Monday, 21 June 2010

Tony Robinson's Poor Maths

For a Minister in charge of Victoria's pokies and consumer affairs, we're entitled to have someone who can add. Or someone who has bothered to read the most important report to be released in his portfolio. Or at least someone who has knowledge of the laws he is charged with administering. Judging by what Tony Robinson said in response to Green MLC, Sue Pennicuick, Victoria's Minister for Gaming can't add, has not bothered to read the Productivity Commission's draft report and is deficient in his knowledge of the Gambling Regulation Act, the law he is charged with administering.
Here's what he said:
"There was an element of the PC report that we disagreed with, and it was the means by which they came to a conclusion about the maximum loss rate per hour. They came out with a figure of $1200. This was actually predicated on a $10-bet limit, so straightaway in Victoria we are at $5. As I understand it — as it is been explained to me — you could only lose $1200 per hour if you left your finger on the button continuously and did not take it off for a full hour and you did not achieve a single credit in that time. That is a hypothetical figure; I do not think it bears a relationship to what happens commonly. It might happen once or twice a year, but I am just not aware of too many people who sit there for an hour — you would get a very sore finger."

Let's consider the facts.

At the time the Productivity Commission's draft report was released, the maximum bet per button push was $10 but, contrary to what Tony Robinson stated, the PC wrote it down to $5. So it would seem that the Minister failed to read the report.

One then needs to calculate how many times a gambler is legally permitted to push a button every hour. This is found in paragraph 9.2 of the Victorian additions to the National Gaming Standards where it states:
"For a game approved by the Commission after 1 January 2003, unless the game is to be operated in the approved “specified area1” the spin rate or interval between spins on the gaming machine must not be less than 2.14 seconds per play."
It's best to read the actual page where the Productivity Commission findings appear. Here's the relevant page of their draft report.


The Victorian legally permissible loss per hour at 2.14 seconds per $5 spin is not $1,200 but $8,411.21. What the PC did to get to $840 per hour is to extrapolate the national return to player of 90% although they heavily self qualified even that calculation. This is the issue of volatility already the subject of an earlier PokieAct.org blog.

But let's be more realistic and build in some delays between button pushes and calculate the maximum amount that could be lost. At 3 seconds per push, the calculation comes to $6,000 per hour. This statement made by Tony Robinson about $1,200 is terribly wrong.
"you could only lose $1200 per hour if you left your finger on the button continuously and did not take it off for a full hour and you did not achieve a single credit in that time"
Tony Robinson misses the true calculation by a factor of 5x!

What is even more troubling is the Minister's lack of awareness of the reality of problem gambling when he says:
"I am just not aware of too many people who sit there for an hour — you would get a very sore finger"
Tony Robinson needs to get out in his electorate more and, at least, visit the two Woolworths' associated venues, the Blackburn Hotel and the Mitcham Hotel. He'll find gamblers not only sitting in front of these harmful machines for much more than an hour but also, (through promotions like auction dollars) being encouraged to do so by our largest retailer.

All of this underlines the need for the most simple solution to be adopted. That's the $1 per button push / $120 per hour volatility loss limit / $20 maximum cash acceptor. It's relatively inexpensive to implement, will not affect the truly recreational gambler and target the addicted.

9 comments:

cyenne said...

What I find staggering is how out of touch Tony Robinson is with the very area he is supposed to oversee. Your calculations and break-down of his statements (and mistakes) are spot on, but Robinson prefaces his comments by stating that this is how he understands it, as it has been explained to him. What's to explain? This is not rocket science.

I wish Robinson had been sitting next to me when my gambling addiction was in full flight. He would have seen how easily you can spend hundreds, if not thousands of dollars in a relatively short space of time... and that's without playing the maximum bets.

You're so right. The minister needs to get out more.

Stuart said...

I have no vested interest in this pokie debate but I feel compelled to make a couple of comments.

