Gambling News: Woolworths shamed, Crown reveals pokies revenue, Michael West, Victorian losses, Ross Ferrar, VCGLR case wrap and much more

Gambling News: Victorian mobile billboard launch, Coles recommits to reform, pokies action in the ACT, Vic/NSW/QLD gambling motions, Champions for Change launches in NSW, Ross Ferrar quits and Victoria’s $1.2b pokies windfall much more

In this latest edition of Gambling News, we reveal plans for a giant mobile billboard to coincide with the final week of sittings in the current Victorian Parliament, urge the Victorians to pass the new point of consumption tax legislation before Parliament rises, summarise the pokies reform scene in Canberra, welcome Coles renewing its pokies divestment push and wrap all the action in the council motions space. We’re also pleased that Ross Ferrar has finally retired!

Victorian mobile billboard for final week of Parliament
Time for serious pokies reform in the national capital
Wesfarmers presses ahead with pokies reform, attempts industry exit
Vic/NSW/QLD council gambling reform motions
SA budget as Victoria eyes off $1.2b pokies licence windfall
Champions for Change launching in NSW!
Ross Ferrar quits GTA - at last
60 Minutes and The Sunday Project lead best of the gambling media

Mobile billboard for Victoria in final sitting week of Parliament

The Victorian election is less than 3 months away and The Alliance is cranking up the pressure for serious reform.

As the Wagga Wagga by-election result showed on Saturday, the major parties are on the nose and there are rising expectations of increasing independent and minor party influence in the next Victorian Parliament, which could open the door for serious gambling reform.

On Wednesday, September 19, we will be launching a large mobile billboard, coinciding with the regular Local Government Working Group on Gambling meeting at the VLGA in Carlton. See more details here.

The billboard will be circling Parliament in the final week of sittings for the term and at a time when there is also important legislation in play in Victoria. The point of consumption tax bill has passed the lower house, but is not yet through the upper house.

With a proposed start date of January 1, it is vital that this legislation is passed before Parliament rises, so that the foreign bookmakers deluging our TV screens with advertising will no longer get away with paying barely any tax to the Northern Territory.

The Alliance pressured the Victorian government to move on this issue after it wasn’t mentioned in the 2018-19 state budget and was pleased when Treasurer Tim Pallas made this announcement on May 14.

The Treasurer gave this strong second reading speech in the Legislative Assembly on August 8. The POCT legislation then passed the lower house on August 23 and was introduced to the upper house on August 24, again with a strong second reading speech from Labor Minister Jaala Pulford.

However, there has been no movement since then and next week is the last sitting week of the term with upper house members facing quite a backlog of legislation to deal with.

The Alliance is calling on all MPs to prioritise this legislation given that all states bar Tasmania are aiming to have the point of consumption tax up and running by January 1, 2019.

If Victoria, the home of racing, lets this slip, other states could choose to follow suit.

Time for serious pokies reform in the national capital

They say never waste a good crisis, so from an Alliance point of view, we’re hopeful that some serious gambling reform might emerge from Australia’s present political instability.

The politicians are back in Canberra this week but we were particularly pleased to see Tasmanian Labor leader Rebecca White re-affirming her party’s commitment over the weekend to remove pokies from Tasmanian pubs and clubs. Bill Shorten hopefully heeded that message when he addressed the Tasmanian Labor conference yesterday morning.

And speaking of Canberra, there’s plenty going on with poker machines in the local ACT Parliament, as the ruling Labor-Greens Coalition Government pushes ahead with some long overdue reforms.

Pokies remain limited to clubs in the ACT and the largest operators are the Southern Cross Club (Catholic Church heritage), the Labor Club, the CFMEU (2 venues) and the Canberra Raiders.

The Green-Labor minority government agreement in 2016 included a commitment to cut pokies numbers by 20% from 5000 to 4000, although progress has been slow.

After initially proposing a trading scheme whereby the Canberra Casino would buy entitlements off clubs, the government has now moved to a direct compensation model, the first of its kind in Australia. Legislation is expected later this year and if clubs don’t volunteer in they will be forced to surrender some entitlements to reach the 4000 cap by April 2019 and April 2020.

There have also been proposed changes to the community contributions model which has been widely reported as being rorted, including after a report by Monash University’s Dr Charles Livingstone and subsequent criticisms by the ACT auditor general.

The ACT clubs have been running a noisy campaign against all reform proposals, causing a split in the industry which dates back to chief minister Andrew Barr’s support for a major casino redevelopment ahead of the last election.

