Gambling News 09052018 - Alliance for Gambling Reform

Gambling News - 9th May 2018

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  1. Woolworths faces divestment motion at MAV state conference

  2. NSW in focus for point of consumption tax decision

  3. Northern Beaches Council moves toward a strong gambling policy
  4. Victorian election policy launched - and farewell to Kelvin

  5. Tracking council motions on gambling reform

  6. Busy time in the media: Crown, sports deals, New York Times feature etc

1. Woolworths under the pump on pokies like never before

The Municipal Association of Victoria will hold its state council meeting on Friday May 18 and City of Darebin has lodged the following Woolworths divestment motion for discussion:

The MAV State Council:

  1. Condemns Woolworths for operating Australia’s biggest poker machine business in a reckless and unsustainable fashion, deluging harm and misery on the community by making more than 12,000 predatory and addictive gambling machines available at 300 hotels across Australia, including more than 80 in Victoria.
  2. Authorises the MAV to engage with the Vision Super board to advocate for full divestment of its Woolworths investment by the end of 2018 if the Woolworths board has not publically announced its intention to divest its poker machine division.

The Age’s Nick Toscano has already covered the story and it will be interesting to see the level of support Darebin’s motion generates and then how Vision Super responds to the request to sell its $150 million investment in Woolworths.

Check out the full agenda for the MAV State Council meeting which is open to the public. The Darebin proposal is motion 50 on page 98 so it will probably be debated after lunch.

As the background outlines, Australians are the world’s biggest gamblers in per capita terms with an estimated $25 billion to be lost in 2018. Australia’s 200,000 poker machines are expected to contribute more than $13 billion of these losses.

Woolworths are the world’s largest operator of poker machines in pubs and club and its Victorian division drained $669 million from gamblers in 2016-17, equating to 25% of the $2.61 billion lost gambling on poker machines across Victoria’s 502 pubs and clubs with pokies.

The Woolworths hotels division recently reported a 17% jump in operating profit to a record $163 million for the December half year – comprising a record 11.5% of the overall Woolworths profit.

Gambling regulators across Australia have been investigating claims by whistleblowers who approached Federal MP Andrew Wilkie alleging that Woolworths retains a central data base of big spending gamblers across its poker machine hotels, in order to maximise profits.

The Woolworths board have promised a full independent investigation which is on-going.

Wesfarmers, owner of Coles, is Australia’s second largest operator of poker machines in pubs and is currently investigating a full divestment of the division. The Melbourne Football Club also recently announced it was joining North Melbourne in moving to a pokies free operating model by divesting one venue and not renewing pokies licences at a second. Even the Zagame family, which owns one of the largest pokies pub chains in Victoria, has this week announced they want to exit the industry as well.

Not since the Wilkie-Xenophon-Gillard mandatory pre-commitment debate of 2010-11 have we seen this level of public debate about Australia’s world record levels of gambling harm.

Indeed, the Australia Institute recently released a report  detailing how we have 76% of the world’s poker machines in pubs and clubs, with Woolworths the single biggest operator.

Unsurprisingly, it is also Woolworths which is copping the most heat.

News Corp’s veteran business commentator Terry McCrann is now predicting the brand damage is too great and Woolworths will choose to exit the toxic industry, rather than suffer ongoing hits which have rolled out as follows so far this year:

Fresh food jackpot: how Woolworths became Australia's biggest pokies company
Age/SMH, 17 February, 2018

Woolworths spying on customers to boost pokies profits
ABC News, 28 February, 2018

Xenophon skewers Woolies over pokies in SA
The Advertiser, 11 March, 2018

Woolworths launches fresh review of pokies business
The Age, 19 March, 2018

Woolworths calls in lawyers and accountants to investigate ALH
The Age, 20 March, 2018

Gaming watchdog widens Woolworths pokies probe
Age/SMH, 28 March, 2018

2. NSW in focus for point of consumption tax decision

Are you sick of being deluged with all those sports betting ads? Dithering state governments are partly to blame as the foreign bookmakers continues to get away with making super profits and paying very little tax thanks to their obliging regulators in the Northern Territory.

The Alliance was disappointed with last week’s Victorian budget which was silent on the proposed point of consumption tax on the foreign bookmakers.

We distributed this detailed press release on the issue and also asked Victorian Treasurer Tim Pallas a pointed question at his post-budget lunch hosted by VECCI and the Melbourne Press Club.

Have a listen to this audio of the exchange but the Treasurer’s key response was as follows:

In respect of the point of consumption tax, we said in the last budget we were looking to introduce one and it is still my intention that we will be making an announcement in the near future about that tax. To be clear, I have been speaking to everybody about this, whether it is industry, Sporting codes that think they will be adversely affected, other states, about how we might be able to have a broadly consistent approach to its introduction and I suppose, also importantly, anti-gambling groups to make sure we have a clearly appreciation of their view and their expectations about what we deliver.