Firstly, this blog claims to have as it's goal removing children from gaming venues. In fact each page is headed "The campaign to make Pokie Places child free". If this is genuinely the case, the what on earth has the maximum potential loss rate, or the Minister's mathematic abilities got to do with that. (The Minister's talents, or lack thereof, and his complete lack of ethics, are food for a thousand blogs).

I suspect this blog's actual campaign is the eradication of pokies entirely, despite the administer's frequent claims to the contrary.

I don't play pokies and have no desire whatsoever to do so. I can see no other activity that would be less appealing. Sitting in front of a machine, playing with the use of no skill whatsoever and losing, on average, 10% of the money played seems rather pointless. That said, people clearly do enjoy this activity and they should be allowed to continue to do so.

I sympathise greatly with those people who lose significant sums of money as a result of their gambling activities. I have to say, however, that people need to take greater responsibilities for their actions rather than blame on the providers of these gaming services. There are considerable amounts of money invested in assisting those in need and in marketing warning messages. Should you chose to ignore all of these then shame on you.

To use an analogy (and I know how risky this is given people's propensity to turn these into some form of scandalous comparisons), the elimination of pokies is akin to the elimination of women because some men are drawn to commit rape or the use of cars because some people are prone to drive too fast. In effect, they are ridiculous.

As I understand it, gaming venues provide low price food, drink and entertainment, particularly for older members, employ a sizeable number of Australians and are extremely well regulated.

I have travelled the world regularly for the past 15 odd years on business and let me assure you, there are only two types of country when it comes to gambling. There are those where it is legal and it occurs and their are those where it is illegal and it also occurs. Believe me, there is no third type and the former of the two scenarios is far preferably.

In Greece, for example, they made frutaki, or slot machines illegal some years ago. There are currently more gaming machines in operation in that country than before they were made illegal, all operating in shady surrounds, with no controls over returns to players and with no tax benefit to the country (couldn't they do with that income now!!!!). All monies is going into the hands of the underworld and corrupt officials who allow it to continue with impunity.

As I said previously, I am no expert on the gambling industry and neither am I a technology expert but I would have thought it very simple, given all of the machines are linked to some central monitoring system, to require each player to enter a 'membership card' into a reader attached to each gaming machine. This could then control how much an individual could gamble in each given period and, once this had been exhausted, they would be no longer able to play in that period. Rortable? Go one step further and instal fingerprint readers!

In closing, eliminating gambling is the worst thing we could do. Let's just use some commonsense in regulating play by those susceptible to addiction. Also, I have heard no-one suggest where the State government would raise the tax to replace gaming tax should it be eliminated. Just where will that $1bn odd come from every year? I tell you where. From all of our pockets

PokieWatch said...

Stuart,

Most importantly, I agree with your suggested solution. It is the long term answer.

Your suspicion is, however, wrong. On no occasion have I ever advocated for the eradication of pokies.

The opinion I express about the Minister has not been the subject of "a thousand blogs". In fact, to my knowledge, the Minister's statement is not the subject of any public debate at all. That debate is not only welcome, but should be encouraged.

If you live in Victoria, you'll find that the expensive media campaign is ALL about individual responsibility (Gamble Responsibly!) and nothing about the responsibility of the venue or the regulators.

The fact is that pokie gambling is a harmful form of entertainment endangering more than 1/3 of people who regularly gamble on them. There is no metaphor to describe this extent of damage.

For nearly 40 years, pokies were legal in NSW but not in any other Australian state. There were no vast underworld pokie parlours. Your fears are unfounded.

This particular blog coincides with full page press advertisements in Mr Robinson's electorate that focus on the issue of children in pokie venues. I will post the ad tomorrow. The focus of this blog is unchanged.

Stuart said...

One small comment in response. The world's biggest gambling market is China, yet gambling is illegal in that country, save for two State-run lotteries. In Greece, I have visited many of the illegal gaming 'dens' and I have it on the advice of the previous Commerce Minister that there are now twice the number of gaming machines in the country that there were prior to their being made illegal.

