Friday, 26 February 2010

Don't Poke Jan Juc

Jan Juc is a small family suburb located on the Victorian surf coast. Jan Juc is winding streets, speed bumps, lots of cul de sacs, playgrounds, small to medium homes and almost a total lack of commercial development. Not even a concrete footpath. No fast food franchises with look-at-me signs. No mini malls. Not even an IGA or a 7-11 let alone a Coles or Woolworths. No resorts and no motels. All that glitz is left to nearby Torquay.

As a consequence of what must have been a total brain freeze, Rohan Pertzel thought that these factors make Jan Juc an ideal place for a pokie pub. The Jan Juc community has begun to voice its opposition.The families who live in Jan Juc are fortunate enough to live on the coast near one of the great surf beaches of the world, Bells Beach. Despite it's international fame, Bells Beach, has no commercial development. No motels, no hotels... nothing other than a car park.

It's the way the locals like it. It's why they chose to live there. Great surf. A quiet beautiful community with a few local shops. Rohan Pertzel wants to change that.

His apparent strategy was to first develop the only local hotel, The Beach, as a family friendly haven to take Mum, Dad and the kids for a veal parmigana. But even then, there was a something seriously wrong in his promotion of a child play area where it was reported "parents can also see thier children enjoying themselves through the glass walls to the children's area". It is far better if he had promoted parents and children sitting at the table together and enjoying a conversation; a shared experience.

If the gambling losses from Mr Pertzel's proposed 30 Jan Juc pokies achieve even 15% less than the level of gambling losses in the existing pokie pub in Torquay, Jan Juc will become the pokie gambling centre for the Surf Coast. The Beach Hotel will become its largest gambling venue.

Here's a video I produced. Double click on it to watch it on YouTube:

Look at the graffiti. Listen to the machine noise neighbours have to endure. Mr Pertzel needs to clean up The Beach. No industry award changes the reality of how The Beach presents itself in Jan Juc. Mr Pertzel's proposed motel units are not a fit for Jan Juc. His proposed 30 pokies are not a fit for Jan Juc.

Mr Pertzel needs to man up, admit that his proposal was wrong, publicly abandon these plans and work towards restoring real goodwill with the Jan Juc community.

Wednesday, 24 February 2010

Who Runs The Royal Oak?

Woolworths' electronic division Dick Smith is the Tigers chief sponsor. Might there be a connection between Woolies and the management of pokies at the Tiger's Royal Oak pokie club?The logo of the Richmond Tigers footy club is upfront on the web site of the Royal Oak Hotel in Richmond. Here comes that feeling of deja vu yet again.

Let's start at the ground floor. Who owns the land? Here's a reproduction of a title search from 22 February 2010:The land is owned by a company called ALH Group Properties. Holdings Limited. This company is noted on page 139 of the Woolworths annual report as being part of the ALH Group. ALH is reported as the name of the venture 75% owned by Woolworths and 25% owned by Bruce Mathieson's associated interests.

There is a mortgage on the land granted in favour of Woolworths Limited.

The Royal Oak is a club license. This means that the venue operator does not have to pay 8 1/3% Community Benefit Fund tax. There is also favourable terms relating to pokie entitlements under the new Gambling Regulations. Richmond Football Club Ltd is the venue operator. Had Woolworths, ALH or some other 'for profit' company been the venue operator, the Community Benefit Fund tax would have been payable. As a result, the pokie cash flow is improved. This improved cash flow could be available to the club, lease payments for the land or management fees for running the pokie operations.

To see all the parties associated with the Royal Oak, you need to search the Victorian Gambling Commission records. Here's the screen capture of the search taken today:Click on the image and you see a list of Woolworths' directors including chairman James Strong and CEO, Michael Luscombe, mixed in the Richmond's Gary March. Isn't the venue operator the Richmond Football Club Ltd?? Stephen Wright is still there although Brendon Gale replaced him in August 2009. Maybe it's time to update Tigers' gambling commission records.

