Gambling Amendment Bill (No 2) — First ReadingText is incorporated into the Bound VolumeGambling Amendment Bill (No 2) — First Reading[Sitting date: 22 August 2007. Volume:641;Page:11400. Text is incorporated into the Bound Volume.]Gambling Amendment Bill (No 2)First ReadingHon RICK BARKER (Minister of Internal Affairs): I moveThat the Gambling Amendment Bill (No 2) be now read a first time. At the appropriate time I intend to move that the bill be referred to the Government Administration Committee. This bill amends the Gambling Act 2003. The Gambling Act is large and complex and as is common with new legislation of this nature a number of issues were identified as requiring improvement during its implementation. The Gambling Amendment Bill (No 2) contains many technical amendments and some minor policy enhancements to clarify the law and remove any uncertainties. On balance I think that the Gambling Act is working pretty well so there is no intention of making any significant policy changes. The Act is relatively new and needs to be given a chance to work.This bill is designed to address the technical changes that need to be made in order to assist the department and the gambling sector to engage with more clarity. Work on the bigger issues identified in the reports into allegations about the Christchurch Casino is under way. It would be premature at this stage to address those issues through what is largely a technical bill. We are focused on finding solutions to the issues raised in these reports—issues that the Department of Internal Affairs has been aware of for some time. Once we have developed a more comprehensive understanding of the issues I will invite officials from across the Government to come together and map out appropriate solutions. This process will allow both the Government and the sector to build a solid platform on which to help reduce the opportunities for problem gambling and criminality in the sector.I will now summarise some of the minor policy enhancements in the bill. One of the Gambling Act’s objectives is to ensure the fairness and integrity of games. To further assist with the achievement of this object the bill introduces minimum disclosure requirements for non-cash prizes. The Act already contains a prize disclosure regime but it is only partially achieved and in a fragmented way. Introducing a statutory requirement for accurate disclosure of non-cash prizes would both provide more certainty and remove any inconsistencies between requirements for different types of gambling.The bill contains a number of measures intended to assist its community funding objectives. These include clauses requiring venues that host gaming machines to bank community profits directly into the society’s dedicated account. This amendment responds to the practice whereby some venues have been banking society money intotheir own accounts for a few days and occasionally have not been able to account for it when it is time to bank the money into the society’s bank account.Also included are explicit obligations on community grant recipients to use grants from gaming machine proceeds appropriately including it being an offence for non-compliance. This measure reduces the risk of a grant recipient misappropriating gaming machine proceeds. The conflict of interest safeguards are extended to apply to all persons who make decisions on gaming machine grants. Currently they apply only to those key roles in the management of the society. The bill specifies in more detail the circumstances in which a gaming machine society such as a club can apply gaming machine proceeds for its own purposes as opposed to when it can make grants to community groups. At present the Gambling Act does not provide sufficient clarity on this point.The bill provides added flexibility for clubs wishing to merge to address financial viability issues. The Act currently allows two or more clubs to apply for ministerial approval to operate up to 30 gaming machines at the venue on which they merge. However they may merge into an existing 18-machine venue only if the number of the 18-machine venues is limited. So the bill will allow clubs to apply for ministerial approval to operate additional machines at any venue even if that venue would not otherwise be an 18-machine venue. Access to this facility would still be subject to territorial authority consent.A number of measures are intended to assist with the achievement of the Act’s harm prevention and minimisation objectives. One clause reflects the recent experience with the Dunedin Casino—the suspension case. This clause clarifies that gaming machines and casino operators have an ongoing duty to take all reasonable steps to assist a person they have identified as a potential problem gambler. Essentially this means that it will not be enough for an operator to just approach a person on one occasion provide information to that person about problem gambling and do nothing further if the person’s gambling behaviour continues to be of concern. The bill also provides that the gambling venue staff do not have to issue a venue exclusion order to persons who approach them and identify themselves as being problem gamblers if those persons do not