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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2010-10-26 Daily Xml
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GAMING MACHINES (MISCELLANEOUS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 28 September 2010.)

The Hon. J.M.A. LENSINK (21:34): I rise to make a brief contribution on this bill, which involves a conscience vote for Liberal members. I refer honourable members to our lead speaker the Hon. Terry Stephens' speech on 28 September in the Legislative Council which comprehensively covers this matter. The main issue I wish to speak about relates to the fixed price of $50,000 for electronic gaming machine entitlements which, from memory, is something that we discussed last in relation to a gaming machines amendment bill in 2004.

At that stage the Premier had made the hairy-chested boast that he was going to rip 3,000 machines out of the hotel sector, and we know that he has failed in that. Therefore, this bill is designed to get rid of that fixed price and see the rest of the machines that were promised taken out of the system. The bill also deals with issues of codes and barring, and I note there are a number of amendments from some of our crossbench colleagues which we will all need to listen to carefully and consider.

When we did debate this matter in 2004, I spoke at that stage and expressed some of my concerns about gaming machines. However, I think there are also a lot of urban myths that exist in relation to gaming machines. We are all concerned about problem gambling. I think that particular bill was the Chicken Little approach: we must do anything, even though we do not really know what we are doing. In 2010, we have the benefit of a considerable body of research into gambling matters, particularly for problem gamblers.

The Hon. Terry Stephens discussed in his speech something that I also came across when I had the gambling portfolio, whereby I think the consensus among the experts now is that it is preferable in terms of problem gambling to have fewer venues with a greater number of machines overall, because those venues that have a greater number of machines are more likely to have trained and experienced staff who can identify problem gamblers and therefore intervene. I certainly support that theory and believe that this measure will go some way towards that.

At the time of the 2004 debate I did not vote in favour of the bill ultimately because I did not think that it was going to address the real issues of problem gambling. It was a cobbled together concoction of spin in the usual fashion that we have unfortunately become accustomed to in this state in the last eight years. However, with those remarks, I indicate that I will be supporting the passage of the bill and I look forward to the committee stage of the debate so that we can consider each of the matters that are going to be raised.

The Hon. T.A. FRANKS (21:37): I rise to speak on the Gaming Machines (Miscellaneous) Amendment Bill 2010. In this bill, the government seeks to lift the $50,000 price cap and make it an open market on gaming machines in an attempt to reduce the number of gaming machines down to the target set by the Premier some years ago. The bill also changes a number of areas, with the stated aim and intent of creating better and more responsible gaming environments and reducing the costs associated with regulation and red tape. These measures include removing the fixed price for gaming machine entitlements to accelerate the reduction in the number of gaming machine entitlements, and that is done by using market mechanisms in an approved trading system.

It also changes the requirements and administration of social effects tests for the new venues. It requires late-night venues to have an employee trained in problem gambling intervention and to be allowed to operate only if signed up to the responsible gambling agreement with the responsible gambling agency. It also extends the responsible gambling provisions to airports, formalises the recognition of industry responsible gambling agencies and a number of other measures, including civil penalties to strengthen compliance and enforcement; all very welcome and all very honourable in intent, I am sure.

Members would be far more aware that myself that in 2004 the current state government introduced laws which sought to reduce the number of poker machines in our state by a total of 3,000. That move came after an inquiry from the Independent Gambling Authority, which recommended a 20 per cent reduction in the number of poker machines. As I understand it, the number was to be reduced from a total of 15,000 to 12,000. Those 3,000 machines were initially removed from the premises with some fanfare, approximately 2,195 being switched off at midnight, according to media reports, and wheeled out of venues for, no doubt, great photo opportunities. I have visions of the government also looking to crush them, but perhaps they only do that with hoon cars.

This first step to remove 3,000 machines from the state was described then by the minister, Michael Wright, as 'history making'. It might have been more of a 'feel-good measure', to point to the words of Nick Xenophon at that time, a former honourable member of this place. Most of the 2,195 machines that were turned off that night were in 281 of the state's largest hotels. It is commendable, though, that at least 12 clubs and pubs actually decided to rid themselves of poker machines altogether.

