Second Reading

Danny O’BRIEN (Gippsland South) (17:07): I am pleased to rise to speak on the Gambling Legislation Amendment Bill 2023 and to give the opposition’s position on this legislation which has been introduced by the government. It is part of a suite of reforms that were announced in July of this year and to a large degree also follows up some of the reforms resulting from the Royal Commission into the Casino Operator and Licence. There are two main parts to the legislation: the changes to mandatory closing hours for venues with electronic gaming machines and the changes to the casino with respect to the timing of payment of winnings issues for mandatory carded play and also the issue of a manager for the casino in the event that a casino licence is surrendered, cancelled or suspended.

Another aspect of this legislation relates to the issue of downtime. With respect to the institution of mandatory carded play, that will need to be managed by the third-party operator, being Intralot at the moment. The legislation provides some guidance – some relief, if you like – in the event that that third-party operator has downtime or outages or technical issues that are beyond the capability of the casino or venue operators to manage. They will not be penalised for something beyond their control. Finally, there is the issue of a change to betting contingencies to allow the minister to prohibit wagering providers from offering bets on certain activities, including those outside Victoria. The current act already provides that power to the minister for activities within Victoria. This extends it to other jurisdictions as well, and I will go into more details on each of those throughout my contribution.

There is background to all of this, as I indicated. Although in the context of the bill, a 24-page bill, the issue of the mandatory closing hours for electronic gaming venues is literally two paragraphs – very brief – it is the substantive part of this legislation I think from a public perspective, given that many of the other issues are either minor or very restricted to the casino operations. The government announced on 16 July a series of gaming reforms, including this mandatory closure period between 4 am and 10 am for all venues except the casino, and I will come to that later. It also announced statewide mandatory precommitment and carded play and a reduction in load-up limits on gaming machines from $1000 now to $100 and reduced spin rates on gaming machines.

These reforms, it is fair to say, came out of the blue. They were not something that the sector was expecting. There had been very little indication from the government that there was to be significant reform in the gaming sector, indeed to the extent that prior to the election the government made no commitments whatsoever for the gaming sector and neither did we on the opposition side. Indeed the Age reported on 23 November last year with the headline ‘Labor, Libs pre-commit to pokies reform protection for pubs and clubs’. Now, I would not characterise it the same way that the Age has; I do not think it is necessarily about protection for pubs and clubs. It is about, though, providing certainty for an industry – and any industry. Indeed that article by Royce Millar and Josh Gordon contained the line:

In a September letter, Victorian Gaming Minister Melissa Horne assured the clubs the government changes were limited to the casino.

And yet here we are on 16 July, not much more than six months after the election, and the government outlines something that is so dramatically different to what it said just before the election – quite considerable reforms.

Now, there is no doubt that gambling harm is a problem in our community, and there is no doubt that electronic gaming machines are a part of that harm. There is a serious problem with people addicted to poker machines who are losing lots of money – who are harming themselves, harming their families and harming their friends by spending too much money, often money that they do not have, on gambling machines. I support any efforts to address the level of problem gambling in Victoria.

Indeed the opposition was the coalition government in 2011 that set up the Victorian Responsible Gambling Foundation, which, I might add, is to be wound up, effectively, by this government according to the budget papers this year. That, again, is part of these reforms. It was eventually announced and explained as to why there was only one year’s funding for the Victorian Responsible Gambling Foundation in the state budget. I asked questions at the time of the minister, and the minister indicated the future funding for the VRGF would be for future budgets. And then lo and behold, just a month later, the government comes out and announces, ‘Well, actually most of the role and regulation provided by the Victorian Responsible Gambling Foundation will in fact be rolled into the Victorian Gambling and Casino Control Commission’.

We, as I said, certainly support activities that reduce problem gambling, that reduce the harm that comes from gambling. I do raise a concern, though, that there is often a much, much bigger focus on gaming machines than there is on gambling harm full stop, because gambling harm comes in a whole range of types, whether it is people punting on races – horses, dogs, the trots – whether it is people playing the pokies or whether it is people punting online. There are, I think, very many numbers of ways that harm does occur. I am concerned that the government has introduced or announced these reforms in a context where (a) as I said, it had said before the election that it would not be making any changes to the gaming framework and (b) before that it had just entered into a 20-year licence arrangement with pubs and clubs for the electronic gaming machines.

There is a significant issue I think this raises of sovereign risk. The government has effectively entered into a contract with pubs and clubs for the provision of gaming licences and just a few short months later – in fact about a year later – has announced significant reforms that could have quite genuine impacts on revenue and impacts on the value of those licences and do expose the state, in my view, to a potential sovereign risk issue. Whether that goes anywhere and there are any legal challenges is not a question for me, it is obviously a question for those licensees, but I do know from talking to them that they are very concerned.

