Australian Democrats
Dissenting Report
1. Introduction
In our view, the Interactive Gambling Bill 2001 may be a
well-intentioned attempt to address normative values on Australia’s gambling
culture, particularly for problem gamblers. However, we believe the Bill is
unworkable and thus should be defeated in its entirety.
Contrary to popular perception, the Bill does not and cannot
prohibit on-line gambling. It is impossible to ban or prohibit internet
accessibility of any nature in its entirety. The internet is without
international borders and straddles countless and conflicting legal
jurisdictions.
All this Bill achieves, if passed, is a prohibition on
Australians using Australian based gaming sites from within Australia. This
means on-line gamblers can and will still go to overseas sites with the ‘click
of a mouse’.
The result is that Australian money and jobs then goes
overseas and internet gaming is still accessible to any Australian who seeks
it.
Accordingly, we do not support the key recommendation (R.
2.1) of the Chair’s report that the Senate adopt the prohibition approach to
internet regulation proposed by the Interactive Gambling Bill 2001. It follows
then, that we believe the Chair’s other two recommendations (R. 3.1 and R. 4.1)
are not relevant, although, considered in abstraction, we acknowledge their
rationale.
2. Problem Gambling
At the outset, we emphasize that problem gambling is a
serious social issue with disastrous consequences for individuals, their
families and communities. Moreover, we are most concerned that problem
gambling has particularly severe consequences in low socio-economic
communities. That is, problem gambling has a major social equity dimension.
Problem gambling is not reducible to one readily isolable
factor, thus we are committed to a multi-faceted harm minimisation and
education approach, including the ‘managed liberalisation’ regulatory measures
as advocated in the Productivity Commission’s Australian Gambling Industries
report. [1]
A significant driver in this social problem is the
proliferation of Electronic Gaming Machines (EGMs) or ‘pokies’, which in turn,
is directly correlated with the needs of State and Territory governments to
maximise revenues. A clear example of this relationship is the significantly lower
incidences of problem gambling in Western Australia - the state that has best
resisted the temptation to allow proliferation of EGMs.[2]
We believe it is clear that State and Territory governments’
increasing reliance on gambling revenues is symptomatic of a systemic political
failure by successive Governments to develop an equitable and realistic revenue
base. It is not feasible that significant inroads into problem gambling can be
achieved independently of addressing the broader resourcing issues for States
and Territories.
3. Prior Consideration
As the Chair’s report notes, there has been significant
public discussion of the proposed ban on interactive gambling and thus the
basic positions and arguments are well known.
The Senate report Netbets: A Review of Online Gambling In
Australia and the Productivity Commission report recommended a
regulatory approach over prohibition. The Democrats concurred with that
approach in our supplementary comments in the Netbets report. We believe no
evidence presented to this inquiry or canvassed in the Chair’s report explains
why the findings of the earlier Senate inquiry should now be disregarded, nor
provide a convincing case that prohibition is the best approach.
4. The Bill
The Bill makes it an offence for providers located in Australia
to provide interactive gambling services to a person physically present in Australia.
The committee heard a number of principled objections to
this approach, including the right of Australian adults to take responsibility
for their own lives[3]
and the highly dubious ethical stance whereby Australians should be protected
from interactive gambling with Australian sites but Australian operators can
profit from citizens of other countries.[4]
In addition to the principled arguments, there are a number
of significant technical flaws in the reasoning of the Bill’s approach.
The Bill does not make it illegal for a person physically
located in Australia to access off-shore interactive gambling providers. As
NOIE have pointed out the technical and commercial difficulties with
quarantining access to off-shore sites cannot be reasonably achieved.
Thus, if the estimate that 2.1 per cent of gamblers are
problem gamblers is accepted, this creates an important anomaly whereby:
The Bill ... will deny the 98 per cent recreational gamblers the
benefits of using Australian sites but will not prevent the 2 per cent of
problem gamblers from accessing almost all of the gambling sites on the
internet. As offshore sites do not have the harm minimisation features
required by Australian regulations, this will exacerbate problem gambling.[5]
The committee heard evidence from a number of submittees and
witnesses that the internet is the most effective platform for harm
minimisation.
As Mr Clark, representing the Northern Territory Department
of Industries and Business, stated:
It is ironic that many of the features that COAG and the
Ministerial Council on Gambling would like to see implemented in the physical
world are inspired by or easily achievable on the Internet technological
platform. Even more ironic is that with many of those that we are currently
looking at with a view to moving into the physical world we will struggle to
replicate what is available on the Internet ... We expect these features to help
in fighting problem gambling. Indeed obviously the Productivity Commission,
COAG and the Ministerial Council do as well or they would not have recommended
that these features be applied to the physical world.[6]
Other submittees gave some detail as to the technological
mechanisms available to ensure harm minimisation, including ‘smart card’
technology.[7]
While there are some important concerns with privacy aspects of such
technologies, we believe an effective regulatory framework is the proper place
for addressing such concerns.
We also note the plausible, though speculative claim, that
technological mediated harm minimisation approaches would have a broader spin
off in helping to foster the uptake of e-commerce using smart card and other
technologies.[8]
5. Wagering
A number of submittees and witnesses argued that wagering
should not be captured by the Bill. It was argued, for instance, that:
- wagering
differs qualitatively from interactive gambling as wagering is “about skill and
judgement”[9] whereas interactive gambling is determined by a random number generator “with
the certainty that participants will in the end lose a set proportion of their
bet”.[10]
- banning
wagering may have significant impact on the racing industry, particularly in
regional Australia,[11]
because off-shore operators will return no revenue to the industry,[12]
- the
internet does not introduce any new games but functions as a new way to place a
bet, primarily replacing phone betting,[13]
- the
internet constitutes a cost saving for providers.[14]
We believe such arguments have merit but also note the
argument advanced by a number of submittees, that wagering should not be exempt
because wagering is a significant source of problem gambling and is not as well
developed in harm minimisation approaches as internet gambling.[15]
There is a strong case that harm minimisation is best
approached in the context of regulation thus we remain unconvinced by the
rationale advanced in the Chair’s report that wagering, unlike lotteries,
should not be exempt from the ban. However as the Bill should be defeated in
its entirety it is entirely academic whether we will seek to amend or support
an amendment to exempt wagering.
6. Emerging Issues
By way of conclusion, the inquiry did clarify some emerging
issues in respect of datacasting and television delivery of gambling services.
While the Democrats would need to look more closely at this issue before
adopting a position, we do believe that a future inquiry into this form of
gambling delivery may be warranted.
________________
Senator
Brian Greig
Democrats IT Spokesperson
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