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Four Corners -

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Program Transcript

Read the transcript of Matthew Carney's report Wilkie's Gamble, first broadcast Monday 20 June
2011.

Reporter: Matthew Carney

Date: 20/06/2011

KERRY O'BRIEN, PRESENTER: Politics and the power of money - they're at the heart of the Federal
Government attempt, pushed by independent Andrew Wilkie, to force reform on the poker machine
industry.

Welcome to Four Corners.

Australians are amongst the biggest gamblers in the world and the cause, according to recent
studies, is poker machines.

A staggering $12 billion is being pumped into the pokies each year - 60-odd per cent of all money
gambled in this country - and much of that is being lost by an estimated 100,000 problem gamblers.

But this is a desperate gamble by the Gillard Government too. They need Andrew Wilkie's vote in the
Parliament to cling to office. If they don't introduce laws designed to reduce the flow of money
through poker machines, they could lose that vote and lose government.

But with the pubs and clubs of Australia and state governments raking in big money, the opposition
to the reforms is formidable and ultimately could cost them power anyway.

Andrew Wilkie knows that if he brings the Government down and an election follows it could spell an
abrupt end to his own political career, but he's taken big risks before. In 2003 he resigned as a
senior intelligence analyst with the Howard government's Office of National Assessments, describing
John Howard's Iraq policy as "dumb".

He's convinced the policy he's demanding now will seriously reduce the human misery associated with
problem gamblers. His opponents say his idea is untested and won't work.

Matthew Carney reports on Andrew Wilkie's biggest all or nothing punt.

MATTHEW CARNEY, REPORTER: In Hobart on election night last August Andrew Wilkie got a phone call he
didn't expect. He'd just arrived at a friend's restaurant.

ANDREW WILKIE, INDEPENDENT MP: I'd only been at the restaurant for seemingly minutes when my wife
Kate walked up to me holding her mobile phone outstretched with a bit of a stunned look on her face
and she said, it's the Prime Minister.

And I said something like yeah, sure it's the Prime Minister and had a good chuckle. And she said
no, it really it is the Prime Minister with a stunned look on her face.

MATTHEW CARNEY: Wilkie was about to do the unthinkable - pull a swing of 21 per cent in the safe
Labor seat of Denison. Previously Labor had written off Wilkie but now Julia Gillard wanted to
talk.

ANDREW WILKIE: Look it was simply to say something like congratulations. The best advice she can
get is that I will win the seat and she just wanted to say well done. She didn't quite cleverly I
would add seek to start any negotiation or pressure me in any way. It was very much a very, a very
pleasant, a very clever bridge-building exercise.

MATTHEW CARNEY: Gillard needed Wilkie's support to form government.

On the Monday, Wilkie went back to work in the rug shop he owned but this unknown kingmaker soon
realised the power in his hands.

He was going to take on the gaming industry and impose nation-wide reform of the billion dollar
poker machine business but Andrew Wilkie needed help

NICK XENOPHON, INDEPENDENT SENATOR: We're in the CBD and there are three pokie venues, well there
are four pokie venues within a couple of hundred metres.

MATTHEW CARNEY: Adelaide-based independent Senator Nick Xenophon was the man. He's spent more than
a decade crusading against poker machine addiction.

NICK XENOPHON: The tipping point for me was one client had a brain injury who broke down in my
office one day and told me he'd lost almost all of an emergency $30,000 superannuation payout, sort
of an interim payment.

MATTHEW CARNEY: Seeing the best opportunity yet for pokie reform, Xenophon flew straight to Hobart
to get on board.

ANDREW WILKIE: He and I gravitated towards each other almost instantly. You know, I had no staff, I
had no parliamentary experience. I didn't have an office in Parliament House. I didn't even have a
phone other than my personal one I was paying for calls. And he very, very quickly came to assist
me and in particular to give me advice.

MATTHEW CARNEY: For 12 days after election night Wilkie negotiated with both Gillard and Tony
Abbott.

Xenophon was advising behind the scenes and steered Wilkie towards the Productivity Commission
Report into Gambling of June 2010. The report had been buried as it was released the same day Kevin
Rudd was deposed as prime minister. It was time to revive it.

NICK XENOPHON: The strategy was that whatever Andrew asked for had to be on the basis of the
Productivity Commission's recommendations, because here was an independent report, well considered,
thoroughly researched, robustly reviewed, that came up with a number of key recommendations and two
of them were the $1 bets and also the whole issue of mandatory pre-commitment.

MATTHEW CARNEY: Wilkie was veering towards Gillard and she desperately wanted Wilkie's vote.

Wilkie held out until all his demands were met.

