Gaming Machines Bill
Debate resumed from 30 November.
Mr OAKESHOTT (Port Macquarie) [7.30 p.m.]: Once again it is a pleasure to lead for the Opposition on substantial gaming and racing legislation, that is, the Gaming Machines Bill. This legislation has been talked about since March 2000. There were public announcements in March, April and June this year, on the day the Cabramatta police report was tabled in another place. This bill, which is about 200 pages long, is substantial legislation. I note that the bill was given to the Opposition only last Friday. Therefore, it must be remembered that the Opposition has had only a weekend to deal with the bill. Despite this legislation being talked about for nearly two years, the amount of Coalition, Parliament and community consultation has once again been limited by the Government. That reflects on the Government's general approach to consultation and transparency through the Parliament.
Despite that, this legislation is important. No doubt the gaming industry is a valuable contributor to life in New South Wales. Some figures from the recently released annual report of the Department of Gaming and Racing need to be put on the record. In New South Wales 1,391 registered clubs have more than 74,000 gaming machines, with more than $400 million collected in duty; gaming machine turnover as at 31 May 2001 was a significant $27 billion, with gaming machine assessed profit of $2.8 billion as at 31 May 2001 and an average annual return to government of $5,431 per gaming machine. As for hotels, 1,834 hotels are operating more than 25,000 gaming machines, with $323 million collected in duty; gaming machines assessed turnover was $11.8 billion as at 31 March 2001 and assessed profit was $1.2 billion at the same date, with the average annual return to government from each hotel machine being $12,700.
In this debate we should respect the significant role the casino now plays in New South Wales, with 210 gaming tables, 1,500 gaming machines, an estimated 5.98 million patrons, more than $70 million paid in casino duty and $10 million payable in the Community Benefit levy. Considering the casino in line with other gaming activities in New South Wales, such as Keno gaming, public lotteries gaming and the ever-increasing role the TAB plays in providing products such as links and the central monitoring system, and combining all that with the sports betting industry, the charities industry and the substantial racing industry in New South Wales, we are talking about an extremely important industry in New South Wales. I emphasise the word "important" because these industries provide important employment, they are an important source of revenue for government and they provide important social enjoyment for many people in the community.
With these benefits comes a cost, which was identified in the Productivity Commission's report in November 1999. That was the start of a lengthy debate, which has culminated in the latest round of Government reform going through the Parliament today. It is important to refer to the Productivity Commission report because over the past two years many people have tried to dismiss the report. In the Coalition's view, the reason for that has been that it provided a substantial challenge not only to industry but also to government, and it forced industry and government to have a good look at the way they do business. For that reason alone the Coalition is of the view that the report is a worthwhile document and the Productivity Commission undertook a worthwhile exercise, despite the fact that many people have tried to discredit the work that was done. I shall refer to a couple of points in the Productivity Commission Report because that was the starting point of the debate that is continuing in the Parliament tonight. The key findings of the Productivity Commission included:
I will return to that matter later. The Productivity Commission report contained some key messages in an overview of gambling policy. The report stated:
Policy approaches for the gambling industries need to be directed at reducing the costs of problem gambling—through harm minimisation and prevention measures—while retaining as much of the benefit to recreational gamblers as possible.
The current regulatory environment is deficient. Regulations are complex, fragmented and often inconsistent. This has arisen because of inadequate policy-making processes and strong incentives for governments to derive revenue from the gambling industries …
Counselling services for problem gamblers serve an essential role, but there is a lack of monitoring and evaluation of different approaches, and funding arrangements in some jurisdictions are too short term. …
Policy decisions on key gambling issues have in many cases lacked access to objective information and independent advice—including about the likely social and economic impacts—and community consultation has been deficient.
An ideal regulatory model would separate clearly the policy-making, control and enforcement functions.
The key regulatory control body in each state or territory should have statutory independence and a central role in providing information and policy advice, and its principal operating criteria should be consumer protection and the public interest.
• Transparent processes, careful attention to policy design and evidence-based choices among competing options are the keys to good policy.
• Governments are no always provided clear rationales for gambling policies.
• Some apparent objectives for, and outcomes of, policies do not have a strong prima facie basis—in particular, exclusivity arrangements, economic development, and measures which support particular groups or activities within the gambling industries.
• Policies often appear to have inconsistent objectives and variable application, illustrated by the use of strong probity controls in some gambling modes and their absence in others.
• The goal of revenue generation can have a distorting influence of policy. It is unlikely that the gambling regulatory environment would look like it does without the understandable imperative for states to meet their tax revenue needs.
Finally, the overarching goal should be to maximise the welfare of the community as a whole. Measures that may reduce the social harms of gambling, while maintaining the benefits, find particular favour under this approach.
I cited large slabs of the key messages of the Productivity Commission's findings to have them included on the record because that is really the starting point for analysing the bill before the House. This legislation should be evaluated within the framework formulated by the Productivity Commission. Although several issues arise, largely the legislation meets the standards set by the Productivity Commission to apply not only in New South Wales but also throughout Australia. Off the top of my head, I suggest that credit should be given to the expansion of the self-exclusion program to make it mandatory among all hotels and clubs in New South Wales. If there has been some successful reform over the past year or two, it has been through the voluntary self-exclusion program. The expansion of that program is supported by the Coalition in New South Wales.
Having said that, the Opposition makes the point that, on several fronts, matters could have been done better, especially in relation to transparency as referred to by the Productivity Commission. Over the past six to 12 months, the Government's exercise in preparation of this legislation has been far from transparent. Earlier I made the point that the Coalition was given access on Friday to documentation relating to the bill. Really, the Parliament has had two or three days only in which to deal with this legislation and the community has not been involved in the process at all. Although I have been advised that industry groups have been involved, over the past six months the preparation of this legislation has been an example of government behind closed doors, and development of policy has been a far from transparent process. At times, even the Minister was not involved in the negotiation process.
Many people have made the observation that much of this legislation has come from the Premier's Office, and in particular from the Premier's chief of staff. That is a reflection of the deal-making that has been conducted behind closed doors in preparation of the legislation that is before the Parliament. That practice needs to change if standards are to be lifted in the development of better public policy in New South Wales for gaming. The Productivity Commission also referred to evidence-based policy choices. This legislation provides several examples of approaches that are far from evidence based. The obvious one that springs to mind is mandatory closure of poker machines. The shutdown has been negotiated from six hours down to three hours and is a great example of no evidence being provided in any debate up to date to show that shutdown will do anything to deliver what is supposedly a primary objective of this bill, namely, the meeting of harm-minimisation standards to assist problem gamblers.
If anything, New South Wales is entering a back-to-the-prohibition era with its moonshine and six o'clock swill approach to gaming policy. That will certainly do nothing to assist problem gamblers in New South Wales; in fact, it has the potential to create more harm rather than minimise harm. The Coalition will monitor that issue very closely over the next 12 months. I note the time frame stipulated by the Government in the legislation. The shutdown will extend to six hours in May 2003, which is two months after the next State election. Anyone who knows anything about politics knows that that extension will be bargained away. The Government is not very serious about the introduction of the shutdown initiative, and that indicates a flawed process. The Government is using smoke and mirrors to try to be seen to be doing something rather than properly managing problem gamblers and minimising harm.
Breaking the link between revenue generation and the social conscience of the community is of more concern than anything else. The Treasurer of New South Wales wears the dual caps of both a tax collector and the social conscience of the community. The same person cannot wear both hats. If the Government is deadly honest about this legislation, it will admit that this is not going to work. A structure has to be built in New South Wales to separate those two roles. Even if the roles are performed by two different people within a Ministry, one to argue the case for revenue collection and the other to argue the case of meeting social needs and acting as the social conscience of the community of New South Wales, that would be a better arrangement.
