THE numbers tell the story. 
I know numbers are a big turn off, but bear with me because the story is important, and precisely because numbers are a turn-off, the clubs have been able to dismiss problem gambling as a minor matter not affecting many people.
The ACT has 5000 poker machines. They make a gross profit of $180 million a year. Poker machines return 87 per cent to the gambler and the remaining 13 per cent is gross profit.
So it means $1.4 billion a year has to be put through the 5000 ACT poker machines to generate the $180 million.
It is an astonishing amount of money. The clubs like to give the impression that the vast bulk of this money is generated from the great bulk of their patrons having small harmless flings.
The numbers tell a different story.
Let’s pretend all adults in Canberra put in an equal amount into poker machines. They would be putting in about $7000 a year each and would each lose around $900 a year each. That would be the least harmful way of distributing the loss.
But it is not distributed like that.
A report done by ANU researchers Tanya Davidson and Bryan Rodgers for the ACT Gambling and Racing Commission surveyed the prevalence of gambling in the ACT.
They found that only 30 per cent of ACT adults used poker machines in the past year. So 70 per cent either never or hardly ever use poker machines.
So the average poker machine player in Canberra puts a little over $23,000 a year through the machines and loses $3000 a year.
Now we are getting into harmful territory. But it gets worse.
The ANU study found that only 3 per cent of ACT adults play poker machines once a week or more.
Unfortunately, the ANU study did not find what percentage of total playing was done by the once-or-more-a-week players. That was not their purpose. Their remit was to isolate risk groups so action could be better directed, and they did a good job.
It stands to reason, though, that the regular once-or-more-a-week players will be overall putting more into poker machines than the irregular players. Let’s say a half or a tad more. That would mean just 7000 people in the ACT are on average putting in $100,000 a year each, for a loss of $13,000 a year, generating $90 million in gross profit for the clubs.
I don’t want to stretch present research further than it can go, but it is quite apparent that the harmless-fun impression the clubs give is way off the mark. The research suggests the true position is that a very large proportion of poker machine profits comes from a very few people.
The research proves that the very best position is that the “average” player of all those who play is putting $23,000 a year through the machines for a loss of $3000 a year, which is not harmless fun and is, indeed, problem gambling.
More likely, though, half of the profits are coming from just 7000 people.
Small wonder then the clubs are fighting any control on problem gamblers so vociferously – it would wipe out half their profits.
Some research suggests that between 25 per cent and 35 per cent of profits come from problem gamblers. The ANU research points to a higher figure, especially given that survey respondents would underestimate their gambling.
Unfortunately, the trial of mandatory pre-commitment will not give us the true picture. That’s why the clubs are going along with it.
What is needed is thorough research on what percentage of total poker machine profits come from what percentage of the players.
The ANU research hints that the clubs are right in suggesting that the percentage of players who are problem gamblers is very small. But the clubs are quite wrong in suggesting that this means that only a small percentage of profits come from those problem gamblers.
More likely the very few problem gamblers are providing a high proportion of the profits, maybe half, depending on your definition of “problem gamber”. In short, the present set up of Australian clubs reaping $12 billion in poker machine profits every year from the misery of, say, 100,000 poker machine addicts is immoral.
The libertarian argument does not wash here. A libertarian approach presumes a free will. More and more evidence reveals some people have addictive personalities where there is no free will. Making gambling illegal is not going to work but the ubiquitous and artful placing of massive temptation can be curtailed in the same way that people’s “right” to drive when intoxicated or unseat-belted has been curtailed.
The clubs are quite right to uphold the right of people to have a small harmless fling. Well, let the small harmless fling be restricted to $1 and the pull of a lever which would mean an addict would be restricted to $1 every 10 seconds or $6 a minute or $36 an hour – something someone on the basic wage could at least keep up with – without robbing, defrauding, cheating on family and the like.
This ACT trial is a wasteful delaying tactic. We know the clubs are feasting on addicts – a bit like legalised heroin dealers.
We won’t stop them being addicts. But at least we can control the dose.
DOT DOT DOT
The Republican nomination in the US is backfiring in a highly entertaining way. The Republican Party which in the past decade and a half has been the favoured vehicle of the fundamentalist Protestant Christian right, now has as its two leading lights a Mormom and a serial adulterer double-divorced confirmed-again Roman Catholic. Mitt and Newt. Maybe, the Republicans like diversity, tolerance and liberalism after all.
CRISPIN HULL
This column first appeared in The Canberra Times on 28 January 2012.
