Socioeconomic dimensions of pokie machine losses

Parliament house flag post

Socioeconomic dimensions of pokie machine losses

Posted 3/08/2012 by Amanda Biggs


Image source:
A recent Age article has highlighted the disproportionate financial losses incurred from pokie machine gambling in low income areas of Victoria, when compared to higher income areas. Using statistics from the Victorian regulator the Victorian Commission for Gambling and Liquor Regulation (VCGLR), Craig Butt compared net weekly expenditure per adult (ie player losses) on pokies across local government areas (LGAs), with the average weekly income of those LGAs based on census data provided to the Age.

In 2010–11 in Greater Dandenong, where average weekly income was reported to be $426, pokie losses were $1110 per adult. In wealthier Boroondara where average income was $836 per week average losses were $153 per adult. Furthermore, VCGLR figures show that the density of pokie machines in LGAs with lower average incomes was higher than for more wealthy areas. In Greater Dandenong there were 8.94 pokie machines per 1000 adults, while in Boroondara there were just 1.55.

While these figures are disturbing, looking in more detail at the VCGLR data on these LGAs paints a grimmer picture of the inequitable burden of pokie losses. Unemployment in Greater Dandenong was 8.2% in 2010–11, significantly higher than in Boroondara where it was 3.2%. Census data also reveals that less than half the adult population in Greater Dandenong had completed Year 12, while in Boroondara 76% had done so. In terms of social and economic disadvantage, Greater Dandenong is ranked as the lowest of all Victorian LGAs, while Boroondara is ranked the highest. In 2011–12, the VCGLR data shows the 15 pokies venues operating in Greater Dandenong generated some $117.5 million in player losses, up from $117.2 million in 2010–11. In comparison, player losses in Boroondara were $20.1 million in 2011–12, or nearly 6 times less.

The association of high player losses on pokies in lower socioeconomic areas has been noted elsewhere. This Victorian Auditor General's report in 2009, noted the differential in player losses between low and high income LGAs. It also found player losses on pokies, and pokie numbers, were higher in lower-income communities such as Greater Dandenong. A number of other studies (see examples from researchers at the University of New England and Victoria University) show disadvantaged areas generally experience higher poker machine losses relative to more advantaged areas.

Problem gambling prevalence studies, including from the Victorian Department of Justice, show that higher problem gambling rates are associated with higher spending on the pokies. The study found Greater Dandenong, which it classified as an area which spends high on pokies, had a higher rate of problem gamblers—0.8%—and moderate risk gamblers—2.4%—compared to Boroondara where the rates were respectively 0.0% and 1.2%.

Recent regulatory changes in Victoria have resulted in the cessation of the duopoly arrangements which saw Tattersalls and Tabcorp between them owning all gaming machine licenses in Victoria. Instead, local venue operators were able to purchase pokie machine licenses (valid for 10 years) following an auction process in May 2010. The auction generated some $980 million in government revenues for the 27,300 pokie entitlements on offer, according to the VCGR (predecessor of the VCGLR) annual report (p.5).

At around the same time, new caps were announced limiting the maximum number of pokies per adult in 20 regions and municipal areas. Greater Dandenong was issued with a cap of 9.48 pokie machines per 1000 adults according to the VCGR annual report (Appendix 20). If the population remains stable, this would allow an increase in the number of machines from the current level of 8.94 machines per 1000.

Local communities seeking to curb increases to pokie numbers in their area have already expressed concerns they face an increasingly uphill battle. One issue with the new arrangements is that the licenses that were auctioned have a duration of ten years. This could further limit the extent to which local communities with concerns can act to stem any expansion of pokies in their areas, particularly those communities like Greater Dandenong which have regional caps set higher than their current rate of machines.

Comments

  • 21/01/2014 2:37 PM
    Martin Butterfield said:

    A couple of questions. Is there evidence to indicate that people tend to use pokies close to their homes? That might be the case if they are poor (perhaps due to losses on the bandits) and can't afford to travel. It is implied in the Age article. Do people who could be classified as problem gamblers in wealthier suburbs get their punting fix through other means? I am thinking primarily of the stock market!

  • 21/01/2014 2:37 PM
    Amanda Biggs said:

    Martin, good questions! A range of factors, including accessibility can influence whether people play pokies close to their homes/workplace. Opening hours, venue features, personal preferences, social factors are some others. Chapter 14 of the Productivity Commission report (http://www.pc.gov.au/projects/inquiry/gambling-2009/report) also explores this issue. Perhaps, as you suggest, wealthier people are attracted to other high risk activities (for example casinos). But problem gambling is measured by the harms caused, not just the frequency of play or the spending level. Thus, those on lower incomes can be seen to be at particular risk because of their vulnerability to financial stress or other risk factors (eg mental illness).

  • 21/01/2014 2:37 PM
    Anonymous said:

    Martin, some recent Australian research has addressed your first question ( http://dx.doi.org/10.1080/14459795.2012.664159 ). It found that while only around one third of people visit the venue closest to their home, distance to gambling venue makes a big difference on gambling outcomes. The closer people live to their venue the more often they visit and the more likely they are to gamble when they get there.


Thank you for your comment. If it does not require moderation, it will appear shortly.

Add your comment

[Click to expand]

We welcome your comments, or additional information which is relevant to a post. These can be added by clicking on the ‘Add your comment’ option above. Please note that the Parliamentary Library will moderate comments, and reserves the right not to publish comments that are inconsistent with the objectives of FlagPost. This includes spam, profanity and personal abuse, as well as comments that are factually incorrect or politically partisan. We will close comments after three months.