The deal-making behind closed doors is very evident because one would expect that Treasury would protect its own revenue flows. I would be interested to see any figures on this legislation's impact on revenue. The Opposition suspects that the impact, if any, will be minimal on revenue flows in New South Wales. That exemplifies the problem with the links and begs the question whether gambling in New South Wales would be completely different if the Treasurer and the Government were not so protective of State taxation being the end product of the delivery of public policy. That is not a reflection of the individuals involved, who are just performing their roles, but if this House is intent on delivering the best public policy possible, the structure of revenue collection in the gaming industry versus harm minimisation, the social issue at the heart of this legislation, must be examined.
The Productivity Commission thumped fairly hard the independence of the regulatory process carried out by the Independent Gaming Authority, and the provision of independent advice. Once again I ask the Government—and I note in passing that my predecessor used to press this issue heavily—where is the independence of the regulatory process that is referred to in just about every press release? Even the very last paragraph of the announcement on 26 July by the Treasurer was all about looking at the regulatory structure and seeing whether there was a better way of organising gaming. The recommendations of the Independent Pricing and Regulatory Tribunal [IPART] inquiry were considered. The major recommendation was that an independent gaming authority be established. The Government has been dancing and flirting with this issue over the past five years yet seems to be continually reluctant to adopt the major piece of advice from the Productivity Commission to separate the structures and introduce independence into the decision-making process.
It is one thing to hoard all the decision making, to hide behind closed doors and to do the deals to collect revenue, but if harm minimisation is the bill's primary objective, as stated in the first paragraph of the explanatory notes, one of the best ways this Government can achieve that objective is to take its hand out of the cookie jar and begin to deliver on some of the social principles espoused in the legislation. The Opposition will closely monitor the Government's harm minimisation performance in coming years to assess whether the Government is playing politics or is truly trying to deliver better public policy and break the link between those roles. The Opposition will watch with great cynicism and great suspicion.
I reiterate that if the Government does not want to deliver better public policy, the Opposition will happily do so. The need for adequate regulation in New South Wales has been emphasised by the Department of Gaming and Racing's annual report. All 200 pages of this bill will mean next to nothing if there is to be a continual gutting of the Department of Gaming and Racing. It means nothing if areas such as the compliance division are continually gutted and halved, as happened in the past 12 months. All legislation passed in this Chamber will mean nothing—diddly-squat—because anyone can be in the field doing anything at any time. We need government eyes and ears on the ground, which I am sure industry would support, to make sure that the message comes back to this place that industry is doing everything right. That is what we all want to hear. It is not a suitable public approach to have a compliance division that has been halved, with limited resources in the field and therefore lack of accountability for what is happening in the field in New South Wales.
The annual report, delivered only last week, shows clearly the gutting of the department and that complaints against licensees, club management and venues have increased significantly during the year. It has risen from 626 in 1999-2000 to 1,008 in 2000-01. That is a direct link between the halving of the compliance division and the babbling of complaints. The Minister even mentioned in his forward to the annual report that he is concerned about the number of complaints in the industry at the moment. The Minister cannot have it both ways: he cannot absolutely gut the department and then raise his concerns a year later that there are too many complaints in the field. The Minister made the decision to strip the department and remove many field officers in the compliance division and therefore he is accountable.
Mr Face: Point of order: The Chair always gives a reasonable degree of latitude to shadow Ministers. However, I do not want to have to reply to issues that could have been raised in other debates, for instance, the budget. This bill is simply about gaming, harm minimisation and a range of other matters; it has nothing to do with how many people work in the compliance division. I ask the honourable member to come back to the leave of the bill.
Madam ACTING-SPEAKER (Ms Beamer): Order! The Minister is correct. The Chair extends a degree of latitude to the member leading for the Opposition. I understand that the honourable member for Port Macquarie wants to refer to matters that are not dealt with in the bill. However, I ask him to return his attention to the bill.
Mr OAKESHOTT: I am sure Madam Acting-Speaker is aware that this is substantial legislation that needs the thorough scrutiny not only of this Chamber but of all the compliance officers in the field to ensure that it will work. The point to be made in this debate is that a fully staffed Department of Gaming and Racing, not one that has been slashed and burned by a Minister during the past 12 months, is such an important requirement of this legislation. Despite spats between Ministers and Treasurers about the amount of money that is coming out of Consolidated Revenue, the Minister cannot step away from the fact that his department has suffered significant staff decreases. When legislation such as this comes before this House we must ensure adequate resourcing to enable it to work on the ground.
Similarly, further demands will be placed on the Liquor Administration Board [LAB] and the Licensing Court, both bodies being under-resourced and understaffed. I have heard nothing from the Minister or the Government about providing more resourcing and staff to the LAB and the Licensing Court to make this legislation work. Of relevance to the Department of Gaming and Racing is that if Treasury, the Premier and the Minister continue to run that department into the ground and strip it of all services, staff and resources then most of this legislation will amount to next to nothing. As a result of that compliance officers will not be working in the field, magistrates will have backlogs of work months long—
Mr Face: Point of order: Unfortunately in recent years new members of this Parliament have tended to canvass rulings of the Chair. I would not have tolerated that when I was Deputy Speaker, and that is no reflection on Madam Acting-Speaker. The honourable member has once again given a barrage about compliance officers and budgetary matters and about the LAB, with some jurisdiction under me, being appointed by the Attorney General. The honourable member has shown an abysmal knowledge of what goes on. Madam Acting-Speaker, this gaming bill is reasonably wide but not as wide as to enable the honourable member to walk through my department and raise what could be raised in budget speeches, estimates hearings and other venues. It is a growing trend that some newer members think they can wander all over the place, whereas the forms of the House provide that members should stay within the leave of the bill.
Mr OAKESHOTT: To the point of order: These are ridiculous attempts to try to shut down debate. One only has to refer to the first four pages of the Minister's legislation in which the Licensing Court and the Liquor Administration Board are mentioned. In part 8 of the explanatory note there is an entire section on complaints and disciplinary action, and that is what I am talking about. It is absolutely ridiculous for the Minister to try to shut down issues relating to his department, the Compliance Division, the Licensing Court and the Liquor Administration Board.
Madam ACTING-SPEAKER (Ms Beamer): Order! As I said earlier, the Chair extends a degree of latitude to the member leading for the Opposition. The bill is wide ranging and I ask the honourable member for Port Macquarie to confine his remarks to its parameters.
Mr OAKESHOTT: I had finished the point anyway. For the benefit of the Minister, specifically the Coalition does not quibble with the cap of 104,000, or the separate pulls of clubs and hotels, or the venue caps. We note that technically hotels received double the machines, although that will not be opposed by the Coalition. As far as the tradeable market is concerned, I gather there are some issues in relation to the restrictions in regard to clubs and the one-kilometre radius, and that some amendments will be made in that regard in the upper House. I will be interested to see what the Minister does with that. I notice that in his most recent negotiations he has been incredibly difficult to deal with on some amendments that various industry groups were trying to get through. From a country point of view, some of those amendments deserve closer consideration. However, the Opposition accepts what this Minister of the day puts before this House, and will not oppose the current arrangements put forward in this legislation. Ownership rights look like a lawyers picnic. I note the importance of paragraph (k) of the explanatory note in the overview of the bill, which states that one object of the bill is:
Ownership rights will throw up many problems as so many individual and specific circumstances are to be found throughout New South Wales. I hope that the Minister and the Government are responsive to the concerns of all individuals involved. Once again, if that issue goes before the Licensing Court I hope that licensees, licence owners or building owners will not be left in limbo for long while any backlog is dealt with by government.