(Julia Gillard and Andrew Wilkie shaking hands and posing for photos)

JULIA GILLARD, PRIME MINISTER: How was your flight?

ANDREW WILKIE: Good.

JULIA GILLARD: Good. Okay.

(End of excerpt)

MATTHEW CARNEY: On the 2nd of September Gillard signed a deal with Wilkie.

ANDREW WILKIE: The Prime Minister has agreed that should she form the next government, the
Government will work to implement pre-commitment technologies on every poker machine in Australia
by 2014.

MATTHEW CARNEY: It outraged the pubs and clubs industry

ANTHONY BALL, EXECUTIVE DIRECTOR, CLUBS AUSTRALIA: It didn't have our input, it didn't have the
input of experts or anyone else. It was a deal done behind closed doors - the Prime Minister and
Andrew Wilkie - without the involvement of other people that had a legitimate stake in it.

NICK XENOPHON: This is the brutal world of politics. The only reason we've got gambling reform on
the agenda is not because people have become born again gambling reformers, it's because Andrew
Wilkie had a key vote and they had to listen to him.

ANDREW WILKIE: Oh there's no doubt none of this would be happening without me. It's not a case of
they wouldn't be so keen as that they wouldn't be doing it at all. It wasn't on the radar. No
senior politician in the Government or the Coalition would go anywhere near an issue like this with
a barge pole.

It's an absolutely minefield for one of the big political parties because it is just so hard. You
know the power and richness of the industry, the passion of the opposition in the community, it's a
very, very difficult issue for any government to address.

MATTHEW CARNEY: Julia Gillard was locked into Wilkie's deal.

If Gillard didn't make the reforms law by Budget 2012 Andrew Wilkie would pull the pin.

ANDREW WILKIE: This is one of the key issues upon which my support for the Government hinges and if
they don't progress the reforms, I will withdraw my support. I've never minced my words there and
nothing's changed. If it means the end of the Government so be it.

MATTHEW CARNEY: In Wilkie's Tasmanian electorate of Denison, poker machine addiction has great
traction.

DENISON RESIDENT (To Andrew Wilkie): They're all the same people every day that are looking for
that goldmine, getting sucked in and it's always the ones that can least afford to do it. It's the
same in all the pubs.

MATTHEW CARNEY: Wilkie's been campaigning hard on the issue for the last couple of years.

ANDREW WILKIE: The moment I opened my mouth publicly I became a lightning rod and I very quickly
was approached by many, many people who told me their stories - problem gamblers, their families,
friends, employers and so on and I very quickly realised the enormous tragedy of problem gambling,
particularly from poker machines.

And I very quickly became emotionally involved to the point where today I am emotionally involved
and that helps to explain why I'm so focused on the issue.

(To Steve Menadue) How've you been?

STEVE MENADUE: Good, good. Yeah still having to struggle each day but I'll get there...

MATTHEW CARNEY: Steve Menadue was one of the first to contact Wilkie. He considers pokie addiction
as destructive as heroin, perhaps even worse

STEVE MENADUE: I've been addicted to drugs most of my life as a choice. I'm in the tail end of that
but there's something about the way the poker machines are designed that it works on the human
system. It's... it's really dark. It's really purposeful.

MATTHEW CARNEY: Menadue lost his family and did jail time all because of his poker machine
addiction. He's still educating Wilkie about the power the pokies have over addicts.

STEVE MENADUE (To Andrew Wilkie): You rarely even know who problem gamblers are unless you happen
to see them every week at that same venue and you know them by sight, but apart from that you don't
have anything to do with each other.

ANDREW WILKIE: Yeah, yep.

STEVE MENADUE: You don't even have time to go up and get a drink from the bar because it'll chew
into your time on the machines.

ANDREW WILKIE: And someone might come on to the machine and win the jackpot you were about to win.

STEVE MENADUE: There's a lot of strange psychologies go on with it. There is.

ANDREW WILKIE: Yeah but it's not uncommon...

MATTHEW CARNEY: Menadue has continued to help Wilkie with his campaign since they first met but the
pain and sadness he's lived are never far away.

ANDREW WILKIE (To Steve Menadue): Do you want to go for a walk?

STEVE MENADUE: No, I'll be alright.

ANDREW WILKIE: But I hope you, I hope you never forget that you're now helping to turn it around.

STEVE MENADUE: I know. That's why it's so emotional. But I just, you know I think about those poor
little kids at home (crying). Dad has to come in and lie again. Oh what new lie can I tell her this
week?

Or he goes and gets someone to bash him up so it looks like he's been mugged or something. That's
the extent of the problem, Andrew. That's what's happening out there because there's... I'll get
myself together here.

