Canberrans lost more than $190 million on electric gaming machines in the nine months to March – a 13.8 per cent increase since 2018-19 – while residents of five other states lost $14.5 billion last financial year, according to new figures published by the Alliance for Gambling Reform today.

Carol Bennett, the Alliance’s CEO, urged the ACT Government to reduce gambling harm.

“We have significant losses in the ACT, when you consider that we’re in the cost-of-living crisis at the moment, and that money could be really well spent in the economy elsewhere,” Ms Bennett said. “Those losses are causing enormous harm to individuals, to families, to workplaces, to our community.”

The ACT Government has set a target to reduce the number of poker machines in the ACT to 3,500 by 2025, having already removed more than 1,200 poker machines over the last five years (from 4,946 in 2018 to 3,793 today, a reduction of nearly a quarter).

“We’ve made some decent inroads in recent years, after many years when the poker machine industry got a free ride in Canberra,” gaming minister Shane Rattenbury said.

But the clubs sector and Labor MLA Dr Marisa Paterson, former director of the ANU Centre for Gambling Research, are calling for legislative reform and a long-term plan to help clubs divest from pokies.

“We need to restructure our entire landscape in terms of how we address clubs and gambling,” Dr Paterson said.

But can clubs be viable without that revenue?

Gambling and clubs should sit under other portfolios

The ACT is one of the few jurisdictions that does not have a registered clubs act; instead, clubs sit under the gaming portfolio. That, Dr Paterson argues, makes it difficult to diversify away from gaming machines.

“The entire frame that we look at clubs is through gambling, which leads to adverse outcomes,” she said. “If it remains as it is … it will never shift or move.”

Harm minimisation, Dr Paterson said, sits within the Gambling and Racing Commission: “Basically a remit for pokies legislation”.

The Commission ensures compliance with the Gaming Machine Act 2004 and Gaming Machine Regulations 2004, maintains high standards of fairness and integrity in gaming operations, ensures the quality of gaming machines and associated equipment, that government taxes and fees are collected efficiently, and minimises compliance efforts for licensees without compromising regulatory effectiveness.

But in Dr Paterson’s opinion, the Commission rarely looks outside pokie legislation, and ignores current understandings of gambling harm, how people gamble, and online gambling.

“That narrow lens of understanding gambling harm leads to stagnation,” Dr Paterson said.

The MLA believes that clubs should be moved to the business portfolio, and gambling to the health portfolio (treating addiction as a health issue, like drug and alcohol addiction) – a proposal backed by ClubsACT.

“We would like specific legislation for the industry … [that] gives the opportunity to develop a more stable long-term future, rather than having it controlled through the prism of gambling and alcohol only,” CEO Craig Shannon said.

“We’ve only got a minister for gaming, so we don’t get treated as an industry largely. That’s not a way to build a sustainable and viable sector that has a much broader community role.”

The Alliance for Gambling Reform also believes the ACT should take a public health approach. “It’s a bit of a stretch to say it’s a public health issue unless you have a presence in the health portfolio,” Ms Bennett said.

Despite the ACT’s target to reduce the number of poker machines to 3,500 by 2025, both Dr Paterson and ClubsACT believe the sector needs a longer-term divestment plan – which ClubsACT has called for now for two years, Mr Shannon said.

“It’s not fair to the industry, and they can’t plan their divestment if they only know election year to election year what that target’s going to be, what the strategy’s going to be,” Dr Paterson said.

Dr Paterson considers the Diversification and Sustainability Support Fund (which helps clubs to diversify their income to sources other than gaming machines through grants of up to $250,000) too much of a piecemeal approach.

Mr Rattenbury said: “These comments echo ACT Greens’ calls over many years to reduce gambling harm … There is more to do, and I welcome Dr Paterson’s support for further reforms.

“Based on ambitious election policies from the ACT Greens, the 2016 and 2020 Parliamentary and Government Agreements have delivered substantial reform and set a clear direction for the industry that emphasises harm minimisation, and clearly sets a long-term direction for industry that they need to diversify their revenue stream away from gaming revenue if they want to have a sustainable future,” he said.

One initiative the ACT Government intends will reduce gambling harm is a centralised monitoring system (CMS) for poker machines that would set a $5 bet limit and a $100 credit limit in order to slow the rate at which people lose money.

“A centralised monitoring system is the underlying infrastructure that enables a range of harm minimisation measures to be put in place, including card-based gaming, and far more effective self-exclusion regimes,” Mr Rattenbury said.

But Dr Paterson is concerned the cashless/bet limit would entrench (“solidify”) poker machines in the ACT. The CMS, she argues, would cost $70 million over 20 years to implement (“a substantial investment”); bet limits are not based on any evidence; and CMS does not minimise harm.

The Alliance for Gambling Reform, however, is adamant that the ACT must introduce both the CMS and a pre-commitment cashless card to reduce money laundering and criminal activity, as the NSW Crime Commission and royal commissions have recommended.

“The ACT is playing catch-up when it comes to the CMS system, and we need that in place,” Ms Bennett said.

The Alliance also supports a long-term plan for clubs to move away from gambling revenue, Ms Bennett said; it wants to set “a very high bar” to reduce the number of poker machines.

“We should be acting responsibly to do everything we can to move away from an industry that can and does cause harm in the ACT community towards investments that are healthier and sustainable,” Ms Bennett said.

Last year, the Canberra Gambling Reform Alliance called for the government to reduce the number of poker machines in the ACT to 2,500 by 2025 (instead of to 3,500, as the government would like), through measures ClubsACT considered punitive and restrictive.