provide a reasonable means of identification such as a recent photo.Another clause requires casinos and gambling machine operators to keep records of problem gambler exclusion orders that they have issued and to provide a report on those records to the Secretary for Internal Affairs if requested to do so. The bill modifies the Act’s harm prevention and minimisation regulation-making powers to include regulating the means of payment to participate in gaming prescribing content and training standards for problem gambling awareness training—currently only very general requirements can be prescribed—and restricting or prohibiting eftpos and other means of accessing money for gambling at the venue. Currently only ATMs can be regulated but the harm potential of say a mobile eftpos device might be similar.Another clause is designed to make it easier to conduct research on gambling in real-life gambling environments. The clause authorises the Secretary for Internal Affairs to temporarily approve gambling equipment for operation in a gambling venue for the purpose of testing whether the equipment’s introduction will facilitate the attainment of the Gambling Act’s objectives.A number of clauses in the bill are designed to assist the Gambling Commission with the performance of its functions. One clause enhances the Gambling Commission’s protection from liability along similar lines to the immunities provided to statutory entities out of the Crown Entities Act 2004. Another clause provides the commission with the flexibility to determine when it sits as a division and to decide whether division includes the Chief Gambling Commissioner.Finally the bill ensures that the Gambling Act binds the Crown. The Act was introduced prior to the requirement that all policy decisions on proposed legislation seek a decision on whether to bind the Crown. The general principle is that the Act should bind the Crown unless the application of an Act to the Crown would impair the efficient running of the Government. There are no such factors at work here. The introduction of this bill is designed to address the technical changes that need to be made in order to assist the department and the gambling sector to engage with more clarity.Work on bigger-picture issues identified in the reports into allegations at Christchurch Casino is under way and I would say to the House that it is premature to address those through what is largely a technical bill. Officials are currently working on having a better understanding of the issues identified but once this work is complete we will be in a position to address that.This bill is important as it introduces a number of initiatives that are designed to ensure that the Gambling Act continues to work as originally intended. The bill provides the opportunity to implement these measures without leading to a premature review of such fundamental approaches taken by the Act. I commend the bill to the House.ERIC ROY (National—Invercargill): I raise a point of order Mr Speaker. I may well have missed it but according to Standing Order 284 the Minister should indicate which select committee the bill is going to. I did not hear whether he said that.The ASSISTANT SPEAKER (H V Ross Robertson): I believe that he did.Hon RICK BARKER (Minister of Internal Affairs): I say to Mr Roy that the second sentence I uttered was that at the appropriate time I intended to move that the bill be referred to the Government Administration Committee.The ASSISTANT SPEAKER (H V Ross Robertson): Thank you.LINDSAY TISCH (National—Piako): As the Minister said the Gambling Amendment Bill (No 2) is a technical bill and in the first instance I want to draw the House’s attention to page 19 of the explanatory note where it states: “Casino and class 4 venues are required to exclude self-identified problem gamblers from the gambling area of the venue for up to 2 years and to remove them from the venue if they return in that time.”If we look at the Act we see there is a conflict because section 310(1) states that a venue manager or a casino operator must “issue an exclusion order to a person that prohibits the person from entering the gambling area of a class 4 venue or casino venue (as the case may be) …”. If we were to then look further at section 311(1) of the Act we would see that it states: “a person acting on behalf of …” a venue manager or a casino operator “must remove any person who enters the gambling area …”. So here we have a conflict. In one part of the Act it states that the venue manager or casino operator must “prohibit the person” and in the other part it states that the venue manager or casino operator must “remove the person”.During this debate I will highlight the inconsistencies that are in the Act and what this amendment is actually portraying it will do. Section 312(4)(b) of the Act imposes a $10000 fine on the venue manager if he or she knowingly fails to remove a self-excluded problem gambler who has entered the gambling area. But there is no fine—no fine at all—for knowingly failing to remove a venue-excluded gambler who has entered the gambling area. So here again is a major discrepancy in this interpretation. If a voluntarily self-excluded person defaults that person