ANDREW WILKIE: His life has been completely and utterly destroyed by poker machines but he still
has got the strength to come and talk with me and offer to help me because he sees the very rare
opportunity, the unprecedented opportunity right now to bring about some change. So Steve just
about more than anyone fires me up and gives me strength to keep going.

MATTHEW CARNEY: Australians per capita are the biggest gamblers in the world by a long way. They
pump a staggering $12 billion a year through the pokies. An estimated $5 billion of that is lost by
problem gamblers who often lose their jobs, homes and sometimes even their lives.

But are Wilkie's reforms the answer? His starting point in negotiations with the Government was
that every player must set a limit on the amount of money they gamble in a session - it's called
mandatory pre-commitment.

ANTHONY BALL: It will not help problem gamblers. It will be hugely expensive, it will jeopardise
the future of our clubs and it won't help problem gamblers.

MATTHEW CARNEY: When the powerful clubs and pubs sector learnt of Wilkie's proposed reforms they
hit back with a campaign of their own.

ACTOR 1 (Excerpt from A License to Punt advertisement): This license to play the pokies the Feds
are talking about, that's a bit of a worry.

MATTHEW CARNEY: The target audience was the punters in the marginal Labor seats of outer Sydney,
Brisbane and Melbourne.

ACTOR 2 (Excerpt from A License to Punt advertisement): Oh no way. A license to have a punt? It's
un-Australian.

MATTHEW CARNEY: They wanted the Government to feel the backlash.

(Excerpt from A License to Punt advertisement)

ACTOR 1: Gillard would be crazy to back that wouldn't she?

ACTOR 2: Never happen... will it?

(End of excerpt)

ANTHONY BALL: Really we're left with no choice but to talk about this publicly and to run our
campaign. And clubs don't need urging from me or any other industry leader. They're mad as hell
about this.

MATTHEW CARNEY: Early last month Wilkie arrived in Canberra to table his reforms and face the press

ANDREW WILKIE (To assistant): Pip and I will need to finalise the media release straight away but
it's pretty well right to go.

MATTHEW CARNEY: He'd been travelling around the country as the chairperson of the Parliamentary
Committee on Gambling Reform.

ANDREW WILKIE (To assistant): Well did you hear him, the driver of the car this morning when he
dropped me off?

ASSISTANT: Yeah.

ANDREW WILKIE: And he just said quietly, he said in my ear, you know - like your work or
something...

ASSISTANT: Basically, "I'm a supporter". I'm a supporter, that's what he said.

MATTHEW CARNEY: Gathering evidence to see his proposed reforms become a reality.

ANDREW WILKIE (To assistant): Can I have some quiet time to start getting my speaking points
together?

ASSISTANT: No problems with me.

ANDREW WILKIE: I'm certainly the only thing standing between the poker machine industry and the $5
billion they harvest from problem gamblers. I don't have the option to fail or step aside. In many
ways, you know, this will define me. I'm happy with that, I'm confident I'm already winning. I'm
confident I'm going to win.

MATTHEW CARNEY: The Member for Denison was about to give the pokie industry a billion dollar
headache - the creation of two classes of poker machines, high intensity and low intensity.

If you play a high intensity machine you'll have to pre-commit with additional conditions.

ANDREW WILKIE (Excerpt from press conference): That lock-out, as I've described, prevent gamblers
from losing any more money once their limit is reached. That there be appropriate safe-guards to
prevent gamblers from just moving onto the machine next door or the venue next door or the venue up
the street or in the next suburb or wherever.

MATTHEW CARNEY: Play a low intensity machine and there's no pre-commitment but you'll have to
gamble a lot less.

ANDREW WILKIE (Excerpt from press conference): The design features of those machines will have been
adjusted to limit their losses to an average of $120 an hour compared with the $1,200 an hour
average loss on the high intensity machines they might have been playing in the past.

MATTHEW CARNEY: The trouble is there are no low-intensity machines in Australia. At least a hundred
thousand pokies will have to be converted.

Attempts to undermine his position began immediately and came from within.

STEVE CIOBO, LIBERAL MP (Excerpt from press conference): Well thanks for coming out this afternoon.
I wanted to make some remarks.

MATTHEW CARNEY: Committee member and Liberal, Steve Ciobo sat in Wilkie's still warm chair and
released a dissenting report.

STEVE CIOBO (Excerpt from press conference): Our concern with this report was that this is a report
that smacks of being a political fix rather than a policy fix. This report does a great injustice
to problem gamblers across Australia.

MATTHEW CARNEY: Queensland's Gold Coast is home to some of the biggest clubs and casinos in
Australia and most of them sit within Steve Ciobo's electorate.

