Sunday, 30 August 2009

Pay No Attention To The Man Behind The Curtain

Like Dorothy being sent by the Wizard of Oz to bring back the broom of the wicked witch, at a meeting last September I too was sent on a mission by Woolworths' top executives at a meeting last November. The mission was to bring to Australia a national pokie practices standard for pokie. A standard that the Federal government and all the states agreed to. Like Dorothy's quest, it seemed impossible. But with the support of Sen Nick Xenophon and Rev Tim Costello, we did it. Now we've returned to ask Woolworths to honour that standard and here's the reception we're getting.

The adoption by Coles of the National Principles was reported in the Adelaide Advertiser in South Australia, The Courier Mail in Queensland and on the front page of all of the papers in the POST News group in Western Australia.

No Woolworths response.

Last Thursday, I reached out to Peter Horton, Company Secretary and Chief Counsel of Woolworths. Here's a copy of my email:
"Since writing to you, there have been significant developments in the measures that Wesfarmers/Coles is now prepared to undertake to minimize harm caused by pokie gambling. These measures directly address the matters raised in the 249P statement already provided to you.

You may have read the 25 August issue of the Financial Review where it was reported that Wesfarmers/Coles intend to partially sell pokie pub division. This is the action requested in paragraph 3 of the notice. It indicates a reasonable effort to comply with this request.

More significantly, Coles have emailed me indicating their commitment to the National Principles of responsible pokie gambling and other measure that go well beyond those principles. Here is a link to the Federal and State Ministers declaration that state those principles:

The first principle is:
“Minors should not be allowed to gamble or be exposed to gambling areas within venues.” (my underlining).

Any reasonable interpretation of this language signifies that it is a requirement to remove children from the sights and sounds of pokies inside the venue. Wesfarmers/Coles have indicated their written commitment to this principle and have set aside the capital to implement their commitment. As you know, this is the core point of what I have been advocating both in correspondence and before your board and shareholders.

Another principle is the prohibition of the service of alcohol to gamblers while they are at a pokie.

Set out below is the full text of Wesfarmers/Coles email to me. Please note that a virtually identical 249P statement was proposed with respect to Wesfarmers Limited. That action has now been withdrawn.

It is clear that Woolworths Limited are now both comparatively and significantly lacking in their commitment to responsible gambling practices. This fortifies the need for Woolworths to take positive action with respect to the matters set forth in the 249P statement. At the outset, such action should include publicly matching or exceeding the written undertakings made by Wesfarmers/Coles. without limitation this should include excluding children from exposure to the sights and sounds of pokies within a venue.

I have spoken with the sponsors of my endeavour, Rev Tim Costello and Sen Nick Xenophon who have indicated their agreement with the action that I suggest that Woolworths undertake. I understand that it is Messrs. Costello and Xenophon’s intention to directly reach out to Mr Luscombe with a view of Woolworths initiating positive reforms to minimise the harm of your pokie gambling interests. I respectfully ask you to recall Mr Luscombe's own commitment to take this "very very very seriously".

We all believe that Woolworths matching Wesfarmers/Coles undertaking is not only in the interests of Woolworths shareholders but also the Australian public that Woolworths is dedicated to serve.

I am informed that the typical cost of obtaining a copy of the Woolworths share registry is $200. Please advise where I can despatch such sum and obtain a copy."
The response was a solicitor's letter asking for a cheque $840 for the register. I have asked for electronic details so that I can pay the money immediately.

Sadly there was no substantive response.

Listen to the words of Michael Luscombe.

Listen to how he states without qualification that Woolworths treat their pokie gambling practices "very very very seriously". Listen to how he spruicks that "our internal covenant for that is, in fact, to take a leadership position in the area of problem gaming".
Mr Luscombe has failed as a leader. As Woolworths' CEO, Woolworths' refusal to quickly commit to and then implement the National Principles is Mr Luscombe's failure.

What now remains is whether Mr Luscombe is the good natured humbug like the Wizard of Oz who eventually makes good or can we no longer have faith in anything he says?

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