is penalised but if a venue operator excludes a problem gambler and that person defaults then there is no penalty. That is a discrepancy.Similarly a self-excluded gambler cannot stay in hotel accommodation at the venue because as I mentioned on page 19 of the explanatory note of the bill it states: “Casinoand class 4 venues are required to exclude self-identified problem gamblers from the gambling area of the venue for up to 2 years”. We understand that; that is very clear. But it goes on to state: “and to remove them from the venue …”. The venue in this case is not just the gaming area; it is the whole complex. It includes the accommodation as well.Clause 84 of this amendment bill amends section 312 of the Gambling Act and substantially changes the onus of proof for a charge relating to a “breach of exclusion order”. If an excluded person enters the gambling area whether or not the operator knows that person has entered then it is an offence. The current provision in the Act states that the venue manager the holder of the casino operating licence or a person acting on behalf of those persons are liable only if they knowingly allow the person to enter the gaming area or knowingly fail to remove a person who enters those areas. The current procedures are based on identification and removal after entry.However under the proposed changes in the bill allowing the person to enter will be a strict liability offence. What is the case if the person uses a disguise or changes his or her appearance? It will be difficult to identify an excluded person in this case unlike the identification of a youth in the context of the Sale of Liquor Act due to age limitations. The question will be whether this new section will in any way minimise and prevent harm as envisaged under the Gambling Act or whether it will just work against venue operators.Clause 85 which inserts new section 312A needs close attention. The proposal there is that a self-excluded gambler will be required to register with a third party if the secretary—which presumably refers to the Secretary for Internal Affairs—requests. That is quite inappropriate. The self-excluded gambler’s requirements for privacy should be paramount. Otherwise for many the act of self-exclusion may not be forthcoming. Demographic information including age and gender could be recorded without personal information. Nowhere in the Gambling Act are there any requirements for a self-excluded problem gambler to be registered in any way with a third party.The Department of Internal Affairs’Gambits publication dated 2005 shows how many gamblers were excluded over a 12-month period. I quote from that publication. Those excluded by casinos in that period numbered 188 and those who were self-excluded—they took it upon themselves to exclude themselves—numbered 593 which was a total of 781. So that was a 12-month period for which those exclusion orders were applied. In theGambits publication of June of this year June 2007 it states that casinos across New Zealand exclude between 50 and 60 patrons per month.Clause 86 amends section 313 of the principal Act. This is an empowering provision which extends the Department of Internal Affairs’ regulatory powers. There is no definition at all for what constitutes “inducements to gamble”. What does it mean? The Department of Internal Affairs under the Act is responsible for everything. It is responsible for gaming policy for enforcement for licensing and for regulation. The Department of Internal Affairs is judge and jury and this clause 86 delegates to it the power to create implement and enforce regulation without the scrutiny of this House or of a select committee.National members have some reservations about certain clauses in this bill which I have outlined and we will want answers during the select committee process. However we are happy to support the first reading of this bill.DARIEN FENTON (Labour): It is a pleasure to speak in the first reading debate on the Gambling Amendment Bill (No 2).Hon Tau Henare: What do you know about gambling?DARIEN FENTON: Actually I know quite a lot and I tell the member that if he listens he will hear. Many people believe that gambling is a scourge on our society andI do not disagree with that. We could all wish that gambling did not exist in New Zealand at all but people have always gambled in one way or another and some to excess. There is no doubt that gambling brings with it a whole lot of problems and that is why the Labour-led Government introduced world-leading legislation in 2003 after the growth of casino and pokie-machine gambling during the 1990s. Can members guess who was in Government then? Only National!The purpose of the Gambling Act 2003 was to control the growth of gambling to prevent and minimise the harm caused by gambling—including problem gambling—to authorise some gambling and prohibit the rest to facilitate responsible gambling to ensure the integrity and fairness of games to limit the opportunities for crime and dishonesty associated with gambling to ensure that the money from gambling benefited the community and to facilitate community involvement in decisions about the provisions of gambling.The legislation we are debating tonight at its