Pokies politics: how good intentions were derailed

January 24, 2012
Andrew Wilkie.

Tension around pokies reform came to a head on January 21 when Prime Minister Julia Gillard broke her agreement with independent Tasmanian MHR Andrew Wilkie to implement timely reforms to address problem gambling.

Wilkie subsequently withdrew his support for Gillard’s minority government and noted he would “only support motions of no confidence in the event of serious misconduct and not support politically opportunistic motions”.

Unfortunately, this split has been on the cards since November, when former Liberal Peter Slipper took the Speaker’s chair and Julia Gillard picked up one more vote.

The Labor Party has never been a genuine enthusiast for poker-machine reform — it’s never been Labor policy. Needless to say, the road to gambling reform has been long and bumpy, so it’s worth looking back on some of the policies that were on the table and how Wilkie’s good intentions have been derailed.

New policy

The government’s new policy is to trial mandatory pre-commitment in the Australian Capital Territory and insist that all new poker machines introduced from 2013 have voluntary pre-commitment technology. Apart from some minor measures, nothing further will happen until 2017 at the earliest.

Voluntary pre-commitment means that a poker-machine user can opt to set maximum losses and limits of time spent playing when using high-intensity machines. These are the machines on which it is possible to lose up to $15,000 in an hour. Losses average $1200 an hour.

Mandatory pre-commitment means a player must set binding limits on losses and the time they want to spend playing before using a machine. Problem gamblers and those at risk of developing a pokies addiction can’t set limits when they are in the grip of the machines. Instead, they chase losses. They lose a lot of money and are harmed as a result.

The Productivity Commission argues that the voluntary system’s Achilles heel “is that gamblers who have exceeded self-imposed limits can remove their card, still play and break their commitment”. Around 60% of all losses are borne by problem gamblers and pokies users at risk of addiction (this groups makes up one-third of users).

Recreational users lose the remaining 40%. According to the Productivity Commission, 88% of players restrict themselves to less than $1 for each bet. Problem and at-risk gamblers don’t.

The Wilkie/Gillard agreement

When Wilkie and Gillard negotiated their agreement 16 months ago, they had the Productivity Commission’s recommendations before them. Wilkie wanted to see action on the Commission’s two biggest recommendations: mandatory pre-commitment and $1 bet limits.

The Commission recommended a trial of mandatory pre-commitment to test design features and demonstrate the advantages of such a scheme.

Perhaps even more importantly, the Commission recommended a $1 bet limit, with $20 restrictions on the amount a player could feed into the machine. This would bring average losses per machine to $120 for an hour. These came to be called low-intensity machines. (It’s important to note, however, that it’s still possible to feed up to $10,000 into machines in New South Wales at any time).

Sixteen months ago, Gillard rejected the $1 bet limit outright. Wilkie, therefore, settled for mandatory pre-commitment on high-intensity machines. Gamblers could still have unfettered access to low-intensity machines. The time scale for implementation was brought forward, and the agreement was struck.

The report of the subsequent Parliamentary Joint Select Committee on Gambling Reform, supported by its Labor but not Coalition members, endorsed mandatory pre-commitment, the new timeline and the high-intensity/low-intensity split of machines. It said a quickly implemented trial could inform design features and identify unintended consequences. But it warned against delaying a broader rollout of mandatory pre-commitment.

This is where we were before the Slipper manoeuvre. As per Gillard’s agreement with Wilkie, she was to take these findings to Parliament in a Bill.

Changing tune

Gillard now says she’s returning to the original recommendations of the Productivity Commission’s February 2010 report: a pre-commitment trial. What she neglects to say is that mandatory pre-commitment, with a trial, was to be accompanied by the stand-alone measures of $1 bet limits and a maximum $20 load up.

The Commission didn’t suggest a trial for the $1 bets and $20 maximum load up – it recommended implementation. But Gillard continues to reject this part of the Commission’s strategy.

Meanwhile, Wilkie continues to campaign. And the rest of us grow increasingly cynical about the government’s ability to bring about meaningful reform to better the lives of problem gamblers and their families.

[Jamie Doughney is a Senior Research Fellow at the Centre for Strategic Economic Studies at Victoria University. He has received funding from local governments opposed to poker machine growth in their areas and has appeared as an expert witness in related cases. Article republished from The Conversation.]

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