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Thursday, 21 June 2001
Page: 24839


Senator WOODLEY (11:10 AM) —I want to begin by responding to the previous speaker. I believe that he made a very comprehensive analysis of the debate, but he did not answer the fundamental question. I hope that further in the debate we will get this answer from the opposition—that is, if you are going to say that it is impossible technologically to ban gambling, then why is it possible technologically to regulate it?

The other problem, of course, is that regulation is in the hands of the states, and they have shown themselves to be singularly unable to maintain regulation once it is put in place. If we take the history of the last 30 years or even 50 years of regulation in this country, you will find that tough regulations put in place by the states inevitably are eroded over time. Constantly there is the problem that, where tough regulations are put in place at the opening of some gambling facility by the state, those regulations have been eroded. So what I look for in the debate from the opposition is some response to that part of the debate, because I think those are important questions. So I state those questions while at the same time complimenting Senator Bishop on his comprehensive overview of the debate.

For most of the 212 years of European history in Australia, gambling has been part of that history, as have been concerns about problems associated with gambling. However, those voicing the concerns have been in the minority until quite recently. In recent surveys, a majority of Australians have indicated their opposition to the opening up of further outlets for gambling. The recent Productivity Commission survey found that 70 per cent of Australians believed that gambling did more harm than good and 92 per cent of those surveyed did not want to see the further expansion of gaming machines.

The main reason for this opposition has to do with the harm caused to individuals and families through gambling addiction. Australia has around 300,000 problem gamblers, if we add together the two categories that were part of the Productivity Commission report. Each problem gambler, I have been told—this comes from a number of different studies—affects, on average, between seven to 10 people. This includes wives, husbands, children, employees, employers, creditors and victims of crime. The Productivity Commission estimates that the cost of problem gambling could be as high as $5 billion per year. It covers such things as the costs of bankruptcies, suicide, loss of productivity, counselling services, divorce and legal costs.

I recommend that everyone interested in this particular issue should read the Productivity Commission report Australia's gambling industries, although it is quite a large read. The key findings present some very stark statistics on Australia's reliance on gambling, in terms of both its social effects and economic effects. The report states that gambling provides enjoyment to most Australians, over 80 per cent of whom gambled in the last year, spending about $11 billion. It states that 40 per cent gamble regularly and that gambling is a big and rapidly growing business in Australia, with the industry currently accounting for an estimated 1.5 per cent of GDP and employing over 100,000 people in more than 7,000 businesses throughout the country.

The other statistic which is very important in this debate is the increasing reliance of state governments on gambling revenue. The capture that reliance on gambling revenue initiates in terms of state governments' ability to regulate is another question which must be addressed in this debate. We ask state governments to regulate and at the same time those governments increasingly rely on gambling revenue. There seems to be a kind of a break in credibility in that proposition.

The statistics provided in relation to the problem are also alarming, with 2.1 per cent of the adult population estimated to have a severe or moderate gambling problem that requires some form of treatment. The report confirms that the prevalence of problem gambling is related to the degree of accessibility, particularly to gaming machines. While problem gamblers account for $3.5 billion in expenditure—that is, of direct gambling expenditure—annually and lose around $12,000 each annually, it is the social cost which is of greatest concern. One in 10 problem gamblers said they have contemplated suicide due to gambling. Nearly half of those in counselling reported losing time from work or study in the past year due to gambling. That also came from the Productivity Commission report.

As I said, there is a growing concern about the increasing dependence of state governments on gambling as a source of revenue. The percentage of gambling revenue as a proportion of general revenue of state governments has risen steadily in recent years. Along with this dependence has gone an increasing relaxation of the regulation of gambling facilities by state governments. No matter how carefully new forms of gambling have been regulated upon their introduction, the history of poker machines, the TAB and casinos shows that over time gambling regulation always gets watered down because governments are always looking for ways to increase their revenues. The other problem associated with state governments and the regulation of gambling was very ably illustrated, as I said last time I made a contribution to this debate, by the GOCORP scandal in Queensland, where the Treasurer awarded a licence to three Labor Party members. That is an indication of the problems we have when we ask state governments to regulate, and at the same time they are dependent upon gambling revenue.

Let me give you another example of gambling regulatory failure: the TAB. This was highlighted by Tim Costello and Royce Millar in their book Wanna bet? They said that, when the TAB started in the 1960s, regulations prohibited seating, promotions, drinks and aided broadcasts. It was intended to take illegal bookmaking off the streets and help reduce crime as well as provide an opportunity for state and territory governments to get their hands on tax revenue. When they first started, TABs looked like post offices and certainly were not near any pub or club. Costello in his book uses the term `slippage': once the TAB was legalised there was a sanitising effect and arguments soon arose that it should be allowed to advertise. But no-one questions this move. No-one seems to remember that the condition of making the TAB legal was that it could not be advertised. The current situation with TABs, in pubs in particular, is a far cry from the tight regulatory system established in the 1960s. State and territory governments have allowed this slippage because they have become addicted to gambling revenue and have allowed gambling facilities to become increasingly available over the last 50 years. One can predict that the same slippage will occur if the only regulation of online gambling is left with state governments.