I liked this bit best. “This ACT trial is a wasteful delaying tactic. We know the clubs are feasting on addicts – a bit like legalised heroin dealers.”
Well we got rid of heroin…and we will get rid of pokies the same way unless something more important than “the maths” changes…
When do we discuss ‘the crappy, badly estimated and possibly downright inaccurate maths’ that refers to pokies harms, that SHOULD be faced?….we want healthy families and vibrant communities…we do NOT need pokies that kill other businesses! Do the maths on that one! oxxo
kevin:
Blind freddy can see that 100,000 people are ruining their and their families lives. A few % either way is not what the debate is about. You go on about restriction of peoples rights etc. These are THE SAME words some tobacco companies used many years ago and still do today. We restrict peoples right to own a gun unless licenced, that is commonsense. Pokies are DESIGNED (like tobacco) to be ADDICTIVE. The tide is turning, it may not be won by wilkie, i suspect clubs may already be breaching the law and await a smart-ass lawyer to take them on! The only people who will be hurt by a drop in pokie revenue will be CLUB CEOs, the members (THE OWNERS OF THE CLUBS) have not been consulted, they have not been asked if their club can spend a fortune on GAMBLING ads, that is where i suspect they may have broken the law. just like a pollie abusing his/her travel allowance.
Unfortunately I have to disagree with your maths.
To be fair, your numbers make sense and would be reasonable not for one small point that you’ve misconstrued.
Your total figure is $1.4 billion to be put through the machines to make the $180 million profit. However this is the number that is actually “Bet” not neccecarrily the amount which is “put through”.
You see, the issue with your maths is that each person who “on average” puts through $23 000 each year for a loss of $3000 likely doesn’t actually put $23 000 into the machine, that person will proabably actually put $4-$5 000 cash into the machine because each time he bets and wins that “win” will be “recycled” and become a PART of that $23 000. The gambler is gambling with the money which they’ve “won” in that spin, which artificially inflates the amount of money which is “put through” the machine.
This is a libertarian debate, we shouldn’t be restriting people’s freedoms, I know many people who would spend $3 000 on their hobby; books, games, clothing, alchohol, phones, tablets, computers, upper class restaurants or whatever. Who are we to tell someone what they should or shouldn’t do?
Each person has the opportunity to make him or herself better, it isn’t our responsibility as a society to STOP them, it’s our responsibility to give them a way out and help them with that journey. I support education against gambling, I support anti-gambling advertising and initiatives, I support people’s right to want to stop and to find a way to stop. I encourage and help the people that I know to not gamble. I do not however support the RESTRICTION OF PEOPLES FREEDOM AND RIGHTS.
Amusingly enough I support your article too, I just think that you should take a closer look at your maths and a closer look at your ethics.
BRILLIANT !! pity CT doesn’t employ real journos anymore. I am camping and drive 40kms every sat to get “real CT” well worth the drive.
I have put a link to your website/article on http://www.facebook.com/StopTheLossCo
One thing your maths may have missed out on was that i reckon clubs “kill” a machine every once in a while, they choose a machine that owes the punters money. They then use that money for car giveaways/holidays to entice further punters.
In 1973, (pre-poker machines in the ACT) it was the norm for construction workers to call in at the BWIU owned Woden Tradies Club and have a few beers even though we dressed in blue singlets and shorts. Today there is no way me or my workmates can enjoy a beer while dressed in our work gear at “our tradies club” . Why? Poker Machines and the greed that took a small tradesmans club from a poky one room venue to a multimillion dollar enterprise that now shuns construction workers because of their non complience to their elite dress code. Clubs are not about a culture or sport they are money making venues who turn their backs on the “orginal owners” and pull in members from wherever they can so their lifestyle can succeed on the backs of problem gamblers. My suggestion to help PGers would be bring back the 10 Cent One Armed Bandits and only take on members that comply with a clubs purpose. So if you don’t play golf – don’t join a golf club.
A possible solution to reduce poker machine addiction is to increase the time it takes for the different ‘reels’ to rotate and stop in turn thus limiting the machine’s ability to collect revenue. Thus if it took 15 seconds for the reels to stop each play then the number of ‘plays’ would be reduced to 2 or 3 a minute. This may increase anticipation and therefore addiction. Electronic machines could give an instant play result but the punters probably wouldn’t like this and this may also reduce addiction. Either way any attempt to reduce club revenue would be strongly resisted by club managements. Thank you again for another good article.