You can see some of the predictably hyperbolic Clubs ACT newsletters here:

Clubs slam government push to diversify revenue

Clubs attack review of community contributions

ACT clubs slam government over low pokies tax claims

Clubs urge community groups to mass email politicians over community contributions

The Canberra Gambling Reform Alliance which is co-chaired by Rebecca Vassarotti, a former community member on the gambling regulator who resigned after raising concerns, is continuing to push for reform.

The case of academic Laurie Brown, who suffered huge losses on the pokies, triggered a wave of publicity against the Canberra Raiders which was initially fined $120,000 before negotiating this away on appeal, sparking community outrage.

The Canberra Times has published dozens of stories on pokies policy over the past year.

The other interesting factor in the mix is the establishment of an additional Federal seat in the ACT, called Canberra, which will be the first ever genuine Labor-Greens contest at the 2019 Federal election.

The 2017-18 ACT campaign finance figures were released last Friday and showed the Labor Party received free venue hire from pokies venues worth $33,241, plus contributions of $754,197 from the 1973 Foundation, the ACT Labor investment fund which has built up tens of millions of assets over the years from the pokies profits at the 4 Canberra Labor Club venues. Green calls for reforms to donation laws, including an end to pokies funding, was the page 6 lead in The Canberra Times last Saturday.

There is little transparency around the assets of the 1973 Foundation, although you can see the latest declarations from the 1973 Foundation and the Canberra Labor Club here.

If Australia’s is going to shake its notorious status as the world’s most gambling captured nation, there is a strong case for the ACT Labor Party to divest their pokies operations on the grounds that they are conflicted and shouldn’t be promoting such a dangerous addictive product. The ACT still has $10 maximum bets and the lowest pokies taxes in the country, all of which arguably wouldn’t be the case if the most successful political party in Canberra wasn’t a large participant in the industry.

Wesfarmers presses ahead with pokies reform and attempted industry exit

Back in July, The Alliance called for our supporters to email the top brass at Wesfarmers, owner of Coles, to congratulate them on reported moves to exit the pokies industry with a sale to private equity firm KKR.

More than 600 of you wrote to the chair, CEO, head of media and head of investor relations, sparking responses such as this one from the Wesfarmers sustainability manager, Fiona Lawrie:

Thank you for your email dated 15 July regarding Wesfarmers involvement in electronic gaming via its hotel business.

Wesfarmers and Coles take the issue of responsible gaming very seriously. As you may be aware we have made a request to poker machine manufacturers to help us conduct a trial introducing a $1 bet limit on poker machines. This trial will assess whether $1 bet limits will help to address the issue of problem gambling. If successful, we feel a $1 bet limit will be the most robust approach to preventing problem gambling.

Gaming regulations prohibit anyone other than licensed gaming manufacturers from making changes to poker machines, thus the need to ask them for assistance. To date, all the manufacturers have declined, citing cost and the need for a whole-of-industry approach. Coles is engaging in further discussions with manufacturers to request that they reconsider their respective positions because we are ourselves both legally and technically unable to make the necessary alterations to the gaming machines to execute the trial.

Gaming machines can be part of a responsible industry which provides entertainment for those who enjoy gambling and are able to do it responsibly. However Wesfarmers openly acknowledges that a significant amount of the revenue being made from poker machines is from people who have a gambling problem, and poker machines seem to be particularly associated with problem gambling. We are not comfortable with that and are being active in trying to address that. We think the $1 bet limit is a sensible way forward.

Spirit Hotels has a six-step action plan which reinforces its commitment to responsible gambling and harm minimisation, which includes:

  1. Warning signs in car parks and at entries to its hotels, regarding the dangers of leaving children unattended in cars.

  2. Significantly enhanced car park security checks by hotel management, including hourly checks and log book records that can be monitored and audited.

  3. Gaming room screening where possible, to minimise the incidental exposure of children to gaming in its hotels.

  4. Removal of any point of sale advertising that may attract families with children to its gaming facilities.

  5. Point-of-sale helpline material in hotels with gaming operations.

  6. Point-of-sale material to promote self-exclusion to help manage problem gambling.

To provide some further context, Wesfarmers-owned Coles operates 89 hotels which have around 3000 gaming machines, or 1.5 per cent of the national market, and the vast majority of these are in one state, Queensland. Our first choice would be not to own hotels or the gaming machines within them, however under Queensland law, only hotel operators can have packaged liquor licences and operate bottle shops, and Coles does see liquor retailing as an important part of its offer to customers.