This is where it gets confusing. Click here to have a look at ALH's own published list of their Victorian venues. The screen shot is below. You'll have to click on the image to read it.Looks like the Woolworths' associate ALH is representing that "Our Venues" includes the Royal Oak and that it's running this pokie club.

Monday, 22 February 2010

A Pokie Glimpse At St Marys

Pokie gambling is a significant presence for families inside St Marys' Rugby League Club. The presence is so intrusive that the club seems to use it to place promotional messages aimed at children. Inside the pokies area backlit promotional sign with a message targeted to children. The message was for children to play bingo. The sign was attached to a pokie and could be seen on the way to the entertainment / function rooms of St Marys. Here's a picture of the sign:
While ultimately recommending further research the 2008 Nova Scotia Adolescent Gambling Exploratory Research found:
"there were two forms of commercial gambling that emerged as posing higher risk for adolescents, not only due to their rates of involvement with the activity but also due to beliefs and behaviours associated with these types of gambling. Adolescents have less experience or understanding of the “house edge” and how commercial gambling work.
Most adolescent gambling experience suggests that skill can influence the outcome and that they can become more skilful over time with experience and practice. This persistence, which typically pays off in most other situations that are familiar to youth, will contribute to problems with commercial gambling.
Commercial arcade games that offer participants a chance to win prizes for example by stopping buttons in the right place appear to be designed with this in mind by making it appear that winning prizes is due to skill that can be acquired through experience. Surprisingly bingo was another form of gambling some adolescents thought they could improve at over time."
It is irresponsible to be marketing bingo to children at the St Marys Rugby League club...

or any pokie club.

For more information on arcade games in pokie venues; click here to read the blog about Stacker

Friday, 19 February 2010

Who Gets The Coach & Horses Pokie Money?

In honour of the Pies last night loss in the NAB Cup, it's a good time to look at who is making the $$$ from their Coach & Horses pokies club in Ringwood. My guess is that their landlord, the 75% associated Woolworths, ALH Property Group is making the big money. Let's have a look at the details.

Click here for the web page for The Coach & Horses where you can find links to the VCGR web site and all of these Community Benefit Statements.
Click on any of the statements below to enlarge and read the detail.


Employment expenses published as $719,650. Property rental - $242,153. Dividends paid to sporting club of $152,620.2006
Employment expenses published as $605,703. Property Rental - $178,568. Dividends paid to sporting club of $137,421.2007
Employment expenses published as $560,154. Property Rental - $118,552. No dividend to any sporting body.2008
Employment expenses published as $670,127. Dividends "proposed/paid" of $131,799. Does this mean that nothing may have been paid? Property rental of $193,057.2009
No rent is payable but salaries soar to $908,278. Both Property rental and dividends paid to sporting body disappear.
While I'm not suggesting illegal activity, there are inconsistencies in this venue's accounting for the public benefits it's pokie gambling bestows upon Victorians. Same items vary widely from year to year. It seems like the largest recipient is the Woolworths joint venture.

If you accept the premise that The Coach & Horses looks like a pub, operates like a pub, significant revenue for Victoria's largest pub owner, and should therefore be taxed like a pub; then lets calculate the Victorian pokie tax breaks it has been enjoying and the revenue we have been missing out on for the last 4 years:

2005/06 pokie losses were $5,011,142 at 8.33% tax break was $417,428
2006/07 pokie losses were $5,157,999 at 8.33% tax break was $429,661
2007/08 pokie losses were $5,320,449 at 8.33% tax break was $443,193
2008/09 pokie losses were $5,337,597 at 8.33% tax break was $444,622

A staggering total of $1,734,904 in tax breaks over 4 years.

Just think of the kid's footy clinics, extra hospital beds or any manner of true public assets that could have been Victorians from these gambling losses.