Your comment regarding NSW pre legal gaming machines is somewhat trite. My comments refer to what happens AFTER a particular gaming vehicle is banned, not BEFORE. Also, I have no doubt that there a significant number of illegal casinos and bookmakers operating before gaming machines were introduced.

Thank you for your agreement on my proposed solution. I am not sure, however, why it is a 'long-term' solution. The introduction of this form of 'sign-in' technology could be implemented very quickly (as long as the task is not given to the people providing Myki!) and for far less than is currently being expended on responsible gaming advertising.The network already exists, card readers are dime a dozen and the software required within the range of skills held by my three year old daughter (who, admittedly, is far more skilled in this area than me!!).

Finally, if your intent is the elimination of children from gaming venues then can i suggest that you do not dilute this message by talking on matters that have no relationship to children (ie the Minister's maths and the potential loss rates). Whilst you may be clear in your mind as to the intent of the blog, I can assure you that that is not what comes across in your posts.

PokieWatch said...

The gaming machine manufacturer's association estimates that a pre-commitment system could not be implemented for 6 years and would exceed $2 billion in cost. See page 4.

http://www.pc.gov.au/__data/assets/pdf_file/0004/93685/subdr344.pdf

While these estimates deserve questioning, the solution you suggest is not without its complexity. Should you wish to read further, Chapter 7 of the Productivity Commission's draft report deals exclusively with the matter.

Here's a link:
http://www.pc.gov.au/__data/assets/pdf_file/0011/91892/10-chapter7.pdf

Finally, the recorded performance of the Victorian gaming minister on other pokie related matters is relevant to assessing his performance with respect to my core concerns about children in pokie venues.

Anonymous said...

Could this be the same Mr. Bendat.....

Ready for an all-erotica format? Former WCPT (the Point) Albany, N.Y., owner/PD Paul Bendat, who had already unveiled an Internet-only adult standards format, waby.com, has now rolled out two more. In Bendat's words "concerned with the thoughtful consideration of sex" that has 700,000 unique monthly visitors.
His company, bcb inc., operates radio stations online.
Have a look at;
www.Nerve.com
www.maxim.com


So basically it seems he was involved in running an erotica internet radio station.

Mr. Bendat - the great defender of our children.

PokieWatch said...

Anonymous posted this same text on 6 different blogs. This is spam and the other 5 comments have been deleted.

1. I have never been associated with the radio station mentioned.

2. I did provide radio streaming services over 10 years ago to a number of New York City based web sites. These Included iVillage (then America's most used site for women) Gurl.com (information for teenage girls), CMJ.com (College Music Journal and still the organizer of NYC's largest music event), Maxim.com (then America's most read men's lifestyle magazine - no nudity in case you're wondering) and nerve.com

3. I am proud of my involvement at nerve.com where my two radio stations were set alongside writers such as Norman Mailer and photographers such as Helmut Newton. The person to whom I was ultimately answerable to is now
a senior writer at the New York Times. To read more about nerve.com of 10 years ago, read the wikipedia entry. Neither audio service could be described as erotica.


4. The correctness or otherwise of what the present Victorian Minister for Gaming says should be measured on it's own merits. My professional resume is irrelevant to that consideration.

Anonymous said...

Pokie crusaders in the dark on partner's casino fortune
Rebecca Urban
From: The Australian
April 20, 2009 12:00AM
ANTI-GAMBLING crusaders Nick Xenophon and Tim Costello launched a new push against poker machines unaware one of their fellow campaigners owes much of his family's wealth to casinos.

But a little-known fact about Mr Bendat, a former lawyer who once worked for Frank Lowy, is that a sizeable portion of his family's wealth came from an investment in the asset class he loathes - poker machines.

Mr Bendat, 58, insists he has never tried to hide the fact that his father, Jack Bendat, owned part of Perth's Burswood Casino before selling the stake to the Packers' Publishing and Broadcasting Ltd as part of a $77 million deal six years ago.

