Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

I rise to speak to the first report of the Joint Select Committee on Gambling Reform handed down recently that goes to and is entitled The design and implementation of a mandatory pre-commitment system for electronic gambling machines across Australia. It is no secret that I have very real and genuine concerns about the ineffectiveness of this report in addressing what, it was suggested, was the core focus of the committee—that is, to assist problem gamblers. Broader than that, I am concerned that the recommendations put forward by the majority of the committee, which did not include coalition members, will harm the industry significantly. We end up in a situation where, as a consequence of the committee's recommendations, Labor Party policy and the grubby deal that was done between Julia Gillard and the Independent member for Denison to form government, we are now faced with the situation where the likely policy outcome will be the implementation of laws that will see nothing happening with respect to assisting problem gamblers but will have a truly detrimental effect on the pubs and clubs sector across Australia. Why is this so, and how can I be certain: because of the valid concerns raised by members of the public and others with respect to the findings of the report.

In summary, it is relatively straightforward. We know as a matter of history that the Labor Party is only motivated to do something in this space as a consequence of the Prime Minister's deal with the Independent member for Denison. We know as a matter of history that poker machine reform was not a burning ambition of the Prime Minister, the Treasurer or cabinet. It was not something that was on the radar for this government until such time as it was demanded by the Independent member for Denison that there be reform in this space, namely, through the implementation of a mandatory precommitment system, that Labor suddenly said, 'Yes, we believe in it too.'

In fact the most concerning aspect of this is that it is now Labor Party policy to implement mandatory precommitment, which is what is driving this agenda. The reality is that if it were not Labor Party policy, if it were only the Independent member for Denison that wanted mandatory precommitment, then this would not happen. The reason why it will happen is that Labor has signed up to this holus-bolus. It is now Labor Party policy to have mandatory precommitment.

What concerned me was that for those of us who were appointed to the joint select committee, it was not a case of being charged with exploring mandatory precommitment; it was not a case of having an inquiry into whether mandatory precommitment would work; rather the answer was already given: there would be mandatory precommitment and the committee's task was simply to look at the way in which that should happen. We already knew before we started that the Labor Party and the Independent member for Denison, as well as of course Senator Xenophon, were all committed to making mandatory precommitment happen.

On the face of it, if you did not bother to look into the issue very much, you would think it seemed like a reasonably good idea. After all, I have seen Labor member after Labor member, as well as the Independent member for Denison, stand up, hand on heart, palms wringing, saying, 'This is about the 95,000 problem gamblers in Australia.' I have heard Labor member after Labor member, the Independent member for Denison and others engage in rhetoric about how policy changes need to be effected to do something for problem gamblers. As if anyone who is critical of the recommendations or the findings of the committee was in some way not motivated to assist problem gamblers.

We saw it just recently in the previous exchange between the member for Kingston and me where there is this disgraceful moral superiority that comes from those who back the recommendations of this report implying that in some way I and other members of the coalition who knock back and reject the recommendations are not concerned about problem gambling. It is disgraceful that members opposite would moralise on this issue, would claim a monopoly on assisting problem gamblers, when in reality they do not know the first thing about the impact of these recommendations on problem gamblers. That is the great disgrace, because the single most hard-done-by group as a result of these recommendations will in fact be problem gamblers. I will go into great detail to explain why because I understand this topic implicitly as well as on the basis of the evidence that has been supplied.

I think it is time that Labor members, the member for Denison and Senator Xenophon, were held to account to back up their rhetoric when it comes to this report, because I know they will fail. The reason they will fail is that there are several fundamental flaws with this particular report and the recommendations of the majority of the report which cannot be overcome because they are illogical. The fundamental thrust from the member for Denison, from Labor members and indeed from the Independent senator, Senator Xenophon, was that mandatory precommitment would assist Australia's problem gamblers because of the fact that they would be required to precommit to a certain level of losses. On first principles, that sounds rational. On first principles, you would have to ask: who could disagree with that? If someone has a gambling problem, wouldn't logic suggest the very best thing you could do is make them commit to a certain level of losses and then be shut out of the system? It just seems like common sense. But what is clear from the evidence is that problem gamblers have a pathological problem. By definition, that is why they are called problem gamblers. By definition, someone who is a problem gambler—someone who is potentially losing their home, someone who is potentially losing their job, someone who is potentially engaging in criminal activity, someone who is potentially hurting the loved ones around them as a result of their gambling addiction—is not logical, is not rational.