And never forget that an estimated 40% of pokie losses are sustained by problem gamblers and the harm these dangerous machines cause. And how quick, easy and inexpensive it is to fix by the Minister regulating the $1 button push / $120 per hour loss limit /$20 cash acceptor solution.

Eddie McGuire, Gary Pert, Tony Robinson, John Brumby, Michael Luscombe, and James Strong should all be ashamed of themselves.

Tuesday, 16 February 2010

What is a pokie "glimpse"?

Last Thursday I was asked by a reporter from the Illawarra Mercury to comment on this quote;
"To suggest Peter Newell could do more to protect children from poker machines is lacking in truth and is cowardly. The ad implies that NSW clubs are producing a nation of future problem gamblers due to children catching glimpses of poker machines''
Let's look up what is the meaning of "glimpse":
"a momentary or partial view"
Here's a picture taken from inside the Penrith Panthers family eating area of a family having a meal under the lights of an enormous pokie display.

My recollection is that even the jackpots are continually updated and displayed on this brightly lit feature.

This is hardly a glimpse.

Friday, 12 February 2010

Lets Play Find The ATM at Clubs NSW (Part 2)

Here's a picture taken inside the Mt Pritchard & District Community Club showing the ATM near a multi terminal gambling arrangement in the club. The game seems to be Roulette.Can you find the ATM? It's on the left, about halfway up.

No doubt it's legal but it really does seem to be in the same room.

Wednesday, 10 February 2010

Let's Play Find the ATM at NSW Clubs (Part 1)

I have no doubt that strict compliance with the law is practised by NSW Clubs. However, on two instances I've seen practices that I believe try to shortcut the intention of the law. These are practices realting to the placement of the ATM.

Regulation 31 of the NSW Gaming Machines Regulation 2002 provides:
"31 Location of cash dispensing facilities away from gaming machines

A hotelier or registered club must not permit a facility for the withdrawal or transfer of money from a bank or authorised deposit-taking institution (such as an ATM or EFTPOS terminal) to be located in a part of the hotel, or a part of the premises of the club, in which approved gaming machines are located."
Chapter 9 of the Productivity Commission's Draft Report explains why. Click here to download a copy of Chapter 9. The first two sentences in paragraph 9.1 say it best:
The availability of cash and credit in gambling venues has been an important area for harm minimisation action by governments since 1999. This is in part due to evidence of a close association between the use of ATMs/EFTPOS facilities in venues and problem gambling, as well as a strong preference of problem gamblers for their removal.
So the law requires that the ATM not be in the pokie gambling area and the reason is minimising the harm to problem gamblers.

Here's a picture taken inside the pokie gambling area at the Sydney Juniors promoting the location of the ATM.If a gambler is having a problem with their pokie gambling this sign certainly points to where they can withdraw more cash. Clearly such a sign does not comply with the intent of the law to break the connection with pokie gambling and the availability of cash withdrawal facilities.

Tuesday, 9 February 2010

ClubsNSW Lack of Research

Following my interview by Steve Parsons on ABC Radio Illawarra I called Mr Parsons' producer and asked what the representative from ClubsNSW said after I finished. I was unable to listen. I was told that ClubsNSW CEO David Costello was the spokesperson rather than Chairman Peter Newell. I was also informed that Mr Costello mentioned a lack of research. I don't know if he mentioned a lack of research on exposure of children to pokie gambling in NSW clubs or lack of research supporting what I said about children being normalised to pokie gambling as a result of exposure. My stated concern that such "normalisation" could lead to a greater propensity to become problem gamblers.

There are recent studies I am aware of that mention 'normalisation' in the context of exposure to gambling leads to problem gambling. I have sent Mr Costello a copy and a link to two studies. I want to share these studies with you.