To provide that the Crown is not liable for any damages or compensation because of the enactment or operation of the proposed Act.
The Opposition has no problems with the provisions relating to hardship cases and social impact assessments. However, the operation of the provisions relating to amalgamation of clubs will be watched closely by the Coalition over the next 12 months. The basis upon which a club is limited to four amalgamations is not known to the Coalition. We have heard nothing from the Government on which to base that number. As the local member, I know that the Minister is aware of particular amalgamation proceedings going on in Port Macquarie. I do not think it is appropriate to use those as an example to argue that amalgamations generally are bad.
I think there are appropriate opportunities for amalgamations of clubs in New South Wales. Amalgamations are not necessarily a bad thing. But amalgamations, even though limited in their number, will result in a significant rationalisation within the club movement in this State. I hope the Minister will be responsive to the needs of individual clubs that feel the pressure of financial restraint. I hope the Minister will put in place some sort of safety net to protect those New South Wales clubs. The Minister made mention in his second reading speech of bowling clubs and golf clubs. They stand out as two types of clubs that are under significant financial pressures at the moment. Both need support, rather than the limitations that these types of amalgamations place upon them.
In regard to other harm minimisation measures, I have said before that formal links with problem gambling services are welcome. The establishment of what is an almost mandatory self-exclusion scheme also is welcome. Industry groups have proposed that this measure should lead to hotels and clubs developing formal links with their associations. As both associations have what I regard as well-established and well-respected codes of conduct regarding problem gambling, it is an obvious step to link this approach to development of a broader self-exclusion scheme.
A difficulty can arise where recalcitrant hotels and clubs are not members of the peak associations. However, this linking approach needs to be considered. If that involves mandatory involvement with associations, I must say, without having consulted my colleagues, I do not expect that would be met with too many problems from the Coalition side. The point was made to me that the Australian Hotels Association is an organisation of longer standing than this Parliament. From memory, it was established in 1854. So that organisation and Clubs New South Wales are well established organisations. Each has well-established programs that can be of assistance.
In regard to these additional measures, there is a better way of flushing out unsatisfactory secretary managers. I think this provision is nothing more than an attempt at making scapegoats of some secretary managers. Many are saying that this is a payback measure. Many are saying that this is payback time on the club movement. They are saying that this is the payback because one or two secretary managers took on the Government on a couple of issues. This provision goes well beyond what is required by the Corporations Law. When a former police Minister could have an interest in hotels, and a current Minister has interests in hotels, the standards of a Government that places a restriction on managers of clubs having interests in hotels are questionable.
I understand, from consultation with the department, that what will be required is a full declaration regarding the exact salary of the individual. The concern supposedly is that someone out there has gaming interests linked to their salary package. Really, considering the profits made from gaming, one could argue a case that every single secretary manager is on some sort of gaming-related salary package. I repeat, this measure is an attempt to make scapegoats of secretary managers. Does this provision require assistant secretary managers to declare their full incomes and prohibit them from having interests in hotels? It would be completely absurd if an assistant secretary manager were allowed to have such interests when a secretary manager could not. I would like a response to that question, if that is possible.
The Coalition will not oppose this bill. We make it clear, however, that we do not support many aspects of this legislation. The question for us was whether to try to pull this bill apart now or let the Government govern, with the Coalition providing an alternative package over the six months leading into the next election and allow voters to decide. We have chosen the second of those options. We believe there are better alternative approaches. Whilst many aspects of the bill are good, this legislation can be substantially improved. We will put forward those improvements in the lead-up to the next election and the Coalition being voted into office in March 2003.
Finally, I would point to another aspect of the legislation that has been mentioned, the central monitoring system. It is failing badly. The Minister must get this off the ground. The system needs considerable work. It is looking like a lawyers picnic. Clubs such as Twin Towns, St George and Mount Pritchard already have had problems. All have the right potentially to take legal action against the Government and the Totalizator Agency Board for loss of trade. We want the Minister to give guarantees that he will make the linked network a winner for both the club and hotel industries, rather than the substantial burden that the bill will impose, both in time and financial costs. Though some things were done on Saturday, there are still problems and serious concerns about this matter throughout the entire industry. The Coalition is not opposed to the bill. However, this measure departs substantially from the broader principles espoused by the Productivity Commission. I repeat that the decision of the Coalition is to keep our fight for another day in the near future, when we will provide an alternative proposal.
Mr Black: Weak!
Mr OAKESHOTT: No, strong. We are happy to go to the next election on this issue. That is what we are saying.
Mr GIBSON (Blacktown) [8.08 p.m.]: First I shall respond to some of the comments made by the Shadow Minister, who complained that he saw the bill for the first time last Friday. I sat on the Opposition benches for seven years. I can recall occasions on which legislation was given to Opposition members as we walked into the Chamber—on the very day that the legislation was introduced in this place. Most of us see a change in government, and that is what has happened.
Mr Oakeshott: Tit for tat, you mean?
Mr GIBSON: It is not actually tit for tat. But one does not forget seven years in Opposition. As I said earlier, this legislation may not be a total cure, but it provides medicine for the cure. When we refer to harm minimisation we must remember that everyone has great sympathy for the problem gambler. However, the problem gambler is not the person who is playing poker machines at 3.00 a.m. After working in the hotel and club industry for 25 years I have learned that the problem gambler is the person who gets paid at 5 o'clock and has lost half of his or her wages by 6 o'clock. That problem relates not only to poker machines; it relates also to lotteries. But I am not suggesting for one moment that we should restrict the number of lotteries that are held every week or that racing days should be reduced by the Australian Jockey Club or the Sydney Turf Club.
This legislation might not be a total panacea, but it is a great start. I compliment the Minister on his reform package for the gaming industry and on the work he has done on it. It is hard to get the right mix, as many players are involved. I am certain that, in this case, the Minister got the right mix because the club industry and, in particular, members of the Australian Hotels Association [AHA], who are in the Chamber tonight—John Thorpe, Brian Ross and others—consulted with the Minister. The club industry and the hotels made a notable input into this legislation. Some people might say that this Government gave hotels poker machines and I am proud of that. If that had not occurred, hotels, particularly in country New South Wales, would have closed and thousands of jobs would have been lost.
Let me place on record one of the important reasons for the introduction of this legislative package. Today the hotel industry employs 41,500 people. A massive 12,300 jobs have been created in this State since the introduction of poker machines. It is hard to find such an increase in jobs as a result of any legislation introduced into this Parliament. The hotel industry has donated a mammoth $43 million to charity, to sports and to the community. Clubs often pride themselves on the amount of money they donate to the community. Every year 93 million meals, 260 million litres of beer and more than 10,500 cups of coffee are served, which represents the expenditure of a massive amount of money in an industry that employs a large number of people.
The hotel industry in this State pays $700 million in gambling tax, $1.4 billion in wages and $106 million in payroll tax. Those figures demonstrate the necessity for this legislation. The hotel industry is one of the most important industries in this nation. The AHA and the club industry have not been given the credit they should have been given for their responsible administration of liquor and gaming—an issue that should be noted by all honourable members. For a long time the community has had concerns about machines, clubs, pubs and problem gamblers. Most of all, the community has had concerns about jobs. This Government has ensured that those jobs are protected. We have ensured that the hotel industry is able to compete on a level playing field with the club industry.
