Legislative Council: Wednesday, June 28, 2023


Gambling in South Australia

The Hon. C. BONAROS (11:40): I move:

1. That a select committee of the Legislative Council be established to inquire into and report on the extent of all forms of gambling in South Australia, with particular reference to:

(a) the prevalence of all forms of gambling in South Australia, including gaming machine gambling, online gambling and sports betting;

(b) the social and economic impacts of all forms of gambling in South Australia;

(c) the impact of all forms of gambling on South Australian gambling licences, licensed venues and the racing industry;

(d) the regulation of all forms of gambling in South Australia;

(e) mechanisms available to control or prevent access to all forms of gambling by vulnerable gamblers in South Australia;

(f) mechanisms available to prevent access to all forms of gambling by minors including any barriers to achieving robust age verification requirements;

(g) the prevalence and impacts of advertising across different media platforms by all forms of gambling including online betting agencies;

(h) the regulation of advertising by online gambling and sports betting agencies in Australia and South Australia;

(i) gambling markets on local sporting fixtures in South Australia, particularly amateur and semi-professional matches;

(j) online markets in local sport and its relationship with potential match fixing;

(k) marketing and inducement schemes provided by online betting agencies;

(l) what legislative or regulatory changes may be required to control or restrict access to online gambling and sports betting in South Australia; and

(m) any other related matters.

2. That this council permits the select committee to authorise the disclosure or publication, as it sees fit, of any evidence or documents presented to the committee prior to such evidence being presented to the council.

South Australia is still and continues to be in the grips of a gambling crisis, and no-one in any position of power has been prepared to do anything about that. You need look no further than the Auditor-General's Report on gambling harm minimisation, tabled in parliament last month, following a performance audit on the government's management of gambling harm minimisation to see the damage being done.

The snapshot of that report is as follows. South Australians lost $12 billion to gambling in the last decade. Last financial year, South Australians lost a record $1.52 billion to gambling—$1,052 for every South Australian adult—and it is getting worse. An estimated 10,000 South Australians participate in high-risk gambling. Close to 60 per cent of losses are linked to gaming machines in our hotels and clubs.

Losses are substantially higher than the pre-pandemic era, despite all the rhetoric we heard about figures coming down post COVID, and they are on a dangerous upward trajectory, and any hint of a reduction, as I said during COVID, is well and truly over. Gambling activity generated $531 million in revenue for the state government in the 2021-22 financial year—about 10 per cent of state taxation revenue. That figure is projected to increase to $582 million this financial year and a whopping $590 million by 2025-26.

But the crisis is much worse than these statistics. Just next door to parliament, SkyCity Adelaide Casino is facing extremely serious allegations levelled at it by AUSTRAC no less, alleging that criminals have laundered almost $4 billion at the Casino in the past six years. Just think about that for a moment. In its 800-page statement of claim in the Federal Court, AUSTRAC outlines an extensive list of disturbing allegations regarding money laundering to the tune of $4 billion. Those allegations include providing service to 59 customers for whom high money laundering/terrorism financing risks were indicated. They made around $74 million in losses from those 59 customers.

One customer was an immediate family member of a person holding a prominent public position in a foreign government body. Many customers engaged in large cash transactions and transacted with cash that appeared suspicious including in plastic bags, garbage bags, cash bundled together with rubber bands or irregular straps, cash that was literally dirty, and cash that appeared to have been buried. That all allegedly happened right next door at our Casino. AUSTRAC further alleges that SkyCity:

failed to appropriately assess the money laundering and terrorism financing risks it faced, including the likelihood and impact of those risks, and to identify and respond to changes in risk over time;

did not include in its AML/CTF programs appropriate risk-based systems and controls to mitigate and manage the risks to which SkyCity was reasonably exposed;

failed to establish an appropriate framework for board and senior management oversight of the AML/CTF programs; and

did not have a transaction monitoring program to monitor transactions and identify suspicious activity that was appropriately risk-based or appropriate to the nature, size and complexity of SkyCity.