We will continue to report on Spirit Hotels and Gaming in our sustainability report available here.

Yours sincerely, Fiona Lawrie

Since then, there have been some murmurings that an independent Coles wouldn’t be quite so well disposed to pokies reform, so it was with some relief that we read this recent Patrick Hatch story in the Fairfax papers quoting the Wesfarmers CEO Rob Scott as follows:

“I’m very supportive as both a 100 per cent owner of Coles, and also a soon to be 15 per cent owner in Coles, of looking for a way of exiting that business."

“I’ve continued to support the ongoing work to evaluation the potential for a structured exit, and we have flagged that we are evaluating those options."

"The hotel's business within Coles is a very, very small part of the overall business but it’s part of the business we’d prefer not to be in."

Stand by for gambling motions to be debated at upcoming council state conferences

NSW has long been regarded as the most gambling-captured jurisdiction in the world, so it was great to see Byron Shire put up this motion to be debated at the upcoming Local Government NSW annual conference in Albury from October 21-23. (See the minutes.)

Moved Cr Spooner and seconded Cr Ndiaye:

That Local Government NSW provide research and resources to support Councils in NSW developing and implementing Gambling Harm Prevention policies.

With a NSW election due in March 2019 and Premier Gladys Berijiklean on the speaker’s program, it is expected to be a well-attended conference and The Alliance is likely to have a presence.

There will also be some gambling debate at the Municipal Association of Victoria state council meeting in October after City of Darebin unanimously passed the following divestment motion on September 3:

That MAV State Council:

  1. Notes the serious health impacts that gambling is having in the Victorian community and the wider Australian community given Australians are the world’s biggest gamblers with an estimated $25 billion to be lost in 2018.

  2. Notes that despite ample evidence of effective public health measures which could reduce harm, gambling companies are failing to deliver their products in a safe manner.

  3. Authorises the MAV to engage with the Vision Super board to advocate for full divestment of investments held in ASX200 companies where more than 10% of earnings before interest and tax (EBIT) are derived from gambling including Woolworths, Crown Resorts, Aristocrat, Tabcorp and Star Entertainment Group

  4. Watch the 9-minute debate starting 1 hour and 5 minutes into this webcast of the Darebin meeting.

There is also movement afoot in Queensland where Noosa Shire will tomorrow debate a strong pokies resolution calling for councils to be given more power over the rollout and management of poker machines, as is explained here in Noosa News:

If it succeeds, Noosa Shire will put up the the following motion to the upcoming LGAQ state council meeting:

"That the Local Government Association of Queensland advocates to the Department of State Development, Manufacturing, Infrastructure and Planning to amend planning legislation to define electronic gaming machines as a land use and permit planning schemes to address both the land use as well as the social impacts of electronic gaming machines on communities”.

Go to page 91 of this agenda to read the full Noosa report prepared by council officers.

SA budget revenue as Victorian prepares for $1 billion pokies licence fee windfall

South Australia was the last state or territory to release its budget on September 4 and there were some interesting gambling insights. The point of consumption tax is forecast to bring in more than $30 million this year, although almost half this amount is simply on-passed to the racing industry.

South Australian pokies tax revenue finished $9 million below the budget at $276 million in 2017-18 but is forecast to creep higher to $281 million by 2021-22.

Total SA gambling revenue is forecast to be $409 million in 2018-19 which is only 2.1% of the total $19.6 billion in revenue.

Because SA has issued perpetual pokies licences, it will not be enjoying a windfall like what will be coming the way of the Victorian Government through its new 20 year licences.

Asked a question on notice by Reason MP Fiona Patten through the budget estimates process, the Victorian Treasury provided the following insight into this windfall earlier this year:

The Government is currently in the process of allocating EGMs for the post 2022 term through an administrative process. Deposits amounting to approximately $56 million or about 5 per cent of the total estimated premium amount were received in February 2018. These deposits are currently not reflected in the 2018-19 Budget Papers.

Ok, so if $56 million represents 5% of the proceeds, the Victorian Treasury and therefore the Government are predicting total licence payments of $1.12 billion. Another $56 million is expected in February 2019 with the balance coming after the existing 10 year licences expire in August 2022.

The Alliance is launching the Champions for Change program in NSW!

Champions for Change is a program which supports and empowers people with lived experience of gambling harm and affected others to be powerful advocates for reforms to prevent gambling harm.

