I don’t have any huge vested interest, but I do enjoy a $20 flutter with Mum every couple of months. So what is all this fuss about pokies reform?

Yeah, they're the heights, all right. Photo: Herald Sun

Will punters like me be affected? Will proposed changes really help the nation’s 95,000 pokie-playing problem gamblers (and a million other Aussies affected by the ripple)? And will the deal struck between the Gillard Government and Independent Andrew Wilkie decimate our pubs and clubs – indeed our way of life?

Number 1: The changes will have ZERO impact on the average recreational player. Most of us (88 per cent) spend less than $1 per button push. The mandatory pre-commitment cards proposed as part of these new reforms relate only to “high-intensity” betting of more than $1 per spin.

For most of us there’ll be no card, no fuss.

Number 2: Will pre-commitment help problem gamblers? Opponents say no, because addicts will always find other avenues (ie online) to squander their cash.

I agree to a point. But you can lose $1200 AN HOUR on pokie machines in Australia. Surely by restricting losses to $120 per hour (as proposed) we’ll cut the risk of players losing so much that they become caught up in the desperate game of chasing their losses.

Opposition leader Tony Abbott, who “predicts” the Opposition will repeal mandatory pre-commitment reforms, says a better option is increased counselling. SA Senator Nick Xenophon likens this to “getting rid of speed limits on our roads, but funding the funerals really well”.

The social cost of problem gambling in Australia is already $4.7 billion a year. How bad does it have to get before we really tackle the cause instead of dealing with the after-effects? Besides, there is some evidence that these reforms will help.

In 2008-09, the SA Government ran a voluntary pre-commitment trial involving 268 patrons in six venues.

Limits were simply added to their loyalty card (many of us recreational players have one already), with conditions including daily spending caps and playing times and a 24-hour cooling-off period for any limit increases.

True, it wasn’t mandatory so didn’t have a huge take-up of players, nor was it aimed at curbing problem gambling habits. But it still revealed an average spending cut of 32 per cent.

So to Number 3 – will it decimate pubs and clubs and hurt jobs?

There are about 200,000 poker machines nationally and Clubs Australia says it will cost between $3000 and $25,000 per machine ($3 billion total) to introduce the new technology.

Anti-pokies campaigners say it’s more like $1000 per machine. (Last year in Victoria, the configuration of every poker machine was changed to reduce the maximum bet per spin from $10 to $5 – there was no hoo-ha about massive costs and disruptions.)

Let’s split the difference, though, and calculate an average cost of $10,000 (tax-deductable) to change and/or replace every machine.

In SA we have 12,000 machines, putting the industry outlay at $120m. In 2010-11South Aussie pokie punters lost more than six times that amount: $745m.

How about job losses? A 2005 report by the SA Centre for Economic Studies found that 3.2 jobs are created for every $1 million of gambling income. By comparison, for liquor/beverages it’s 8.3 jobs and for food/meals it’s 20.2 jobs.

Less cash lost on pokies = more to spend dining out = more jobs.

Look, you can’t blame Clubs Australia and vested interests for screaming blue murder. They’ve got a lot to lose.

Pubs and clubs do good things for their communities – just like lots of other local businesses who sponsor sporting and special-interest groups. But despite what the industry would have us believe, pokie venues aren’t all run for altruistic purposes (a Sydney Morning Herald investigation found the biggest NSW clubs donate just 2.7 per cent of earnings back to communities).

And the fact is that 40 per cent of their $11.9 billion industry is fed by desperate Aussies with a gambling addiction. Change is inevitable.

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44 comments

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    • Kim says:

      05:15am | 30/10/11

      A well balanced article, Lainie. When you take away the layers, the clubs’ stance on this is no more than self-interest. Tony Abbott can’t help himself, positioning himself as a naysayer once again, which sems a little stange this time as polls suggest a groundswell of support for the proposed legislation. The economic arguments trotted out by the clubs against the changes are the equivalent of arguing that chronic smoking is good for the palliative care industry.