Just up the road from his office is one of the smallest - the Mermaid Beach Surf Club, Steve
Ciobo's local watering hole.

RON PLASS, PRESIDENT, MERMAID BEACH SURF CLUB (To Steve Ciobo): This legislation will not stop
anyone gambling.

STEVE CIOBO: The only ones that will stop gambling are of course the people who don't have a
problem, who think I'm not going to put up with all that rubbish and they'll go and do something
else.

MATTHEW CARNEY: Ron Plass is the president and he's more than willing to share his concerns with
his local member.

RON PLASS (To Steve Ciobo): It's a nonsense. It's a system that can't work, won't work and all I
can see is negatives. Bureaucracy has already gone mad, this is just making it worse.

MATTHEW CARNEY: Ross Plass argues the smaller clubs like his with their tight budgets and small
margins will be hit hardest and he's going to lose either way with Wilkie's hybrid system.

(To Ron Plass) So tell me what you've got here.

RON PLASS: We've got 24 machines. Each one costs about $20,000.

MATTHEW CARNEY: If Plass wants to opt out of the scheme he'll have to replace or refit all the
clubs' machines with low intensity ones that only bet a dollar or less a spin.

Plass says the club can't afford to do this.

RON PLASS: We'll need to replace our machines at a cost of $20,000 a machine, that's nearly half a
million dollars.

MATTHEW CARNEY: If he wants his high intensity machines to stay then the club will have to pay for
a card based pre-commitment system.

But Plass believes the bigger problem for the club's revenue is that most of gamblers, the casual
punters, will walk away.

RON PLASS: The people that will be impacted are the 98 per cent of the general public that are
doing nothing wrong. They just come and have a bit of fun.

They won't come here anymore because they won't be able to gamble or they won't want to because
it's just too hard to go through the bureaucratic process to get the card to comply with the 100
points of ID if that's what's required. I wouldn't do it so why would anybody else?

MATTHEW CARNEY: The punters here don't want to be told by Mr. Wilkie nor the Government how to
play.

POKIE PLAYER 1: No I don't think it is a good idea to restrict everybody.

POKIE PLAYER 2: I mean we know our limitation.

POKIE PLAYER 1: And we stick to them.

POKIE PLAYER 2: You know, and why penalise us for some people that can't?

POKIE PLAYER 3: That's just infringement of your basic rights isn't it?

MATTHEW CARNEY: If the system is implemented Plass says 20 per cent of the clubs takings will be
threatened.

That means the cheap beers and meals the community enjoys could go up in price. But what really
worries Plass is the effect it will have on the surf living club.

RON PLASS: Well all of a sudden the rescue boat we would like to replace every two years that might
have to stretch out to three or four years so then what we are doing is we're compromising our
members' safety because they might be in equipment that should be replaced but effectively can't be
replaced because we just don't have the money, we're not earning the same dollars that we would
have in the past.

MATTHEW CARNEY (To Steve Jones): That's Burleigh down there right?

STEVE JONES, LIFESAVER: Yeah, that's Burleigh right there down that first slump.

MATTHEW CARNEY: The club gives about $120,000 a year to the surf lifesavers.

It provides the vehicles and the equipment needed to patrol Mermaid Beach.

STEVE JONES: As you can see it's pretty picturesque sort of site, it's a very, very dangerous
stretch of beach. We've got it under constant surveillance all the time.

MATTHEW CARNEY: Steve Jones, who's been a lifesaver for 30 years, says if the money goes so too the
service they provide.

STEVE JONES: The club itself get all our boards, our rescue tubes, resuscitation equipment,
defibrillators first aid equipment, in-house training, patrol gear, all that sort of stuff is all
supplied by the club.

STEVE CIOBO: The reality is that these reforms are going to do nothing for problem gamblers.
They're going to cost a lot of jobs.

They're going to drive away a lot of investment and we're going to be left with a situation where I
think in a number of years people will be looking at how the pubs and clubs sector has closed down.
Problem gambling rates will still be as prevalent as they are today and people will be wondering
why it's happened.

NICK XENOPHON: In terms of turning machines into low intensity machines, that is effectively a
software change. That is a question of a technician spending a few minutes on each machine to
adjust them.

The Independent Gambling Authority of South Australia in their submission to the inquiry, their
evidence made it clear that you can retrofit machines without having to have a network solution
system where machines have to talk to a central, a central system.

We have a bolt-on solution for about $1,000. I mean the industry has come up with some hysterical
and misleading figures in terms of what this would cost.

ANDREW WILKIE: Well I reckon there was a few ups and downs today but I reckon on balance...

MATTHEW CARNEY: Back in Canberra, Wilkie's heading home, fully aware of the public debate he's
unleashed.