One is the 2008 Nova Scotia Adolescent Gambling Exploratory Research. This paragraph appears on page viii:
"Even more important is the growing trend towards adolescents having increased exposure to high-risk gambling at a household level either online, on television or through adult’s gambling behaviour. Such exposure normalizes the behaviours and appears to be associated with increased harm and risk for youth."
If any reader would like a copy of this report, I am happy to email it to you. Email me at

I emailed Mr Costello a link to a July 2008 Queensland study. Click here to download a copy of that study. This is the extract I forwarded to Mr Costello.
Many young people possessed insight into the social processes that influenced their gambling related beliefs. Many explained that their parents' attitudes and behaviours had a large influence on their own beliefs:

[What factors do you think put people at greater risk of gambling?]
If their parents do it because they have grown up around those kinds of venues and their parents are doing it so they believe that that's normal (employed, female).

I think it's a huge influence. If my parents were to gamble a lot regularly, I think that I might have a different perception of it and think that it's okay and all that. You know, that it's more acceptable to do that. But coming from a family that doesn't gamble much at all – it's definitely – the perceptions that I have, have come from that (University student, female).

[Why do you think you didn't gamble when you visited the internet site, whereas other young people may?]
I suppose just culture and influence and how I've grown up... just the way I've been conditioned. It depends on the lifestyle you grow up with I suppose. I never really grew up around gambling... Mum still does the Lottery I suppose, occasional scratchie. I find that okay. Never looking to pokies or anything but I suppose other families' children who do gamble – if it's played off – if their parents play it off as something like, "it's harmless, it's fine" then the kids might grow up thinking, "Okay maybe it isn't such... maybe I can do it". So sort of depends on just I suppose how you live (unemployed, Male).

These quotes reflect several ideas about familial influence on gambling. The first quote displays an understanding that early recreational experiences in gambling venues can normalise the gambling experience. Academic literature in fact supports this notion, suggesting that gambling venues that accommodate young people may initiate a normalisation process in which gambling is viewed as a fun family activity (Secomb, 2004). The second female, explains that parental modeling of gambling can influence one's perception of appropriate and socially acceptable recreational behaviour. She also considers the magnitude of parental influence to be very substantial. Finally, the last quote indicates that parental values, attitudes and beliefs about gambling can influence young people via a conditioning process. These notions have long been supported by empirical research and reflect the advanced nature of understanding young people held (Oei & Raylu, 2004).
One hopes that Mr Costello, in future, refrains from making statements about lack of research on the influence of being exposed to adult gambling.

Instead, Mr Costello, Mr Newell and ClubsNSW should be looking to ways to quickly stop exposing our children to pokie gambling inside NSW Clubs.

Sunday, 7 February 2010

Stop Exposing Our Children to Pokies in NSW Clubs

Have a look at the advertisement that Peter Newell and ClubsNSW did not want readers of the Illawarra Mercury to see. Their solicitor, David Kennedy of Colin Biggers & Paisley has stated, on behalf of his clients, that the ad is defamatory. I don't think it is. Given that Mr Kennedy has knocked back my request to simply reproduce his communications to me, I'll do my best to reproduce their concerns and explain how I have accommodated them.The first thing to explain is why am I paying good money to publish this advertisement. The goal is to urge NSW Clubs to adopt the national principle that children should not be exposed to pokie gambling within a pokie venue. As the Productivity Commission pointed out in their draft report (Page 8.41); this could be done by prohibiting the entry of children into the venue (my preferred option) or imposing venue design standards.

NSW hotels have suitable requirements in place. NSW clubs should have the same requirement. This is how the goal can be implemented i.e. the same laws for both clubs and pubs. This levelling out of this requirement across clubs and pubs is consistent with the national principles for the conduct of responsible gaming machine activity in clubs and hotels.

There is history behind this ad. The ad you see is the last version. The 1st version was submitted to the Mercury. I was informed that it was looked at by their legal department. It was approved for publication.

