Monday, 18 October 2010

Victoria Abandons Pre-Commitment

The proposals set out in the Victorian government's consultation paper on pre-commitment demonstrate that the government intends do as little as possible to implement the considered recommendations of the Productivity Commission. These well researched recommendations were made after 11 years of study.

Click here to download the Victorian government's consultation paper that puts forward a fundamentally incorrect understanding of what is the true meaning of "pre-commitment". The Paper also sets out it's preferred recommendation that pre-commitment consists no more than a pop-up screen that disappears after 15 seconds or sooner.

Set out below is my submission:
“Policies addressing business practices that generate harm – such as pollution and hazardous products – do not give much weight to the resulting revenue impacts of raised standards … The revenue impacts associated with effective policies addressing problem gambling and other harms are analogous to this.”

Productivity Commission Final Report 2010 Page 11.28

"Victoria has the worst rate of problem gambling prevalence of any Australian state and thereby the worst harm minimization practices of any Australian state.

Based upon its own September 2009 epidemiological study 12,000 Victorian pokie gamblers contemplate taking their own life and about 6,000 Victorians were led to do something against the law as a result of their pokie gambling.

A further Victorian government study found a strong relationship between crime and pokie gambling:

“Gaming expenditure per capita is significantly positively associated with nearly every type of crime in all years of the analysis.”

The Productivity Commission (“PC”) found that “the harms from problem gambling include suicide, depression, relationship breakdown, lowered work productivity, job loss, bankruptcy and crime.” “For each problem gambler, several others are affected - including family members, friends, employers and colleagues.”

Given just these facts, the Department of Justice’s Pre-commitment Consultation Paper (“Paper”) is objective proof of a terrifying and continuing contempt of the interests of the people of Victoria with respect to the harm caused by pokie gambling. This considered statement is based upon the findings set out in the government’s own research. The Paper ignores the substance of the recommendations of the Productivity Commission.

The Paper also ignores the findings of the August 2009 study published by the Victorian Department of Justice titled Impact of changes to Electronic Gaming Machine characteristics on play behaviour of Recreational Gamblers.

The Paper gives weight to the biased Responsible Gambling Ministerial Advisory Council. No weight should be given to the views of this Council given that it’s makeup comprises mainly of people whose interests lie with preservation of the income derived from gambling losses. It is expected that this Council would suggest a course of action that would do little to impair the flow of gambling income. The Paper confirms that expected result.

The Paper’s definition of “Pre-Commitment” set out in the first line of the document is not only misleading but also wrong. Commonsense meaning of the word “commitment” connotes a pledge to a course of action. It is wrong to define the word commitment as the mere ability to set a limit. This is not semantics; rather, this distortion sets the direction of the Paper. Commitment means a commitment; not something else. “Self imposed limits are not commitments.” (PC Final Report 10.5) “The very concept of pre-commitment is that it is a contract that parties cannot breach without significant consequences.” (PC Final Report 10.23

The correct definition is found on page 10.2 of Productivity Commission’s final report:
“… regulatory options that would give people the opportunity to constrain their behaviour when in gambling venues (pre-commitment), with limited potential for reversal”

The Paper’s policy direction away from the true definition of Pre-Commitment must be corrected otherwise measures introduced will not minimise the harm of pokie gambling.

The absence of any specification or even the briefest mention in the Paper of an identifying device is in direct conflict with the first and essential key recommendation of the Productivity Commission for even partial pre-commitment. This failure is fatal.

Rather than the ineffective policy options described in the Paper; the findings of the Productivity Commission in Recommendation 10.4 and Chapter 10 of their final report should be expressly adopted including the specification of an identifying device. This approach is consistent with publicly stated agreement between the Prime Minister and the Member for Denison.

In particular, the Victorian full pre-commitment system must incorporate these essentials;
  • A compulsory device for all pokie gambling including pubs, clubs and the Crown casino
  • Non-transferable i.e. include measures to avoid identity fraud
  • Set a default limit that the gambler must opt out of
  • Require that gambling stops within a set period once limits are exceeded i.e. a commitment."


As a result of further debate, I have partially modified my suggestions to an arrangement taking better account of the concerns of the pokie industry. I will set these out in my next blog.

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