When I say ‘talking to them’, that is something that we on the opposition side do. I have certainly met with and spoken to the Alliance for Gambling Reform – there are a couple of gambling harm events this week that I will be attending – and I also talk to the industry. I talk regularly to the Australian Hotels Association (AHA) and to Community Clubs Victoria (CCV) to understand their concerns and issues. It would appear that the government has not done that, because these reforms announced in July, including the subject of this bill, the mandatory closure periods, came as a complete shock. No-one got a heads-up on what the government was proposing here.

This is in a context that was a surprise to me. The context is, as members will be aware, that most members probably get invited – the Greens probably do not get invited – to the Australian Hotels Association annual drinks at the start of the parliamentary year, something that the former Premier was a regular attendee at. Certainly I have seen some ministers, probably not enough, at that event each year. It is an opportunity to mingle with pub owners and the hotel industry more broadly, and the former Premier was there regularly. The former Premier outlined his support for the pub sector repeatedly. He recognised the contribution that pubs make as a hub for their communities and the contribution they make particularly as employers, and he recognised the work that they do in the wider community with respect to sponsorship and support of their communities. So it was a surprise to me that that same Premier, Mr Andrews, then came out and announced these reforms with no consultation with the Australian Hotels Association, Community Clubs Victoria or indeed anyone, it seems.

I know the AHA and CCV have worked very well in being open with the government and opposition and all members of Parliament about their aims and their industry, and it is a significant industry. We caught up just recently with Clubs Victoria and some of their stats. They have 30,000 employees and 2.3 million members – if you put 2.3 million members into context, roughly one in three Victorians is a member of a club – and they give back $56 million a year in cash and in-kind donations, $127 million a year in in-kind labour and $805 million in free or subsidised facilities. Those facilities are things like RSLs, golf clubs and bowls clubs, where people have the opportunity to go to a club, to get some fellowship and to socialise. They might want to have a punt. The vast majority of people put a few dollars through a machine while they have a beer or a cup of coffee and socialise with their friends. Likewise, AHA members donate around $27 million a year to charities, contribute $4.5 billion to our gross state product and employ some 52,000 people. Between them those two provide over 80,000 jobs in the state. We have just heard the member for Narre Warren South talk about the importance of jobs. This is a sector that does provide a lot of jobs. Not all of them, of course, are related to gaming machines, because many of them do not have gaming machines, but certainly it is a key component.

I know the AHA works very hard to keep government members and ministers informed of their concerns and issues. Paddy O’Sullivan, the CEO, and Dave Canny, the president, have worked extremely hard to try and make sure the government understands the value that they provide, and likewise Community Clubs Victoria, Andrew Lloyd, Greg Roberts and all of their members, who play such an important role in the community. So it was a complete shock I am sure to them, as it was to me, when these reforms were wheeled out just seven or eight months after the government had gone to an election with a commitment to make no changes. It is probably a salutary lesson for any industry or business with this government to think that they have a stable environment – well, you can be thrown on the scrap heap at any given time. As I said, there is a need to ensure that we tackle harm, and the government has indeed announced these reforms.

I might add, while I am talking about consultation, the government announced the reforms on 16 July – and clearly, as I have indicated, no-one knew they were coming – and then said they were going to consult with industry. To that extent the industry received an email on 23 August that provided a bit of a framework, an outline, of how the government intended to consult with them on these reforms, and it contained a line that stuck in my head. It said:

The Department of Justice and Community Safety has compiled a consultation paper to assist with the early stages of policy development.

How do you assist with the early stages of policy development for a policy that has already been announced by the government? It is quite absurd to suggest that the government is now going to consult when it has already announced what it is going to do. I think that is a real concern about how this government goes about its business in dealing with industry, in dealing with any sector. Whether it is a commercial sector like this, whether it is a heavily licensed sector like this, heavily regulated, or whether it is simply the private sector, the commercial sector, the volunteer sector, you do wonder what sort of attitude the government is taking to these things when it can simply come out and change the rules midway through. As I said, there is a significant sovereign risk issue there.

