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Wednesday, 27 June 2001
Page: 25268


Senator O'BRIEN (5:19 PM) —That was an interesting contribution from Senator Allison. I am not sure if one of the proposals that one should take from it was that we should raise an extra $11 billion in taxes from people who gamble on the basis that they gamble.


Senator Allison —It's tax in another form.


Senator O'BRIEN —In terms of the programs that need to be met, that is how they could be met. Senator Allison interjects that it is a tax in another form. Yes, one of the problems is that it is a source of revenue in the states. Doing away with it would only deny the states the revenue and deny some of the social benefits that Senator Allison supports and the revenue they need to survive.

The first thing I wanted to touch on was a bit of a historical perspective in the role of the Commonwealth in its attempt to limit gambling. My state of Tasmania has been historically involved in just such a parallel. In fact, it goes back 100 years to 1901. I am indebted to Des Hanlon, an old friend and colleague of mine, who does a historical report for the ABC in Tasmania. I just happened to hear his report recently about this event, and I asked him for a copy of the transcript. I am proposing to read it into the Hansard, because I just could not help but see the absolute parallel to what occurred at the turn of the last century, in 1901. Let me read this into the Hansard, and I am sure that the Senate and listeners will understand the parallel. He said:

The new Commonwealth Parliament in 1901 debated and passed the Commonwealth Postal and Telegraphic Act, the purpose of which was to unify the various State postal and telegraphic departments.

One aspect of the new act was of greater interest to Tasmania than the other States. The Act prevented the use of the Royal Mail to sell or transact the buying of a ticket in a lottery. In the 1890's the various colonies had made the running of lotteries illegal except in Tasmania.

In 1896 Tasmania had legalised the conducting of a lottery and issued a licence to George Adams. George then moved his Tattersalls lottery business from the mainland—

I think it was in Victoria—

to Hobart.

The Tattersalls lottery then became a source of revenue for the Tasmanian Government, employing more than 100 people.

The Commonwealth under the new legislation allowed the Minister, by regulation, to restrict the delivery of mail to a particular address suspected of conducting a lottery. Sir Philip Fysh was the first Tasmanian to hold a federal ministry and the second Postmaster General. Not all Tasmanians supported the establishment of Adams lotteries and Fysh was one.

Mail as a result was not delivered to Tattersalls' office in Collins St. Hobart. A series of strategies were then devised by Tatts using other Tasmanian addresses.

The Commonwealth in 1909 retaliated by issuing Regulations in the Commonwealth Gazette identifying various persons to whom mail would no longer be delivered. Many prominent Tasmanians were named and as a result denied deliveries of mail, in the belief that they were acting as fronts for Tattersalls. The size of the problem for both Tatts and the post office can be seen from the fact that 10,000 letters were returned on the first day of the regulation.

For example the Commercial Bank of Tasmania was named and denied mail deliveries in 1911—the head office building of the bank remains in Macquarie St, now the ANZ .

To enable the Bank to receive its other mail it was forced to agree not to accept mail on behalf of Tatts. All letters addressed to the Commercial Bank of Tasmania were opened and sent back at no cost to the letter writer. This was all done at the taxpayers expense including the loss of postal revenue. Overtime was worked by the Sydney Mail Exchange to carry out the task.

The number of letters not delivered to the bank alone numbered more than 100,000. Of course this provoked an outcry across the country but people still managed to buy a ticket in Tatts and the winners in Tatts managed to receive their prizes.

Throughout the history of the Regulation the Commonwealth's role was very dubious. It created and printed a special money order that matched the cost of a ticket in Tatts. The majority of money orders issued for this amount were used to buy tickets in Tatts. Later in the 1920s the Commonwealth then attempted to tax the winnings of the lucky ticket holders.

No other State had a legalised lottery until the Queensland State Government started its Golden Casket lotteries in the 1920s. The Commonwealth took no action against Qld but continued to act against Tatts in Tasmania.

There were all sorts of ways one could use to send money, have it delivered to Tatts and in turn receive the ticket. Signs in shop windows which said `regular contact with Hobart' meant leave your money and ticket application here and it will arrive at Tatts.

