At the heart of the VITAB affair is a question. Was this proposal a genuine foray into the Asian betting market by ACTTAB after receiving a proposal from a company that had secured a betting licence in Vanuatu? Or was the VITAB proposal totally underwritten by a couple of Australian syndicates of big smart punters sick of having to beat the 15 per cent government take before it can make a profit? Why not go off-shore where the government take and overhead costs are lower and the returns higher?
Pearce shows ACTTAB was naive, too enthusiastic and starry-eyed at the presence of the Great Punter Bob Hawke. He shows, too, that the VITAB directors were smart in insisting on a confidentiality agreement which would cut off some of its and the department’s avenues of inquiry.
But why did they fall for it? Because they were bureaucratic babes in a commercial wood. Why did VITAB go for it? Because the prize was big: access to wealth generated by government monopoly and prohibition that would not otherwise be there.
Where do we go from here? Rosemary Follett’s answer is more control and regulation when control and regulation have manifestly failed.
Technology is making the betting market too hard to monopolise. Computers, 008 phone lines, off-shore options and the like make it too hard to keep the big players dutifully paying the artificially high 15 per cent cut the Government and overheads demand.
ACT taxpayers have shelled out for people on the public-sector pay-roll to do a job. Collectively they flunked it. The Government should sell the TAB and put the money into something socially useful. It should allow and private or interstate TAB to compete in this market and pick up tax in the ordinary way (stamp duty, financial transactions tax and so on). And then if the make a hash of it, it is their money not ours.
It has been a cosy little earner for governments for a long time, but technology is bringing the curtain down. If it is not VITAB sniffing around the 15 per cent take, it will be someone else.