I have referred often in this House to the Wagon Wheel Hotel and to St Marys Band Club, which were located right next door to each other in the electorate of the honourable member for Mulgoa. The club, which had poker machines, sold schooners for about 35 or 40 cents, and the hotel, which had no poker machines and had to charge double that price for beer, was expected to survive. That demonstrates the need for these legislative changes. When the Minister replies to the debate he might refer to a number of matters that concern me. One of my concerns relates to the poker machines that will go into the pool. Once all the hardship cases have been determined and we are left with 500 poker machines, where will those machines go? Will they go to poker machine heaven?
Will the Government ensure that the number of poker machines is capped at 25,980 now and in the future? The Minister referred in his second reading speech to the allocation of poker machines to pubs in new hotels. Under this legislation any new club will be entitled to 10 poker machines. The Minister should also have regard to hotels in new suburbs, towns or developing areas where populations have increased fairly quickly. If hotels are not permitted poker machines they will not be competitive. The Minister said he would also review the provision in the legislation that permits country hotels to have nine or fewer poker machines. What will happen to them?
Having lived in the country for most of my life—I originally came from Young—I know that hotels are an essential part of any country town, just as the inns in England are the focal point of any town. Hotels are used as a meeting place and, generally, they are the only places to which people can go to entertain guests. I am pleased that it is the intention of the Minister to review that provision. I believe also that the 104,000 poker machine cap is sensible. As I said earlier, as the club and hotel industry had a major input into this legislation I am sure that all areas in the industry will be looked after. Once again I compliment the Minister on the great job he has done in this very difficult area. It is hard to satisfy everyone in the hotel and club industry, but the Minister has done it magnificently.
Earlier in debate the shadow Minister referred to a three-hour gambling restriction. That might not be a total panacea, but it would make things a lot easier for the industry. We must take into account harm minimisation before we determine whether gambling should be restricted to six hours or three hours. That sensible proposal will assist us in determining harm minimisation measures. I believe that that proposal will be accepted by all who are screaming out for harm minimisation measures. That proposal will also assist problem gamblers. I support the bill and, once again, compliment the Minister on having the guts to rewrite this gaming legislation. It is hard to please everyone in this industry but I congratulate the Minister on the job he has done.
Mr FRASER (Coffs Harbour) [8.19 p.m.]: In speaking to this legislation I will go over what clubs and pubs have meant to New South Wales over the years. The Minister for Gaming and Racing well knows that from my young childhood I worked on the greens of Kahibah Bowling Club, a small club that was built by my father and after whom one of the greens is now named. That club was the focal point of the Kahibah community. It was the place where people would meet. It is much larger now but, I dare say, it is still the focal point, and not just for the Kahibah community.
Mr Face: It has the best black in town.
Mr FRASER: As the Minister says, it has the best black in town. It has also produced some of the best bowlers, such as the Robbins boys, and Jimmy Henderson, who used to be secretary-manager. To a large extent clubs have been and always will be an extension of the social fabric of our society. Clubs are places where people like to go to gain some benefit for themselves and to give some benefit to the community. In the early days of dad's association with the Newcastle District Bowling Association, poker machines were a bit of a bugbear. A fellow whom I will not name in this House—he is now dead—used to put his salary through the poker machines every Friday night. The management of the club allowed him to play only one machine and at the end of the night they would take the money out of the machine and return it to his wife. That principle remains within the club movement of New South Wales.
Poker machine revenue has provided extensions to clubs and opportunities for members to expand their needs. Clubs have always been non-profit organisations that have provided a service to their members. There are fellows like the one I mentioned who are problem gamblers, but that is only 1 per cent. A number of measures are in place already to give clubs and hotels the opportunity to refer those people to proper help. The good management of clubs and pubs will ensure that those people get the help they need and that their families do not suffer unnecessarily.
In about March 2000 this became a political football. Although the Minister may disagree, my opinion is that the change to the gaming bill and the change to the ethos of poker machines in clubs and pubs came about because the Premier and the Premier's Department took note of the media. I am not saying there should not be pressure to ensure that problem gambling does not get out of hand, but there was undue pressure from the Premier's Department to put the screws into the clubs and pubs to make sure they complied with what the Premier saw as a political imperative. That is sad.
I agree that we need a cap on the number of poker machines but the club and pub movements have been at the forefront in looking at what their patrons want from gaming machines, how they want to play them, and what sort of rewards they want from them, et cetera. I think we have a cap of $1,000 in player rewards. Coming from a tourist town like Coffs Harbour I think that is somewhat low. Many of the smaller clubs there can join with local car dealers or other promoters to offer larger prizes to entice people into their clubs.
In the ex-servicemen's clubs and the bowling clubs in the Coffs Harbour and Port Macquarie areas a large percentage of the membership are non-residents. They are people on holidays who are attracted back to the club because of the benefits offered to members through members' draws et cetera. It is sad that we see such limitations, because those things are voted for by the club boards and others in the clubs, but because the argument about problem gambling has got out of hand, the clubs and pubs are the ones who will be disadvantaged. Yet, the casino is still operating and still offering deals that clubs and pubs are not able to.
As the shadow Minister has pointed out, clubs and pubs are the lifeblood of our communities. They are some of the largest employers in country communities. They employ people on a permanent basis and they have casual employees in the holiday times. They provide a great boost to our local communities. While we need to cap the number of machines to make sure they do not get out of control, responsible clubs and hotels see themselves as guardians of the future. Being the guardians of their futures, they are looking for anyone who might be a problem gambler.
The senior vice-president of the Australian Hotels Association [AHA] told me recently that in small country towns, especially in the western area, the local pub is the village green. It is the place where the community collects of a weekend and at times when the community is not working to enjoy a steak, to enjoy one another's company, to have a little flutter on the poker machines and probably to put a few dollars through the TAB, if it has a TAB licence. The club is the drawcard, the village green, of those small communities. Most clubs never have and never will have a problem. They do not need a cap, because supply and demand in those small communities drives how many machines they have, the profit the publican makes, and the benefits he gives back to the community.
It is not only clubs who help the community. I am sure the Minister knows Bruce Wilson of Woolgoolga. The amount of money that Bruce Wilson has given from his pub and bottle shop over the years to local football shops, raffles, local schools is a credit to him. I do not take anything away from the clubs in the area, the ex-services club and the bowling club, but country town pubs provide the same service as clubs in those communities. They are the ones that benefit from people having a drink after a game, et cetera. I suggest to the Minister that we need to consider completely overhauling the Liquor Act. I recently travelled to Europe and saw how liquor is served over there. The restrictions in Australia, especially in tourist towns, badly need addressing. I know that is digressing from the bill, but it is a challenge for the Minister and his Government, and it will be a challenge for us when next we are in government to completely overhaul the Liquor Act.
It was said earlier that the AHA goes back to 1824 or 1854; the Liquor Act dates from that time as well. It is high time we brought it into the twenty-first century and let it reflect what our constituents want, especially in tourist areas. People who come to Coffs Harbour from overseas or from other parts of Australia expect to be able to have a drink and have a flutter on the poker machines, but basically the Premier's Department has led this argument on the basis of what newspapers have printed, and it has become a political football for that small percentage of people who are problem gamblers, as there is a small percentage of people who are problem drinkers.
I know that the Minister is aware of the needs of small clubs such as the Coffs Harbour Rugby Club, which is currently licensed to have eight machines. It is heavily debt laden and it will not grow a lot over the years. Many blokes there like to play football—I know the honourable member for Port Macquarie has played there in the sevens competition. His team pinched the plate one year, but they have not won it since. That club does it hard and its debts are high. Giving it the opportunity to sell some of its licensing entitlement to these machines to clubs such as the Coffs Harbour Ex-Services Club, which wishes to expand, will enable this little club to survive. Further, it would give the Ex-Services Club, which currently has between $3 million and $5 million of extensions on hold because of the poker machine cap, a chance to expand and meet the needs of its community. There are some good parts in it, such as the fact that you can trade the machine. The honourable member for Blacktown referred to what happens to the pool machines, where they end up and who gets them. But how we assess where they go is an interesting question that must be posed.