first reading is designed to build on that work by clarifying the law and removing any uncertainties. My wonderful colleague Sue Moroney that well-known horse racing expert from the Waikato gave me a really good tip about gambling. She said that I should never gamble more than I could afford to lose and I have taken that advice very seriously. Apart from having the odd punt on a horse I am not a gambler. But I do know a little about casinos and I have had quite a lot to do with them.When our largest casino opened in 1996 in Auckland there was much commotion from the National Government about growth in the local economy and local jobs. I went to the jobs expo held for interested workers in 1995 where 18000 people turned up hoping for a job in what they then saw as a glamorous industry. What they did not know was that Harrah’s which was building the casino intended to take full advantage of the then National Government’s anti-worker employment law that empowered employers to dictate pay and conditions in an environment with high unemployment and a climate of fear. So those poor workers who came to work at the casino turned up bright-eyed and keen but low pay long hours and the anti-union management culture soon led to a lot of disaffection and a high turnover among staff.Harrah’s and then Skycity flourished under National’s totally supportive gambling regulatory regime with a focus on profits for the tourism and entertainment industries. Regulation was light-handed. So were other things like health and safety workers’ rights and gambling restrictions. In my former job I spent a lot of time at Skycity Casino—for my sins—or at least outside it because the employer would not let unions into the place until Labour became the Government. But the workers did want to talk. They wanted to talk about some of the poor conditions the lousy pay—The ASSISTANT SPEAKER (H V Ross Robertson): I am sorry to interrupt the honourable member but I say to members that the rules permitting interjections are predicated on the assumption that the person being interjected upon has the call. A number of interjections have been going across the House and neither of the parties involved has the call. Interjections are not permitted at all if they are directed at a member who does not have the call.DARIEN FENTON: The workers wanted to talk about the poor conditions the lousy pay the forced 12-hour shifts in some departments and the unjustified sackings. The bright shiny casino of those times had not only a growth in problem gambling but an exploited workforce.My first real dialogue with management came as the Employment Relations Bill was going through Parliament and the key person in charge of human resources at Skycity Casino then was an ex – Red Squad member from the 1981 Springbok Tour—funny that!Sue Moroney: It wasn’t Ross Meurant was it?DARIEN FENTON: No it was not Ross Meurant; it was someone like him though.Three things changed at Skycity Casino when Labour became the Government. Firstly we brought in fairer labour laws which meant that Skycity had to engage with union members in collective bargaining. The first collective agreement was signed in 2001 and that took quite a struggle. One of the great victories all those years ago was to achieve a $10 an hour minimum pay rate which just goes to show how hopeless the National Party was at getting wages up. Of course since then wages have continued to rise and conditions have improved enormously.The second thing that happened was that the Gambling Act 2003 came into being the purpose of which I have already mentioned. That changed casino and other gambling in New Zealand. Out went the focus on economic imperatives and the huge profits at the expense of the local population and in came harm minimisation and keeping the lid on gambling. We were delighted that the explosion in casino building came to an end with that Act.The third big change—and I pay tribute to Steve Chadwick for her contribution to this—came with Labour’s legislation to ban smoking in workplaces. Casino workers were right behind that legislation because they were sick and tired of working with second-hand smoke. It was yet more foresighted legislation by this Labour-led Government and it is today widely supported by the public.The legislation before the House today for its first reading is a tidy-up of the Gambling Act 2003. Inevitably with a large Act of Parliament like the one of 2003 changes need to be made to make this very tight regulation of New Zealand’s gambling industry as effective as it possibly can be. The Gambling Amendment Bill (No 2) contains technical amendments and some minor policy enhancements to clarify the law and make it work as it was intended to.The aim of the bill is to make grant recipients use pokie grants appropriately to extend the conflict of interest safeguards to all persons making decisions on gaming-machine grants to strengthen the requirements on venues banking gaming-machine profits to widen offences and regulations for gaming-machine operators and licensed promoters to introduce requirements for the accurate disclosure of non-cash prizes and to provide more flexibility for clubs wanting to merge gaming-machine operations.The