Some social commentators have commented especially on the extension of gambling within Australian homes which would occur if the extension of online gambling goes ahead. Again in his book Wanna bet? Tim Costello points out that the demand to extend gambling facilities comes from the industry itself, not from public demand for more outlets. The potential of online gambling is enormous and raises again the problem created by accessibility. It has the potential to turn every home in Australia with a TV set or a computer into a virtual casino. The proposed legislation is the first time since the Second World War that I can find, in limited research, any Australian government proposing legislation to limit gambling rather than to extend gambling.


Senator Kemp —It has been opposed by Labor.


Senator WOODLEY —I might have some criticisms of the government's legislation, Senator Kemp, because it does not go far enough, but I commend the government because at least it has made a start.


Senator Kemp —And condemn the Labor Party.


Senator WOODLEY —I will get to that. Let me say in commending the government that the Democrats—


Senator Mark Bishop —All of them?


Senator WOODLEY —Yes, I think I can speak for all the Democrats at this point. The Democrats will be looking for further action by the federal government in terms of problem gambling, particularly the gambling created by poker machines. I can say that on behalf of all of the Democrats, although most of my contribution is on my own behalf, I will admit.


Senator McGauran —Did you run this speech past your leader?


Senator WOODLEY —My leader does not agree with me. You know that already, Senator McGauran; I do not have to tell you that. It is important, as I have said, that this is the first time since the Second World War that any Australian government has proposed legislation that limits gambling.

Honourable senators interjecting


Senator WOODLEY —It is important, Senator Kemp and Senator Bishop, to underline this fact because the offer of the states to regulate online gambling is an offer to regulate the extension of gambling outlets. Let us underline that. It is not an offer to limit gambling, to wind back gambling outlets. It is an offer to regulate the extension of gambling in terms of online gambling. I think we need to note that. The only limits the states are proposing are limits on this extension because even they are not prepared to promote the unfettered opening up of online gambling at this stage. However, the history of state government regulation in Australia is a history of incremental increase in gambling through progressive watering down of the tougher regulations of 20 or 30 years ago.

Let me again commend the government on taking a first step. Senator Bishop has said that there is not enough being done to mitigate the effects of problem gambling, and I agree with him absolutely—not by any state government and not by the federal government. But again I think we should commend the federal government that they have taken first steps along this road. In particular, in responding during the last debate we had on the moratorium on Internet gambling, the federal government made a commitment to put funds towards research and also towards an education program warning Australians about the danger of the misuse of gambling. Let me commend the government that in the recent budget $10 million was allocated over four years.

What I would like to see the federal government also doing in terms of the mitigation of problem gambling is taking the lead in working with the states to increase funding for counselling and rehabilitation programs. There is a strong argument for allocating a percentage of gambling revenue to these programs. There is a direct correlation between the extension of gambling outlets and the increase in problem gambling. While commending the federal government on taking a first step, I think there are many other steps that need to be taken, and that can be taken, in terms of addressing the needs of problem gamblers.

In relation to this, let me briefly turn to the many phone calls and written communications I have had from a friend of mine, the Reverend John Tully, who runs—and has run for the last 15 years on the Gold Coast in Queensland—what is registered as the `New Life Ministry at Street Level Inc'. This is a service particularly directed at the counselling and rehabilitation of problem gamblers and gamblers addicted to many other substances, and so on. The work has grown because the problem has grown on the Gold Coast. He particularly underlines the need for rehabilitation and compensation for the victims of gambling, particularly those victims of crimes related to gambling. He says that both the cost of rehabilitation and the cost of compensation should be paid by the gambling industry itself—especially by casinos, because he is very aware of the operation of Jupiter's Casino on the Gold Coast. He says that it should be the industry rather the taxpayer who funds these kinds of compensation and rehabilitation programs. It should be by levy on the industry.

I am not sure what he means by that but my suggestion is that a percentage of state government revenue from gambling should be applied to these programs so that as the revenue increases so the percentage which goes towards the mitigation of problem gambling would also rise. This is the experience of one person who is directly involved in the programs to help problem gamblers and others and this is his suggestion, which I certainly would endorse very strongly.

I was going to quote from an article by the Reverend Tim Costello in the Age in April this year. He talked about `Gambling's great web of lies' and commended the Prime Minister and said that it `is right to try and ban Internet gambling'. I do not have time to put on the record all that he says but I commend that article to other senators.

Another article in the WeekendAustralian of 2 to 3 December 2000 reports a study which was done into gambling in just one town—Bendigo in Victoria. Some of the results of that study showed that in a population of 80,000 the money lost to gambling annually in that town is $32.35 million, or $404 dollars per person. The number of poker machines in Bendigo is 532 and more than 72 per cent of players earn less than $30,000 a year. That gives the lie to the idea that the gambling industry takes most of its money from high rollers. It does not. It takes most of its money from people on low incomes. Bendigo has almost 850 problem gamblers—in just one city in one state of Australia—and it has six full-time gambling counsellors. The net loss—and this is an economic study—to the region's economy is estimated to be $11.57 million a year, or 237 full-time jobs. While we talk about the size of the industry and the number of people it employs, one study of one town shows that there is actually a net loss in economic terms and a net loss of jobs due to gambling. I see that my time has expired, and no doubt the debate will continue in the committee stage.