I agree that social impact statements should be done, especially for shopfront gaming dens. Recently in Woolloomooloo or East Sydney I noticed a little place that obviously has a gaming licence, but it looks more like a pinball parlour. Indeed, I would call it a backyard casino: it has a licence and a few machines. The locals tend to go there. We must look at those sorts of areas rather than at pubs and clubs that provide a service to our community. As I said, the social aspect of clubs is great. Their social aspect in small country towns, especially, must be preserved. I suggest that it is only since the advent of poker machines that hotels have had the income to enable them to upgrade their machinery. How many pubs in country areas have been upgraded in recent years?
The Dorrigo hotel is one example. Peter Ferris has beautifully revamped the Top Town hotel in Dorrigo to its original style. I dare say it is not only his business but the advent of the clubTAB and the poker machines that have enabled him to provide that little community with something it can be proud of. The pubs, instead of dying, are growing. They offer an alternative to clubs. They are not necessarily a single issue establishment. When I say "single issue" I mean they are not a bowling club, a golf club or an ex-servicemen's club: they are a pub and a community gathering point.
The idea of amalgamating clubs is very important in country towns. For example, in Bellingen, the ex-servicemen's club and the golf club have already amalgamated. In the long term I tend to think that many of these small communities will have sportsmen's clubs. The ex-servicemen's club and the bowling club, and possibly the tennis club, will amalgamate because of economies of scale. It is cheaper to run one club than it is to run four or five small clubs. Amalgamated clubs will also become a focal point for a variety of sporting groups within the town, which will help bowling, golf, tennis and other sports to survive.
It is a difficult issue and it is unfortunate that it has been brought about by the political imperative of the Premier in the first place and not by the Minister. I hope it works. I think it will work in many areas. The fact that club licences cannot be transferred back to the city without there first being a social impact statement will enable many small pubs to survive. Poker machines will not be able to be sold so freely back into city areas, which means that the long-term survival of pubs will be assured. Although the Opposition does not oppose the bill, it has some concerns. As I said, in the long term I would like to see a review that has less regard to politics and more regard to the community benefit of securing the future of these clubs and pubs.
Mr COLLIER (Miranda) [8.32 p.m.]: I am pleased to speak on the Gaming Machines Bill, which is a reform package that I welcome. The bill is difficult and complex but it is based on consultation and commonsense. The Minister and the Government have listened to the community and the industry. This legislation strikes a balance between harm minimisation and jobs, between jobs and business incomes, and between business incomes and the ability of clubs and pubs to participate in the life of the community. I am particularly interested in part 3, which deals with hardship cases, and how it will apply to a specific hotel in my electorate, the Como hotel.
The Como hotel was built in 1887 and burnt down in 1996. It was the oldest building in the Sutherland shire. In 1998, 13 local residents of Sutherland shire purchased the site and the licence, and in 1999 plans were submitted to faithfully restore the hotel to its original architectural glory. This hotel was frequented by Henry Lawson. It was a community pub where families went, where cricketers went after their game, and where people went for a quick beer while the butcher down the road filled their meat order. It has been fully restored, and it reopened on 3 November, exactly five years after it burnt down. At the time of the acquisition and during the planning and construction, the hotel licence allowed for the operation of 15 poker machines and 15 card machines, and the building and loan contracts were entered into by the 13 shire residents on that basis.
The viability of the hotel was assessed on the assumption of the ability of the owners to operate the machines to which they were entitled under the licence. The new owners went through the mandatory processes, including submitting the gambling affidavit stating that the hotel intended to operate not 15 poker machines and 15 card machines but 15 poker machines and only two card machines. The hotel owners clearly understand the importance of harm minimisation and limiting problem gambling, and they appreciate the purpose for which the poker machine freeze was instituted. However, that does not help them with their financial commitments. These commitments are based on the then reasonable assumption that the hotel will be able to operate with a modest number of poker machines.
The 13 shire residents are not millionaires. They are simply locals of somewhat limited means who are unable to fund the shortfall that would be caused by the loss of poker machine revenue. This hotel is a family hotel and the 15 poker machines and the two card machines are consistent with the hotel and its longstanding place in the community. The locals affectionately refer to the Como hotel as the Como Hilton. The measures that relate to hardship cases are welcomed, especially by the owners of the Como hotel. It is hoped that these new provisions will apply in their case because it is a very important part of my community. Indeed, in terms of demographics, this hotel is located at least two kilometres away from the nearest gaming operation. It is rather isolated. Indeed, as I have said, the number of poker machines and card machines the owners are seeking is well below their total entitlement.
I welcome also the harm minimisation measures set out in part 4 of the bill. For example, they include the requirement that hoteliers and clubs arrange for problem gambling counselling services to be made available to patrons and the requirement to establish and conduct patron self-exclusion schemes. I am pleased to say that in August this year, with a State Government grant of $168,000, the Wesley Mission opened a centre for problem gamblers in the Sutherland shire, at a central location that is only two train stations away from Como hotel.
We had the pleasure of having the Minister, with Reverend Dr Gordon Moyes of Wesley Mission, open the centre for problem gamblers. It is an important part of the shire. It is directed towards harm minimisation and it is playing its role in that way. I congratulate the Minister on this difficult and complex bill. As I said, it strikes a balance between harm minimisation, jobs, business incomes and the ability of clubs and pubs, especially in country areas and a local area like Como, to play their part in their communities. I commend the bill to the House.
Mr KERR (Cronulla) [8.38 p.m.]: This is extremely important legislation because of the role that hotels and clubs play in the life of communities across the State. A large number of clubs and hotels in the Sutherland shire play a well-known role in our civil society. They are active in community work, they provide facilities and they promote interaction between the cultural and sporting aspects of the shire. That also applies to hotels, and a number of hotels sponsor sporting teams. Hotels are a venue for sports people after games. If one were to go to a hotel on a Saturday afternoon in the Sutherland shire, one would see matches being discussed there.
The honourable member for Miranda alluded to social problems that are occasioned by gambling in our community. This bill has been touted as landmark legislation because it tries to reconcile the various competing interests and concerns of the industry. The Wesley centre in Sutherland is attempting to cope with a problem that is beyond its resources. Unfortunately, in the Sutherland shire there are a large number of people who have a gambling problem, and the problem has spread right across the spectrum of the community. A couple of weeks ago I heard from a barrister who had a person in his chambers who had a very good practice, but every week the proceeds of the practice were going through the poker machines at the New South Wales Rugby League Club. That subsequently resulted in huge financial problems. In recent times honourable members have witnessed the fate of barristers who encounter financial problems.
The assumption that gaming machines create problems only for people on limited incomes and with limited education is absolutely ridiculous. When legislation comes before this House seeking to address complex matters such as limitations on gaming machine numbers, poker machine entitlements, hardship, harm-minimisation measures, administrative controls that apply to gaming machines, miscellaneous offences, gaming-related licences, complaints and disciplinary action one would expect that the knowledge and experience of people in the community would have been harvested and that such matters would have been the subject of a great deal of debate. The bill comprises 189 pages, including the schedules, and honourable members are asked to debate it tonight.