That is the very reason why, when you say to a problem gambler who is already potentially losing their home, losing their loved ones and putting their life on the line and who is potentially suicidal as a direct consequence of their gambling habit, 'Look, you are responsible for setting your own gambling limit. We think you'll be able to handle that,' it is doomed to fail from the outset. Problem gamblers—and we know this from international examples—will set a limit that is exceptionally high, well above what they can afford. As a consequence, this piece of technology which the Labor Party and the member for Denison like to hold out as the silver bullet solution will in fact fail miserably. Someone with a pathological gambling addiction will not sit there and think to themselves, 'You know, I can only afford to lose $50 this week, so I'm going to set my limit at $50.' No, they are bound in a spiral of irrationality that will see them set a limit of $1,000 or $10,000. Who knows what the limit will be? But I guarantee you one thing, Madam Deputy Speaker: it will not be a rational limit, because this is a person who is battling an addiction, who is already losing their home and their family, who is having an impact on loved ones and who is potentially suicidal. Yet apparently they are meant to have this moment of clarity where they will say, 'I can only afford $50 this week. That will be my limit.'

The reality is that problem gamblers have a pathological problem and they need medical intervention. They need support and assistance to make them realise that they cannot handle gambling and that they should not be gambling, full stop. That is what is required, because the only people who will stand by a rational limit are rational people who do not have a gambling addiction. We know from the psychological evidence that was given to the committee that problem gamblers chase their losses. They are of the view that if only they were given one more shot, if only they had one more big wager, they would be able to win back that which they have already lost. That is the psychology and that is exactly what drives them to set unrealistic loss limits on their cards. That is why this technology simply will not work. The people who will set rational loss limits on their cards are recreational gamblers—the 4.8 million gamblers out of the five million poker machine players. They will set reasonable limits. I welcome the member for Denison, who has just come into the Committee. These are the people who will set rational loss limits on their cards. These are the people who will recognise that it is having an impact on their lives.

In addition to that, from the outset I have made it clear that without the integrity of a national database this system is doomed to fail. I was met with cries of protest from the member for Denison and from Labor members, who said I was scaremongering. They said I was scaremongering to suggest that there had to be biometric identifiers and that there needed to be a national database. This is where it all just conveniently slips through the net in the majority report of this committee, because they like to conveniently disregard the need for a national database. I have heard the member for Denison say this on numerous occasions: 'People don't have to worry because the information will be kept on the card.' Without a national database, there is nothing at all to prevent a problem gambler from going into—I will use a local example from my electorate—the Southport Surf Lifesaving Club, getting a card from the club after supplying their 100 points of ID, or whatever the regime may be for identity verification, setting their limit at $500 or whatever, expending that limit and then thinking: 'I've got to chase that loss. I'm going to go to the club down the road.' So they jump in their car and drive down to the Broadbeach Bowls Club. They go in there and say: 'I'd like to sign up for a card here. I want to play the pokies.' Without a national database there is no way that that bowls club can know what the surf lifesaving club has on their system. Without one, that person could have a card from every pub and club that they wanted. There must be a way to verify that this person is not using multiple cards in multiple venues. The only way to do that is to have a national database. Even the preferred, short-term political fix solution that the member for Denison and Labor members have proposed, which is that it be state based jurisdiction, does not overcome the problem that in tourism towns like the Gold Coast, for example, where we have a border right through the guts of it, people can swap across from jurisdiction to jurisdiction. There must be a national database. It is an absolute requirement for this to work. Otherwise, the person can have all of their particulars on their smart card from the Southport Surf Life Saving Club—the assurance that the member for Denison and Labor members like to claim—but that does not mean anything if they get another card from another venue when they provide their ID and the venues do not know about each other. I have never heard members opposite address that, and I would dearly love to hear members opposite address that very issue. I invite members opposite to please tell me how you can get system integrity without having a central database. They know what I know, which is that you cannot.

In addition to that, let us talk about the recreational gamblers. Let us talk about the 4.8 million Australians who play the poker machines once a month or once every three or four months. This is the person who goes to the Southport Surf Life Saving Club, provides their 100 points of ID, gets their card, plays their 50 bucks on the poker machines, walks away and does not think about it for three months. Three months later when they turn up to some other club or even the same club and say, 'I would like to play the pokies,' the club will say, 'Where is your card from three months ago? You are on the system as having a card already. We need to see your card.' If the person says, 'I'm sorry. I haven't played the pokies for three months. Can you issue me with another one?' isn't that situation going to present some challenges? Do they just issue you with another card? You would assume not because how would you know that the problem gambler who just had a massive loss the day before is not also turning up and saying, 'I'm sorry. I lost my card. Can I get another one?' Therefore, you would have to assume that there are some systems in place for the person who only had a punt three months ago, has not thought about it again since, does not have a card on them and wants another one. Again, I would love to hear from members opposite their solution to this, because I have never heard it. The devil is in the detail when it comes to this, and they have been scant on detail every step of the way.