    • Super D says:

      06:50am | 30/10/11

      I wouldn’t be at all surprised if there was more opposition to this within the Labor Party than the Liberals.  It is Labor after all who benefit from the pokies at the workers’ clubs around the nation.  It was Labor state governments after all that oversaw the massive increase in the number of poker machines and in NSW at least introduced them to pubs.

      Abbott is no doubt playing politics and why shouldn’t he?  This law is only being introduced as a result of Labor’s grubby deal to cling to power.

    • Super D says:

      05:20am | 30/10/11

      I call BS on this $1200 an hour loss rate.  This would be the potential loss rate and would assume that the $1200 was loaded into the machine at the beginning of the hour and not a single win was recorded or feature triggered.  Also that the spin button was pressed in the nanosecond that the previous spin was completed. 

      I would bet that in the history of $5 spins on poker machines not a single person has ever lost $1200 in an hour.  Not a single time.  Ever.
       
      Now who do I have to see about getting permission to make that bet?

    • Freeman says:

      06:27am | 30/10/11

      Super D,

      if you can win $1200 in an hour I’d say you can lose it. I’ve seen my mates put hundreds through a pokie in minutes. it shouldn’t be allowed.

    • acotrel says:

      06:28am | 30/10/11

      @SuperD
      You should admit the truth to yourself.  The only reason you made that comment was that you are glued to the LNP !  Wishing that Tony Abbott will one day act responsibly or even make sense, won’t make it happen !

    • Steve Putnam says:

      07:59am | 30/10/11

      I’ve seen a friend’s wife do $1,000 in an hour over two consecutive hours.
      This was a tragic instance of problem gambling for more reasons than one. The friend concerned was trying to establish a small manufacturing business at the time and was working seven days a week to achieve this. It was during a period of low demand for his components and he was deeply troubled by the possibility that he might have to lay workers off.
      His wife was in total denial about the whole thing, and was at first oblivious to the fact that I was even present. When she finally did notice me it was the old lie about “breaking even”. Though I said nothing to my friend about it, I haven’t been invited around to any of his social events since, and my own attempts to re-generate the friendship have been rebuffed.

    • Economist says:

      08:29am | 30/10/11

      I call BS on your BS and take that bet. At 3 seconds a spin, $10 a pin, that $200 a minute or $12000 an hour, assuming an on average 87-95% back on a machine (this % should be shown on the machine, but generally isn’t) you’d lose $1660- $600. Now a machine doesn’t pay back between 87-95% every hour, its effectively over the lifetime of the machine, you could be their in an “unlucky” hour. Besides I’ve seen it and been told it.

      Regarding the nanosecond, punters simply insert a paper coaster between the button, then continually feed it cash.

      You can deposit my winnings by calling 1800 800 768. and speak to Lifeline (13 11 14).

    • Super D says:

      10:05am | 30/10/11

      To lose $1200 an hour you need to lose $20 per minute and at $5 a spin that is one spin every 15 seconds - which is how long a spin takes.  All I’m saying is that to achieve the magical $1200 lost in an hour you would need to have the machine preloaded with $1200 (a silly thing to do) then either hit spin again as soon as the spin completes - or have a coaster wedged in the button.  Even still you could only lose the $1200 if not a single obe of your 240 spins won a single credit.  My point is not that pokies reform isn’t needed just that the theoretical maximum that is bandied about is unlikely to ever have been achieved in practice.

      Now I may be wrong that the spin duration is 15 secs but then this would produce a higher theoretical maximum loss an hour and it just doesn’t seem likely to me that anyone arguing passionately against pokies would use anything other than the highest possible (albeit theoretical) number.

      Of course you could lose more if you were playing two machines at a time but thats taking moron to the next level.

    • Jarrod says:

      11:10am | 30/10/11

      SuperD: Since the anti-pokies campaigners are continually referring to the $10 maximum bet in the same breath as the $1200 per hour figure, I think it’s safe to summarise that they are talking about maths closer to Economist’s than yours even if accepting your 15 seconds per spin figure (which I’m fairly sure it is shorter than).

    • Jordan Rastrick says:

      11:44am | 30/10/11

      15 seconds per spin?

      Super D, for someone very quick to call others morons, you’re awfully relaxed about offering bets on the characteristics of machines you’ve seemingly never actually set eyes on, let alone played or studied at any significant length.