The program successfully launched in Victoria and South Australia where an incredible group of people have been working together to help reduce the harm associated with gambling. The Champions for Change have met with their local MPs, participated in forums, run community stalls, written letters to members of government and the media, handed out flyers at the games of AFL-pokie clubs and spread the word about the impact of gambling in the community.

We're excited to now be bringing the program to NSW and will be holding an information night on 10th October 2018 at the Strathfield Library. If you’d like to RSVP - click here!

If you are interested in becoming a Champion for Change or just learning more about it- come along to the info night! Attending the info night doesn’t tie you into anything, it’s just a way to learn more about this program and if it’s right for you. If you’re interested in becoming a Champ- irrespective of what state you’re in- click here!

Ross Ferrar quits after 17 years

Ross Ferrar, the long serving CEO of the combative Gaming Technologies Association, has finally retired after 17 years in the job.

Ironically, we called for his retirement in the last edition of Gambling News and the retirement was announced on the same day, although our position was unlikely to have been the determining factor. (Here is a charitable industry perspective on his departure.)

That said, we did complain to certain members of the GTA when Mr Ferrar wrote so some of our Victorian council funders after the Shonica Guy Federal Court case concluded in February this year.

We felt Mr Ferrar’s comments were way too combative, not unlike his over the top opening address at the recent Australian Gaming Expo, particularly when he said the following:

"When the anti-gambling activists drive off down the pokies-funded road to drop their kids at the pokies-funded school and when they have to visit the pokies-funded hospital, I hope they remember that government revenue from gambling benefits all Australians, whether they like poker machines or not."

The Age’s Nick Toscano covered these outlandish statements, including some strong sentiments from The Alliance with our deputy chair Allison Keogh quoted citing a recent study showing the total social cost of gambling harm was estimated to be almost $7 billion a year in Victoria alone.

Having been CEO of the GTA since 2001, we felt it was time the organisation moved on from Ross Ferrar and found some new more contemporary leadership. It is telling that the GTA has an all-male board and staff, which is typical of the gambling industry.

It is also interesting that Ferrar’s successor as GTA CEO, Chris Muir, is a former political chief of staff who also spent time at Austrac, the agency trying to combat money laundering.

As investigative journalist Michael West suggests in this recent piece, there may be money laundering going on within some NSW venues where the household losses appear abnormally high.

Muir’s political career involved working primarily for NSW Liberal Andrew Constance, both when he was NSW Treasurer and subsequently Transport and Infrastructure Minister.

Clubs NSW is hoping to sign another one of their notorious MOUs with the NSW Coalition before the 2019 election, something The Alliance is strongly opposed to.

A wide range of interesting media articles and interviews on gambling

It was a busy Sunday night for television viewers 8 days ago when 60 Minutes broadcast this story about kids getting addicted to Fortnite and The Project ran this story about so-called skill-based poker machines which are really just an industry ruse to convert younger video gamers into poker machine gamblers.

Those two mass-market television pieces have been added to our web page linking to interesting media on gambling issues from around the world. Here are a few more interesting items that are worth sampling:

Shirt sponsors should contribute to fight gambling addiction
The Guardian, 9 September, 2018

How technology turns us into addicts
QRIUS, 8 September, 2018

Landmark study finds Australia developing a generation of gamblers
News Corp tabloids, 8 September, 2018

BBC probe exposes UK football clubs targeting kids through gambling sponsorship
BBC 5 Live, 7 September, 2018

Noosa Council pushes ahead with pokies reform
Noosa News, 7 September, 2018

Murray River shire notches up Australia's highest household pokies losses, 5 September, 2018

Coles still committed to pokies sell-off
The Age, 4 September, 2018

Brimbank losses soar 9% in July as public health crisis hits
Star Weekly, 4 September, 2018

Editorial on the Australian solution for NZ racing
NZ Herald, 4 September, 2018

Backlash over Kiwi push for racing move into pokies
Stuff, 1 September, 2018

Crown targeting Millenials with skill-based gaming
The Age, 31 August, 2018

Roger Corbett: Australia's most controversial Christian
Eternity Magazine, 29 August, 2018

Holy Dooley: how Catholic clubs make a killing out of pokies, 28 August, 2018

That’s all for now. We’ll be back with another Gambling News update within a fortnight.

Meanwhile, if you’d like to become a financial supporter of The Alliance as we strive to reduce world record levels of gambling harm in Australia, click here.

Until next time.

Do ya best,
Stephen Mayne
Editor of Gambling News
Feedback to [email protected],  0412 106 241 or DM tweet to @maynereport