The single most offensive aspect of this—and it is offensive—that I have heard from members opposite with respect to the 70,000 people whose livelihoods rely on this industry and the 4.8 million recreational punters who do not have a gambling problem is the explanation that the reason the pubs and clubs are concerned is because there is going to be a massive deterioration in problem gambling revenue. The member for Denison and Labor members say that if you cannot survive as a club with deterioration in problem-gambling revenue then you have a failed business model. I have heard this time and time again. Indeed, the report itself deals with it. That is disingenuous, because their concerns are not about the revenue from problem gamblers. Their concerns revolve around the fact that the people who are going to be put off playing the poker machines are the 4.8 million recreational gamblers who do not have a problem. That is where the loss of revenue is going to come from—people who are not going to provide 100 points of ID in order to get a card, people who are not going to put up with a great big new federal bureaucracy in order to have a $30 or $40 punt on the poker machines.

Time does not allow me to get into the issue of low-intensity machines. But low-intensity machines were not a central part of the committee's focus. They were a quick political fix that came in during the last several weeks. They deserve to be a core part of the focus of the inquiry of the committee. For reasons I will go into in another forum, they are also not the solution.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

We are here today to comment on the report that was tabled in parliament this week by the Parliamentary Joint Select Committee on Gambling Reform, entitled The design and implementation of a mandatory pre-commitment system for electronic gambling machines. The reason that this committee has conducted the inquiry is that we have a problem. We have a problem with pokies addiction, and it is real. It is a public health issue, it is a family issue, it is a workplace issue and it is an economic issue. It will not go away as a result of the hysterical speeches of those who sit in the chamber opposite me. It will go away because members in this place have the courage to do something about it.

The reason we have an obligation to do something about it is that governments license the existence of gaming machines. We derive revenue from them. Therefore, we have an obligation to ensure that they are operating safely and in line with community values. I can tell the members opposite and everybody else that the community simply does not accept the proposition that any business, organisation or government should profit from the misery of others. Our objective in bringing these reforms forward is to ensure that we are able to properly regulate this form of gambling which is proven to have an addictive and damaging effect on so many Australians.

Throughout the 1990s there was a liberalisation of poker machines throughout Australia. It led to what the Productivity Commission has recently described as the maturation of the industry. In common speak, that has led to a growth in the number of machines in clubs, pubs and many other venues around the country. So we have the situation today where there are close to 200,000 electronic gaming machines in this country, and nearly half of them are in my state of New South Wales.

As I have already mentioned, we have an obligation to do something about this because governments derive a source of revenue from gaming and poker machine revenue. States derive about $5 billion per annum from gambling—about 10 per cent of state revenue—and a significant proportion of that comes from electronic gaming machines. The total gaming revenue in the economy as a whole was $19 billion in 2008-09, which is about $1,500 per adult.

As members opposite have indicated, Australians do not mind having a punt. I do not mind having a punt myself. I am amongst the estimated 600,000 people who play poker machines. Unfortunately, about 115,000 people have a problem with gambling. While these 115,000 people make up only about 15 per cent of the total gambling population, they contribute somewhere between 26 per cent or 40 per cent of gaming revenue. So we have a problem, particularly when you consider that hotels derive about one-third of their revenue, clubs about 60 per cent of their revenue and casinos about 78 per cent of their revenue from these machines. We have a problem and we have to deal with it.

We can stick our heads in the sand, like the member for Moncrieff, opposite, begs us to do and say that what we are doing at the moment is good enough. But we on this side of the House do not believe that that is fulfilling our obligation to the communities that we represent. We have put in place a proposition which says nothing more than this: we do not give up on problem gamblers and we do not think that people who play poker machines, as the member opposite seems to suggest, are somehow mad and bad most of their lives. We understand and the evidence before the committee was quite simply that, yes, when problem gamblers and many other gamblers are in a gaming environment and sitting before a poker machine they lose control and are not operating on the basis of reason that most of us would operate on normally. But even these people have moments of lucidity and moments of reason when they go home and they have to explain to their wife, their husband or their kids, or when they have to go to work the next day and explain why they are asking for an advance in their pay, or when they have to go and cash in their television or their video recorder. They have moments of reason and they understand that the behaviour they engaged in last night, last week or for the last 10 days when they were on a binge—'chasing the losses', as the member opposite has pointed out—was wrong. The tools that we are proposing to put in place will give them some control over that gambling addiction.

Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

But they are not rational.

Amanda Rishworth (Kingston, Australian Labor Party) Share this | Link to this | Hansard source

They're not irrational all the time.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

As the member for Kingston has pointed out, these people do not have a problem all the time; they have a problem when they are in a gaming situation. They have moments of reason, moments of lucidity.