That is staggering. The fact that we are talking about money that is literally dirty, money that we are talking about in rubber bands that has come out of the dirt, and we did not have transaction monitoring programs in place to deal with those sorts of scenarios. In response to these deeply troubling allegations, the Liquor and Gambling Commissioner, Mr Soulio, engaged retired South Australian Supreme Court Judge Brian Martin KC to undertake an independent investigation into the Casino. But that has since been suspended, as I have said in this place before, pending the outcome of AUSTRAC's Federal Court action.

Last month, the commissioner announced he had directed the Casino to handpick its own independent monitor to review its progress in strengthening its anti-money laundering and counterterrorism financing enhancement programs, something which I have, again, said in this place is akin to putting the fox in charge of the henhouse, especially in light of the allegations that the Casino is facing.

But the crisis goes much further and deeper than even those statistics and allegations. Take a moment to reflect on these facts and figures from the state government's very own agency, responsible for overseeing gambling in SA, the department for consumer and business affairs:

65 per cent of South Australian adults gamble.

most popular gambling activities in 2018 are:

48 per cent on scratch tickets and lottery products;

26 per cent on lottery tickets for a major prize;

19 per cent on electronic gaming machines; and

12 per cent on betting on horses, harness or greyhounds.

40,000 South Australians engage in high or moderate risk gambling each year.

72 per cent of those seeking gambling help in South Australia are for problems with electronic gaming machines. That is 72 per cent of 19 per cent of the total figures that I have alluded to.

risky gambling is reported by:

32 per cent of sports betters;

27 per cent of those using electronic gaming machines; and

12 per cent of gamblers generally.

For every high-risk gambler, it is estimated that at least six to eight other people are impacted, so you start to see the extent of the problem. Again, that 19 per cent becomes particularly pertinent when you consider the amount of revenue that the government reaps from gaming machines alone each and every year, which, as I have said, is on an upward trajectory.

What we are not seeing are any positive, proactive programs to address the impact gambling is having throughout the community. What we are not seeing are all the safeguards that the government and the opposition promised us when we had the last major debate on gambling machines in this place. Here are some of the reasons why: in the report, the Auditor-General uncovered some disturbing issues that must be addressed if we are serious about reducing the harm caused by gambling. In his report, he found, and I quote:

gaming machine and wagering inspections do not effectively target higher risk licensees;

inspections have not been completed as planned;

no formal training program for gambling compliance inspectors;

the timing of some inspections is predictable and not scheduled to encourage year-round compliance;

data indicates almost 30% of gaming managers and employees have not completed mandated training requirements;

no testing performed to ensure mandated harm minimisation attributes for gaming machines are operating as intended;

gaming venue system for detecting indicators of gambling harm not tested to confirm it is operating effectively;

no evaluations performed to assess whether current regulatory approach is effectively minimising gambling harm; and

recommendations from gambling industry inquiries and investigations not systematically assessed and monitored.

In that list are a number of the safeguards that the government and the opposition promised the people of South Australia would reduce gambling harm in this state. What the Auditor-General is telling us is that not only are they not working but in many cases they are not even being implemented, enforced or complied with.

So what is the government's response to the Auditor-General's Report? To date, it has been absolute crickets, which is just as troubling. Where is the oversight? I would like to know the answer to that. Where are the commissioner's teeth in cracking down on these troubling failures? I would like to know the answer to that. And there is all of this, despite some of the fluffy words that have come out on the CBS website addressing the issue of minimising gambling harm. Here is a quote from that website:

There is growing recognition that minimising gambling harm requires us to look beyond treatment for 'problem gamblers' and towards activities that enable people, social networks and communities to make healthy choices.

To do this we must address the social, economic and environmental contributors to gambling harm, prioritise actions that prevent harm, and ensure our service system can intervene early and support recovery across all levels of harm.

