Tuesday, September 27, 2011

Shmandatory Shpree-coshmitment: Will New Pokies Regulation Work?

Mandatory pre-commitment. The idea is to make problem gamblers think consciously about their actions, before the addictive behaviour kicks in, and to then bind them to their sober choices.

Will the plan work? No. But is the thought in the right place? Kind of, I guess. But is it the right approach? Doubtful. Here's why:

Let me start by saying that after reading (parts of) the 290 page Parliamentary Joint Select Committee on Gambling Reform report, I think that the recommendations aren't as bad as Clubs Australia has been claiming with their scare campaign.

The Plan

  1. Make people get a card that allows them to set a spending limit and a duration,
  2. Allow people to reduce limits and increase durations, but not vice versa,
  3. Modify all pokies machines to enforce the limits,
  4. Ensure that once a spending limit has been reached, the limit cannot be abused by going somewhere else,
  5. Introduce clearer information about payout rates of machines,
  6. Exempt from the scheme machines on which only $120 per hour can be lost

Opening Observations

The first thing that sounds scary here is the implication that Clubs Australia has highlighted about the scheme being a "licence to gamble". It sounds like an overbearing government program that will infringe on civil liberties. That may be, but the report actually does more than just pay lip-service to privacy concerns.

There is one approach that is discussed in the report that would involve big, centralised databases. These would be terrible for privacy, but there is also discussion of linking smart-cards to people, and then storing all the relevant information on the card, with no need for centralisation of data. This style of plan, while probably extremely hackable, would solve most of the privacy concerns, while still limiting the gambling of most gamblers out there, including most problem gamblers.

There is discussion in the report about people getting access to more cards, and I think that's a valid concern. If the plan doesn't stop problem gamblers, and actually creates an illicit market, i.e. for trafficking in cards, then more problems could be created than solved. The report deals with this by suggesting that big payouts are made only to people who can prove they are the legitimate card-holder. I can see this being abused by venues in order to attempt to not make payouts when players win, while still allowing them to lose.


Here's the thing: This is a very expensive solution (think $3B) where far more mundane solutions could work just as well without being anywhere near as aggressive.

I've been affected by problem gambling. I grew up for much of my childhood with evictions being a frequent occurrence. Pokies were the largest part of that. It sucked. That doesn't mean that mandatory pre-commitment is the right approach.

What is good about the scheme is that it's all about breaking people out of their brain-dead cycle of just continuing to bet, blocking out all other thoughts. From what I have experienced, it was never about winning money. It was always known that serious winning didn't happen and that money would be lost, but it provided the ability to just shut off one's mind and tune in to the flashing lights and ringing bells. It's pretty much why PopCap Games is so popular.

Where I think it goes wrong is that it tries to use too many artificial systems and constraints to stop bad behaviour. What should be done instead is try to engage people in more positive behaviour. So, I'll brainstorm some ideas that I think would work better to both reduce the amount of problem gambling, but also keep up clubs' revenue and engage people more socially.
  1. Nowhere among the recommendations is there any suggestion that licensing of less poker machines could be a good idea. A small venue is classified as a a venue that has less than 15 poker machines. That's a lot of poker machines. I'd limit the licences granted to about 1 machine per 50 legal capacity, so that clubs would tend to have between 2-10 pokies each, no more. After all, clubs and pubs are not casinos; they are social venues.
    I remember from my childhood going around the Melbourne CBD with friends to all the Time Zone arcades and starting out by spending a few dollars. We would then case the places looking for free credits, and usually find one or two. Even after the option of playing games was exhausted, we were happy to watch other people playing games. There's just about as much excitement watching someone else virtually rip out a spinal cord as getting to do it yourself.
    So I'd suggest that were pokies to be few enough that they were generally busy, and engaging enough that people could get their kicks by watching others play, that this would get problem gamblers some of their fix. And by increasing occupancy on each machine, clubs would have less overheads for each dollar that was bet, so it's not all a loss for them.
  2. Keeping with the social theme, allow a multi-player poker machine to count as one machine. On one of these machines, winning and losing would be shared with someone else. It would be interesting to see how people act when they know that their losses are felt by another person. It might get the players thinking more about their own situations. I see these multi-player machines having side-by-side terminal, with the betting buttons over 2 metres apart, which should be enough to ensure that one player can't play on their own. While I think this could help to limit problem gamblers, it could actually bring in more revenue from non-problem gamblers, as instead of being the one sad-case that goes off to play the pokies, a person could take a friend and still be sociable at the club.
  3. Clubs have really abdicated their responsibilities to poker machine companies. *Back in my day*, football clubs made money without pokies. Perhaps I'd even be more likely to go to my club if it didn't come across as a place where sad old bastards go to gamble away their pensions. Clubs should be engaging with a wider base, raising funds in more family-friendly ways. Instead of draining the cash from a small part of the membership, drain a smaller amount from a wider range of members. More raffles and competitions. More special dinners. More bowls nights. More opportunities to meet the players and get merchandise signed. Stop being so lazy because there are poker machines sitting there making the money that's needed.
  4. Go back to good old video games and pool tables. They're like gambling, but without the gambling. They're fun, they make money, they're social, but only mildly addictive. If I see a Galaga, 1942 or Tiger Heli machine somewhere, I am far more likely to play that than to play a poker machine.
  5. Building on top of point 1, where there are few enough machines that occupancy is generally high, after some fixed amount of time, say 1 hour, force a cool-down period on the machine for, say, 15 minutes. If the gambler can't easily hop on another machine due to the high occupancy rates, they'll have to actually step away from the machines for a while. 15 minutes is not enough to motivate one to find another club, but it is too long to just stay seated at the poker machine and keep one's head spaced out. At some point during that time, there'll be a spark of introspection, and possibly enough annoyance at the delay to just leave.


I don't think that Wilkie's plan is as bad as its detractors make it out to be. I think that there is quite a minefield to navigate with respect to people's privacy rights, but that the navigation is achievable. Yet still, I think that when this plan comes from a belief that pokies are a problem, less pokies and less-isolating pokies are probably a better solution than more complicated, plentiful-as-ever pokies. Until I'm confronted with a good counter-example, I'll always prefer regulation of businesses over regulation of denizens.

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