The week that sees Australia’s biggest lottery jackpot in history on offer is perhaps the wrong time to talk about gambling. But Prime Minister Albanese’s determination with the cost of living and tax to “do something about it”, should augur well for the Government’s response to the parliamentary committee’s gambling report.
It, too, is related to the 2 March Dunkley by-election. The by-election was caused by the death of Peta Murphy who chaired the House of Representatives Standing Committee on Social Policy and Legal Affairs which produced the report in June last year.
The report recommended a ban on the advertising of online gambling and 30 other measures abhorrent to the gambling “industry”. For a long time that industry has successfully hedged its bets against new pesky regulation by giving money to both sides of politics.
A Centre for Public Integrity analysis last year found that the gambling sector gave $8.7 million to political parties from 1999 to 2021 and the hotels sector – including pubs and clubs with poker machines – gave $15.2 million.
It sounds like a lot, but it is chicken feed compared to the $2 billion a year or so of losses that Australians suffer to pour into the industry’s profits. It is a good bet with good odds. The house always wins.
Behavioural economics researchers have found that it takes only a small gift for someone to feel obligated to a gift provider. That obligation takes a great deal of character to ignore.
Let’s hope the Albanese Government has that character to honour the memory of Peta Murphy and “do something about” the gambling advertising and gaming simulation through video games that, in her words “are grooming children and young people to gamble and encourages riskier behaviour. The torrent of advertising is inescapable. It is manipulating an impressionable and vulnerable audience to gamble online.”
Unfortunately, we do not find out about political donations in real time. The Australian Electoral Commission reports on a financial year’s returns in the following February. So, it could be up to 19 months for a donation to be made public.
In 2022, Sportsbet paid $19,000 to help the campaign of Michelle Rowland, who is now the minister who holds the communications portfolio which plays a key role in gambling regulation. That is her right and it is perfectly legal. She complied with all legal requirements for declaring political donations.
A lot of donations go under the radar because they have to be more than $14,500 before they must be reported by the donor.
Equally bad for public policy is the practice of well-heeled industry lobbyists to privately pepper and pester ministers and other politicians to act or not act in their interests rather than the public interest. It has happened since the committee’s report.
Surely, the gambling and advertising industries have had their chance to put their views through the parliamentary committee process. But clearly, they do not like the sunlight. The Government should ignore the lobbying and stick to the committee’s recommendations which were based on extensive public hearings and 161 public submissions.
It has had the report for a suspiciously long seven months without responding. As it happens, Independent Zoe Daniel has (probably Quixotically) introduced a private member’s bill to ban gambling advertising in toto, not just online gambling.
That approach has a lot of merit. It helped the dramatic reduction in smoking in Australia despite the public squeals and artful private lobbying of the tobacco industry – which like the gambling industry preys on addiction and vulnerability and is a public-health menace.
Their pleas about jobs should be ignored. A phased introduction would give people time to move from jobs which should not be considered real jobs because they are created by causing harm.
It would be better if all political donations by the gambling industry were banned. That would remove the temptation to fulfil those subconscious “obligations” to donors.
There are some constitutional difficulties but they can be overcome with co-operation from the states and/or by meeting the legal challenges head-on, as happened with the tobacco industry. When the Commonwealth used its “post, telegraph and other like services” power to ban broadcasting tobacco advertisements, the tobacco industry flocked to print. The Commonwealth then used its corporations power to ban print tobacco ads, too.
Unions and property developers have challenged bans on political donations relying on the constitutional freedom-of-political-communication cases, with mixed success. Even so, it should be hard to argue that those principles could apply to the cause of promoting public harm.
As the committee’s report said, “Online gambling is unlike other forms of entertainment because of its potential to cause psychological, health, relationship, legal and financial harm to individuals and those around them, and tragically, gambling is a key risk factor for suicide.”
The committee’s inquiry was restricted to online gambling, but the poker-machine industry is just as bad. These two forms of gambling induce addiction and financial catastrophe in gamblers in a way that, say, a weekly lottery does not.
That brings us back to this week’s Powerball first prize which over the past few weeks of no-one getting the winning numbers has jackpotted to $200 million. The total prize pool is estimated to be $500 million.
It is a staggering amount of money. The sad thing here is that Powerball is owned by The Lottery Corporation, a corporation listed on the ASX with a market capitalisation of $11.06 billion. The Lottery Corporation has a practical monopoly on Australian lotteries outside Western Australia and runs for profit.
Western Australia does what Canada, Britain and other wiser jurisdictions do with lotteries. They are government-run, non-profit organisations which use takings for socially worthwhile things like the arts, amateur sport and community activities.
The Sydney Opera House would never have been completed without the state-run not-for-profit Sydney Opera House Lottery (1957-1986) which provided most of the ever-ballooning $102 million cost.
But since then, privatisations have handed the profits to shareholders. The Lottery Corporation pays about $300 million in dividends each year. That is a lot of privatised public good.
And we will know what the Federal Government thinks about the public good when it responds to the parliamentary committee report. Good luck.
This article first appeared in The Canberra Times and other Australian media on 30 January 2024.