Captcha
Generate a new image
Type characters from the image:

Facebook LinkedIn Twitter Add | Email Print

FlagPost

Flagpost is a blog on current issues of interest to members of the Australian Parliament


Parliamentary Library Logo showing Information Analysis & Advice

Archive

Syndication

Tagcloud

Refugees asylum climate change immigration Australian foreign policy parliament social security elections welfare reform welfare policy school education Australian Defence Force health financing higher education emissions trading indigenous Australians women private health insurance people trafficking Employment illicit drugs gambling health reform federal election 2010 disability Sport Australian Bureau of Statistics statistics United Nations Asia Afghanistan income management Middle East Medicare health forced labour Australian Sports Anti-Doping Agency World Anti-Doping Agency United States federal budget Industrial Relations Carbon Pricing Mechanism politics dental health Australian Electoral Commission WADA criminal law transport aid child protection environment poker machines Australia in the Asian Century steroids National Disability Insurance Scheme detention aged care 43rd Parliament slavery health system ASADA Law Enforcement Australian Federal Police Fair Work Act Australian Public Service governance labour force people smuggling debt taxation international relations constitution New Zealand food Australian Crime Commission pharmaceutical benefits scheme corruption pensions public service reform children's health Aviation federal election 2013 foreign debt gross debt net debt defence capability parliamentary procedure Senate Senators and Members ALP Newstart Parenting Payment multiculturalism Youth Allowance sea farers election results voting mental health Federal Court terrorist groups science social media Higher Education Loan Program HECS federal state relations accountability Papua New Guinea youth paid parental leave same sex relationships coal seam gas customs planning doping OECD crime health risks International Women's Day Gonski Review of Funding for Schooling sex slavery Special Rapporteur Northern Territory Emergency Response social policy violence against women domestic violence China ADRV terrorism transparency research and development welfare ASIO intelligence community Australian Security Intelligence Organisation carbon tax mining High Court military history electoral reform employer employee renewable energy regional unemployment fishing by-election European Union family assistance skilled migration banking United Nations Security Council Australian economy forestry food labelling vocational education and training Drugs UK Parliament welfare systems Indonesia children Constitutional reform local government codes of conduct terrorist financing homelessness Parliamentary remuneration money laundering Trafficking in Persons Report energy social inclusion human rights paternalism disability employment Tasmania integrity standards NATO Australian Secret Intelligence Service sexual abuse World Trade Organization Australia public health housing affordability bulk billing political parties water productivity health policy Governor-General US economy trade unions export liquefied natural gas foreign bribery firearms question time speaker superannuation public housing expertise public policy climate Intergovernmental Panel on Climate Change leadership Department of Agriculture Fisheries and Forestry regulation Pacific Islands reserved seats new psychoactive substances synthetic drugs UNODC carbon markets animal health middle class welfare Census Indigenous constitutional recognition of local government referendum consumer laws PISA competition policy royal commission US politics language education baby bonus Leaders of the Opposition citizen engagement policymaking Australia Greens servitude Trafficking Protocol forced marriage Population rural and regional alcohol entitlements ministries Hung Parliament social citizenship maritime Iran ANZUS regional students school chaplains federal budget 2011-12 salary Medicare Locals primary care Building the Education Revolution China soft power education Fiji India Disability Support Pension Antarctica Diplomacy by-elections state and territories Bills anti-corruption fraud bribery corporate ownership whistleblower G20 economic reform innovation Members of Parliament Scottish referendum early childhood education Middle East; national security; terrorism social services Criminal Code Amendment (Misrepresentation of Age to a Minor) Bill 2013 online grooming sexual assault of minors ACT Assembly national security smoking plain packaging tobacco cigarettes Asia; Japan; international relations Work Health and Safety Migration; asylum seekers; regional processing China; United States; international relations fiscal policy Racial Discrimination Act; social policy; human rights; indigenous Australians Foreign policy Southeast Asia Israel Palestine asylum refugees immigration political finance donations foreign aid Economics efficiency human rights; Racial Discrimination Act employment law bullying asylum seekers Animal law; food copyright Australian Law Reform Commission industry peace keeping contracts workplace policies same-sex marriage disorderly conduct retirement Parliament House standing orders prime ministers election timetable sitting days First speech defence budget submarines workers financial sector Canada Somalia United Kingdom GDP world heritage political engagement leave loading Trade; tariffs; safeguards; Anti-dumping public interest disclosure whistleblowing Productivity Commission limitation period universities Ireland cancer gene patents genetic testing suspension of standing and sessional orders live exports infant mortality honorary citizen railways disciplinary tribunals standard of proof World Health Organisation arts international students skilled graduate visas temporary employment visas apologies roads Italy national heritage NHMRC nutrition anti-dumping Rent Assistance obesity evidence law sacrament of confession US presidential election international days DFAT UN General Assembly deregulation Regulation Impact Statements administrative law small business Breaker Morant regional engagement social determinants of health abortion Members suspension workplace health and safety marine reserves hearing TAFE Victoria astronomy resources sector YMCA youth parliament Korea fuel rebate Australian Greens presidential nomination Racial Discrimination Act political parties preselection solar hot water Financial Action Taskforce Horn of Africa peacekeeping piracy Great Barrier Reef Stronger futures political financing political education Social Inclusion Board early childhood National Quality Framework for Early Childhood Education and Care Murray-Darling Basin sanctions Norway hospitals republic President Barack Obama Presidential visits qantas counselling Korean peninsula Work Choices biosecurity hendra environmental law federalism federation preselection therapeutic goods Therapeutic Goods Administration plebiscites computer games pests suicide nuclear COAG Ministerial Councils floods ADHD stimulant medication advertising electricity extradition conscience votes poverty preventative health rural health coastal erosion Parliamentary Budget Office work-life balance

Show all
Show less
Back to top