The legislation was introduced last Friday, so the Opposition has had only the weekend in which to conduct consultation. Even if the Government, as is its wont, wants to treat the Opposition with contempt, by doing so it treats the whole community with contempt. Because honourable members are being asked to debates legislation that was introduced as recently as a few days ago, the disclosure of the contents of the bill and the exposure of this bill to scrutiny has occurred only in the past couple of days. Given the enormity of the problems sought to be tackled by this bill and the complexity of the issues raised, that is a scandalous tactic by the Government because the issues to which I have drawn attention transcend party politics.
Mr Face: I can remember a similar thing being done to me when I was in Opposition.
Mr KERR: Does that make it right?
Mr Face: No, not necessarily.
Mr KERR: I would not have thought so. Minister, when you say that was done to you—
Mr Face: You failed to mention that you have had three months lead time and all the consultation that has occurred with the community. Do not come in here and tell lies, Malcolm. You have been here long enough.
Mr KERR: For the Minister to take this so personally is extraordinary.
Mr ACTING-SPEAKER (Mr Mills): Order! The Minister will cease interjecting and the honourable member for Cronulla will direct his remarks through the Chair.
Mr KERR: I referred to the length of time in the lead-up to the debate and what the Government was doing to the Opposition. The Government has been preventing the community from making a reasoned response. It is not just a matter of the Opposition being deprived of an opportunity to consider the legislation but, rather, a matter of depriving a great number of organisations that are spread throughout the community, that are entitled to respond, to have amendments and their interests represented after they have seen the legislation. I do not wish to dwell on that because I think I have made my point. I gave an undertaking to the Government Whip that I would not speak for longer than 10 minutes and I intend to abide by that undertaking.
Mr Thompson: You are a good man.
Mr Fraser: But he will get a lot in.
Mr Thompson: Better than you would.
Mr KERR: Will the honourable member put that in writing? The shadow Minister has outlined the Opposition's concerns. The bill will come into effect and the Opposition will examine the operation of it and continue to monitor the social problems that occur in the community. As I have said, this is major legislation. The Productivity Commission has provided key messages and every member of the Government who has a social conscience would examine that report. The recommendations relating to transparency, the objectives of the legislation and the harm that is occasioned to society through gambling are matters whose value I doubt honourable members would argue against. The Productivity Commission has laid down very sensible parameters as an objective and independent body. Those recommendations should have been complied with in the preparation of this legislation.
Mr THOMPSON (Rockdale) [8.47 p.m.]: My contribution to the debate will be brief. I believe that the issues have been fully canvassed. There has been extensive consultation with the industry and within the broader community. This bill consolidates the provisions relating to gaming machines—that is, poker machines and approved amusement devices that are currently regulated by the Liquor Act and the Registered Clubs Act. The bill also gives effect to a number of new measures that are designed to limit the number of gaming machines in hotels and registered clubs and to promote the primary objective of gambling harm minimisation. I shall mention just a few of the reforms that are proposed in the bill. One of the reforms is to impose an overall State cap on the number of gaming machines in hotels and clubs. The limit has been set at 104,000 gaming machines, made up of 25,980 machines for hotels and 78,020 for clubs. The bill also provides for maintaining the existing limits of 30 gaming machines per hotel, but imposes for the first time a limit of 450 gaming machines per venue in the case of registered clubs.
Another reform requires clubs that currently have venues with more than 450 gaming machines to relinquish over a five-year period 10 per cent of the machines or such number which would bring the number of gaming machines at that venue to within the 450-machine limit. Another reform is the introduction of a scheme under which poker machine entitlements, as allocated by the Liquor Administration Board, may be traded by hoteliers and clubs provided that for every two entitlements that are sold one is forfeited to the board. A social impact statement must be provided by a hotelier or club and be approved by the board before additional gaming machines may be kept in the hotel or club, or before any gaming machine may be kept in a new hotel or a new club. The last reform I want to highlight is one that has probably caused the most discussion across the board in the industry: the requirement for hoteliers and clubs to switch off the gaming machines for certain periods of the day.
It is proposed that initially that period will be three hours, and I believe it is anticipated that the requirement should be operational from 1 April next. On 1 April 2003 the period will be increased to six hours, but certain qualifications will apply. I believe the bill is a further logical step in the Government's administration of gaming in New South Wales. Clearly, the community has serious concerns about problem gamblers. The bill is a reasonable response to those concerns and, as far as hotels and clubs are concerned, I believe it promises a fair and equitable outcome for all. I commend the bill to the House.
Mr McGRANE (Dubbo) [8.50 p.m.]: I support the Gaming Machines Bill and congratulate the Minister for Gaming and Racing on the way he has consulted the industry and the community. I should declare that I have an interest in the bill as I am involved in the hotel industry and therefore have a feeling for the liquor industry, on both sides of the bar. When introducing the bill last Friday the Minister noted that the prime purpose of the club and hotel industries is to serve liquor and food, not to provide gambling casinos. I believe that is pertinent to this bill, because we need controls as well as penalties. For the first time the bill provides for controls on the hotel and club industries, as well as for penalties.
I believe that every fair-minded hotelier, club manager and club director would appreciate that the bill provides for such controls and penalties. Australia's hotel and club industries are unique. In some respects the club industry is more important to country areas than it is to city areas. The industry supplies sporting facilities and performs other important charity work. Dubbo RSL Club has so far spent $16 million on aged care facilities, in addition to the large amount of money it has spent on the youth of Dubbo. Dubbo RSL Club is a caring club. The club movement provides good amenities and services for patrons, and also puts money back into the community.
In a free enterprise world, at times the hotel industry has faced a battle to survive, but the primary purpose of hotels is to provide liquor and food. With regard to gambling, either via card machines or poker machines, the introduction of the bill has been a saviour to the hotel industry. Hotels are very much a part of Australia's way of life, and of course the good hotels and clubs have put money back into their communities. The bill allows that to occur. My only concern relates to the tradability of machines. The bill places a number of conditions on the tradability of poker machines, but there has not been a good track record with regard to the tradability of items or entities.
With regard to the tradability of milk quotas and water licences, there has been a tendency for large operators to consume small operators, and therefore many areas of previously irrigatable land is not now irrigatable because there is no water quota. It is hoped that that will not occur with regard to the tradability of gaming machines. We would not want to see hoteliers in country areas go out of existence simply because large operators in Sydney, where the turnover is a lot higher because of the population, are forced to pay a lot of money for gaming machines. The bill caters for a number of limiting factors. I am sure that if it contains anomalies the Minister for Gaming and Racing, with his vast experience, will consult with the community and the hotel and club industries. I commend the bill to the House.
Mr FACE (Charlestown—Minister for Gaming and Racing, and Minister Assisting the Premier on Hunter Development) [8.55 p.m.], in reply: I thank the honourable member for Port Macquarie for his support of the Government's well-reasoned initiatives, which, contrary to the suggestion of the honourable member for Cronulla, were devised in consultation with industry bodies. Whilst I apologise for the late introduction of the bill, it must be accepted that it comprises 189 pages. It is a complete rewrite of the original draft, but that will provide cost savings to the industry. However, the honourable member for Cronulla missed the point that the introduction of the bill was announced on 26 July and the entire legislation has been available for public scrutiny since that time. Never has a bill had so much massaging.
I have spent at least several days of each week dealing with those who wanted to see me about it. With respect to the honourable member for Port Macquarie, he is a little out of step. Two of my officers spent last Wednesday afternoon going through the details of the bill, and I was quite happy for that to occur. It is therefore a little ludicrous, to say the least, for the honourable member to suggest that the bill has simply been thrown on the table. I thank other honourable members for their contributions on this very important bill, and I will deal shortly with some of the matters raised. Firstly, I emphasise that the bill truly represents a watershed in the history of gaming machine policy and regulation in this State.