    • Super D says:

      12:53pm | 30/10/11

      The point is where does the $1200 an hour figure come from?  Is it just made up or does it have some firm footing?  I’m more than happy to concede you may get more than 4 spins a minute - I have no idea what the exact number is.  The point though is if its more than 4 then the potential loss rate is higher than $1200 an hour.  With $10 spins its even higher.  So why is the $1200 number quoted everywhere?

      And yes it is moronic to lose $1200 an hour playing pokies and it is certainly even more moronic to do it on 2 machines at the same time.

    • Economist says:

      01:56pm | 30/10/11

      Super D I gave you the figures, but my bad I got part of my calculation wrong. In NSW/ACT, the spin rate is 3.5 seconds not 3, where do you get the idea of 15 seconds? Where does the $1200 come from I’ve linked to it before, check out the PC report into gambling., most of which Lainie’s analysis comes from.

      They’re not morons they’re addicts. They range from professions to no skills. I wonder if Phil Gould has the guts to speak to the families of football stars, who I won’t name, whose live have been ruined by these machines??

    • Super D says:

      04:57pm | 30/10/11

      @Economist - the $1200 comes from Lainie’s article above - I have no idea where she got it from.  I took that figure and worked backwards on the basis of a $5 bet assuming that this was the highest potential loss per hour, meaning $20 per minute, meaning 15 second spins.  Which seemed logical to me at 6:20am.  At 3.5 sec spins the potential loss would be over $5k/hour - assuming the credits were preloaded and no time was wasted between spins and not a single credit was won.

    • Chris_D says:

      06:15am | 30/10/11

      I took the family down to visit my mum and dad who were camping down at Kingscliff for a week.  While the kids went and played on the beach, they asked me to set up their TV for them and tune it in, which I did.  As it turned out, the first channel that came on after it finished auto-tuning was the Derby Day races.  The McKinnon was getting ready to run, the horses were being paraded.  We watched it, and I said, “I’m gonna put a bet on”, grabbed my mobile, logged in to my account, and we spent the next few hours drinking, betting and having some fun from their campsite on the beach.  My mum actually said to me, “What’s the point of limiting pokies if people can just gamble with their mobile phone?”

      My point is simply that betting is much bigger than pokies, much more accessible than going to your “local” and the only limits to online betting, or most other forms of gambling are how much money you have in your account or wallet. 

      If people want to make a real difference to gambling and it’s associated problems, then treat the whole industry as the problem, not allow certain politicians to single out certain sections that they can use as their own political football.  And the same goes for the media.

    • Austin 3:16 says:

      09:20am | 30/10/11

      Productivity Commission - $19 billion was spent on gambling in 2008-09, $12 billion of it on poker machines.

      Three-quarters of problem gamblers have problems with poker machines. It’s even higher for women - in 9 out of 10 cases poker machines are identified as the cause of problems for women
      Delfabbro, P, Gambling Research Australia, A review of Australian Gambling Research, August 2008, p61

      So if pokies do make up 63% of all gambling and 75% of all problem gambling in this country why not treat them as a stand-alone cause for concern ?

    • Robert says:

      10:18am | 01/11/11

      @ Chris_D the problem with the pokies (and to same degree Kino) is the instant gratification and addictive nature of it.

      in your case you were in a social environment iterating with others.

      Poker machines are entirely different. Problem gamblers can set at a machine for hours with no concept of time or how much they are betting.

      So while it’s true that some might simply more to other forms of gambling in many cases if the poker machine addiction can be broken they will not. Even if only 10% break the habit that’s 9,500 people being helped with no impact on anybody else.

    • Alex says:

      07:18am | 30/10/11

      Poker machine players will just move on to other forms of gambling.
      Sports betting, Race betting, Card games, Dice Games, Roullette, Keno, Bingo, Lotto, etc…

      If there’s a way to get rich quick, they’ll find it.