Out of those staggering revenue figures, less than 1 per cent is what the government contributes to all those fluffy words that CBS has just outlined. We give less than 1 per cent of the total revenue figure we receive to the Gamblers Rehabilitation Fund. They are figures that should be alarming to all of us because we know, as I have said, that those gambling revenue funds are increasing—$582 million in the pockets of the government every year and they are on an upwards trajectory. So 1 per cent of that is what we contribute to the things that the CBS says we need to do to prevent people from falling into the grips of a gambling addiction.

I do need to be somewhat careful here because, obviously, I want both major parties to support this motion and that is going to be tricky in the face of previous debates and also in the face of what I would really like to tell them about what I think of what they have done on gambling. I have never held back before, but I really do want their support for this.

I want their support for this motion not just because it is a good idea but because it is what these two major parties under the previous government agreed needed to be done in South Australia. Indeed, it is the safeguards that the former Attorney-General and the now Premier promised were going to occur as a result of that bill passing in 2019. It is 2023 now and that committee never saw the light of day.

The terms of reference are not actually my terms of reference; they are the terms of reference that were agreed to by the two major parties during the former term of government. The only change I made to those terms of reference—and they were lengthy and I saw some eyes looking at me yesterday saying, 'Geez, this is a mouthful,' but they are not mine—was 'online gambling' to 'all forms of gambling'. That is the only change I made to the agreement between the now Premier and the former Attorney-General's terms of reference for what they said was going to be a major safeguard moving forward after having allowed note acceptors and a number of other measures into our legislation.

I mentioned note acceptors and I do so because you will not to this day—and in fact the figures are a reflection of this and I will bet my house on the fact—find one single expert in this state because we have spoken to all of them and I appreciate that I just bet my house on this—

The Hon. I. Pnevmatikos: A bit of gambling.

The Hon. C. BONAROS: Yes, I am happy to gamble on this one. I am really happy to gamble on this one because, if you go and find one expert who told you that allowing note acceptors into this jurisdiction was a good idea—well, I have no words. There is not one, because we consulted with all of them, and they all said the polar opposite. They all said this is the most retrograde step that we could take as a jurisdiction. They all said that this was the single most effective harm minimisation that South Australia had benefited from for decades.

I think it is also worth noting the budget that was just handed down in terms of those budget figures that I have alluded to. It is a pretty alarming state of affairs when the budget papers themselves say that taxation revenue was revised up off the back of three factors—land tax, payroll tax and gambling taxes—to the tune of $1.3 billion. We know almost $600 million of that has come from gambling taxes alone. They are extraordinary figures, but they also serve to show why there is such a reluctance to look at gambling in this jurisdiction.

We all know that, despite the sentiments expressed behind closed doors, successive governments have relied on those revenue streams. They cannot make them up anywhere else. If you could give them a cash cow that could present $600 million a year despite the long-term costs to individuals, their families and the community, then I am sure they would take it in a heartbeat, but they do not know where to come up with the revenue. In the absence of any other revenue stream, they continue to let our communities bleed.

According to the 2021 Australian Communications and Media Authority annual consumer survey, commissioned by the Australian government this time, one in 10 adults reported gambling online in the first part of 2021. Sports betting overtook racing as the online betting of choice with 57 per cent of online betting activity in that period being wagered on football, soccer, tennis and the like. Young Australians, we know, are absolutely being targeted more than ever before with promotions like Bet With Mates.

It is more insidious than that, in fact. There are gaming apps left, right and centre, geared towards kids—little kids; five and six year olds, 10 and 11 year olds, 15 year olds—all aimed at getting them hooked on gambling so that when they turn 18 they already know how these things work because they have been conditioned through gaming apps. I am sure many of us as parents think these apps are quite innocent, but they have at their root a very insidious purpose, and that is to condition children to normalising gambling behaviour.

