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Gambling (2010)

Inquiry report

Released 23 / 06 / 2010

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  • Key points
  • Contents
  • The rapid growth following liberalisation of gambling in the 1990s has given way to more 'mature' industry growth.
    • Total recorded expenditure (losses) in Australia reached just over $19 billion in 2008-09, or an average of $1500 per adult who gambled.
  • Gambling is an enjoyable pursuit for many Australians. As much as possible, policy should aim to preserve the benefits, while targeting measures at gamblers facing significant risks or harm.
  • While precision is impossible, various state surveys suggest that the number of Australians categorised as 'problem gamblers' ranges around 115 000, with people categorised as at 'moderate risk' ranging around 280 000.
  • It is common to report prevalence as a proportion of the adult population, but this can be misleading for policy purposes, given that most people do not gamble regularly or on gambling forms that present significant difficulties.
  • The risks of problem gambling are low for people who only play lotteries and scratchies, but rise steeply with the frequency of gambling on table games, wagering and, especially, gaming machines.
  • Most policy interest centres on people playing regularly on the 'pokies'. Around 600 000 Australians (4 per cent of the adult population) play at least weekly.
    • While survey results vary, around 15 per cent of these regular players (95 000) are 'problem gamblers'. And their share of total spending on machines is estimated to range around 40 per cent.
  • The significant social cost of problem gambling - estimated to be at least $4.7 billion a year - means that even policy measures with modest efficacy in reducing harm will often be worthwhile.
  • Over the last decade, state and territory governments have put in place an array of regulations and other measures intended to reduce harm to gamblers.
    • Some have been helpful, but some have had little effect, and some have imposed unnecessary burdens on the industry.
  • A more coherent and effective policy approach is needed, with targeted policies that can effectively address the high rate of problems experienced by those playing gaming machines regularly.
  • Recreational gamblers typically play at low intensity. But if machines are played at high intensity, it is easy to lose $1500 or more in an hour.
    • The amount of cash that players can feed into machines at any one time should be limited to $20 (currently up to $10 000).
    • There are strong grounds to lower the bet limit to around $1 per 'button push', instead of the current $5-10. Accounting for adjustment costs and technology, this can be fully implemented within six years.
  • Shutdown periods for gaming in hotels and clubs are too brief and mostly occur at the wrong times. They should commence earlier and be of longer duration.
  • There should be a progressive move over the next six years to full 'pre-commitment' systems that allow players to set binding limits on their losses.
    • Under a full system, there would be 'safe' default settings, with players able to choose other limits (including no limit).
    • In the interim, a partial system with non-binding limits would still yield benefits, and provide lessons for implementing full pre-commitment.
  • Better warnings and other information in venues would help. But school-based information programs could be having perverse effects and should not be extended without review.
  • Relocating ATMs away from gaming floors and imposing a $250 daily cash withdrawal limit in gaming venues would help some gamblers. But the net benefits of removing ATMs entirely from venues are uncertain.
  • Effective harm minimisation measures for gaming machines will inevitably reduce industry revenue, since problem gamblers lose so much. However, this would not occur overnight and the reductions may be offset by other market developments.
  • Problem gambling counselling services have worked well overall. But there is a need for enhanced training and better service coordination.
  • Online gaming by Australians appears to have grown rapidly despite the illegality of domestic supply. Gamblers seeking the benefits it offers are exposed to additional risks and harms from offshore sites that could be avoided under carefully regulated domestic provision.
    • Liberalising the domestic supply of online poker card games, accompanied by appropriate harm minimisation measures, would test whether managed liberalisation should be extended to all online gaming forms.
  • Recently enacted race fields legislation has been the main way jurisdictions have addressed the dual reform challenges of preventing free-riding by wagering operators and facilitating a competitively neutral wagering industry.
    • Should the race fields legislation be unsuccessful in either respect over the next three years, a national funding model should be established, based on federal legislation and with an independent price-setting body.
  • The arguments for retaining the exclusive right by the TABs to provide off-course retail wagering products are not compelling.
  • Governments have improved their policy-making and regulations with respect to gambling, but significant governance flaws remain in most jurisdictions, including insufficient transparency, regulatory independence and coordination.
    • There is a particular need to improve arrangements for national research.
  • Preliminaries
    • Cover, Copyright, Letter of transmittal, Terms of reference, Contents and Abbreviations
  • Overview - including key points
  • Recommendations and findings
  • Chapter 1 Introduction
    • 1.1 What has the Commission been asked to do?
    • 1.2 Inquiry processes
    • 1.3 How is this report organised?
  • Chapter 2 A snapshot of the gambling industry
    • 2.1 Introduction
    • 2.2 The state of the Australian gambling industry
    • 2.3 EGMs in clubs and hotels
    • 2.4 The casino industry