In my past interaction with Woolworths regarding what I intended to say at their Annual General Meeting, I have forwarded a copy of what I intend to say in advance. Similarly, with Wesfarmers / Coles, I forwarded a copy of the advertisement I intended to run. I did the same for Mr Newell and ClubsNSW as a matter of courtesy. The following email was sent around noon on Friday, 29 January anticipating publication on Monday, 1 February.
"Dear Mr Newell,

As a matter of courtesy, I have attached a pdf file of the advertisement scheduled to appear in the Illawarra Mercury on Monday, 1 February 2010.

My objective is that pokie clubs voluntarily adopt the same standard that protects children from the sights and sounds of pokies as exists with respect to NSW pokie pubs. You would agree that Clubs' status as mutuals is not an excuse for the conduct of irresponsible pokie gambling activity.

I would be grateful for the opportunity to meet with you to discuss a plan whereby the standard can be implemented.

At such time, I would also like to discuss the immediate measure urged by the Productivity Commission to bring in the $1 button push / $120 per hour loss restriction and $20 cash acceptor limit. This measure will target addicted gamblers and, as you are likely aware, there is substantial research that supports the fact that recreational gamblers will not be affected.

Around 3PM, Mr Kennedy sent an email. Since I have been declined permission to reproduce it, I will try to paraphrase Mr Kennedy's concerns. He indicated that there were several defamatory imputations in the ad although he expressed only one. The publication would be likely to damage Mr Newell's and Club NSW's reputations. The most serious imputation being that Mr Newell and Clubs NSW permit children to gamble on pokies. I was called upon not to publish the ad otherwise they would seek an injunction in the NSW Supreme Court.

This alleged imputation surprised me. It was never contemplated, let alone, intended. At no time in nearly two years of this campaign have I ever indicated that any operator permits children to gamble on pokies. I did not believe that the advertisement, as then written, gave rise to implication. I had no reservations about ensuring that implication could not be drawn by altering the advertisement using clear language.

I telephoned Mr Kennedy and stated that I would insert such language and asked him to express any other concerns so I could address them. He declined to provide particulars. Mr Kennedy informed me that Mercury had informed them that the ad would not be published on Monday. The ad was re-done by adding the words "While neither Mr Newell nor Clubs NSW permit children to gamble on the pokies". An email was sent to the Mercury:
"Please note that I reject the imputations made by the solicitors for Clubs NSW. The headline in the ad could not be clearer that the message is about exposure rather than children actually gambling. The word 'Exposing' appears in the headline of the advertisement. The word 'exposed' appears again with reference to the national principles. This ad is about stopping exposure rather than stopping children pokie gambling. Because the imputation that has caused concern was never intended, I have altered the advertisement. Please note that this is the only expressed concern. I have attached a pdf of that revised ad.

As you are aware, your own legal department examined the advertisement over some period of time and with a minor alteration found it to be acceptable.

I was informed by Mr Kennedy that the ad will not be published on Monday. While this is disappointing I request that the ad be published on the following Monday, 8 February. This conforms to the 7 day notice requested by Mr Kennedy. Please inform me of any further issues.

While my relationship regarding publication remains with your newspaper, please note that I copied this email as a matter of courtesy to Mr Kennedy."
Mr Kennedy emailed again on 3 February. Mr Kennedy characterised my action as a threat. He was not satisfied that the addition made to the ad had fixed the problem. He cited the Federal Court decision of ACCC v Target Australia Pty Limited [2001] FCA 1326. Click here to read that decision. Further, he felt that by the ad implied that Mr Newell was acting contrary to the law, that Mr Newell was responsible for the legislation and that Mr Newell had a interest in the matter that somehow allowed him to profit from the issue.

The ad did not state nor imply any of the above. The ad did not represent that either Mr Newell nor ClubsNSW either acted contrary to the NSW Gaming Machines Act nor that Mr Newell has an interest in the issue that somehow allowed him to profit. While Mr Newell does state in the 2008 /09 Annual Report of Clubs NSW is "engaged in areas covering policy and government", the advertisement does not state or imply anything with respect to the NSW state legislation.