Mr Ciobo interjecting—

The evidence before the committee was quite clear on this point. It might have been evidence that was delivered on some of the many days when the member opposite who is interjecting so much was not there, but it was very clear that the expert evidence before the committee—

Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

I rise on a point of order. I have a reasonably wide tolerance for being verballed, but statements of factual inaccuracy like that one should be withdrawn. I find them offensive.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

The member for Moncrieff has made his point.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

The second reason we do not give up on problem gamblers and we believe the precommitment technology that has been the subject of this inquiry has a very good chance of solving or helping to resolve problem gambling is that it will prevent people who have been identified by experts as at-risk gamblers converting to problem gamblers. They will avoid doing that by using the precommitment technology to effectively set themselves a budget to punt, a budget to gamble, so that they know on a daily, weekly, monthly or yearly basis how much of their family income they are going to be able to put through a poker machine—how much they can afford to lose.

So we have very good reasons to believe—we are not as cynical as those members opposite—that the technologies and the systems that we are proposing to put in place will work. We believe they will work because they will stop the conversion of at-risk gamblers to problem gamblers and they will give problem gamblers who have already crossed the Rubicon some tools, in those moments of lucidity and reason, to take control of their gambling addiction. Of course in and of itself it is not the complete solution. It has to be part and parcel of a package of solutions. The recommendations put forward by the Joint Select Committee on Gambling Reform go to a combination of solutions.

Some objections have also been raised throughout the course of the inquiry about the egregious costs that this is going to visit upon the industry. We have listened closely to this evidence, and the report points out that for the most part these claims are widely exaggerated and these technologies can be introduced for a fraction of the cost that is estimated and a fraction of the revenue that is generated by one of these machines over its life span. With that comment made, we do make the concession and we do understand that there is going to be a need, particularly for small clubs, for us to have a phased introduction of these technologies and we have recommended exactly that.

I will make the point that the member for Moncrieff was alluding to and then going to quite pointedly in his contribution to the debate. I enjoyed his cross-examination of witnesses throughout the inquiry on this particular point. It goes to the issue of privacy and intrusion, that somehow the introduction of this technology is going to be the visitation upon every Australian citizen of some mammoth Big Brother database which is going to intrude upon every aspect of their private, social and working lives. Nothing could be further from the truth. We have ruled out quite early the use of biometric technology, despite the fact that many pubs are already introducing biometric technology as a condition of visiting their premises here and now. Many pubs in the state of New South Wales and elsewhere, I am reliably advised, are already introducing, beyond the pale of regulation, biometric technology—fingerprint scanners, retina scanners—as a condition of entering their premises. I believe, and I am sure that many right-minded citizens—and I suspect the member for Moncrieff—would agree with me, that this sort of activity should probably not be occurring outside the realm of regulation; but perhaps that is a matter for another day.

The second point that I would make on the issue of privacy and intrusion is that it is a condition of the establishment of a club that they set up and keep a membership register and ensure that anybody who enters the premises of a club, at least in New South Wales or Queensland and I suspect everywhere else, has proof of identity which satisfies the requirements of the legislation and is able by one means or another to satisfy the occupiers of the premises—the licensees, the club owners and managers—that when they enter those premises and intend to use the facilities, including the electronic gaming machine facilities on those premises, they can show that identity. That is to say, the database already exists. Not only does it exist but it collects information about the gaming habits of individual club members and visitors and the clubs already use that data to market to those patrons they know who are frequenters of electronic gaming machines. They do such things—and I make no value judgment about this whatsoever—as send free tickets for meals and a courtesy cab around to a regular punter's home and say, 'Come on down, we've got a special deal for you today; we will put on a meal and free drinks and we've got a special pokies promotion going on.'

I make no value judgment about that whatsoever. Clubs are entitled to market, but they are already using this data and we believe that the introduction of the mandatory precommitment technology is no greater intrusion on a club member or a club patron's privacy than already exists. In fact, through this mechanism we might serve to tidy up some of the practices that many within the community think are not meeting community standards and expectations.

We are far more optimistic than those opposite. If their real issue is problem gambling and they think that we should do something about it and if their real objection is this just ain't the problem, we are a bit more optimistic. This ain't the solution. We are a bit more optimistic than that. One of the recommendations of the committee, as the member for Moncrieff knows, is that there shall be a trial. I am quite confident that, as a result of the rollout of this technology and the trial that we intend to put in place, any of the teething problems that the member for Moncrieff is so passionately concerned about will be able to be dealt with. I am sure the member for Moncrieff and those he represents will get plenty more opportunities—

Mr Ciobo interjecting—

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

The member for Moncrieff has had his opportunity.

Stephen Jones (Throsby, Australian Labor Party) Share this | Link to this | Hansard source

to run his scare campaign around his alleged concerns about privacy. But I end my contribution where I began. Gambling addiction is real, it is a public health issue, it is a family issue, it is a family issue, it is a workplace issue and it is an economic issue and we cannot sit idly by and just identify all of the problems—for those of us who have the gumption and the courage to try to do something about it—without proffering some of the solutions that will make a real difference.

Debate adjourned.