To fulfil its stated aim and much-publicised reduction of 20 per cent, the legislation required a further 832 of those machines to be compulsorily switched off and, to make up that total of 3,000, we expected there to be a trading out of the system over time. At that stage, many members of the opposition in this place, and certainly members of the community and the social justice sector, had some reservations about whether that would be achieved, and we are here now debating this bill because, in fact, it was not achieved.

I note in the bill before us some consultation occurred and submissions were made to the draft amendments, and I commend the government for that, and I commend those groups who participated in that consultation process. There was also a range of recommendations made through that process that have not been reflected in this bill. I point particularly to the amendments to closing hours, the limitation of visits to ATMs, the indexation of monies donated to charitable organisations, and the establishment of a consumer advocacy committee and a register of gaming machine entitlements.

The main goal of the bill, to change the trading system and remove the cap to allow free trading of gaming machine entitlements as part of the government's goal to achieve that 3,000 fewer poker machines, was noted by most of the groups who made submissions not necessarily to be the best way to tackle problem gambling. What we have before us, as the honourable member just stated, is using a hammer to crack a nut, and it is not necessarily going to leave you with anything worth eating in the end. We have reduced the machines by some level, but I do not believe that we have actually reduced the issue of problem gambling in our community, and I do not believe that this bill will go far in addressing that very serious issue.

I note that the Hon. Mr Darley will move some amendments to the bill, and the Greens look forward to debating those. We also look forward to working with him and other members to address the issue of reforms in this bill that could really tackle problem gambling, such as addressing closing hours, limiting the number of trips to an EFTPOS machine (this is already in the act but has not yet been proclaimed, and so we look forward to seeing that particular measure proclaimed), and also looking at the indexation of the amounts to go into the various mitigation funds. Currently, they have lost 22 per cent of their real value, as they have not been indexed—$7 million, it is estimated, since last time the act was amended—so we look forward to seeing that indexed.

We would also like to see the establishment of a consumer advocacy committee to balance out the powers of the industry on this issue, and the establishment of a register of gaming machine entitlements. As I say, the Greens look forward to working with others in putting those particular agenda items into the mix as we get into the committee stage of the bill.

The Hon. J.A. DARLEY (21:45): I rise to speak on the Gaming Machines (Miscellaneous) Amendment Bill. The proposed bill is the result of a review of the Gaming Machines Act, which was finalised in 2008. A decision was made to delay the implementation of the proposed bill until it could be assessed against the Productivity Commission's final report into gambling. The Productivity Commission's final report was released in June 2010. It was the result of an extensive public inquiry into Australia's gambling industries. Unlike the Productivity Commission's first report into the impact of gambling, which was completed some 10 years ago, the most recent report includes a number of formal recommendations regarding public policy.

The Minister for Gambling has indicated that this bill is consistent with the recommendations of the Productivity Commission. It does not mean that the bill before was the subject of any substantive amendment after taking into account the recommendations of the Productivity Commission. However, the government has indicated that the Gaming Machines Act will be further amended at a later stage in order to specifically address a number of recommendations including those of the Productivity Commission, as well as those of the Independent Gambling Authority's inquiry into barring arrangements, and those of the Responsible Gambling Working Party into signage. Those changes will also address the requirements for compliance with the Council of Australian Governments' mutual recognition obligations. The draft legislation will be the subject of further consultation later in the year.

My office has been involved in ongoing discussions with the minister's office regarding the bill before us at present. During those discussions I raised some specific concerns, some of which have been addressed in the bill. I am particularly pleased with the inclusion of provisions which require the commissioner to keep a register of licensees holding gaming machine entitlements and requiring that register to be published on their website so that it is readily available to the public. The register will also include the number of gaming machine entitlements held by each licensee and the premises to which the gambling entitlements relate. I am advised these provisions will also extend to Club One.

I am also pleased to advise that the minister has agreed to give consideration to the establishment of a no pokies association aimed at promoting venues that do not have poker machines. At this stage it is envisaged that those promotions will include advertising at venues on various websites. I am working closely with my colleague Senator Nick Xenophon to implement a strategy that is acceptable to those venues that do not have poker machines. Obviously any such proposal will require some funding, and I will be continuing my discussions with the minister's office regarding some contribution by the government.