Tim Costello did indeed have a meeting with the Victorian Treasurer last month and The Alliance is keen for all states to get on with introducing the tax as soon as possible at the highest possible rate.

The South Australian tax has been operating for 10 months and Sportsbet’s parent company, Paddy Power Betfair, told investors last week its Australian operation is booming and so it will be expanding its marketing budget with no news taxes expected in calendar 2018. The precise words were as follows:

Australian division: Sportsbet

Revenue increased by 6% in local currency, with continued good growth in underlying customer activity partially offset by adverse sports results. Ahead of the expected introduction of new taxes, competition remains intense and market consolidation has commenced. We have reviewed our investment plans and see an opportunity to compete more aggressively to take advantage of the potential disruption to competitors. As a result, we are increasing investment in promotional generosity and marketing activity. We currently expect 2018 full year underlying EBITDA to be between £470m and £495m. This expectation reflects the increased investment in Australia and assumes no new taxes become payable in Australia in 2018.

The NSW budget is due to be released on Tuesday, June 19, and – as our press release noted – the Government is currently consulting with the industry on how to introduce a point of consumption tax.

Our message is clear: get on with it as soon as possible. A joint NSW and Victorian announcement would make sense. If July is too hard for a start-date it should be no later than January 1, 2019, which would coincide with when WA is starting its point of consumption tax.

3. Northern Beaches moves to become 2nd NSW council with a strong policy

In an exciting development, Northern Beaches Council (Manly – Pittwater in Sydney’s northern suburbs) is considering adopting a Gambling Harm Reduction Strategy. The Alliance worked with councillors Pat Daley and Nat Warren to put a proposal that the Council call for a cap on poker machine numbers in their council area, and for staff to start researching local actions. The Alliance also assisted with that research, and we’re really pleased to see several powerful strategies being suggested – including Council using its position as landlord to work with tenants to remove poker machines and gambling sponsorship from public land.

If you live or work on the Northern Beaches, or simply want to encourage only the second council in NSW to be working on a gambling reform policy, please make a submission here before the end of May. Tell the council that you think they should have a Gambling Harm Reduction Policy, it should be strong, and they should be congratulated for standing up as community leaders on this issue.

4. Victorian election policy launched

The Alliance recently launched its Victorian election policy with a group of councillors and officers at the regular Local Government Working Group On Gambling (LGWGOG) meeting at the VLGA.

Tim Costello spoke about The Alliance’s plans and Margi Potter provided a lived experience perspective before the group engaged in a detailed discussion about campaign tactics, messages and policies with mayors, councillors and officers from across Victoria.

Mildura’s seven-time mayor Glenn Milne even made it down for the launch as can be seen in this coverage in The Sunraysia Daily.

The Alliance’s Victorian pokies policy outlines a range of reforms ranging from $1 maximum bets, reduced trading hours and retirement of the machines surrendered as part of the current licence renewal process.

We also called for a ban on political donations from gambling interests which is topical given Victoria has today revealed the detail of legislation for a dramatic overhaul of the state’s campaign finance laws.

Whilst cutting the maximum donation to just $4000 is obviously welcome, there are no proposed spending limits on industry so Victoria could yet see a repeat of what happened in Tasmania and South Australia with the gambling moguls spending millions campaigning against reform proposals.

Staying with Victoria, we’re also sad to lose our Victorian campaign manager Kelvin Thomson who has been snaffled by City of Brimbank as this report in The Star Weekly explains.

However, Brimbank is one of our 12 leadership councils in Victoria and does great work on gambling reform so Kelvin will still be part of the broader gambling reform family.

We’ve advertised for a replacement and applications close on May 13 so do alert anyone you know who might be interested.

5. Tracking council motions on gambling reform

The States and Territories are often conflicted and captured when it comes to gambling reform, given that they will pocket about $6 billion of the world record $25 billion that Australians will lose gambling this year.

And with the two major parties also heavily influenced by the gambling industry at the Federal level, this makes local government a key driver of gambling reform.

To highlight the good work of local government in this space we’ve started a page on our website dedicated to successful councillor motions which advocate reform.

The latest is from City of Monash which is putting pressure on Hawthorn Football Club to exit the pokies business.

The Monash motion generated strong coverage in The Monash Leader, which in turn led to Hawthorn President Jeff Kennett facing questions this week when he came out strongly against sports betting advertising, an unusual position for a director of Seven West Media to take.

Other council motions featured include City of Melbourne, Brimbank, Manningham, Hume and two from NSW, namely Northern Beaches and Byron Shire.

