The Australian Government Productivity Commission today released a draft report on gambling for public comment. Written submissions must be made by 18 December and a final report will be prepared and forwarded to the government by 26 February 2010. Around 15% of Australians gamble regularly, excluding those who gamble only on Lotto and scratch cards, and about one in ten could be classified as problem gamblers. The Commission points out that the prevalence of problem gamblers expressed as shares of the adult population are misleading, given that most of the population do not gamble regularly.

The report states, “The significant social costs associated with problem gambling mean that even policy measures with modest efficacy will often be worthwhile. Rough, but conservative, calculations suggest that even a 10 per cent sustained reduction in harm could provide a gain to society of nearly half a billion dollars annually.” It adds, “Over the last decade, state and territory governments have put in place an array of regulations and other measures intended to reduce harms to consumers. Some have been helpful, but some would have had little effect, and some have imposed unnecessary burdens on the industry.”

A key point of the report is the call for a more coherent and effective policy approach and the need for targeted harm minimisation policies. For gaming machines, widely called pokies, there is the suggestion that the bet limit should be lowered to one dollar per button push (equating to losses of around $120 an hour) with much lower limits on how much cash can be fed into machines at any one time.

According to the report, shutdown periods for gaming rooms in hotels and clubs are too brief and occur at the wrong time. “They should be extended and commence earlier. There should be a progressive move over the next six years to a universal pre-commitment system for gaming machines, using technologies that allow all consumers in all venues to set binding limits on their future play.”

The Commission says that school-based education could have perverse effects and should not be extended without review; that relocating ATMs away from gaming floors, and lower daily cash withdrawal limits on ATMs, would help some gamblers, but removing ATMs from venues poses costs and risks, and jurisdictions should await an evaluation of Victoria's impending ban; and that statutory provisions to enable gamblers to seek redress through the courts for egregious behaviour by venues appear necessary.

“With effective pre-commitment, many other regulations on gaming machines could be modified, or be removed as they become redundant. Effective harm minimisation policy for gaming machines will inevitably erode gaming revenues. In the longer run, however, technological changes may attract a wider base of consumers, offsetting this.”

The report concludes that Governments have improved policy-making and regulation with respect to gambling, but significant governance flaws remain in most jurisdictions - including insufficient transparency, regulatory independence and coordination – and there is a particular need to reform the institutional arrangements underpinning national research. (E-10.21.09)

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