recent reports about loan sharking and money-laundering in casinos are very alarming and these are issues that do need addressing. However this largely technical bill may not be the right vehicle to do so. I am confident that the work under way to deal with these issues will result in Government action. The loan sharking revelation of last week showed that the Department of Internal Affairs was already hot on the tail of that odious person.I also acknowledge the very real concern about pokie machines. As an MP working in South Auckland I share the worry of those communities about the impact they are having on family lives. Therefore I am particularly interested in the proposed amendments that will assist with the Act’s harm prevention and harm minimisation objectives. However I can only imagine how bad the situation would be today if Labour had not introduced its world-leading legislation to allow local authorities to restrict the growth of gambling in their communities.We need to continue to work together with the community to ensure that local authorities use the tools in the Act as effectively as possible. The Gambling Act specifically allows councils to consider their overall numbers and density as well as neighbouring land uses and the characteristics of neighbourhoods. Communities are becoming more actively involved in these processes as we recently saw with the 7000 submissions that were handed to the Manukau City Council calling for tighterrestrictions on pokie machines. A campaign is now under way to cap the number of pokie machines in Manukau. Other local authorities have already acted to put limits in place and some have sinking-lid policies.There is no doubt that the submissions on this bill will be very wide-ranging and that the passionate concerns communities have about problem gambling and the crime that is inevitably associated with it will be reflected in many submissions. This will inform the debate about the things we need to do in the future to ensure we continue to minimise the harm that gambling can cause and limit any growth in gambling. I look forward to participating as a member of the select committee in the process and I commend the bill to the House.ERIC ROY (National—Invercargill): I too take a call on the Gambling Amendment Bill (No 2). As our first speaker Lindsay Tisch said National will be supporting this legislation going to a select committee.It is important that we get the rules right on issues like gambling. This bill is largely a complex and prescriptive piece of legislation. It is rather difficult to make headway through it unless one has the principal Act in one hand because lots of snippets are inserted here and there to clarify and help the understanding of the principal Act. So the bill in itself does not make sense without applying it to the principal Act. I mentioned that it is a complex and prescriptive bill; I am always a bit mystified when a bill is tabled in the House and the explanatory note exceeds the bill itself and that is very much the case here. There are some 33 pages of explanation and a similar number of pages to the actual bill.Gambling is an issue that we have to legislate for. It is certainly a significant part of the New Zealand psyche. It is not unique to New Zealanders and it is not unique to Anglo-Saxons. At this time I think that various members might confess their involvement or participation. I have to say that I am not a gambler. Only once or twice in my life have I been encouraged or tempted to have a bet; it is just not something I do. But I have an interest in observing what happens. I am so perplexed as to why people should want to use their time on gambling as entertainment that I get some enjoyment out of watching them even though I am kind of mystified by it.About 18 months ago I was at a convention in Reno—it was in January the year prior to last—and in the evening in winter in Reno there are really only two activities. One is the strip club and the other is the gambling machines and the casinos. It should be recorded that I went to watch what happened in the casino. I was fascinated to watch Texas hold’em which is a game that has currently got quite a bit of media attention. The dealer was setting up the table and I wandered over to see how it all worked. She said: “Are you going to join the table?” and I said: “No I don’t think so.” and she asked: “What’s with you mister are you religious or something?”. I was trying to figure out what sort of response to give to that kind of question when she said to me: “What’s the difference between someone praying in church and someone praying at my table?”