
problem gamblers accounting for between 22 to 60 per cent of that figure, with
40 per cent the accepted average. Also according to the Productivity
Commission, there are between 80,000 and 160,000 adult Australians who are
suffering from ‘significant problems with their gambling’, with a further
230,000 to 350,000 at risk of developing further problems.[17] On
average, each of these problem gamblers affects seven other people.[18]
1.28 Too
many Australians are have first-hand knowledge of the damaged caused by poker
machines for the issue to disappear from the political radar, as perhaps both
the Government and the Opposition hope.
1.29 Ultimately,
to use gambling terminology, in my view this legislation is a ‘loss disguised
as a win’. It will not do enough to help existing gamblers or curb problem
gambling in the future, and those measures it does contain may not be
enforceable.
1.30 To
that end, I call on the Government and the Opposition to support a plebiscite
on the issue of maximum $1 bets and $120 maximum average hourly losses to
determine the will of the Australian people.
1.31 The
Government has not explained why it is willing to have machines mandatory
pre-commitment ready but not maximum $1 bet ready, which is arguably a cheaper,
simpler, and easier to explain option that will be more effective. The
Government’s failure to support this measure as recommended by the Productivity
Commission is, I believe, a cynical act of bad faith on their part.
Recommendation
1: That the bills not be passed unless amended to include provisions for the
implementation of maximum $1 bets and hourly losses of $120 on all gaming
machines in Australia.
Recommendation
2: That there be a plebiscite to be held at the next Federal Election to
determine the will of the Australian people on the maximum $1 bet and $120
hourly loss recommendation of the Productivity Commission.
NICK XENOPHON
Independent Senator for South Australia
Attachment 1 (PDF 3033KB)
Attachment 2 (PDF 724KB)
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