    • Austin 3:16 says:

      09:12am | 30/10/11

      From my limited understanding the problem with the pokies isn’t trying to get rich quick it’s the psychological effect the machines have on the players. Problem gamblers often refer to the “zone” when playing the pokies. To quote a comment from another forum “We are slaves to these machines we can not walk out, you get in a zone it is not the money, we are compulsive gamblers.”

      The “zone” seems to be unique to the pokies as opposed to other forms of gambling.

    • murr40 says:

      07:20am | 30/10/11

      Gee here we go again,those evil poker machines,that hold a gun to my head and make me put all my hard earned into them,maybe when we have saved ourself from ourself,can we also have a mandatory Pre Commitment for my Tab account,and once we have sorted that one out,how about a Mandatory Pre Commitment for alcohol,or what about fast cars,motor bikes ,all have social cost .
      Its part of life,people will make choices some rite and some wrong,having Pre Commitment wont cut it,and nor will the nanny state…......

    • acotrel says:

      09:21am | 30/10/11

      It doesn’t matter how you try to spin it, the pokies lobby and Tony Abbott are acting like the low life they are, on this one !

    • Andrew says:

      10:52pm | 01/11/11

      It is about balance: we don’t want a nanny state, but nor do we want a state where no one gives a s**t about anyone else. The pokie purveyors are much closer to the latter than the former, like tobacco companies.

    • Kipling says:

      07:26am | 30/10/11

      Thanks for your article Laine. I think the big issue here is that problem gambling has been a growing problem for some time now and, consequenlty, clubs and pubs who have raked in fairly substantial profits from this have had ample time to come up with some practical solutions to the problematic side of the equation. They have opted to ignore the problems in favour of maximising their bottom line. Consequently measures are being imposed on them. Whether these measures are effective or not remains to be seen, although it would appear evident that some positives will come out of this for families of problem gamblers. Overall though, the much whinged about losses that Clubs and Pubs will suffer are mostly due to their own deliberate inaction to address an issue that they have jointly been significant contributers to.
      As to job losses and reduced funding to kids sports etc, to my mind that is nothing more than pure unadulterated blackmail. I would suggest any club that either sacks people out of hand or withholds money from junior sport should loose its license to operate.

    • acotrel says:

      09:29am | 30/10/11

      @Kipling
      ‘clubs and pubs who have raked in fairly substantial profits from this have had ample time to come up with some practical solutions’

      ‘Fairly substantial ’ ?  - OBSCENE would be closer to the truth.  And all that stuff about voluntarily putting value back into the community is BULLSHIT ! The only value they return is through government tax which you couldn’t claim is voluntary !  Our local club claims the wages of its staff as being the maor part of their contribution.  I don’t know how their manager sleeps at might, with his rotten conscience.
      Locals councils should be able to tax pokies venues in their areas at the GST rate, to take pressure off other ratepayers !

    • Fiona says:

      08:03am | 30/10/11

      Pokies have just become a very lazy way of making money for pubs and clubs. How on earth did they survive before them?

    • acotrel says:

      09:35am | 30/10/11

      @Fiona
      There are no pokies in the VIctorian town of Mansfield, yet they have two excellent pubs which sell superb meals.  It’s not rocket science to provide a decent service to the public.
      In Benalla we have three pokies venues, none of them sell a decent meal, or even one at a reduced price ! There is only one good restaurant in the town, and it is struggling to survive.

    • Rose says:

      01:16pm | 30/10/11

      Once upon a time Adelaide had a roaring live music culture, with many pubs hosting several gigs a week. Now the bands have been pushed aside for pokie machines. Other pubs which had atmosphere and were a little rundown but always friendly and welcoming are now all chrome and glass and about as warm as an iceberg.
      Back in the good ol’ days going to the pub meant hanging around listening to music, chatting with mates and anybody else who happened along, a few drinks and a lot of laughs. Nowadays I don’t usually bother with pubs, too many bright, flashy lights and those ridiculous bells and whistles on the macines that just won’t shut up.

    • Fiona says:

      09:13am | 31/10/11

      Rose, I too remember the days when pubs hosted bands of varying talent on a regular basis. They used to get really busy on weekend nights. I come from Melbourne, so we were not suffering for lack of choice there. It’s a real shame that my kids haven’t had the chance to experience that, or up and coming bands have far less potential venues.
      Acotrel, you’re lucky you have at least one place without pokies to go to. Even our local sports and rec club has about 10 of them and it’s really a small (fairly crappy) venue.