ANDREW WILKIE (Reading a letter): Well done on pursing the pokies issue, exclamation mark. I have
an adult son with a serious gambling problem. It goes on about ATMs. It's good.

What this one here? No that's not a nice one (laughs). Someone has just heard my dribble on 2GB.

ASSISTANT: Dribble? (Laughs)

ANDREW WILKIE: Yeah. Incensed. Get out of our lives you lying hypocrite. That's a bit harsh.
Serious question, have you had a recent psychological evaluation? Okay, well everyone is entitled
to their view.

MATTHEW CARNEY: But it's the clubs and pubs that are uppermost in his mind

ANDREW WILKIE: Even though I reckon we have had a really good day, hard day, good day though, I do
caution myself that the industry is very rich and very loud and very unhappy and who knows what
they are going to come at us with next.

MATTHEW CARNEY: In an outer suburb of Brisbane, bowlers are enjoying a sunny winter day at the Pine
Rivers Memorial Bowls club.

They take their sport seriously. The club has just finished a $6 million renovation which provided
the covers for the greens and revamped the bars and grill inside.

Pine Rivers is a big club with 11,000 members. It prides itself on being part of the community and
the support it gives to local sports teams and charities.

BOB EBBORN, PRESIDENT, PINE RIVERS CLUB (In meeting): It's too hard, too hard, this scenario was
never on the horizon...

MATTHEW CARNEY: Club president Bob Ebborn and CEO Wayne Moffatt have called a meeting with
Queensland Clubs to discuss the impacts of the reform and they're deeply worried.

WAYNE MOFFATT, CEO, CLUB PINE RIVERS (In meeting): We met with our banker this morning inviting him
to come to our strategic planning and all he wanted to do was talk about what impact was this going
to have on us. I mean his hands will be in his pockets.

He's nervous and that's just shaking the confidence. We can't go into our planning. There's no way
we can do any of our planning for the next three or four or five years. You can't do it.

MATTHEW CARNEY: The club is heavily dependent on revenue generated from its 150 poker machines.
They provide 60 per cent of Pine Rivers' earnings. If the gambling reforms become law they believe
the club as they know it will be finished.

WAYNE MOFFATT: We would not be here. We wouldn't be here. If the recommendations come in as stated
and if the impact as stated occurs, then good night Pine Rivers Bowls Club.

BOB EBBORN (In meeting): If we had a reduction of 40 per cent in our income here, the community
would certainly suffer and we wouldn't be able to do...

MATTHEW CARNEY: The industry says it stands to lose 20,000 jobs across Australia. If Pine Rivers
goes down and staff are laid off Moffatt knows the impacts for the local community will be dire.

WAYNE MOFFATT: There'd be 90 families out of work and the multiplier effect of that is I don't know
how many, the impact of 90 families local, they're all they're all community local people losing
their jobs, being out of work, suppliers. We, our suppliers about $3 million a year and again
everything we try to do everything as local as we can, the impact there would be incredible.

NICK XENOPHON: There will be more jobs created in net terms as a result of these reforms because
more money will be spent in your local newsagent, your butcher, the retailer.

MATTHEW CARNEY: Pine Rivers says they don't need the reforms. They've had their own version of
pre-commitment in place for about 18 months.

It's called Simplay - a cashless card-based system. It's a voluntary, not mandatory scheme. The
punter decides if they want to join.

To set up the card you just need your name, address and date of birth.

SIMPLAY ASSISTANT (To Matthew Carney): Now we'd like to set up a PIN number for you so only you can
access your card.

MATTHEW CARNEY: Sure.

SIMPLAY ASSISTANT: So set up pin. It's a four number pin, enter that in, press OK. You'll have to
enter that a second time press and press OK.

MATTHEW CARNEY: Okay.

SIMPLAY ASSISTANT: Okay.

MATTHEW CARNEY: If they want, casual punters or problem gamblers can cap spending with a daily
limit. If they hit it, they're locked out for 24 hours.

(To Simplay assistant) What do what do people normally put on? What's their normal...?

SIMPLAY ASSISTANT: They usually put on maybe $200 for a daily spend limit.

MATTHEW CARNEY: But at the machine there is no visual record or cue of how much the player is
losing.

(To Simplay assistant) So, with the card what do we do?

SIMPLAY ASSISTANT: So we pop the card in.

MATTHEW CARNEY: Is there any record on this that shows you how much you're spending as you go or
not?

SSIMPLAY ASSISTANT: No, no. It would just be the credits and how much you're winning.

MATTHEW CARNEY: So far the take up hasn't been great. Only about 130 people have signed on to
Simplay. Critically only 17 have put limits on themselves.