To go to a little bit of the detail in this legislation, the mandatory closing hours issue I mentioned is literally two paragraphs and implements a mandatory 4 am to 10 am closure period. That is hard to argue with. I do not think too many of us could stand up in here or out in public and argue that it is really important that someone has the opportunity to be at a pokie machine at 7 am. There are exceptions of course. There are shiftworkers, there are people who work odd hours and there are insomniacs and all sorts of party animals that have different time lines and time arrangements than the rest of us. But I do think that there is a case for limiting the hours at a particular time, and the evidence does show that enforcing a break of some description like that will actually help those who need to get out of a venue and need to stop putting money through it – those with a serious problem who might be going for 10 or 12 hours at a time. It is probably unlikely that people are doing that, because our venues do tend to have a good, close watch on their customers. They have responsible gambling officers, and they are making sure that people are not overdoing it as best they can. But in a big venue setting a break is not a bad thing.

What I think though is quite contradictory and quite hypocritical of the government is the fact that these new hours will apply to everyone except the casino. Indeed in the second-reading speech the minister said that the government has ‘some of the strongest casino laws in the world’. Ironically this whole piece of legislation, when it comes to the mandatory closure periods, does not apply to the casino. We have seen for a long time that the casino has got special treatment from this government. There was a blind eye turned to what was going on at the casino, and I will turn in a moment to some of the other aspects of this legislation, which are continuing to tidy up the outcomes of the Finkelstein royal commission – a royal commission, I might remind the house, that really only happened because of the Bergin inquiry in New South Wales. That inquiry uncovered some atrocious behaviour by Crown Casino, behaviour that had been completely missed by the former Victorian Commission for Gambling and Liquor Regulation, and this government was dragged kicking and screaming ultimately to establish that royal commission.

You will remember, Deputy Speaker, that there was some absolutely disgraceful behaviour found through that royal commission when it came to money laundering, when it came to junkets and when it came to criminal activity within the casino. Indeed Commissioner Finkelstein said:

… for many years Crown Melbourne had engaged in conduct that is, in a word, disgraceful. This is a convenient shorthand for describing conduct that was variously illegal, dishonest, unethical and exploitative.

They are pretty strong words from a commissioner, a very respected former legal mind, and that was based on the evidence that was produced at that royal commission. As I said, I think it reflects pretty poorly on the government that it had to be dragged kicking and screaming to undertake that royal commission. It reflects pretty badly on the former VCGLR as the then regulator, who literally did not pick up any of it. I would hope that the new Victorian Gambling and Casino Control Commission will be doing a much better job.

That brings me to some of the amendments related to the casino. We have got effectively two parts to the casino legislation here: one is a new part 2A inserted into the principal act, the Casino Control Act 1991, which will clarify the powers of a manager who would be appointed in the event that a casino licence is suspended, cancelled or surrendered. The provisions for a manager have been in the act for a long time but have been amended through the last couple of pieces of legislation with respect to the royal commission findings, and this bill makes some further changes to that. They largely replicate the provisions in the existing act, but there are some modifications, largely to protect the interests of both the manager and the state, including in the event that there is an administrator or liquidator appointed to the casino or to the casino operator at the time that a manager is in place. They ensure the casino can continue to operate under a manager. It gives the manager some powers with respect to clear access to property, limits on third-party rights and matters such as shared services provided to the casino by non-casino parts of the business, such as housekeeping, car parking, security, waste disposal and the like. Effectively you have got Crown Towers and other aspects of the business where services are shared, so this bill tidies up some of that.

The second area relates to the timing of the new cashless gaming requirements and seeks to limit money laundering opportunities by capping payouts of winnings in cash. Basically the bill as it stands sets up two periods. There are some minor changes and some technical amendments, if you like, to how those payouts are handled between now and 1 December 2025 when the full mandatory requirements will come in on all machines to be played in the casino. There are further requirements that come in post 1 December 2025, and this bill clarifies exactly what that will be in clause 11 – that is, providing those interim requirements up until 1 December 2025, which do not include an ID requirement. Post 1 December 2025 there will be an ID requirement; people who are getting out more than $1000 in winnings will need to provide their identification. There will be limits on how it can be paid out. There will be certainly also a 24-hour limit if someone requests a payment by EFT. Those are the amendments to the casino.

I will just touch on the other things. I mentioned that Intralot currently has the role of the third-party service provider for gaming machines, and there is a clause giving the minister effectively the power in the event of an outage – ‘downtime’, as it is referred to. The casino cannot be held responsible for not implementing some of the carded play and precommitment arrangements if it is circumstances beyond their control, and we do not have any issue with that.