I am also pleased that in the meantime the minister's office has confirmed that the Office of the Liquor and Gambling Commissioner's website will be updated in order to provide a link to poker machine-free venues for consumers. That information has not been readily available to the public in the past. This bill proposes a number of measures aimed at creating better responsible gambling environments in South Australia.

The first of these measures proposes to remove the fixed price of $50,000 on gaming machine entitlements traded through the approved system. The Independent Gambling Authority has indicated the fixed price on gaming machine entitlements is the reason for the failure to deliver the additional reduction in gaming machine entitlements. This measure is particularly important to those venues looking to get rid of their poker machines insofar as it will allow them to do so without being commercially disadvantaged.

Other measures in the bill, which in my view are long overdue, include strengthening the social effect test; formally recognising the industry responsible agencies; strengthening the compliance and enforcement provisions under the act, making it expressly clear that gaming machine licences can only be approved in enclosed areas where smoking is prohibited; and extending responsible gambling measures to venues operating on airport land controlled by the Australian government.

The bill also seeks to impose longer closing hours on those gambling venues which do not have a responsible gambling agreement in place. I do not think that this particular measure goes far enough, and this is certainly one of the measures that I will be proposing be amended. The bill also includes a number of further provisions aimed at reducing red tape. The fact that poker machines pose the greatest risks in terms of problem gambling demonstrates the need for legislative reform. Some of these measures are long overdue; others, I believe, do not go far enough in addressing the issue of problem gambling.

I am sure many members would be well aware of the statistics relating to the prevalence of problem gambling given the debates that have occurred in this place on the issue over the years. However, I think it is worth highlighting some of those again. The Productivity Commission estimates that around 600,000 Australian adults (just under 4 per cent) play poker machines weekly or more often and that 95,000 (15 per cent of this group) are problem gamblers. A further 15 per cent of poker machine players face moderate risks.

The Productivity Commission also estimates that there are between 80,000 and 160,000 Australian adults suffering significant problems from their gambling, with a further 230,000 to 350,000 experiencing moderate risks that may make them vulnerable to problem gambling. In terms of expenditure, the Productivity Commission estimates that problem gamblers account for approximately 40 per cent of poker machine spending. This 40 per cent is the average of a range of estimates as high as 60 per cent and most conservatively as low as 20 per cent.

Moderate risk gamblers also account for a further significant share of poker machine spending. The likely range for moderate risk and problem gamblers combined is said to make up 42 to 75 per cent of poker machine spending. In terms of the actual cost of gambling attributable to problem gamblers, the Productivity Commission estimates that, in 2008-09, that figure ranged between $4.7 billion and $8.4 billion.

There is no doubt that the adverse effects of gambling go beyond the monetary cost attributable to problem gamblers, particularly when you take into account the adverse consequences to problem gamblers' family, friends and employers. These effects are not just financial. They also include family breakdowns, physical and mental health issues, poverty, criminal behaviour including fraud and, worst of all, suicide.

In 1999, the Productivity Commission estimated that for every problem gambler, the lives of approximately seven others are adversely affected. We know the number of people affected by problem gambling far exceeds the reported number of problem gamblers. This demonstrates the wide-ranging dangers associated with gambling products such as poker machines.

Members may be aware that the Coroner has just recently delivered his findings into a gambling-related suicide. That inquest concerned a young mother of two, Ms Katherine Michelle Natt, who worked in the gambling industry, struggling with a gambling addiction and who tragically took her own life at the age of 24. The Coroner found that Ms Natt's suicide was a direct result of her inability to cope with a poker machine addiction and the resulting financial consequences of that addiction.

As I understand it, this is the first time that a suicide has been directly attributed to a poker machine addiction by an investigating authority. Undoubtedly, Ms Natt's death has had a devastating effect on her family and friends. To put this into further perspective, the Productivity Commission has reported that problem gambling has a higher adult prevalence than heroin use or hospitalisations resulting from traffic accidents.

I am sure many, if not all of us, know of someone struggling with a poker machine addiction or know of someone affected by the addiction of another person. I know that, since coming to this place, I have heard some very tragic stories of individuals who have lost tremendous amounts of money on poker machines. In all cases it has been money that they cannot afford to lose, money that was never intended for gambling.