Notwithstanding, I sincerely wanted to address Mr Kennedy's concerns and redrafted the ad. Here's the email I wrote to Mr Kennedy attaching the re-draft:
Dear Mr Kennedy,

I refer to your email of 3 February.


Your use of the word "threatened" in the first paragraph is ill-founded. At no time have I threatened any action. On two occasions I have supplied advertisements to your client that I intended to have published as a matter of courtesy. In the first instance I also asked for the opportunity to discuss two matters and set out the objectives of that discussion. I continue to believe that such a meeting would be beneficial.

In the conduct of my campaign, I have extended the same courtesy to both Woolworths Limited and Coles/Wesfarmers.

With respect to Woolworths, I forwarded them a list of all issues I intended to raise at the annual general meetings I attended. A similiar practice was adopted with the 249P Statement. The result, in each instance, has been frank but constructive meetings with Woolworths and ALH senior executives. On a substantial matter, I joined with Woolworths in advocating a shared view and I have publicly commended certain of their practices.

The advertisement that was published with respect to Wesfarmers / Coles was also forwarded prior to publication. Coles acknowledge that as a result of our joint efforts, a child was rescued from a parked car by their pokie venue staff. Other instances of potential physical harm to children have also been averted. Coles have also adopted the National Principle that children should not be exposed to pokie gambling within their venues and have altered a number of their premises accordingly, with my input.

The reaction of your client is a clear contrast.


The heading of the advertisement could not be plainer in its reference to the matter of exposure. Your client is aware that my concerns relate to exposure of pokie gambling to children. Mr Newell wrote about this in his editorial in Club Life published in August 2009. Members of your client have publicly reacted to the same matter and their reactions were televised on 4 November 2009 during the nationally broadcast 7:30 Report. The ABC reporter, Ms Murray reported "clubs say they've got no plans to change their policy regarding minors". During my own visits to registered clubs in NSW, I observed that children are exposed to pokie gambling inside the venue. This is the circumstance that I am urging Mr Newell to change.

To suggest that it is my intention to infer that either Mr Newell or ClubsNSW support or endorse children gambling on pokies whether it is to their harm, or otherwise is wrong.

In the Reasons for Judgement in the matter of ACCC v. Target Australia Pty Ltd [2001] FCA 1326 there is reference to 3 different newspaper advertisements. Two advertisements related to discounts on clothing and housewares where it was not sufficiently disclosed by those advertisements that the price of some items would not be so reduced. There were also advertisements where there was a failure to "sufficently disclose by those advertisements that no 'rainchecks' were available". With respect to the clothing advertisement, the Federal Court noted that the qualifying words were printed in typeface of not less than two millimetres in height. With respect to the houseware goods advertisement, the respondent admitted that certain houseware goods were not reduced. With respect to the raincheck advertisements, the court noted, having regard to the statement of raincheck policy on the Target website; "With respect to the advertisements which included the simple statement "no rainchecks", it is likely, considering the size of the qualifying advice in the context of the whole advertisement, that the advice would have been overlooked. It is also to be borne in mind that with Target's promotion of its "raincheck" policy, consumers would have expected that notification of exclusion of a "raincheck" would have been prominent and specific."

The case you brought to my attention appears to be about insufficient disclosure caused by the use of small print. There is no suggestion in your letter of insufficient disclosure brought about by my use of small print. On the contrary, the concept of exposure is in the headline of the advertisement in the largest typeface used in the artwork. There is no statement in the ad alleging that children gamble on pokies in NSW Clubs either to their harm or otherwise. In fact, a contrary statement appears. This statement is less qualified than your own expression.

Notwithstanding, I have altered the advertisement by moving the 4th paragraph to become the 1st paragraph and have revised words so that there is a 3rd mention relating to 'exposure'.


It is a matter of fact whether NSW Clubs comply with the first National Principle "for the conduct of responsible gambling" or not. As mentioned above, it was reported that there are "no plans to change their policy regarding minors". That conduct is irresponsible in the light of the ministerial statement issued. Additionally, it is my opinion that is that such conduct is irresponsible. I have made it clear that this advertisement expresses my opinions.