Finally, just while I am going through the other non-opening time issues – prohibited betting contingencies. The minister currently has power to prohibit wagering being offered on certain activities that occur that might be, to quote the second-reading speech, ‘out of step with community expectations’, such as children’s sport or amateur sport. This very minor amendment changes that from being for activities that occur in Victoria to ‘in Victoria or elsewhere’, recognising that of course Victorians can be punting on activities happening interstate or overseas. This will ensure that the minister can prohibit betting on certain activities. This has largely come from concern earlier in the year about bets being offered on the under-19 women’s cricket world cup, where you had 15-year-olds and 16-year-olds playing – so minors playing. I think the government needs to be reasonable and sensible on this and be cautious about what it prohibits betting on. There will be some circumstances where it is difficult to ensure clarity, and one of the wagering companies gave me the example of a 17-year-old playing at the Australian Open. It may not be clear the age of players at the tennis, for example, and there may not be any particular concern from the community about betting on a minor in that circumstance. I do remember Boris Becker was 17 when he won Wimbledon in about 1985. I guess all I would ask of the government is to do some consultation with the industry when it is making decisions on that sort of betting.

I will return now to the mandatory closing hours issue. I think there is general disquiet from the providers in the sector about this change. They are already limited to 20-hour operation – they cannot operate for more than 20 hours in a 24-hour period – but have had the ability to set their own opening times. Largely the government is responding. The second-reading speech indicates and the government has said publicly that it is concerned that there have been some venues effectively gaming the system – no pun intended – by staggering their hours and providing in the local area a 24-hour opening period so people could move from one venue to another and literally gamble 24 hours a day. I guess I would say that while we do not oppose legislation to address that, how much enforcement, how much regulatory activity did the government do to try and stop that from happening? Did it go and knock on doors and say, ‘Hey, you’ve got an obligation not to do this’? I am not sure that occurred before the government simply moved straight to the sledgehammer of bringing in legislation on this. Again, I do not think there is much argument for people to be playing pokies at 4 o’clock or 6 o’clock in the morning, but I do wonder whether the government looked at how it could talk to the industry about this before it actually brought in legislation, particularly in a circumstance where that legislation will not apply to the biggest gaming venue in the state, being Crown Casino.

I think it is particularly unfair that – given the history that I have outlined with the casino royal commission and so much of the reform that has been introduced in this state that has already been applied to Crown Casino in terms of mandatory precommitment, carded play and the like – it is now being enforced on a sector that has done nothing wrong. There was no evidence at the royal commission that the sector has been involved in the sort of behaviour that Crown was involved in. Particularly that is the case for venues who would be in direct competition with the casino – those venues in close proximity, predominantly in the city, the CBD, but with the casino being on the edge of the CBD, down into South Melbourne and Port Melbourne and that area as well. The opposition will be moving an amendment to the legislation, and under standing orders I wish to advise the house of the amendment to this bill and request that it be circulated.

Amendment circulated under standing orders.

Danny O’BRIEN: This amendment is to clause 26. As I said, there are literally only two paragraphs with respect to the gaming hours. Clause 26 inserts new section 3.5.28A(2):

This section does not apply to a venue operator who is a casino operator.

Our amendment adds the words ‘or in relation to an approved venue that is within 3 km of a casino’, effectively saying that those who are close by should not be disadvantaged by the fact that the government is exempting the casino from these mandatory closing hours. We do not think that is fair. If it is the view of the government that the casino is in some way a protected species because it is a significant venue and it is a tourism attraction, then that applies broadly to the area around it, in our view, broadly to the CBD. If we are going to be an international city, if we are going to be a place that welcomes people to come and socialise, to celebrate, to party, to drink, to gamble, to dance and to do all those things that a vibrant city offers at night, then it is not very fair that the rule only allows the casino to be open 24 hours and there is a mandatory closing period for gaming venues in the vicinity. Again, the maximum 20-hour rule would still apply for venues, but if they chose to remain open in the early hours of the morning when they are competing with the casino, they could do so under the amendment that we will move. I would hope for support here or in the other place for that amendment because it is a matter of fairness. People may ask why 3 kilometres. It is an arbitrary figure. Wherever you go, wherever you put a line, you are going to provide people on the edge of that line a disadvantage, but 3 kilometres is roughly a reasonable walking distance. It takes it to roughly the Albert Park beach, it takes it to Punt Road and it takes in all of the CBD and much of Carlton and North Melbourne. Those areas that are considered the CBD and the inner-city entertainment area would be exempt under these rules.

We are not opposing the legislation. I encourage the government to support our amendment, and I certainly encourage those in the other place to support it when the bill gets there. The government does not have a mandate for these reforms, so it should acknowledge the concerns of the industry. We in the opposition certainly are keen and committed to tackling problem gambling, but I think we need to get the balance right and make sure that we support the jobs and the industries that are crucial in this state as well.

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