For example, I know of a woman who lost over $10,000 in a 24-hour period after gambling it all away at one venue and on one machine. For those of us who do not have a problem with gambling, the idea of walking into a gambling venue and pouring your hard-earned wages into a poker machine seems illogical and foolish, but for the person struggling with the grip of addiction, sadly, it is a daily reality.

These factors should be alarming to us and highlight the pressing need for a more stringent gambling policy. As with any addictive product, poker machines pose a significant risk to a significant proportion of the population. The risk needs to be adequately addressed through tougher legislation, which is properly policed and enforced by the Office of the Liquor and Gambling Commissioner and the Independent Gambling Authority.

In my view, in the past there has been scant regard for gambling legislation by the OLGC. I hope the new provisions in this bill will be adhered to and stringently enforced. The proposed bill is a step in the right direction; however, more can be and ought to be done to minimise the risk of problem gambling, particularly with respect to poker machines which pose the greatest risk to problem gamblers.

It is for this reason that I propose to introduce a number of amendments aimed at further strengthening the social effect principles to ensure they take into account the socioeconomic characteristics of a community and the adverse effects of problem gambling within that community; further reducing the hours of operation of hotel and club gambling venues; removing automatic coin dispensing machines from gambling venues; removing ATMs and other cash facilities from gambling venues; ensuring that a person who has objected to an application under the act has standing in an appeal and is entitled to be joined to any such proceedings before the courts; banning the sale and operation of replica gaming machines which are primarily aimed at minors; and banning the installation of skill tester machines in gambling venues.

The last two proposed amendments relate specifically to minors. I will speak to all of those amendments further during the committee stage. I also foreshadow that there are some further amendments relating to gambling which do not fit within the scope of this bill but which I will be introducing in a private member's bill in due course. These amendments relate to the location of gambling venues and greenfield sites.

Additionally, I foreshadow my intention to call for a Legislative Review Committee inquiry into gambling. The Productivity Commission's most recent findings signify that the issue of problem gambling needs to be further addressed from a legislative and policy point of view. Whilst I appreciate that the minister will be further reviewing the act in the coming months, I believe it will be also worth while for this matter to be the subject of further scrutiny.

I will conclude by making some brief comments on the Gamblers Rehabilitation Fund. I note the comments of the Hon. Terry Stephens in relation to this fund in terms of the amount of money actually spent on harm minimisation measures and front-line services as opposed to salaries and other bureaucratic services. I too share those concerns. The Gamblers Rehabilitation Fund was established in 1994 to fund programs and initiatives aimed at minimising problem gambling and to offer services to those affected by a gambling problem.

Funding for the GRF is made up of contributions from the Australian Hotels Association, Clubs SA, the Adelaide Casino and the South Australian government. The current funding available under the GRF is $5.945 million per annum, of which $3.845 million comes from gambling taxes, and $2.1 million from industry in the form of a voluntary contribution.

In 2007 the government announced a sweeping review of all government funded agencies providing problem gambling treatment. That resulted in many non-government agencies and not-for-profit organisations losing their funding for gambling counselling services. At the same time, a statewide intervention program was announced. The Statewide Gambling Intensive Therapy Service is an extension of the Flinders Medical Centre intervention program.

Under the new scheme, money from the GRF goes towards funding the Flinders Medical Centre, three other clinics in the southern, northern and western suburbs and a number of outreach services in regional centres. I do not doubt that these programs provide effective services; however, I would be interested to hear what proportion of funding still goes towards front-line services provided by non-government agencies. My primary concern in relation to the GRF is that the $5.945 million in funding is a drop in the ocean when compared with the $300-odd million the government rakes in each year in gambling revenue from poker machines.

This demonstrates the government's dependency on gambling revenue. As with land tax, the government has become hooked on a source of income that has probably far exceeded any initial expectations. It has been very slow in grappling with the damaging effects of poker machines on the community. I do not expect the government will make any radical changes to its gambling policy any time soon. However, I certainly welcome the opportunity to debate the social impact of poker machines and hope that this bill signals the beginning of a new approach towards the issue of the harm caused by poker machines and problem gambling more generally. I look forward to the committee stage debate.

Debate adjourned on motion of Hon. J.M. Gazzola.


At 22:01 the council adjourned until Wednesday 27 October 2010 at 14:15.


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