    • Daemon says:

      06:44pm | 31/10/11

      I think we should all move to Toompine. There are no pokies, but the meals are first rate and cheap as chips.

      Say hi to Jonesy.

    • Adam Diver says:

      08:16am | 30/10/11

      “In SA we have 12,000 machines, putting the industry outlay at $120m. In 2010-11South Aussie pokie punters lost more than six times that amount: $745m.”

      You have never run a business obviously. Its OK to take 1/6th of profit, because of a government intervention that will also cost future profits. I guess a 16% levy on your earnings is of little concern, if its paying for someone elses problems?

      Beyond the figures though, how about a little individual responsibility.

    • Amy Sturt says:

      09:46am | 30/10/11

      ‘True, it wasn’t mandatory so didn’t have a huge take-up of players, nor was it aimed at curbing problem gambling habits. But it still revealed an average spending cut of 32 per cent.’

      Uhh.  Lainie.  You just undermined your entire article with that paragraph…  The trial didn’t attract problem gamblers but reduced the spending of those who ‘like a flutter’ by 32%???  That’s a huge loss for no gain in curbing problem gamblers!  Huge!

    • Col Croweater says:

      01:45pm | 30/10/11

      An interesting comment. Isntt it sensible to say that the problem gambler must come from a pool of those who “like a flutter” as you say? So a reduction in those who “like a flutter” will result in a reduction in problem gambling”
      I was interested to hear James Packers comments about his Casino’s own efforts to reduce problem gambling by introducing their own scheme. He said himself that 20,000 took up this scheme last year. Doesn’t that admission alone suggest that theit is a real need for a national approach to problem gambling. Another point is that problem gambling is not the only issue. In many cases problem gambler steal to feed their habit much like drug addicts. In many cases stealing from their employers to feed the machines. This legislation could in fact be great for many small businesses as Laine points out as small businesses employ many more people than Pokie palaces.

    • Chuck says:

      10:07am | 30/10/11

      When will people start being responsible for their own actions rather than relying on “nanny” to fix everything.
      Maybe we should rescind the legislation for aboriginals having the right to drink??

    • Lapun says:

      11:16am | 30/10/11

      Absolutely agree.  We will have very few freedoms left after this Green/Labour/Nobodies government gets through.  Can’t play Pokies, can’t let companies expand when it makes sense,  same-sex marriage to maybe become compulsory with the greens in the senate.  Omigawd!
      I play pokies very, very, seldom, but when I returned to Australia after years overseas, and had very few old friends to return to, I did fill in lonely days in clubs and played them.
      My experience was that I lost more on small value, small bet, machines as the return was not enough to make me put it in my pocket and go home.  I just kept feeding them.
      When I switched to placing bets, 25 lines x 10c, I found that the machines were much more likely to drop a fair pay, AND MORE IMPORTANTLY, the amount was was sufficient to make me put it in my pocket and go home.  I may still have been down but not as much as the other way.

    • acotrel says:

      10:51am | 30/10/11

      I find it incredible that Tony Abbott can put forward the ‘freedom of choice’ argument when speaking about a serious but preventable addiction. He’s so perverse that I wonder if he’s living in the same world as the rest of us ?

    • Paul M says:

      07:43pm | 30/10/11

      “So to Number 3 – will it decimate pubs and clubs and hurt jobs? “

      Screw them. Really. If an establishment makes 90% of it’s money from gambling revenues, if you look in the door and see a hectare of gaming machines, then that establishment is a casino. “Clubs”, as such, are dead and have been for some time. These places are gaming shops that make their living persuading people to feed the pension money into a flashing box.

      Screw them. Ban the bloody things altogether, and any “club” that goes under: serves it right. We don’t need these dinosaurs, these wolves in 50-year-old sheep’s clothing.

      The “clubs” can go to hell.