The system is not really designed to deal with problem gamblers. It's targeted for the recreational
punter, to make playing the pokies easier.

(To pokie player) It's just about convenience. I mean it's easier...

POKIE PLAYER 4: Basically, yes. It's time saving. Well you're I mean you're not over, I'm not lined
up over there to get change. I can just push here. If they're busy over there you can stand over
there for five, 10 minutes or something. Whereas they're getting more money by you being able to
just push a button aren't they?

MATTHEW CARNEY: A lot easier to gamble?

POKIE PLAYER 4: Yeah, well it is I think so.

MATTHEW CARNEY: Because you don't have to go up and get the money, come back.

POKIE PLAYER 4: Yeah and you don't have to sit around waiting for someone to come and pay you. So I
can't see that it'd be an advantage for sort of compulsive gamblers anyway.

MATTHEW CARNEY: Because it makes it easier for them to gamble.

POKIE PLAYER 4: Yeah a lot easier I think.

MATTHEW CARNEY: The biggest problem with voluntary set ups like Simplay is that an addict can just
dump their card and start pumping cash into the machine or venue hop - go to the next pub or club
and continue gambling.

This is one of the major reasons the Productivity Commission and committee headed by Andrew Wilkie
found that pre-commitment had to be mandatory.

Wilkie say the costs of implementing it and the potential revenue loss will not bankrupt the
industry.

ANDREW WILKIE: Now $3 billion is an enormous amount of money. I acknowledge that but you know it's
only a bit over half of the amount of money lost by problem gamblers in a single year. You know
that's the sort of order of magnitude we're talking.

So in that context even those upper estimates are bearable, they're doable.

MATTHEW CARNEY: But will mandatory pre-commitment help poker machine addicts. Nigel Hankins knows
the system would not have helped him when he was in the darkest depths of addiction.

NIGEL HANKINS: It's the colours and the sounds. They, they just trap you and they just take you in
and "the zone" is such the best way to describe it, because you don't have peripheral vision,
you're just straight into looking at those three lines, five across.

That's all you see and they just get into your head. I wasn't existing. I had no meaning. I had no
purpose. I was just totally consumed by the pokies.

MATTHEW CARNEY: Hankins pumped half a million dollars into the pokies. All his wages went in and
then he started to steal to feed his addiction.

Yet under mandatory pre-commitment all player including addicts can set their own limits.

(To Nigel Hankins) The people that are driving this are basing this on the fact that they say that
addicts will be rational enough to set their own limits.

NIGEL HANKINS: I can't see that happening because you don't have rational thinking. That's one
thing that part of my therapy taught me was the rational thinking. You never, I never had it and it
was something so simple that I had just lost the knowledge of doing. The rational thinking, it
just, you don't have any of it anymore.

MATTHEW CARNEY: So you didn't have moments of clarity where you thought, my God I shouldn't be
doing this?

NIGEL HANKINS: Not at all, no. I was, it was just the pokies were my life. There was no thoughts of
anything else other than the pokies.

MATTHEW CARNEY: So you believe that would've- wouldn't have had any capacity to manage it yourself?

NIGEL HANKINS: No. I can't- I don't think I would've, no. Definitely not. But I can see where
they're coming from with that though and then you look at it from the other aspect that what it is,
in essence what it's going to do is it's going to stop people becoming problem gamblers.

MATTHEW CARNEY: And that's what the experts say. Mandatory pre-commitment might stop the slide into
addiction and help those not so hopelessly addicted.

DR CHARLES LIVINGSTONE, MONASH UNIVERSITY: The real issue about this is the detail of how it's
going to work. If you can change your limit, you know at the club, on the night that you're
gambling, well it's not going to be very effective.

But if you can only change it, you know once a fortnight, preferably away from the club environment
when the machines are tinkling in the background then it's going to be more effective.

It's not going to solve all the problem. I mean no one thinks pre-commitment's going to solve all
the problems of problem gambling but it's going to give people a very effective tool to enable them
to manage that problem much more effectively than is the case now.

MATTHEW CARNEY: But other experts can't see the value.

PROFESSOR ALEX BLASZCZYNSKI, SYDNEY UNIVERSITY: The difficulty basically is that I don't believe
that pre-commitment is going to have its desired effects

I think there may in fact be an unintended consequence where gamblers set higher limits and then
will gamble more amounts of money to meet those particular limits and that's a detrimental effect
and may aggravate the problem for a proportion of gamblers.

Secondly, I think the cost benefit needs to be re-analysed. I think the cost of implementing the
system is not going to be worth the benefit it does achieve and much of that money could in fact be
spent on more effective responsible gambling measures.

