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Thursday, 29 November 2012
Page: 10374


Senator XENOPHON (South Australia) (20:49): At the outset it would be remiss of me if I did not thank my legislation adviser Hannah Wooller for the tireless work she has done on this bill. I think she will be glad to at least see this phase of this legislative program dealt with. But let's go to the bill itself. The term 'Hobson's choice' comes to mind when considering this package of bills. The story is that that phrase comes from Thomas Hobson, who owned a livery stable in 16th- and 17th-century England. To take the use of his horses he gave his customers a supposed choice: they could either take the horse in the stall nearest the door or take none at all. So a Hobson's choice is an ostensibly free choice when in fact there is only one option on offer: take it or leave it. That in a sense is what the government has done here. I say 'in a sense' because this legislation is worse than a Hobson's choice, because initially the government offered something much better, something tangible and substantial in gambling law reform, something that actually would have made a difference in the lives of problem gamblers hooked on poker machines and, as importantly, could have prevented many thousands of Australians becoming problem gamblers in the future.

It is a matter of public record that on 23 June 2010 the Productivity Commission handed down its final report into gambling in Australia. It followed in form and substance the landmark 1999 report from the commission that set an international gold standard in analysis, methodology and sheer thoroughness in reaching its conclusions. Both reports essentially found that some 40 per cent of Australians' losses on poker machines—currently some $5 billion of the $12 billion in actual gambling losses each year—come from problem gamblers. The 1999 report made the chilling finding that, for every problem gambler, on average seven other lives are affected. That finding was not altered more than a decade later. Based on the available evidence, the commission found that there are between 80,000 and 160,000 Australian adults suffering significant problems from their gambling, with a further 230,000 to 350,000 experiencing moderate risks that make them vulnerable to a full-blown addiction. Overall, the overwhelming majority—up to 80 per cent—of Australians who have a gambling problem have that problem because of poker machines.

The 2010 Productivity Commission report made a number of key recommendations. Principally, it was recommended that poker machines, an unambiguously product for too many Australians, be made much safer by implementing a maximum $1 bet per spin and maximising losses at $120 an hour. When coupled with mandatory precommitment, giving individuals the right and choice to set limits on how much they want to lose, the commission made it clear that these measures could make a real and substantial difference in tackling poker machine problem gambling. The impact on recreational gamblers would be miniscule, as Senator Di Natale has mentioned, when you consider the research of the commission showing that, overall, 88 per cent of recreational players and 88 per cent of players do not put more than $1 per spin into the machines.

More recently, the outgoing Chairman of the Productivity Commission, Gary Banks, who participated in both inquiries, reiterated the commission's views on $1 bets at the Dangerous Consumptions Colloquium at Deakin University on 29 May this year. He made it clear that $1 bets satisfied 'good public policy' because it 'predominantly targeted the problem gamblers without having too much collateral effect on the average recreational gambler'. Further, he said, it should be implemented without a trial. But how did the Rudd government respond to the commission's report on 23 June 2010? Most of us had an idea that, when the government announced its response—effectively to ignore the recommendations to minimise harm and to fob them off to the states—it would be one of the last announcements of the Rudd government.

Real gambling reform appeared dead and buried not just by the Rudd government but, unfortunately, by the new Gillard government until Andrew Wilkie was elected to the seat of Denison as an Independent on a strong platform of poker machine reform. In a hung parliament, Andrew Wilkie's views suddenly mattered. In his 2 September 2010 negotiations with the Prime Minister about supporting an ALP government, Mr Wilkie in good faith argued for the $1 bet option as recommended by the Productivity Commission. That was my first option and the first option of my colleagues Senator Di Natale of the Greens and Senator Madigan of the DLP as well. It was the first option to reduce the losses on machines from the current potential of $1,200 an hour or even more. The government rejected that sensible proposal and instead offered mandatory precommitment to be passed by the parliament by May 2012 and to be rolled out from May 2014. It was a second-best but still credible reform option that would alleviate the devastation of poker machine addiction. I agreed with Andrew Wilkie at the time that it was the best that could be negotiated and Mr Wilkie and I were confident that at last there would be real change. The offer was set out in writing and signed by the Prime Minister and Mr Wilkie.

That written agreement was effectively ripped up on 21 January this year in exchange for a watered down and compromised scheme that represents a breach of trust not just with Mr Wilkie but with every poker machine problem gambler and generations of problem gamblers to come. The agreement with Mr Wilkie became expendable when, as Senator Fifield noted, Mr Slipper left the Liberal Party to take the Speaker's chair.

What we are debating tonight is a further weakening of the already diluted legislation promised in January—more delays, more vagueness, more imprecision to further compromise already compromised legislation. I do not blame Andrew Wilkie for this. He acted in good faith all along. I do not blame the Australian Greens, and particularly Senator Di Natale, because they too have acted in good faith all along. I blame deeply cynical politics on the part of the government and, yes, on the part of the opposition too. They have caved in to a campaign of fear and misinformation by the poker machine lobby. I want to make it clear that in good conscience I cannot support these bills as they stand. They need significant and substantial amendment before they can provide any of the necessary reforms to address problem gambling.