    • Robert Smissen Of rural SA says:

      10:27pm | 30/10/11

      If you are losing money at $1,200 an hour, you don’t deserve to have it in the first place

    • F.W.G. says:

      08:48am | 31/10/11

      It’s not about losing $1200 dollars an hour it’s about people losing there pension’s and wage’s even over a couple of days as our next door pensioners did every fortnight. convert the machines to a dollar maximum bet would be a step in the right direction. As for the cost of the conversion i did not hear any complaints when theyconverted from ten & twenty cents over to dollar coins & notes.f

    • Dieter Moeckel says:

      10:03am | 31/10/11

      It isn’t about losing $1200 an hour, It’s about losing enough on Thursday evening to have to go hungry for the rest of the week.
      A pensioner or a basic wage earner only has to lose a quarter of the possible to be broke, skint and starving for the next week.
      Any club that can’t afford to have problem gamblers controlled is preying on an addiction. Get rid of the machines and let clubs deal in H to addicts - match the same damage.

    • Wilma J Craig says:

      10:37am | 31/10/11

      How right you are, Lainie!
      I, too, love the odd flutter on the Pokies. I am 84 & my grandson takes me about once ever 6 weeks. We allow ourselves $20 each. We have a couple of glasses of what does you good on top of that $20! We play & when we win even only a few dollars they go into a seperate pocket. We keep doing this until we have collected a minimum of $21 - so we’ve got our money safe &,at least $1 profit! We keep playing & adding the odd dollar to the profit pocket. When we leave we have our money intact, have had a good evening of laughs, some food & a couple of noggins! We will not be hit with this( largely unworkable?) “Pre-Commitment, Nanny State nonsense of Tasmania’s Andrew Wilkie & SA’s Nick Xenophon.
      Clubs, pubs etc will gradually replace all their pokies with ones which only allow a maximum of $1 bets. They along with, in particular, the biggest addict of all the Government of South Australia will still rake in hundreds of millions every year.
      If our politicians were honest in their claims to be concerned about gambling addicts & that other blight: Smoking they would simply ban both Pokies & Tobacco products altogether. They never will because they are the biggest addicts of all.

    • malohi says:

      12:15pm | 31/10/11

      Your seystem makes no sense. Sorry.

    • Talon says:

      10:46am | 31/10/11

      What would be the clubs response to limited betting?  Simply increase the rate of spins yet again.  No great loss there really and only problem gamblers bet more then $1.25 a spin.  Poker machines are naturally one sided regarding pay outs so limiting the variety of bets would be in the clubs favour not the punters.

      I have one of those annoying practical and principled minds.  If anyone has to register to play the poker machines then I will not.  I will not even bother with the club raffles but go elsewhere.  That may not be much of a problem from one $50 / fn punter but on a larger scale it could be.  There are better forms of entertainment and in some cases the meals would be much better.

    • RED says:

      02:29pm | 31/10/11

      Less cash lost on pokies = more to spend dining out = more jobs

      I admire the length of the bow you’ve drawn

    • Linda says:

      04:02pm | 31/10/11

      Last year, my husband and I left Perth to go work in Adelaide for a 2 year stint.  As we lived right in the city, we were 5 minutes from the local Casino. NOw, both mu hubby and I are casual social gamblers who can take it or leave it !! We work and respect money way too much to be reckless with it!  It turns out that I met 2 women who were avid pokie gamblers.  The first was a 48 year female, married ( just still) , both became un-employed and have now lost their house because of their ego and pokie loss’s !!  I clearly remember sitting with her a few times whilst she played the machines and each time she would lose between $1000 to $3000…......and alot of the time she got the money from her visa C/C !!  More and more debt mounting and a very big issue with DENIAL. It made me see that this was a very toxic situation and person and it enforced in me even more that…that is NEVER where and how I ever want to end up! EYES WIDE OPENED ! The second woman was in her 80’s who’s attitidue was, that going to the Casino gave her somewhere to go everyday to get out of the house.  She too, was a renter !!Anyway, the pokies seem to have a more impacting psychological effect on women I think. The bight lights, the bells ringing and th hope of a win !!

    • Paul M says:

      05:06pm | 01/11/11

      its because chicks (even 80-yo ones) simply don’t understand math.

 

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