My son opens apps all the time, and I look at these things. The bells and whistles of poker machines and all those things are there. We have laws in this jurisdiction that are supposed to protect minors from those sorts of things. Notwithstanding that, there are lots and lots of things that our kids are exposed to each and every day, all aimed at the psychology of gambling, conditioning children to gambling and normalising gambling behaviour.

The good news, if there can be any, is that the federal government has recently announced its intention to ban online gambling accounts being topped up with credit cards so that, if you are going to gamble, it has to be your money. It has to be real money; it cannot be credit card payments. That is something that we have pushed for in this place previously, and it is a very welcome move finally, but it is only one measure. It is only one in a raft of measures that we have talked about in this parliament now for decades, that I have talked about since I have been here and had the benefit of learning about over the 20 years that I have worked in the political sphere.

My question today is exactly the same as the first time we ever introduced a gambling bill into this place, and that is: when are we as a parliament going to get serious about the impacts of gambling? I can tell you now that our Premier might be relying on that $580 million, $590 million, or whatever it is, revenue stream, but the long-term costs to our community are absolutely crippling. The preventative steps we should be taking would ultimately serve our community so much more, because we know that the long-term costs to our community and to the government and the services it is required to provide are way more than any short-term benefit they get from that instant hit of $580-odd million a year.

The worst side of this for me is the fact that there are people who continue to take their own lives because of gambling addiction. There are families, marriages and relationships ruined each and every day because of gambling. There are kids going to school hungry, missing out on lunches and breakfasts because of excessive gambling. There are parents who, the moment their pay hits their bank account, will either go online or down to the local poker machine pub or club and lose that week's mortgage payment, that week's rent, that week's food money, that week's utility bills, literally in the blink of an eye, and then sit and wonder what they are going to do for the next week or two before they get paid again.

We have had successive governments benefit in the short term from that sort of misery. That is what you are benefiting from when you get a $580-odd million revenue stream—you are benefiting from someone else's misery. You are contributing less than 1 per cent to doing anything to address that harm and that misery. As I just said, ultimately long term it is costing the government so much more than the $582 million instant hit it is getting from that revenue stream.

We do not have any real-time evidence of the extent of the problem in this state, the cost to the community and the number of South Australians directly or indirectly impacted by the scourge of gambling, and that was the purpose of the committee agreed to between Labor and Liberal, which forms the basis of the terms of reference in this motion—I have not gone and drafted my own.

I have picked up terms that were agreed to by the now Premier and the former Attorney-General and changed 'online' to 'all forms of gambling'. That is all I have done, and I am holding them now to their commitment that they still consider this an absolutely necessary measure and as important as it was when the Premier backed in those last changes in 2019. He did so on the basis—he accepted note acceptors in South Australia—that there would be safeguards, including this very inquiry.

I would like to know what the Premier's current thinking is, now that he is in the position he finds himself in. I would like to know whether he still considers this one of the most important safeguards in terms of gambling and that we need to undertake this process in this jurisdiction to fully appreciate the extent of gambling harm, but also that it is the appropriate way forward in terms of gambling reform.

As I said, this is what the Premier and now former Attorney-General agreed to. I would like to know if there is an appetite for the changes the now Premier touted, pushed for, after they fell away altogether when he was in opposition. I would love to know whether his concerns around gambling are the same. I would love to know whether he has read the Auditor-General's scathing review and assessment of gambling in this jurisdiction, and I would love to know whether he still supports a forensic analysis and inquiry into gambling in this state.

I foreshadow that next week I will be moving another motion, which also expands on this motion, but not in terms of an inquiry, and I will further outline some of those issues the Auditor-General highlighted in his report. I really do seriously and sincerely hope that both major parties in this place consider this motion with the importance that it deserves, because I can wholeheartedly say that no proposal the government puts forward without this sort of forensic assessment is going to cut the mustard.

Debate adjourned on motion of Hon. R.B. Martin.