Since the Prime Minister's agreement with Andrew Wilkie in September 2010, this issue has been pulled, pushed and battered from a thousand different angles. We have now reached the stage where these reforms have become the proverbial political hot potato, juggled from one hand to another until they can finally be dropped. Personally, I find that to be a tragedy. This is not a political issue. It is not a hot potato, a football or something to be ticked off before the end of the year and the summer holidays. The problem at the very centre of all this wheeling, dealing and arguing—the addictiveness of poker machines—is not a theoretical one, as so well set out by Senator Di Natale. Yes, it can be measured in fiscal amounts like profit, revenue and taxes such as the $4 billion the states rake in from poker machines every year, with 40 per cent of that from problem gamblers, but it must primarily be measured in lives destroyed, in loved ones lost, in broken hearts, in broken promises and in desperation. Senator Di Natale mentioned the terrible, tragic suicide of Katherine Natt. I was the barrister representing Ms Natt's mother pro bono in the Coroners Court. It was harrowing to go through that evidence. It was harrowing to read the note. It was harrowing to learn how she died.

Ultimately, this is not about the Prime Minister's backflip on her agreement with Mr Wilkie. It is not about the grossly misleading 'licence to punt' campaign by vested interests or the phony fear campaign about a national database recording individuals' gambling activities. It is not about a nanny state or taking control over people's lives. This is about people who suffer from problem gambling, their families and communities. It is about how to help them. My great fear is that this legislation quite simply does not do that. In gambling parlance, my fear is that this is a loss disguised as a win. The measures contained in these pieces of legislation are nothing more than a passing nod to the issue but, on the surface of it, it could be argued that something is better than nothing. In this case I believe this something could be worse than nothing.

Believe me, this is a terribly difficult and fraught decision for me. I do not want to see this legislation passed off as some substantial reform, because it is not. I know that Mr Wilkie, Senator Madigan and the Australian Greens have made the commitment that this will be only the first step in reforms and that they will not stop fighting for change, and I will fight with them. The danger is that both the government and the opposition will take the tick-and-flick approach. They will say the matter has been dealt with and will shut down real reform for many years to come. That is my great fear. But I cannot support a bill that does not include the most basic of measures recommended by the Productivity Commission: maximum $1 bets and $120 hourly losses. The government has fallen for the scare tactics of the gambling industry and has presented something so watered down that the only people it could possibly offend are those interested in meaningful reform. But the industry is still protesting. You have to wonder just how weak any kind of reform would have to be before they would accept it.

I thank Senator Fifield for his gracious words about the work I have done. In his contribution he made a point about the contribution that clubs make. I direct Senator Fifield to the work of Charles Livingstone, the Productivity Commission and others. The work of Charles Livingstone shows that clubs claim this massive community benefit. In New South Wales they are returning the equivalent of only 1.3 per cent of their poker machine losses to the communities they claim to support, leaving aside the damage and devastation they wrought on communities.

Voluntary precommitment, central to this legislation, is a joke. It just will not work. Problem gambling is an addiction. It is not as simple as a matter of choice or willpower. It is also incredibly offensive to suggest that problem gamblers could stop if they wanted or that it is about choice. I cannot think of anyone who would choose to lose everything they have or would not want to stop if they could. People who suffer from poker machine addiction need to have meaningful and effective measures in place to help them control their gambling.

We are dealing with a dangerous product. In the most basic sense, the problem with voluntary precommitment is that, no matter how many loss limits a gambler sets or how much the system restricts their activity, there is nothing to stop them pulling their precommitment card out of the machine and continuing to play outside the system. The very fact that the government and the opposition do not seem to understand or appreciate this shows how they have little or no understanding of problem gambling as a whole.

In fact, these pieces of legislation seemed to be based on how people should behave rather than on how people actually behave. Two years ago a study into precommitment prepared for the Nova Scotia Gaming Foundation in Canada reported that voluntary schemes consistently and miserably failed because they relied on the willpower of players—that is, players have to have the willpower not to keep playing outside the system when they reach their limit. A study in South Australia shows something like a 0.7 per cent take-up of precommitment when it is voluntary. Further, the study in Nova Scotia found that high-risk players were less likely to take up precommitment options and would continue to play unless they were locked out of the system completely when they had reached their limit.

I know that some people are arguing we should not be forcing people to set limits and then shutting them out of what is essentially a form of entertainment but, as Senator Di Natale pointed out so well, on what other so-called form of entertainment can you lose $1,200 an hour? On what other so-called form of entertainment can you lose your pay packet in a matter of minutes? On what other form of so-called entertainment can you lose your home, your family and, most tragically of all, your life? If we really want to consider poker machines as entertainment we need to reduce their intensity, one of the things that makes them so addictive. We need to introduce limits on bets, spin rates and the amount of credit a machine will accept at one time.

