The New South Wales Treasury has predicted that slot machine revenue will hit a new high within the next decade to hit $9 billion per year. And, with that, comes a big boost to the NSW Treasury in the form of gaming machine taxes. However, not everyone is happy with these numbers.

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New Gambling Numbers from the NSW

Aug 07, 2019 Poker machine revenue for NSW is due to hit $9 billion annually by the year 2029. This will be an increase of $2.5 billion. Meaning people will spend $85 billion on slot machines in the next 10 years. Gaming and Vending Machines Manufacturing in Australia industry outlook (2020-2025) poll Average industry growth 2020-2025: x.x lock Purchase this report or a membership to unlock the average company profit margin for this industry.

The Sydney Morning Herald found some interesting information in new NSW Treasury documents this week. Poker machine revenue for NSW is due to hit $9 billion annually by the year 2029. This will be an increase of $2.5 billion. Meaning people will spend $85 billion on slot machines in the next 10 years. It also means the NSW Treasury will take $2.5 billion of that in gaming machine taxes.

These extraordinary numbers have caused concern among the general public, in government circles, and with organizations like the Alliance for Gambling Reform.

AGR spokesperson Kate Da Costa, told the Sydney Morning Herald, “NSW is not normal. Losses through poker machines in clubs and hotels are now running at $17.7 million every day. Star Casino adds at least another $920,000 a day to that figure. These are losses, not turnover figures – a huge sum of money which is a proxy for untold misery and harm.”

It should be noted that the most recent Treasury numbers are in line with those released just one year ago. Those numbers estimated that poker machine profits would reach $7 billion by 2021. This would be a 12% increase over four years.

Regulation Not Enough?

There are laws in place to limit the number of poker machines – all slot machines, also known as pokies – throughout New South Wales. But even so, gambling losses to machines have increased significantly of late, more so in pubs rather than clubs.

Estimates show that pub pokies losses are expected to increase by 50% from the 2018-2019 numbers to those expected in 2028-29, while club losses are only expected to increase by 30%.

According to the laws on the books of the New South Wales government, the Gaming Machines Regulation 2010 was updated on March 2019. The original 2010 law limited machines in clubs and hotels to 99,000 and 1,500 in casinos. This limits the total number of machines in NSW to 10,500. But, the latest Gaming Machines Amendment Act 2018 put a cap on pokies in areas identified as ones with concerning levels of problem gambling.

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The result was that approximately 20% of NSW was prohibited from obtaining new pokies. And fines were increased to keep establishments from skirting the law and paying the fines as a cost of business.

An overview of the latest predictions for NSW poker machine revenue, however, shows that the law may have underestimated the popularity of the machines and their prevalence.

Concerns Abound

Independent MP Justin Field was the first to express his concern after analyzing the Treasury numbers. “The explosion in poker machine profits forecasted for the clubs and pubs, in spite of government reform, is another example of politicians turning a blind eye to the impacts of gambling on communities,” he said. “The Labor Opposition remains deathly silent on this important social issue.”

Field pointed out that the increases match a rising level of political contributions from the Australian Hotels Association. It also comes from other lobbying groups like Clubs NSW. For example, the AHA gave more than $416K in 2018 political donations. This is compared to little more than $89K in 2017. Donations have gone to the NSW and federal Labor and Coalition parties.

Referring also to the recent Crown gambling investigation, Field noted that it shows “the capture of major parties by the gambling industry and their complete and historical failure to regulate gambling in the public interest.”

NSW Increases at Odds with Responsible Gambling Efforts

The NSW Office of Responsible Gambling has been in the news quite often of late. It processes funds for various initiatives and programs dedicated to reducing gambling harm. It also provides more resources for anyone with gambling concerns.

The Responsible Gambling Fund takes a portion of casino games licensing fees, through the Gaming Machine Act, and via the Treasury. It has led to significant funding for the overall responsible gambling strategic plan for 2018-2021.

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Millions are being invested in research, education and awareness, support services, partnerships, and technology and innovation.

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Most recently, the Office of Responsible Gambling commissioned and received a report from Flinders University. This will help determine future objectives and fill in the gaps where programs aren’t working as well as predicted. Further research will identify more areas where funding would be helpful.

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