Only an outstanding reputation for honesty by Tatts, its agents and employees allowed this enormous business to grow and flourish, despite the efforts of the Commonwealth and the other states to stop the public getting a ticket in Tatts.

King O'Malley, who represented the Tasmanian West Coast in the federal Parliament, did not oppose the ban. He suggested that as no one else could start a lottery in opposition to Tatts it may not be a bad thing.

The Commonwealth had no power or authority to control gambling or lotteries or to stop a lawful Tasmanian activity. But no action was ever taken to have the High Court of Australia declare the Regulation illegal.

Tattersalls may have agreed with King O'Malley's assessment because they had 30 years without any opposition. Despite the post office, the wowsers and the opposition, Tatts prospered and became a national icon.

This situation went on until 1930 when Joe Lyons was made Minister for Posts. Joe was a Tasmanian who later became Prime Minister. Joe cancelled the Regulation order, making it legal to write a letter and have the post office deliver it to Tatts in Hobart.

One hundred years ago, we had the federal parliament making laws and regulations to block a gambling activity in a state. It failed. Over a 30-year period, those regulations were avoided. We are not talking about science; we are not talking about technology. We are talking about the desire for people to buy a lottery ticket.

One would have to say: here we go again. We are being asked to pass legislation which will have precisely the same effect. It will not change the desires of people to gamble, it will not change the desires of states in relation to raising revenues through gambling, it will not change the fact that there are too many poker machines and too many opportunities for people to gamble in the states and it will not deny the availability of Internet gambling sites to people in Australia—that is the reality and I think we all know it. In fact, what this bill will do—as I understand the amendments that are proposed and if I understand what the support for them is—is to supply Internet gambling sites for people in other countries but not here.

This is a massive misuse of Commonwealth power, I suggest, but more importantly it is a massive missed opportunity. I think some people are supporting this legislation because they are desperate to do something. It is within the government's power to do better things than to pursue this legislation on the basis of trying to get a few brownie points and a bit of publicity, because that is all they will get. They will not achieve what they propose is the real aim of this legislation.

What the Commonwealth could do and should do is to not pursue this legislation but go to the states and say, `We believe that there is a public concern about the availability of gambling.' All of the statistics show that there is one mechanism that raises the most money, and it is not the subject of this bill. The Commonwealth ought to explore the possibility of some change to the regulatory regime for gambling in this country.

Let us face the fact that you are not going to change people's desire to gamble. I heard Senator Woodley talking about the TAB and its growth. Why did the TAB come into effect? Because people were gambling with SP bookmakers; they were gambling off course. It was not regulated and there was the opportunity to say, `This money is being wagered; what is the public good in leaving it as an illegal activity when it is going to happen anyway? Let's create an opportunity to regulate it and take some money from that activity, put it into industries that employ people, like the racing industry, and put it into social good in some of the expenditure that governments have in schools, hospitals and police.' That is what happened. The fact that governments have taken advantage of that is probably down to their being realists and making a good business out of what was essentially illegal activity.

We are not going to change the desire of people to gamble and to use the Internet to gamble, if that is what they want to do. The passage of this legislation will not do that. We go back to the example that Des Hanlon gave us of 100 years ago to see precisely the same activity by the Commonwealth parliament and precisely the sort of desire to restrict the access of people to gambling opportunities. We see an outcome of failure. I do not think anyone—the supporters of this bill or those who oppose it—really expects that this will prevent people from gambling. If someone is not computer literate enough to find a gambling site outside this country if they want to, they just turn off the machine and walk down to the local hotel. There are any number of machines there that they can pour their money into with no preventions at all.

We are being asked to put on the blindfold and pretend that we are going to do good by passing this bill when the reality is that the opposition's position on this matter is the only realistic one, that is, this government should be seeking proper codes of conduct in relation to gambling and using what may well be strong bargaining power with the states to deal with some of the other problems and perhaps to deal with some of the issues of financial need that removal, restriction or proper regulation of gambling opportunities might raise. It is a problem for the Commonwealth; it is a problem for the community. Let's get fair dinkum about it and let's not pretend that we are going to solve the problem with this bill, because we are not.