How to tackle Australia’s gambling problem

Why? Because Australia has a gambling problem. We have the highest gambling losses in the world. And no wonder – gambling is everywhere: on our screens, in our pubs and clubs, and available anytime at our fingertips. Pokies are more common in our suburbs than post boxes, ATMs or public toilets, and they are concentrated in our poorest neighbourhoods.

Gambling losses are draining already tight household budgets, and losses can lead to financial and mental distress, relationship breakdown, family violence and suicide. But gambling harm is largely preventable with better regulation.

To reduce the harm being caused to hundreds of thousands of Australians, we need a ‘seatbelt’ for the most dangerous gambling products – pokies and online betting. Together, pokies and betting account for more than three-quarters of Australia’s gambling losses. No one should lose their house, or their life, gambling.

Mandatory pre-commitment with maximum loss limits would ensure gamblers no longer lose more than they can afford. The federal government should establish a national pre-commitment system for online gambling, and state governments should roll out statewide pre-commitment schemes for pokies.

Pre-commitment schemes require gamblers to choose their limits in advance – before they lose track of time or start chasing losses. The system then enforces these limits.

The scheme should have maximum loss limits to prevent catastrophic losses, particularly given the evidence that many people, when asked to set limits, will choose an unrealistically high level (such as $1 million a day). More than 90 per cent of people who gamble on pokies and online betting would be unaffected by a maximum loss limit of, say, $500 a month – and those who would be affected are overwhelmingly at risk of severe gambling harm.

A mandatory pre-commitment scheme for online gambling could potentially be an extension of the federal government’s national self-exclusion register (Betstop), which cost just under $50 million to set up, with the cost covered by industry. A sector levy could cover the costs of an extension of the scheme.

Mandatory pre-commitment schemes for pokies should be rolled out by state governments. Pokies venues would need to comply with the scheme as a condition of their license, and could be given the option to sell their licences back to the state government instead.

Buyback costs could be substantial if many venues choose to surrender their licences. While this is unlikely – because pokies are so profitable – a big reduction in pokies numbers would also come with great social benefits at a one-off cost to the taxpayer. Even better, state governments could pay for it by reducing pokies tax concessions for clubs, which currently cost state governments at least $1.2 billion a year.

The finances could be covered, as detailed above. But this system would more than pay for itself in lives saved and harm reduced.

In the 1960s and 1970s, Australia’s road toll was high and proposed safety measures such as seatbelts were met with consternation. But over time these measures have become part of life – and the road toll has more than halved. We need the same approach to make gambling a safer, better bet.