Senator Xenophon said yesterday he knew nothing about it. Nor did Mr Costello.

It's not surprising. Despite having built up a public profile thanks to his website PokieWatch.org, Mr Bendat's casino ties appear to have gone largely unreported.

In September 2003, PBL announced that it had acquired a "14.2 per cent strategic stake" in the Perth casino operator from companies associated with property tycoon Bill Wyllie and Jack Bendat. A notice issued by the Wyllie Group revealed it had sold its 47 million shares to PBL for $52.9 million. The Bendat family, which owned almost 5 per cent of Burswood through a company called Dreamtime Nominees, made about $24 million in the sale.

The Burswood Casino, now owned by James Packer's Crown, is the only venue in Western Australia permitted to have poker machines. In 2003 - the same year Dreamtime appeared on the casino's share register as its fourth-largest investor - Burswood's 1000-plus machines brought in $95.9 million revenue.

Paul Bendat is keen to distance himself from his father's casino investment. "I tell people," he said when asked by The Australian whether he had disclosed the links. "But ... that's my dad, not me."

However, Australian Securities and Investments Commission filings for Dreamtime Nominees reveal that Paul Bendat - along with his father and his mother, Eleanor - was a director of the company between 2001 and 2005.

Mr Bendat said he was working in the US at the time the Burswood shares were held, and derived no financial benefit from the investment. He does not believe it detracts from his message - that Woolworths, Australia's biggest operator of gaming machines, and Coles are not doing enough to minimise the exposure of children to pokies.


Yep, this Mr. Bendat is the very same one that runs this website, which is dedicated to denigrating anyone that has anything to do with pokies.
Despite his attempts to separate himself from the family investment in the only pokie venue in WA, clearly this is a lie as he was in fact a director of the company.

Daddy must be so proud!

Banpokies1 said...

Anonymous and Stuart, you both sound like gambling industry 'plants' as you try to so cleverly but irrelevantly attempt to trivialize Paul Bendat's comments and expressed opinions.

What focus a radio station has is irrelevant to this gambling safety site, if it suits that market and is not harmful or illegal.

Frankly Paul's closeness to the gambling industry may have been a prime trigger that changed his views later.

Having known of Paul's involvement with Burswood because he was very upfront about it, nobody really cares about that at all, so your attempt to malign Paul has fallen flat on its a$$$e!

The fact that Paul's site is primarily focused towards protection of children from the seedy, potentially harmful influences of gambling venues, does not give Stuart the right to dictate that the site may not logically broaden in any other direction as well. Besides, the insights that Paul Raised about Tony Robinson are worthy.

If the protection of children from the dangers of gambling addiction may be increased even indirectly, by making the operative environment safer for their parents (upon whom thise children depend), then Paul's opinions are most relevant.

Incidentally, Tony Robinson is both Victorian Minister for Gaming and Minister for Consumer Affairs. How odd that he wears those two hats...when one main issue is that pokies are run illegally in Victoria! They do not provide consumer receipts...yet our fair trading law (Sec 161(a) of the Fair Trading Act 1999, says that consumers of purchased services over $50 must automatically be provided with purchase records or receipts. (Our consumer laws are set to become national but it is believed that the Victorian law will be maintained).

All consumers need to have records of significant spending, to properly regulate their budgets responsibly, but pokies gambling consumers do not get that protection! Any talk of 'personal responsibility' is silly if the consumer does not get the toolkit to be responsible!

No wonder the Victorian government has turned a blind eye to the receipts issue since 2004, by delaying any possible reform that may finally occur in a decade, by 2014! Pokies profits may drop if gamblers truly 'saw' later, when cool, what they spent in total.

When our consumer safety is also managed by the same man who allows much consumer harm and abuse to occur, via badly regulated pokies gambling and unsafe consumer products, what hope have we got? It is a huge conflict of interest! A disgrace in fact!

If parents were to be better protected as gambling consumers, then their children would presumably benefit anyhow. Stop your sniping. It does neither of you any credit.