Thursday, 10 March 2011

The Most Important Thing

The most important thing I would say about the implementation strategy is that it itself involves precommitment to precommitment and by that I mean really the technology platform. So the starting point for the implementation plan is to put in place the standards and the technology across the states that would allow precommitment. It is also the same platform that could allow a whole range of other measures to be put in place and, most importantly, to withdraw or amend them at very low cost depending on their effectiveness.

That's not something I wrote although I wish I could have.

It is an extract of the transcript of the Productivity Commission's contribution to the Select Committee's inquiry into pre-commitment. The words are from Dr Ralph Lattimore who was very much involved in the 1999 inquiry as well as the 2010 inquiry. His recommendations deserve the greatest weight together with the views of Gary Banks and Robert Fitzgerald who also conducted both inquires (no disrespect whatsoever to Ms Sylvan who is a veteran of only the 2010 Inquiry!).

Why is it the most important thing? Because the Productivity Commission never recommended pre-commitment as the complete fix-it to Australia's enormous pokie gambling problem. Again, Dr Lattimore words are preferred
"the commission has never suggested that precommitment will be a silver bullet. It is part of a suite of measures. You cannot just rely on a single approach to address problem gambling or, indeed, consumer protection."
Pre-commitment was only one of a series of measures considered that included the $1 bet limit, reducing the amount of cash that could inserted into a pokie at any one time, the volatility of the machine, the spin rate, the maximum ATM withdrawal and others.

Let Dr Lattimore, Ms Sylvan and Mr Fitzgerald do the talking:
I can give an illustration of this. This is why we have put a lot of emphasis on the platform at the commencement. We had a lot of dealings with the ATM manufacturers because we wanted to address rigorously the costs associated with ATM changes. Changing a limit on an ATM machine in a gaming venue is very low cost because it can be done remotely. In Queensland, where they use the QCOM system, again it is extremely cheap to make a change to the gaming machine because the communication between the machine and the monitor—a private monitor in this case—is easy. So they were able to introduce a change in the amount you could put into the machine in any one go overnight. As it happened, we withdrew it shortly afterwards but again remotely. On a platform side, that is what you are looking at. That involves the capability for precommitment and it also gives you the capability for a range of other regulatory measures. That is why the most important part of that implementation strategy is getting agreement on standards and technology.
Ms Sylvan—We are talking about a national uniform set of standards, which industry said to us was very important. One of the concerns at the moment is that the standards are quite variable across the states and territories. Our use of the term ‘adaptive technology’ means you have a base set of standards, but the implementation of that in different jurisdictions could in fact be different. For instance, bet limits could be different and could be changed quite easily. So that is an important feature of the system.

CHAIR—So you could have a state based technical solution to a set of common standards?

Ms Sylvan—A different implementation really.

CHAIR—Okay, but ultimately arriving at a uniform technology?

Mr Fitzgerald—The technology should be standard across Australia. That benefits industry. It is the most cost effective way to do it. Once you introduce this new technology, individual jurisdictions can implement different measures. The problem at the moment is that the current status quo machinery means that all implementation of measures is expensive. This changes forever the way in which the industry, the regulators and government policy can interact. The key thing is that it is very cost effective, but to do it you need national technological standards with a capability to do a range of things."
It would be ultimately
  • cheaper
  • quicker, and
  • more effective
if Australia followed the considered recommendations of the Productivity Commission.

Let's hope that the ALP will stay the course and the Coalition will think about Australia's welfare instead of their apparent cynical priority of calling an early election.

No comments: