Poker machines are loud, bright and enticing. So appealing that in 2004-05 Australians pumped $8.7 billion into poker machines. For some people they are a popular recreation activity, for others they are an addiction. For state governments they are a key source of income.
Money received from poker machines is split into thirds: one third is for the government, one-third for the pokies provider, and the final third goes to the venue. State governments earn an average of $1 billion per year from poker machines making them the third highest source of tax revenue, after payroll tax and stamp duty. In Victoria, gambling giants Tabcorp and Tattersalls (the providers) earn approximately $500 million per year. Meanwhile, the players collectively lose $2.5 billion per year and 42 per cent of that money comes from Victoria’s problem gamblers.
Problem gamblers are addicted to the thrill of winning; the sound of coins spilling out of the machine, flashing lights, music, and the look of envy from other patrons keep them at the machine. However, the reality of a big payout is slim. The odds on winning the major prize on a poker machine is one in 33 million. In comparison, the odds of being struck by lightning are one in 1.6 million. Poker machines are designed to make a profit. The average net take per annum from one poker machine is $46,300. The minimum payout is 85 per cent, so for every $100 that is put in the machine, $15 will be lost.
According to the Victorian government, problem gamblers believe their gambling will cure financial problems, improve their quality of life or relationships, or help to manage work issues. Nationwide, the Salvation Army estimates there are 293,000 problem gamblers who lose between $7,000 and $10,000 a year.
The social impact of pokies is devastating. Problem gambling can lead to financial stress and the loss of assets such as the family home. Family breakdowns follow, with severe consequences such as homelessness, domestic violence, crime and suicide. The problem is worse in some states than others. NSW residents are the biggest gamblers in the country, with each adult spending an average of $1196 on gambling. Western Australia has the least gamblers, spending only $490 per person. This may be because Western Australia does not allow poker machines outside the Burswood Resort Casino.
Governments know the social and economic costs of gambling. The Victorian government is spending $132.3 million on the
‘Think About What You’re Really Gambling With’campaign. Advertisements ask gamblers to ‘Set yourself a limit and don’t exceed it’ and to ‘Think of the people that need your support.’ Considering that the Victorian government collected $983 million from pokies revenue in the 07/08 financial year, is this really enough? Apparently it is. Former Victorian minister for gaming Mr John Pandazopoulos boasts that ‘We have done more to provide problem gambling services and community education than any other State or Territory Government.’
Far from separating themselves from the pokies, state governments are increasingly relying on their revenue. The Australian National University Centre for Gambling Research revealed that from 2000 to 2005, gambling taxes and levies increased by 6.2 per cent each year. According to a former federal treasury economist, Julie Smith, ‘promoting gambling or encouraging its extent in order to protect or enhance taxation revenue is not philosophically, economically or socially defensible strategy because of the wide costs to society embodied in such an approach.’
So do we blow up the pokies?
There needs to be a national approach to ban pokies to stop state governments from using poker machines as quick and easy revenue. Most state parties have committed to cutting down poker machine numbers but few have agreed to get rid of them. The anti-pokies People Power party in Victoria, which proposes non-renewal of poker machine licenses when they expire in 2012, is in the minority. The problem is, if one state banned pokies, people would travel interstate to play. It’s happened before. Pokies were introduced into Australia in 1956, but were banned from Victoria until 1992. Vicky Barlow from Victoria remembers that her family holidayed in NSW so her mum could play the pokies.
If the federal government doesn’t have the guts to ban the pokies outright, they can at least take Western Australia’s lead and ban them from all venues except casinos. New legislation should be introduced to force state governments to spend the money they receive from pokie machines on preventative gambling strategies.
One new method to prevent problem gambling encourages people to play negative-conditioning poker machines which shout out insults every time a player loses money and remain silent when they win. How quickly would the gloss wear off gambling if every time you lost, the machine called you a ‘loser’ or a ‘coward’? It would be a hell of a lot more effective than a poster on the wall from any anti-gambling government campaign.
How do I know this?
Davidson, K (2006) ‘There is a good way to deal with pokies,’
The Age, September 7 accessed at:
www.theage.com.au/news/opinion/there-is-a-good-way-to-deal-with-pokies/2006/09/06/1157222200113.html?page=2
‘Gambling,’ Catalyst
www.abc.net.au/catalyst/stories/2386227.htm
‘Gambling revenue,’ Technical Paper
www.pc.gov.au/__data/assets/pdf_file/0006/
13686/technicalpaper10.pdf
NSW Office of Liquor, Gaming and Racing ‘Industry Statistics at a glance’ figures are at 30 June 2007
www.olgr.nsw.gov.au/pdfs/industry_stats_07.pdf
‘Society Matters,’
The Age www.theage.com.au/news/victoria-votes/society-matters/2006/10/19/1160851056652.html?page=fullpage#contentSwap1
Sydney Problem Gambling Centre Report, October 2006
https://salvos.org.au/about-us/media-centre/documents/061016PRBGAMREP_000.pdf
Tasmanian Greens
http://tas.greens.org.au/issues/index.php?ThemeID=6
Trezise, Anne [Interview with Jenelle Whittaker] Tuesday 11 November 2008