ANDREW WILKIE: Some people will set unrealistic limits and this system will not protect them. But
short of removing poker machines, which I'm not advocating, we can't protect everyone for sure.

The aim is to come with a system that's based on credible research, which will protect the
overwhelming majority of gamblers and the research shows this will protect the overwhelming
majority of gamblers.

MATTHEW CARNEY: What helped Nigel Hankins on his journey out of addiction was counselling. He's now
training to be counsellor himself and he thinks this is where reform efforts should be directed,
not mandatory pre-commitment.

NIGEL HANKINS: The best way to treat it is the counselling is so valuable. That just helped- will
help so much, and a lot of people that I've spoken to who do have problems with gambling, you can't
just stop. You need that help. You need therapists to be able to give you the guidance that you
need.

MATTHEW CARNEY: The Productivity Commission report says there's strong evidence for mandatory
pre-commitment but to be conclusive it states a, "full scale regional trial or trials" have to be
done before the system is implemented in 2016.

In the Parliamentary Committee Wilkie headed, that timeline has been squeezed to 2014 and the
inquiry states a trial should not "delay the timeframe for implementation." This means a trial and
the proper evaluation it brings does not have to be completed.

STEVE CIOBO: This entire reform as it's called is all about politics overriding good policy. This
is a reform that's coming about because Andrew Wilkie's demanded it. The Labor Party's capitulated
on it. The evidence is clear. It's not going to work.

ANDREW WILKIE: The Federal Government is continuing negotiations in some jurisdictions I
understand, and I'm hopeful that there will be a trial.

I think it would be good to fine tune particularly the, you know, the technical aspects of what
we're trying to do here. As far as the timeline, when the Productivity Commission came up with the
figure of 2016, I bet there was no way in the world they thought that this issue would become so
turbocharged and that we might be able to progress it sooner.

I've asked the Productivity Commission do they believe 2014 is achievable and they've said yes.

ANTHONY BALL: He wants this to come in by 2012 fully rolled out by 2014 with the so called
exemption for our smallest clubs to 2018.

Now I just don't think that is possible. First of all the technology's not there. It's not just on
the shelf. Where are the army of technicians that are going to install this across 200,000 poker
machines across ah 6,000 venues? It's unrealistic and it can't be delivered.

MATTHEW CARNEY: It's the mega clubs that are in the firing line and Mounties in Sydney's South West
is one of the biggest.

Caroline Lumley is the club's marketing and communications manager.

CAROLINE LUMLEY, MANAGER, MOUNTIES CLUB: So we've got 561 poker machines here at Mounties. The club
is busy seven days a week as you might imagine. There is no real scope to the playing patterns
here, we just know that we've got a lot of members that do like to play poker machines, they also
like to play Kino.

MATTHEW CARNEY: These businesses are huge. More like Las Vegas casinos than suburban social clubs.

CAROLINE LUMLEY: So the health and well being of our members is paramount here at Mounties. We've
got 39 different sub-clubs ranging from soccer, yucca, gardening, tennis whatever you'd like and of
course the gymnasium with facilities that suit every age and every demographic.

We've got learn to swim over here, we've got squad swimming over there.

MATTHEW CARNEY: Pokies are the core business here. Seventy-five per cent of their revenue comes
from the machines, making the club $65 million last year.

ANTHONY BALL (Handing out T-shirts): What size are you mate? Good stuff mate, put it on, wear it
around.

MATTHEW CARNEY: They can't survive without the pokies so they're ramping up the campaign against
the reforms. Anthony Ball, executive director of Clubs Australia is on hand to help.

ANTHONY BALL: The campaign's been going for about two months now. The job now is to get all of our
clubs covered in "it's un-Australian" posters and coasters, get members to sign the petition -
there's one on the back of each beer coaster - and really raise awareness of this issue amongst
club members, club staff, the people that clubs support.

I mean ultimately we will spend as much as we need to to have this issue addressed. Remember, we
had no say in this policy.

CAROLINE LUMLEY (To bar staff): So today gentlemen, our goal is to get these out into as many high
profile places in the club as possible, into all of the bar areas...

MATTHEW CARNEY: Clubs like this have real political power and they're going to flex it.

CAROLINE LUMLEY (To bar staff): They are in fact petitions and I intend to dump at least you know,
a thousand of these on every doorstep of every federal member we have so let's get them out...

MATTHEW CARNEY: The membership base here is the size of some electorates.

CAROLINE LUMLEY: We're going to fight this tremendously hard. I've got 105,000 members with a
voice.

If the Prime Minister thinks that she needs to listen to one independent that got voted in by
14,000 people then she needs to realise as I say there's 105,000 here at Mounties alone that have a
voice that will tell her differently.