As I said when I introduced the Gaming Machines Bill last week, the bill brings together the large number of pioneering measures the Government has brought forward since 1995, with a set of new and unprecedented reforms, and combines them in one comprehensive package. This involved a whole-of-government approach, which the honourable member for Port Macquarie has virtually admitted. It is wide of the mark to suggest that the bill emanated from the Premier's office. At the end of the day, it was the Department of Gaming and Racing and my ministry that presided over the bill. However, it has been well known to Treasury, the Premier's Department, the Cabinet Office and my office, and several other ministries have also been involved in this measure. This has been a whole-of-government approach, to ensure the best result possible.
The bill clearly spells out the long-term policy framework for clubs and hotels in this State with regard to gaming machine operations, a measure I have continued to address ever since I became Minister. I have been a member of this place for long enough to see the hotchpotch of the club industry never really knowing where it was going and the hotel industry not having much future. The bill provides those industries with some certainty for three years. No-one can plan a business when there is no certainty as to one's income and the likely outcomes, and one cannot put into place long-term strategies and business plans. The club industry is currently going through what is probably its biggest period of change in its almost 50 years with regard to poker machines. That is not through mismanagement or any particular reason; it is because of the effluxion of time, peoples' changing attitudes, and people spending their money and disposable income in so many different ways.
I hope this legislation will end the period of uncertainty that has affected many in the industry. It is unfortunate, but it has taken time to get the policy right. I am sure that anyone who reads the Gaming Machines Bill will appreciate that it has taken a considerable amount of time to draft. However, because of its sheer size and complexity it was inevitable that there should be some drafting anomalies. They are not of a calamitous nature, but there will need to be some correction at a later stage in another place to make certain that the legislation is corrected. Since I introduced the bill last Friday it has been examined closely by a number of people. Some largely technical and drafting anomalies have now become apparent, which will be rectified in another place. As a result, the Government will move amendments in another place when the bill is debated there. They do not alter the policy direction of the bill. I will arrange for my officers to brief the Opposition spokesperson as soon as possible with respect to that small number of changes so that the Opposition is cognisant of them.
The honourable member for Coffs Harbour digressed for a moment and commented on the Liquor Act, which I accept he is interested in. He referred to deficiencies in the Liquor Act. However, the Act has been changed substantially in the past five years. For example, I refer to the dine and drink provisions. Years ago such a measure would have been opposed by the Australian Hotels Association and the club industry. By approaching this legislation in bite-size chunks over time we have been able to change a whole series of measures. It is true to say that there have been more changes to the Act in the past five years than there were in the previous 50 years. For the information of the honourable member for Coffs Harbour, the Liquor Act will be rewritten because of the National Competition Policy review scheduled for next year. Further matters will arise out of the National Competition Policy about which the industry may not be happy, but the fact is that the State Government—like every other State and Territory government—has to follow.
The Leader of the Opposition referred to the increase in gaming machine numbers under this Government. She demonstrated her abysmal knowledge in relation to this matter. She obviously did not want to look at the facts. When the Carr Government came into office in 1995 there were 73,814 gaming machines in 3,247 clubs and hotels throughout New South Wales. Under this Gaming Machines Bill gaming machines in clubs and hotels will be capped at 104,000. I am advised that there are currently 3,228 clubs and hotels with gaming machines. In simple terms, that means that since 1995 total gaming machines in clubs will have increased by a total of 40.9 per cent. It seems to have escaped the Leader of the Opposition that under this legislation they will not increase any more. At the same time—1995 to now—the number of clubs and hotels operating gaming machines has fallen by 0.6 per cent.
What happened between 1988 and 1995, during the time of the former Coalition Government? In June 1988 there were 52,300 gaming machines in this State, spread across 2,670 clubs and hotels. From 1988 to 1995 there was an increase in total gaming machines of 41.1 per cent, compared with the total increase of 40.9 under the Carr Government from 1995 until now. In relation to the number of venues operating gaming machines, there was a 21.6 per cent increase when the Coalition was in office compared with the fall of 0.6 per cent during the time of this Government. Further, those machine numbers included approved amusement devices [AADs]. While they are not as popular today, 10 years ago the draw poker game on the AAD was hugely popular with hotel patrons, just as "Queen of the Nile" or "Penguin Pays" are popular types of poker machines today.
When Garry West was the Chief Secretary, without any ceremony he increased them from five to 10 overnight. To disregard AADs in the counting game just ignores history, as the Coalition increased it. What did the previous Government do about these increases? The number of gaming machines, and the number of places with gaming machines, increased by a greater percentage under the Coalition. So what did it do? Absolutely nothing! Under the Coalition there was absolutely no strategy to control the number of gaming machines in this State, or even the number of venues operating them. The Leader of the Opposition proffers herself to be the next Premier of New South Wales. She keeps saying, "We have to have an independent gaming commission." Did the Coalition establish a commission to control the numbers? Of course it did not. I do not think the Leader of the Opposition knows what it is all about, although it is a pretty good word. Did the Coalition bring to this House one single piece of legislation imposing controls on clubs and hotels to minimise gambling--related harm and to promote responsible gambling? No.
If we were to believe the Leader of the Opposition gambling problems and increases in gaming machine numbers did not start to happen in this State until this Government came to office in 1995. The truth is that the Carr Government was left to pick up the pieces of the Coalition's failures when it was in government. The Opposition should be condemned and, quite frankly, the Leader of the Opposition is a complete hypocrite. Lately we have heard from the Leader of the Opposition—I know it is prompted by the chief executive officer of a club association who runs around this State making out that he is an expert on gaming problems—about evidence-based gaming. She says that nothing should be done until it is evidence-based gaming.
I said to the fellow that if gaming machines are so bad they should be handed back until we have evidence of whether they are good or bad. In 1955 when they were introduced there was no evidence-based gaming. He did not think that was a very good idea. There are those who take the view that the gambling-related harm-minimisation measures introduced by the Government during the past two years and contained in the Gaming Machines Bill should not be introduced until we can establish whether the research has been effective.
Mr ACTING-SPEAKER (Mr Mills): Order! The honourable member for Murray-Darling and the honourable member for Port Macquarie will cease interjecting.
Mr FACE: Recently, we have heard this mantra from someone who believes in evidence-based gaming. I repeat: I suggested to the person who espoused this mantra that perhaps we should get rid of gaming machines until such time as they are proven not to be harmful. That is the approach taken with therapeutic drugs: it must be demonstrated, as far as possible, that therapeutic drugs are not harmful before they can be made available for public use. The Government could not adopt a similar approach with gaming machines. Needless to say, the person espousing this mantra did not agree with my suggestion. It is ridiculous to suggest that the Government should do nothing until harm minimisation measures have proven to be effective when it is clear, from what was said by the honourable member for Port Macquarie about the Productivity Commission, that there is a problem that needs to be addressed. The community expectation is that the problem will be addressed.
Mr ACTING-SPEAKER (Mr Mills): Order! The honourable member for Port Macquarie will cease interjecting. I call the honourable member for Port Macquarie to order.
Mr FACE: The evidence includes the finding of the Productivity Commission in 1999 that problem gamblers—
Mr ACTING-SPEAKER: Order! I call the honourable member for Port Macquarie to order for the second time. It is grossly disorderly and reprehensible behaviour for the honourable member for Port Macquarie to continue to interject in a loud voice. I warn the honourable member that if he does not cease interjecting, I will order that he be removed from the Chamber.
Mr FACE: The evidence includes the finding of the Productivity Commission in 1999 that problem gamblers represent just over 290,000 people, or 2.1 per cent of Australian adults. That figure does not include those who do not have a problem themselves but who are affected by someone else who does. The commission found also that the prevalence of problem gambling is related to the degree of accessibility to particular gaming machines. In light of those findings, the Government would be irresponsible if it did not act to reduce the cost of problem gambling through harm minimisation and prevention measures.