    • 2.5 The wagering industry
  • Chapter 3 The policy framework
    • 3.1 Governments and gambling
    • 3.2 Steps to good policy
    • 3.3 Rationales for gambling policy
    • 3.4 Different frameworks inform policy
    • 3.5 Evidence-based policy in gambling
  • Chapter 4 A broad perspective on gambling problems
    • 4.1 Measurement should be policy-relevant and relate to vulnerabilities and harm
    • 4.2 Identifying vulnerabilities
    • 4.3 Identifying those who are harmed
    • 4.4 Risks by venue type
  • Chapter 5 The prevalence of 'problem' gambling
    • 5.1 "What is 'the' number?" — measuring problem gambling
    • 5.2 A true 'case' is hard to find
    • 5.3 'False positives and negatives' : how accurate are the surveys?
    • 5.4 The headline indicator: identifying 'problem' gamblers
    • 5.5 Exposure and problems
    • 5.6 Comparison of gambling problems with other public health concerns
    • 5.7 How much do problem gamblers spend (lose)?
    • 5.8 Has problem gambling prevalence declined?
  • Chapter 6 The benefits of gambling and some implications
    • 6.1 The benefits to consumers of gambling
    • 6.2 What are the perceptions of social benefits to communities?
    • 6.3 Empirical evidence about community impacts
    • 6.4 Volunteering
    • 6.5 In-kind contributions
    • 6.6 Cash contributions
    • 6.7 Clubs with greater dependence on gambling serve different market segments
    • 6.8 Employment and business benefits
    • 6.9 The bottom line on the benefits of gambling
    • 6.10 The size of the 'prize' from more effective harm minimisation
    • Chapter 7 Counselling and treatment support services
      • 7.1 Reaching the target population
      • 7.2 Effectiveness of treatment and support
      • 7.3 Counsellors' qualifications and service standards
      • 7.4 Funding of gambling help services
      • 7.5 Building a better evidence base
    • Chapter 8 In-venue information and gambling advertising
      • 8.1 Warning messages
      • 8.2 Advertising
    • Chapter 9 School-based gambling education
      • 9.1 Existing approach to school-based gambling education
      • 9.2 Youth and gambling
      • 9.3 Evidence on the effectiveness of school-based gambling education programs
      • 9.4 Lessons from other school-based education programs?
      • 9.5 Drawing together the evidence
    • Chapter 10 Pre-commitment strategies
      • 10.1 Why should player choice and control be a policy issue?
      • 10.2 Self-exclusion
      • 10.3 More flexible pre-commitment arrangements
      • 10.4 What limits or other options might be available for players?
      • 10.5 How could partial pre-commitment work?
      • 10.6 How could full pre-commitment work?
      • 10.7 The details of the scheme and its implementation are critical
      • 10.8 Auxiliary functions of a pre-commitment system
      • 10.9 In conclusion
    • Chapter 11 Game features and machine design
      • 11.1 Introduction
      • 11.2 The intensity of play
      • 11.3 Note acceptors and cash input limits
      • 11.4 A novel proposal for safer play: an 'airbag' EGM?
      • 11.5 Other features
    • Chapter 12 Venue activities
      • 12.1 Introduction
      • 12.2 Voluntary harm minimisation measures by venues
      • 12.3 Strengthening incentives for venues to implement harm minimisation measures
      • 12.4 Staff training in harm minimisation
      • 12.5 Problematic player behaviour identification and intervention
      • 12.6 Inducements to gamble
      • 12.7 'Reality checks'
      • 12.8 Exposure of children to gambling activity
    • Chapter 13 Access to cash and credit
      • 13.1 Introduction
      • 13.2 Restrictions on ATMs/EFTPOS facilities
      • 13.3 Using credit for gambling
      • 13.4 Payment of gaming machine prizes as cash
      • 13.5 Cheque cashing
    • Chapter 14 Accessibility of gaming machines
      • 14.1 Introduction
      • 14.2 The link between accessibility and gambling harms
      • 14.3 Restricting the accessibility of gaming machines
    • Chapter 15 Online gaming and the Interactive Gambling Act
      • 15.1 Background
      • 15.2 What harms are associated with online gaming and how do they compare to other gambling?
      • 15.3 Has the prohibition 'worked'?
      • 15.4 Policy alternatives
      • 15.5 Weighing up the regulatory options
    • Chapter 16 Developments in the racing and wagering industries
      • 16.1 The legacy of traditional funding arrangements
      • 16.2 Principles of a good funding model
      • 16.3 A national funding model for racing and wagering in Australia
      • 16.4 Other aspects of a national model
    • Chapter 17 Regulatory processes and institutions
      • 17.1 Introduction
      • 17.2 What does best practice look like?
      • 17.3 Governance structures still need work
      • 17.4 Improving regulatory processes
      • 17.5 National regulation and jurisdictional consistency
    • Chapter 18 Gambling policy research and evaluation
      • 18.1 Introduction
      • 18.2 Improving gambling data: collection, national consistency and access
      • 18.3 Improving national gambling research
      • 18.4 Improving policy evaluation and review
      • 18.5 A forward agenda for gambling research
    • Chapter 19 Implementation issues and transitions
      • 19.1 Implementation issues vary across measures
      • 19.2 Changes to EGMs: influences on implementation
      • 19.3 Changes to EGMs: an implementation path
      • 19.4 A leadership role for the Australian Government
    • Appendix A Consultations
    • Appendix B The expenditure share of people experiencing problems
    • Appendix C Pre-commitment systems
    • Appendix D Scoring in the Canadian Problem Gambling Index
    • Appendix E Self-exclusion programs and exclusion on welfare grounds
    • Appendix F Survey of clients of counselling agencies 2009
    • Appendix G Access to cash and credit: evidence
    • Appendix H Australian litigation on gambling
    • Appendix I The link between accessibility and gambling harms
    • Appendix J Counselling services
    • Appendix K Advertising
    • References