There is no reference to NSW legislation either express or implied in the advertisement. No imputation with respect to NSW legislation was contemplated. The imputation you draw is wrong. Notwithstanding, I have added another reference to 'principle' to make the reference to the ministerial statement even clearer. I have also added the word 'more' in the large type sub-heading.


Finally, you raise the issue of "plays the man and not the ball". Mr Newell is the chairman of ClubsNSW and its figurehead. There is no personal reference other than to Mr Newell in that capacity. I have attached a publication aimed at the former NSW Treasurer, Mr Egan. This publication was produced and distributed by your client. In that ad, your client personalises intentions by Mr Egan using descriptive expressions like "grab", "mean" and "gets away with it". The ClubNSW publication sets out 'end-of-the-world' type speculative options personally consequent upon Mr Egan's own action. Such events or options may have never eventuated although expressed as a certainty by use of the word "will". Your client's own publication "plays the man" in harsher terms than my advertisement targeted to the issue of child exposure to pokie gambling inside NSW clubs.

I have submitted the revised advertisement for publication in the Mercury. A copy is attached.

As your email expressly prohibits unauthorised use, I seek your authorisation to reproduce your letter of 3 February to the readers of my blog and, as a result visitors to my two web sites. I would do so without editing your words. It is my intention to reproduce your email for Monday's blog so that people who see the ad and visit can read your concerns firsthand. So that I can proceed with this use, I look forward to your positive response by 5PM on Friday, 5 February 2010.

Mr Kennedy emailed again indicating, among other things, that the ad did not fix their concerns. He expressly mentioned the inclusion of Mr Newell's name in the top line. Again, while not agreeing with his concerns, Mr Newell's name was deleted from the top of the advertisement. Mr Kennedy was emailed the ad that appears in this blog. In that email, I respectfully acknowledged that there were issues that could not be agreed upon and stated my appreciation for him setting them out.

Those of you who have read this very long blog may be curious in seeing the publication of ClubsNSW referred to in point 4 above. Here it is:It's my intention to keep readers informed of progress as I try to achieve the goal of stopping children being exposed to pokies in NSW clubs.

Thursday, 4 February 2010

Who Runs The Coach & Horses?

The logo of the Magpies is upfront on the exterior of the Coach & Horses in Ringwood and on Monday nights kids eat free but who runs this venue? Here comes that feeling of deja vu again.

Let's start at the ground floor. Who owns the land? Here's a reproduction of a title search from 4 February 2010:The land is owned by a company called ALH Group Properties. Holdings Limited. This company is noted on page 139 of the Woolworths annual report as being part of the ALH Group. ALH is reported as the name of the venture 75% owned by Woolworths and 25% owned by Bruce Mathieson's associated interests.

There is a mortgage on the land granted in favour of Woolworths Limited.

The Coach & Horses is a club license. This means that the venue operator does not have to pay 8 1/3% Community Benefit Fund tax. There is also favourable terms relating to pokie entitlements under the new Gambling Regulations. Collingwood Football Club Ltd is the venue operator. Had Woolworths, ALH or some other 'for profit' company been the venue operator, the Community Benefit Fund tax would have been payable. As a result, the pokie cash flow is improved. This improved cash flow could be available to the club, lease payments for the land or management fees for running the pokie operations.

To see all the parties associated with the Coach & Horses, you need to search the Victorian Gambling Commission records. Here's the screen capture of the search taken today:
Click on the image and you see a list of Woolworths' directors including chairman James Strong and CEO, Michael Luscombe, mixed in the Collingwood's Edward "Eddie" Joseph McGuire, Alex Waisletz (the late Richard Pratt's son-in-law) and Gary Pert, Carlton's Bruce Mathieson, and many others. But isn't the venue operator the Collingwood Football Club Ltd??