“The problem is that we’ve got almost a race to the bottom amongst jurisdictions … to compete with each other over who’s toughest in terms of regulation,” Mr Shannon said.

“That provides no sustainability to the industry in terms of business operations. We want an industry that can continue to grow, rather than collapse and regress. The clubs industry has been fundamental to the historical development of Canberra as a community asset. That has stifled in recent years, and the clubs as an industry has not grown.”

Do clubs need gaming revenue?

The biggest obstacle to removing poker machines is that clubs rely on them for revenue, which they in turn give back to the community, Mr Shannon argues. Through gaming machines, clubs support community sport, recreation, and culture, and are also emergency evacuation sites. Without that revenue, clubs might only be able to support local communities with ACT Government funding.

“Poker machines for clubs are just a part of operations,” Mr Shannon said. “It’s not that we’ve got an ideological commitment necessarily to these things; they are a revenue stream. When we’re talking about diversification, we’re talking about alternative revenue streams that can offset that revenue. That’s what we need to work through with the government.

“A lot of clubs, for instance, if they didn’t have those opportunities, would not be maintaining community ovals and sporting facilities; directly funding teams at the community level, like many of them do; or even charitable organisations that they support. That revenue potential comes through the revenue they get from their electric gaming machines.”

The ACT Government has reduced the number of electronic gaming machines by 30 per cent since 2015 – and the live music scene in Canberra has “collapsed” in recent years, Mr Shannon said, due to a decline in poker machine revenue, which funded square meterage.

That is also an impediment to cultural clubs for Canberra’s ethnic groups. The model at the moment, Mr Shannon said, is a reception centre with volunteer staff – which he believes is unsustainable. To have space for performances or receptions, cultural clubs would need square meterage, which would have to be funded even when not being used.

There are, Mr Shannon argues, no viable models for sustainability in the absence of poker machines.

“In hospitality generally, the margins in food and beverage are very limited … It’s not easy to make a viable business where you survive just off food and alcohol, particularly bigger facilities, and you’re going to have meeting rooms available for community use and a hall where live music could be performed. Well, how do you fund that? And how do you also fund football teams, netball teams, basketball teams, which are substantially supported across the ACT by our members?”

For that reason, ClubsACT has reservations about Dr Paterson’s recent bill to ban poker machines from clubs in new suburbs. While ClubsACT supports a trial in Molonglo Valley (where the initiative began) for a club that can sustain itself viably without poker machines, Mr Shannon is concerned that the legislation might deprive areas of the benefits of community return that clubs provide.

“Until we can come up with a model for a sustainable club model that does not rely on revenue from machines, banning outright expansion of machines to other locations may actually have a counterintuitive impact that’s negative to those areas,” Mr Shannon said.

ClubsACT propose instead that electronic gaming machines not be expanded to for-profit venues, including Casino Canberra (which has none). The NSW Crime Commission’s report on money laundering, Mr Shannon notes, showed that gambling in for-profit venues could lead to harm and criminal behaviour.

Ms Bennett, however, maintains that clubs and pubs themselves have failed to manage gambling harm, and says they must “diversify into other areas in order to be sustainable into the future”.

Mr Shannon defended the clubs sector’s record.

“We’re committed to harm minimisation,” Mr Shannon said. “Nobody wants a patron at risk.”

Gambling harm, he noted, has reduced in the ACT in the last two years, due to collaboration between the sector and the regulator, according to an assessment of the Gambling and Racing Commission (GRC) Strategy for Gambling Harm Prevention 2019–24.

ClubsACT is working with the government to improve self-exclusion models, and some have implemented in-house additions (such as the Vikings Club’s Ask for Andy, or the RUC Turner’s OK to Play system, which might be rolled out across the ACT).

The regulator, however, rejected a facial recognition system, which Mr Shannon considers “one of the most viable options to make self-exclusion work”; the system was introduced to NSW last year.

Mr Shannon is also concerned that removing poker machines from clubs would lead to an increase in online gambling. He acknowledges that there is an online self-exclusion system, but says there is nothing in place to identify an individual and offer them assistance and intervention.

“If you’re a person who is prone to gambling, if you go to your local clubs and you use a machine, that’s a pathway for intervention,” Mr Shannon said. “You can be identified as someone who’s at risk … If you take the clubs out of play, then there’s nothing. There is no other mechanism at the community level that would provide that opportunity.”

Ms Bennett disagrees that clubs act to identify problem gamblers and intervene; royal commissions and reviews of venues across Australia have highlighted consistent failures of responsible service of gambling, she said.

Data shortage

Stakeholders also say that there is a shortage of data, or that data is not used effectively. According to Dr Paterson, self-exclusion efforts are declining (the number of people engaging is going backwards), and there is a lack of transparency in monitoring. She says it is hard to find out how the self-exclusion register is progressing, and the government does not make the best use of the gambling incident register.

The clubs sector provides data sets on gambling to the ACT Government. Dr Paterson believes this “rich and valuable” data could be used by researchers, or clubs could run intervention at harm points in clubs – but she is frustrated that the data has not been translated into policy outcomes. Likewise, Mr Shannon noted that the clubs sector had not been provided with demographic data on self-exclusion system; they did not know the mix of male/female, ethnicity, age group, or location.

“How can you actually target models for education and intervention in the absence of an understanding of who you’re trying to deal with?” Mr Shannon said.

Mr Shannon wants to expand the intervention and education model for people at risk; one week of education by the regulator, in Gambling Harm Awareness Week, is not enough, he believes.