In addition, the community has made it quite clear that it expects the Government to do what it can to reduce the harm that occurs as a result of problem gambling. Many of the harm minimisation measures that the Government has introduced over the past two years, and those contained in the bill, were included in the Productivity Commission's report as options for harm minimisation. Research will assist government and non-government organisations to obtain more accurate data on why people gamble, devise methods for treating problem gambling and assist in determining effective harm minimisation measures.
The closing down period has been a major issue. I had understood that the Opposition would oppose it. I am pleased that commonsense has prevailed. The Opposition tried to make out that the Government was involved in some sinister conspiracy regarding the closing date of 2003. Obviously the honourable member for Port Macquarie does not understand operational matters. Fancy suggesting that this provision would be put in place about a month before an election. Quite obviously, any government contemplating introducing a second stage would introduce it after the 2003 election. Another perennial issue put forward by the Opposition is that the Gaming Commission should determine fundamental policies on matters such as the level of gaming permitted in future. However, the Independent Pricing and Regulatory Tribunal [IPART] report states:
That is what IPART has said, and that is the view of the Government. The honourable member for Port Macquarie jumped up and down when making a number of references to the Productivity Commission. Quite frankly, I have never berated those who wrote the report. I think this report, like most reports, could have been somewhat better if its authors had had access to more informed people at the grassroots level. It has been accepted that this report was written by people who, although well-intentioned, did not have a deep knowledge of gaming and its problems. Nevertheless, this report has been produced. It was not produced without some angst, and some encouragement, from people like me, because when I took over this ministry in 1995 the Howard Government did not want to know anything about what ultimately became the Productivity Commission.
Under the Westminster system of Parliament it is well accepted that governments should be held accountable by the electorate for significant policy decisions which impact on the wellbeing of the community.
Mr Oakeshott: That is rubbish.
Mr FACE: It is not rubbish. The honourable member for Port Macquarie was not around at that time. I have correspondence that demonstrates that the Howard Government was not even interested in what became the Productivity Commission. All of a sudden, John Howard had a road to Damascus conversion when Mr Costello—not the Federal Treasurer, but Tim Costello—decided that something should be done about the matter. That is the fact. We got the Productivity Commission because the Howard Government realised it was going to be an issue. The Federal Government, to its credit, set up a ministerial council which this Government is part of. But I and my conservative Victorian colleague, Mr Hallam, and others could not get the Federal Government to even recognise that we existed. The honourable member should not try to tell me what the Productivity Commission is all about. He has only been here five minutes! I repeat: the Federal Government did not want to know anything about the Productivity Commission, but it was set up and this Government has accepted its findings.
Does the Department of Gaming have the resources to implement the proposed changes? The Treasurer has approved the allocation of additional operating funds required to implement the gaming machine reform package. Once again, that demonstrates the abysmal knowledge of the honourable member for Port Macquarie about what is going on. Additional funding has been approved for the years 2001, 2002 and 2003, and for every year thereafter. I anticipate approval for additional capital funding to implement the necessary changes to the department's management information system in the near future.
We heard much from the Opposition about amalgamations. Of course, the Government will audit those amalgamations as they take place. I do not say that that is the be all and end all of the matter, but the fact is that a discussion paper was put out because of the extent of concerns about amalgamations in this State. The Government will monitor how those amalgamations work. However, I believe that we have struck a balance between protecting the rights of legitimate club members and the needs of the industry. I seriously question the legitimacy of some club members. Quite frankly, some club amalgamations are taking place far too quickly and without adequate participation of their members. That matter is addressed in these provisions.
Section 39A requires that any relevant person must declare an interest in a hotel licence. The Opposition placed some emphasis on that issue in this debate. The honourable member for Port Macquarie claimed that that provision applies to only club secretary-managers. In fact, it will apply to several people. The term "relevant person" means the secretary or manager of a registered club, any director of a registered club and the five highest paid employees of a registered club. Quite frankly, it is wrong to assert that this provision is onerous. It is completely in line with the Corporations Law of this country. This is nothing more or less than would be expected of people in similar positions in private enterprise or those who hold government positions and must disclose the nature of their wages and conditions. To suggest this is a payback for a couple of secretary managers who went against the Government really is indulging in a flight of fancy, to say the least.
As far as hotel ownership is concerned, or ownership of any licensed premises for that matter, as a consequence of the royal commission into the New South Wales Police Service, this was made law. Any licensee or person who has a beneficial interest has to declare that interest. Why should people in the club industry be any different? In the Illawarra a person and his wife have been before the courts. They had interests in licensed premises. What occurred is now history. So why should the club industry not be subject to the same provision? Persons in the club industry with a beneficial interest are required to declare that interest—and so they should.
The honourable member for Port Macquarie asked why clubs are to be banned from buying hotels. The bill will impose a new condition on a certificate of registration of a club prohibiting a club from holding a hotel licence under the Liquor Act 1982 or having any financial interest in the hotel. The bill also prohibits the secretary of the registered club from having any financial interest in the hotel. Once again, that is a consequence of an instance where a club owned a hotel that was put in the name of the chief executive officer of the club or another person. These provisions have been included in the bill as there have been some reports that clubs may contemplate purchasing hotels as a means of gaining access to additional gaming machines. I am advised that at least one such purchase has already occurred.
Mr Oakeshott: Point of order: The Minister is making another second reading speech. No-one raised in debate the issue to which he is referring, that is, clubs having an interest in hotels. I am not sure why issues such as that are being raised as they have no relevance.
Mr ACTING-SPEAKER (Mr Mills): Order! I do not uphold the point of order. The Minister may continue his reply.
Mr FACE: I am not trifling with the House. I am trying to use terminology that is easily understood by honourable members, who could confuse what I am saying about a person and a club. I am trying to put this into simple language for the benefit of Opposition members. This is contrary to the longstanding policy of government of distinguishing between the gaming privilege afforded to clubs and hotels, which is unacceptable. It is already known that some clubs have bought hotels in the names of their secretary-managers. That is why the law extends the ownership by secretary-managers. Clubs are already disguising their interest by purchasing pubs in the name of secretary-managers. I repeat that this provision is not to be confused with a person who owns an interest in a hotel, that is, a secretary-manager or one of those five people who will be defined in the legislation.
I thank those who contributed to the preparation of this bill. I pay tribute to the industry, which has been both tolerant and persistent in putting forward its views. I am happy to see John Thorpe, President of the New South Wales Australian Hotels Association [AHA], and Brian Ross, Chief Executive Officer of the AHA present in the gallery. Mark Fitzgibbon from Clubs New South Wales and Terry Condon from the Club Managers Association, people for whom I have a great deal of respect, are also present in the gallery. Those people do not play political games; they made known their views to Opposition and Government members. Those people are an important part of the process. I believe that with their co-operation we have been able to achieve a fairly reasonable result, something that does not occur in every State or country. It is great that we live in democracy where we can put forward our points of view and, at the end of the day, make things a little better.
The last six or seven months have been a trying time for staff in the department. Many people have wanted to put forward their views. Staff in the department have been extremely tolerant and have given much of their time. I do not normally thank members of my staff during a second reading debate, but this occasion is an exception to the rule. I thank my director-general, who fielded many questions and spent time in negotiations in relation to this issue. I thank other members of my staff, in particularly Jill Hennessy, for assisting in the drafting process and helping with the smooth passage of this legislation through the House. I commend the bill to the House.
Motion agreed to.
Bill read a second time and passed through remaining stages.