As I have said, a significant and key recommendation from the Productivity Commission's 2010 report was the introduction of $1 bets and the reduction of maximum hourly losses to $120. It was an unequivocal recommendation. We do not need any more research into that. We do not need any trials. Mr Banks from the Productivity Commission made that absolutely clear. To that end, I will be introducing amendments, as Senator Di Natale will, to cap bets at $1, jackpots at $500 and the amount of credit that can be loaded onto a machine at any one time at $20. That is consistent with the bill I have introduced jointly with my colleagues Senator Di Natale and Senator Madigan. The amendments will also require the spin rates of machines to be slowed so that a machine played at maximum intensity for an hour would result in losses of no more than $120. That is the Achilles heel of this legislation.

The government has failed time and again to say why it will legislate to have machines ostensibly mandatory- precommitment-ready but will not make machines $1-bet-ready. The heavily redacted documents that I have obtained from the department through the FOI process failed to explain why $1 bets were supposedly too expensive to implement. The government has failed to justify why it has relied on the vested interests of an industry and not on independent experts to provide costings of the rollout of $1-bet-capable machines. I note from the work that Senator Di Natale commissioned that the real cost would be less than $350 million over a number of years, which pales into insignificance when you consider the Productivity Commission's estimates and other estimates of the cost of problem gambling being over $4 billion a year. In Victoria just last month it was estimated to be $1.2 billion. That is what the cost is to the community. That is what the real cost is.

Parenthetically, when Senator Fifield and the industry talk about jobs created by poker machines, let us look at some independent research conducted by the South Australian Centre for Economic Studies for the Tasmanian Treasury which found that for every million dollars lost on poker machines, 3.2 jobs are created. A million dollars spent on retailing, however, creates 6.5 jobs, and a million dollars spent on food and meals in hospitality creates 20.2 jobs. So, unambiguously, poker machines are a job killer, not a job creator. The government has failed to justify why it is relying on the industry and not on others, why it is undertaking its own independent research, why it will not even refer it to the Productivity Commission to let the independent umpire look at this.

These are simple, straightforward amendments, they were central to the Productivity Commission's recommendations and they will be relatively easy to implement. If I cannot get support for the implementation of $1 bets, I will move a similar set of amendments that would only require machines to be capable of operating to those limits, with the actual implementation of these measures to be made in regulations. At the very least I hope my colleagues in this place would support the idea of machines being capable of these limits. If we can make them capable of being mandatory pre-commitment ready, why on earth can't we make them capable of being $1 bet ready?

I also have serious concerns about the other measures in this bill, and hopefully in the truncated committee stage we can at least deal with them. The withdrawal limits on ATMs could be a useful step but they are still too broad; there are too many loopholes in that. There is also no limit on the cash that can be withdrawn through EFTPOS, which is a major oversight. Again, the requirement for dynamic warnings on machines is good in theory, but too many details have been left to the regulations.

I also have concerns about the implementation of the penalty provisions and the gaming machine regulation levy: these sections include specific exemptions for paying penalties or a levy where there is not a pre-commitment system operating. While I understand the theory behind these exemptions, there is also no legal requirement in the bill for states or territories to have pre-commitment schemes. It is not unreasonable to imagine that these exemptions could be considered a green light to venues and states and territories to not have a system in place. Judging by the response I received to a question on notice to the department during the committee inquiry, the whole foundation of these reforms lies in the fact that states and territories have agreed to go along with them. That could be a fatal flaw. My question is: what happens if there is a change of government and suddenly that agreement does not exist—what then?

I will be moving a significant number of amendments in the committee stage in an attempt to address these issues—these technical flaws. For me, this legislation is ineffective not just because of the policies underpinning it but because of the lack of detail and consideration in the legislation itself.

Finally, I want to reflect on the words of Leanne Scott, who showed great courage in speaking out about her poker machine addiction just before she was sentenced to two years imprisonment for stealing money from two of her employers. I have been to see her a couple of times in jail and I will see her again next week to see how she is getting on. On 13 July this year, outside of the Adelaide Magistrates Court, just before she was sentenced, she said:

In a few minutes I expect to be sentenced for stealing a lot of money to feed my poker machine addiction. I'm not here to make excuses or ask for sympathy.

I want to appeal to everyone who has a problem with pokies or is on the road to getting hooked to tell someone, to please, please get help.

I'm so sorry for what I've done but I hope by speaking out just before I go to prison, at least one person out there who's got a problem will get help—because I don't want this to happen to anybody else.

If Leanne Scott can spend the time before she was sentenced to imprisonment thinking of others, not herself, maybe we should try to do the same thing here tonight.

This is not an easy decision for me to make, but when I think about the people I know, the people who have shared their stories with me over so many years, I cannot in good conscience support this bill without the measures and proposed amendments. Otherwise, people like Leanne will continue to be faced with no choice at all.