Gambling—a reprise for reform?

Dr Matthew Thomas, Social Policy

Key issue
Using his influence in the 43rd Parliament, Andrew Wilkie advocated for some significant gambling reforms. Ultimately, a watered down package of measures was introduced by the Gillard Government. These measures were repealed by the Abbott Government and gambling-related reforms were not a key focus of the 44th Parliament. Mr Wilkie has recently indicated that he and Senator Nick Xenophon intend to use their key crossbench positions to ‘put gambling reform back on the national agenda’.

Problem gambling and poker machines

In 2010, the Productivity Commission (PC) released its final report after an extensive public inquiry into gambling in Australia. The PC estimated that of the $19 billion spent on gambling in 2008–09 around $11.9 billion was spent on Electronic Gaming Machines (EGMs), otherwise known as poker machines.

Problem gambling may be defined as being ‘characterised by difficulties in limiting money and/or time spent on gambling which leads to adverse consequences for the gambler, others, or the community’. While problem gambling occurs across all forms of gambling, the PC estimated that a greater proportion of EGM players—around 15 per cent of all adults who play EGMs weekly or more often—were problem gamblers. The PC estimated the cost of problem gambling to the Australian community to be at least $4.7 billion a year, with EGMs being responsible for the majority of this cost. The social costs associated with problem gambling result from adverse impacts on people's health, jobs, finances, emotional states and relationships.

Given the potential for harm associated with EGMs, the PC recommended, among other things, a progressive move towards an Australia-wide EGM pre-commitment system—under which players could set spending limits on all EGMs—by 2016.

Gillard Government reforms

In 2010, Independent Member for Denison, Andrew Wilkie made the introduction of a full mandatory pre-commitment system a key feature of his agreement to support the minority Gillard Labor Government following the federal election.

Subsequently, the Parliamentary Joint Select Committee on Gambling Reform recommended in its 2011 report that a card-based mandatory pre-commitment scheme be introduced by 2014, and that a trial of mandatory pre-commitment be conducted.

In early 2012, then Prime Minister, Julia Gillard announced the gambling reforms the Government would be proceeding with. The reforms included a raft of measures to tackle problem gambling, including legislating for pre-commitment capable EGMs. However, they did not include the implementation of a mandatory pre-commitment system and, as a consequence, Mr Wilkie withdrew his support for the government. In changing its stance the Gillard Government was likely to have been influenced by an intense campaign against mandatory pre-commitment conducted primarily by the club and hotel industries.

In November 2012, the Gillard Government introduced the National Gambling Reform Bill 2012 and two companion bills. The provisions of these bills required that:

from the end of 2013, all new EGMs would be capable of supporting an approved pre-commitment system
by 2016, EGMs would be linked together as part of a state-wide or territory-wide pre-commitment system, and display electronic warning messages, and
from 1 May 2013 Automatic Teller Machines (ATMs) located in gaming venues would have a $250 daily withdrawal limit.

The bills also proposed the establishment of a national regulator to monitor compliance with the new scheme and the main features of, and methodology for, a 12 month trial of mandatory pre-commitment. The trial was to be undertaken by ClubsACT before being postponed in the lead-up to the 2013 federal election.

Following its election to office, the Abbott Coalition Government introduced the Social Services and Other Legislation Amendment Bill 2013, which effectively wound back all of the above reforms in favour of the development and implementation of a voluntary pre-commitment scheme and a focus on responsible gambling and industry self-regulation. The bill was passed by both houses of Parliament on 25 March 2014.

Online gambling—an emerging area of concern

In its 2010 report, the PC observed that online gaming and sports betting were growing rapidly in Australia. This trend has continued, with sports betting, in particular, gaining in popularity among young men. It has been estimated that online betting is growing at 15 per cent per annum.

A number of factors are likely to have contributed to the strong uptake of online sports betting in Australia. These include the centrality of sport and general acceptance of gambling in Australian culture, Australia’s high rate of internet and smartphone usage and intensive advertising and promotion by sports betting companies. There is some concern that sports betting advertising during live sports broadcasts may be normalising gambling among young viewers, and potentially creating a new generation of problem gamblers.

One of the problems associated with online sports betting is its potential to increase corruption in sport. Gambling online easily enables wagers to be made on particular incidents taking place in a sporting competition, and not just on the competition’s outcome. ‘Exotic’ or ‘spot bets’ have already been implicated in the corruption of international cricket. While the provision and advertising of ‘in play’ betting to customers in Australia is prohibited under the Interactive Gambling Act 2001, the existing approach to regulation has been found to be inconsistent and difficult to enforce, with in play betting readily available through offshore providers. It is worth noting that, irrespective of the regulatory approach adopted, it would be almost impossible to regulate access to or prevent the use of international gaming sites.

Another key concern is the capacity for online gambling to contribute to gambling problems among vulnerable individuals. The use of communications technology enables gamblers to gamble from anywhere, at any time, in privacy, and without appearing to spend ‘real’ money. These characteristics, when combined with sports betting companies’ aggressive marketing and inducements to gamble, have contributed to rates of problem gambling among online gamblers being more than double the rate for all gamblers.

The Government is aware of the problems associated with online gambling and the limitations of Australia’s current regulatory regime. In 2015, then Minister for Social Services, Scott Morrison commissioned a review of the impact of illegal offshore wagering. In its response to the review, the Government committed to, among other things, the development of a national policy framework that would improve the regulation of online gambling and the effectiveness of consumer protection and harm minimisation measures.

Where to next?

Andrew Wilkie and Nick Xenophon have indicated that they intend to pursue a number of specific gambling reforms, namely, the imposition of maximum $1 bets and $120 in maximum hourly losses on EGMs, and the banning of sports betting advertising during G-rated television broadcasts. They also hope to revive the Parliamentary Joint Select Committee on Gambling Reform in order to push for further reform in relation to online gambling and EGMs.

Comment

Although a significant number of Australians experience gambling-related problems, the PC estimated that only around 15 per cent of them seek help. Further, it found the evidence for the effectiveness of many of the available help services is limited.

This suggests that if problem gambling and its associated harms are to be seriously tackled then there may need to be a greater focus on preventive measures. Such measures include changing aspects of the environment that lead to problems for gamblers vulnerable to harm, such as gambling technology, the accessibility of gambling and the nature and conduct of gambling providers.