If you’re a councillor reading this newsletter, why not get on board with a motion of your own. And if you’re aware of other strong council gambling motions which should be added to the list, drop us a line to [email protected].

6. Latest Alliance media releases and media monitoring

2018 has been a busy time in the media for The Alliance and here are links to the 3 press releases we’ve issued since the last newsletter went out on March 29:

Has Stephen Conroy and the foreign bookies nobbled Victoria's point of consumption tax?
1 May, 2018

Record Crown fine over tampering adds strength to call for cut to the maximum shareholding
27 April, 2018 

Why isn't gambling reform part of these mega-deals with Cricket Australia and the AFL?
13 April, 2018

We’ve also put together this useful page chronologically capturing interesting media stories on gambling, which is now up to almost 300 links. Here are a few favourites from recent weeks:

Zagames joins the pokies exodus as toxic industry battles divestment push
Sydney Morning Herald, 9 May, 2018

Local Australian sport susceptible to match-fixing corruption
SBS, 8 May, 2018

NBA play-offs coverage on ESPN reveals gaps in advertising restrictions
ABC, 8 May, 2018

Social media giants copying gambling industry techniques to addict
The Guardian, 8 May, 2018

Tiny take-up of Victoria's Yourplay voluntary pre-commitment scheme
Sunday Herald Sun, 6 May 2018

The economics of poker machines in Australia
Money, Radio National, 3 May, 2018

Singapore winds back the pokies, so why can't Australia?
The Straits Times, 3 May, 2018 

Failure to move on gambling tax risk greater deluge of ads
Sydney Morning Herald, 2 May, 2018

Monash urges Hawthorn to quit the pokies at Waverley Gardens
Monash Leader, 2 May, 2018

Queensland re-instates the household gambling survey and they top pokies gamblers
Brisbane Times, 30 April, 2018

Auditor General finds ACT Clubs are rorting community contribution schemes
The Canberra Times, 30 April, 2018 

Tim Costello calls for Packer to be forced to relinquish control of Crown
ABC, 27 April, 2018

Victorian gambling regulator slammed for miniscule Crown fine
The New Daily, 27 April, 2018

Former Newcastle Knights full-back equates pokies lobby to NRA
The Newcastle Herald, 26 April, 2018

Should Vision Super dump its $150m stake in Woolworths over pokies scandals?
The Age, 23 April, 2018

Nick Toscano feature on Crown executive chairman John Alexander
The Age, 21 April, 2018 

Charles Livingstone: casino will just bring more misery to Sunshine Coast
Sunshine Coast Daily, 21 April, 2018

Tim Costello calls for ACT Government to forget casino, get on with pokies reform
The Canberra Times, 20 April, 2018

How Millennials are getting fleeced by the online gaming industry
Financial Times, 17 April, 2018

Jon Stanhope blows the whistle on windfall pokies profits in Canberra
Sydney Morning Herald, 16 April, 2018

Outrage over how Lottoland bought naming rights at Brookvale Oval
Sydney Morning Herald, 16 April 2018

How Sydney lawyer stole $10m to feed gambling addiction
Sydney Morning Herald, 16 April, 2018

Tasmania cuts cash withdrawals to $100, bans alcohol service at pokies
ABC, 14 April, 2018

Tabcorp and News Corp fined over Sun Bets pie-eating stunt during football broadcast
The Guardian, 13 April, 2018

NSW pokies clubs investigated for cancelling memberships of journalists
Sydney Morning Herald, 13 April, 2018

Will the Crown skyscraper in Melbourne ever be built?
Southbank News, 11 April, 2018

Xavier Ellis calls for AFL to wind back gambling influence
PerthNow, 10 April, 2018 

Rooty Hill RSL denies membership to another SBS journalist
SBS, 10 April, 2018

SBS investigation into gambling harm in CALD communities
SBS, 10 April, 2018

How Kate Seselja turned her life around delivering hope
The Canberra Times, 9 April, 2018

Tim Costello blasts desperate Lottoland pitch to newsagents
The Guardian, 5 April, 2018 

How Australians became the world's biggest gamblers
The New York Times, 4 April, 2018

Demons to pocket close to $11m from Moonee Valley for Leighoak pokies pub
The Age, 4 April, 2018

Where Brisbane and Port sit on the AFL pokies league ladder, 4 April, 2018

Herald Sun feature on how gambling addiction can hurt women
Herald Sun, 31 March, 2018

Daily Mail gets inside giant UK gambling conference, reveals cynical industry rorts
The Daily Mail, 31 March, 2018

If you know of any other stories which should be added – no matter how old – send the links through to [email protected] and we’ll make them available. The same goes for interesting academic research papers or submissions to government regulators.

That’s all for now. We’ll be back with another edition of Alliance News in late May.

Stephen Mayne and The Alliance team