ANDREW WILKIE: If you're a venue that has that 88 per cent of Australians who gamble a dollar or
less and you opt to have low intensity machines you'll experience no change in your revenue.

But I tell you what, I'll add to that, there are some clubs out there that have enormous numbers of
problem gamblers. There is no there is no doubt about that.

The Productivity Commission finds or found that 40 per cent of the money through the poker machines
comes from problem gamblers; that 15 per cent of people who gamble weekly are problem gamblers.
They're out there somewhere.

MATTHEW CARNEY: The clubs and pubs have some very powerful allies - the state governments.

They too are addicted to the revenue from the pokies, earning about $5 billion a year in poker
machine tax.

Last month, the first big showdown between the states and the Federal Government took place in
Canberra. If the states didn't agree to mandatory pre-commitment the Federal Government would
enforce it with legislation.

New South Wales - the state with half the country's poker machines and the most to lose - was not
buying it.

GEORGE SOURIS, MINISTER FOR TOURISM, RACING & ARTS, NSW: Now this will be a battle of states'
rights, this will be a battle about the Gillard deal with Wilkie. This will be a political event
and I'm afraid ah the focus will shift from problem gamblers, where it ought to be, to the
political battle. And I don't know that anybody is served by that.

MATTHEW CARNEY: Victoria too wanted the Federal Government to back off. They're already going to
implement voluntary pre-commitment state-wide by 2015 and ban ATMs from venues.

MICHAEL O'BRIEN, MINISTER FOR GAMING, VICTORIA: In many ways the Victorian position is far stronger
in terms of taking action on problem gambling than the federal political fix that the Gillard
Government's put in place with Mr Wilkie.

And so we will be maintaining the integrity of our policy position. It was thought through, it's
holistic, it's got a democratic mandate, none of which you can say about the Gillard-Wilkie deal.

MATTHEW CARNEY: Jenny Macklin, the Federal Minister for Community Services, came looking for
consensus but she wasn't going to find any on the issue of mandatory pre-commitment.

At the meeting the states positions hardened. They all wanted more research and a proper trial to
be done.

GEORGE SOURIS (Outside COAG meeting): The Commonwealth is not pursuing this as a result of
significant research or trial or science. These things need to be done if we need to take these
issues seriously."

MICHAEL O'BRIEN (Outside COAG meeting): I think there's a broad view amongst the states and
territories that pre-commitment is a very useful technology for tackling problem gambling but the
federal proposal just won't work. It's not evidence based.

MATTHEW CARNEY: Later Minister Macklin announced they'd be pushing ahead. Legislation would be
drafted to force the states to implement the Wilkie deal.

JENNY MACKLIN, FEDERAL MINISTER FOR COMMUNITY SERVICES: If we can't conduct a trial because we
can't get anybody to agree to conduct it, then we think it's our responsibility to introduce a
system of pre-commitment that will actually work to help problem gamblers.

MATTHEW CARNEY: But some people would see that as not being good policy. You're not testing what
you're implementing.

JENNY MACKLIN: We also have to be practical.

MATTHEW CARNEY: So what you're saying, the practicality is we're going to implement a system that
hasn't been tested properly?

JENNY MACKLIN: Well we have done a lot of trials on voluntary pre-commitment. As I've just
indicated to you what they show is that pre-commitment technology itself is useful.

MATTHEW CARNEY: Everyone was smiling for the cameras but the stage is set for a bigger battle.
Victoria and New South Wales say they'll fight the legislation all the way to the High Court if
it's passed.

This could grind the whole reform process to a halt and possible kill the Wilkie-Gillard deal.

It's a measure of Andrew Wilkie's power that he meets with the Prime Minister every Tuesday when
Parliament sits.

With the stakes rising, Wilkie is still holding firm to his beliefs and the Prime Minister to the
deal that's keeping her in power.

STEVE CIOBO: I think Julia Gillard and the Labor Party will be looking for whatever excuse they can
to delay, to be able to put her hand on her heart and say to Andrew Wilkie, look mate I really
tried but unfortunately I couldn't make it happen.

Something that gives Andrew Wilkie enough opportunity to save face and say, well I tried but by the
same token not enough to walk away from the Labor Party.

ANDREW WILKIE: This is everything for me and I'm not going to waver and I'm going to see these
reforms through. They are going to come into existence.

People will be helped but if for any reason the wheels fall off and these reforms are not realised,
so long as I know I've given it my very, very best shot, then I'll be able to live with myself
afterwards.

KERRY O'BRIEN: Yet another front on which the Gillard Government has a distracting fight on its
hands and a very stubborn man it can't afford to disappoint.