This is where it gets confusing. Click here to have a look at ALH's own published list of their Victorian venues. The screen shot is below. You'll have to click on the image to read it.Looks like the Woolworths' associate ALH is representing that "Our Venues" includes the Coach & Horses.

Good old Collingwood forever!
They know how to play the game.
Side by side they stick together
To uphold the Magpies name.

Tuesday, 2 February 2010

Is it a club or a pub? More Manningham Mayhem.

The status of the Manningham Club was subject to review in 2004. The matter under review was whether this venue was operating as a club or was really a pub. It's a question of nearly $3 million in lost Victorian state revenue.

Remember that as a pokie club, instead of a pokie pub, the Manningham Club is relieved from paying the Community Benefit tax of 8.33%. This amounts to $2,296,659.81 since the 2005/2006 fiscal year. Here's the breakdown:
2005/06 pokie losses were $6,923,561 at $576,732.63
2006/07 pokie losses were $7,278,951 at $606,336.62
2007/08 pokie losses were $6,578,314 at $547,973.56
2008/09 pokie losses were $6,790,120 at $565,617.00
Click here to read the decision of the Victorian Casino and Gaming Authority in June 2004 where the matter of whether it was a club or a pub. was determined. Click here to read a later letter from that club.

In that matter it was found that a lease entered into by a company now associated with Woolworths Limited had what could be described as a profit sharing arrangement with that club. From later correspondence it would seem that this same arrangement continues and club status is enjoyed notwithstanding. As we have seen, the Woolworths’ associate’s web site characterises this and other club facilities as its own.

The Authority found stated in paragraph 32 of that decision as follows:
“Overall there does not seem to be a great deal as would distinguish the Club and its activities from those offered by many hotels. Also, in this case the Club is managed in the same interests as the adjoining hotel licensed premises and freehold owner. While it is not unusual for club gaming venues to be on land where the freehold is not vested in the venue operator, we see paragraph (a) as identifying the possibility that where the premises are owned by outside interests, the preferential tax rate on gaming revenue, intended for clubs because of their community contribution will actually benefit the freehold owner. We are fortified in this view by the increasing trend of clubs with gaming licenses being seen as attractive investment vehicles for private investors.”
It would seem that arrangements such as these impede the objectives of the community benefit fund. I wonder if this arrangement still exists?

If they do, such arrangements cost all Victorians a lot of money. The difference in pub or club status for a single venue such as Vegas at Waverley Gardens (Jeff Kennett's Hawthorn FC is the venue operator - Woolworths again an associate) potentially cost the tax payer over $3.3 million a year!

And Woolworths makes the profit.

Monday, 1 February 2010

Who Gets Manningham Money?

The Victorian Commission Gambling Regulation web site provides insight as to where club pokie losses go. The information is found in the audited Community Benefit Statements filed for each pokie club venue. While it is not a full picture of the club's operations; it is an indication of what might be happening with the pokie money. In order to get a sense of the history of the Manningham Club's pokie proceeds and how much went back to the community, I downloaded and took screen shots of all the Community Benefit statements since 2004.

You can go to the web page where you'll find links to all the Manningham Club Community Benefit Statements.

The method I used was to add up all the money that goes to sport, recreation or charity. We'll call this "Community Benefit". Then we can compare that sum to what went to the Woolworths associated company by way of rent. You can click on the related Community Benefit Statement to look at the detail (or correct any addition or classification errors)

Community Benefit - $38,827 Rent - $411,6002005
Community Benefit - $22,324 Rent - $358,3732006
Community Benefit - $21,792 Rent - $357,8822007
Community Benefit - $152,928 Rent - $353,851
Community Benefit - $46,696 Rent - $265,5792009
Community Benefit - $70,395 Rent - $231,952Mr Blair-Holt is also the chief operating officer of ALH, the Woolworths' associate.

It seems clear that Woolworth's associate takes a lot more out of the Manningham Club pokie losses than the community.