. I said: “Well it beats me.” and she said: “Well here they really mean it.” I think that says quite a bit and there is real truth in it and I can see that members appreciate the sentiment behind it.But as I mentioned this is not just an Anglo-Saxon pastime. I have been in casinos in West Africa in the Gulf and in Europe. Certainly there is something in the make-up of people that makes them want to get involved in gambling and so it is that we need to control that.I want to relate to the House a conversation I overheard on talkback radio about 3 or 4 weeks ago when there was quite some discussion about pokie machines. It showed why we need to have some very prescriptive and precise rules on them. There was some debate about how they operate and where they work. A gentleman called FrancisWevers came on air. I cannot recall his association but he was chief executive of some sort of gaming-machine association—and no doubt he is probably listening and will correct me in his submission to the select committee. He commented that in New Zealand pokie machines alone if I recall correctly have a throughput of $9.5 billion.Peter Brown: How much?ERIC ROY: It is $9.5 billion. About $7.5 billion of that goes back to be recycled at different stages in winnings about half of the remainder of $2 billion goes to the owner of the machines and the rest goes on tax and various other administrative costs. That is just pokie machines. If we look at Lotto at dogs at racehorses and at casinos per se we see that the money spent is huge. That is what actually happens in New Zealand. We need to get our heads around that.This bill does not lower the bar on any of the controls. What it does is clarify them. I believe that it is essential to clarify them and that they need to be tidied and that is why we are supporting this bill going to a select committee. We need some discussion about the accuracy and the intent of the principal Act. That is what this bill does. It actually clears up these issues.This bill is very much about definitions and about how the various entities work. It includes definitions about venues. For example what is a gambling venue and how should it work? It is about licensees. It is about who should be a licensee of a gambling establishment—who those people are what they should do and how they should conduct themselves. It is about classes of gamblers. I do not know what the relevance of that is because I have not had time to go right through the principal Act. It also talks about prizes and what they can be used for. It talks about the banking that is associated with gambling. There are a whole lot of definitions in the bill that help clarify all these issues. As I say one needs to read the principal Act.I have been reading this bill for about half an hour and I am perhaps a little surprised that given that there have recently been some issues about inappropriate behaviour around casinos with loan sharking with a range of people making a living out of what we would all agree was extortion—living off rorting interest rates—I cannot see where in this bill that area has been tidied up. Clearly there is a problem. It has been identified and has had a lot of media attention. I hope it is in here—sometimes one misses things on a cursory glance—but going through the headings and the explanatory note I cannot see where it tightens up those provisions. I believe that that is an area this bill should actually address.We acknowledge that gambling happens. We are not going to change that. Essentially what we need in gambling is fairness and integrity in the process. There also need to be some very clear provisions on harm minimisation and addressing the issue of problem gamblers. Part 3 of the bill tightens up those provisions a little bit more. I certainly hope they are able to deliver in situations where there is a problem with gamblers.This is a bill that is complex it is quite prescriptive and it needs to be read in conjunction with the principal Act. I just hope that New Zealand has a close look at this and that the submission process is well contributed to. One sees that the significance of gambling in New Zealand is simply huge when one looks at the amount of money involved and the number of people who participate in it. That is not to say it is something we should eliminate. That is simply not practical. But it is something that we need to control and manage. We certainly need to have a focus on problem gamblers and those areas where there are elements of extortion or inappropriate behaviour. I trust this bill will do that—if not in its original draft then after it has gone through the submission process. I commend the bill to the select committee and I look forward to its report back and to seeing its deliberations.PETER BROWN (Deputy Leader—NZ First): I think I should confess that in my younger days I was a gambler—I was a gambler. As a merchant navy officer it was an activity I got well involved in and I have to say that from time to time I am tempted now. I was tempted at the weekend Mr Assistant Speaker—and I am sure you will understand this—but Arsenal let me down. I felt certain and I would have had a bob on it that they would have beaten Blackburn Rovers. I know that you personally know a little bit about Blackburn Rovers Mr Assistant Speaker—a knowledge that probably others in the House do not share.Hon David Carter: Haven’t got a clue what you’re talking about!PETER BROWN: The member over there does not have a clue about what we are talking about or what he is listening to. In shipboard activities we used to play cards quite frequently. If one takes a successful measure of gambling as being the amount of money one wins then I was quite good at it because I usually won. We used to play poker and pontoon. I even won a cribbage tournament and a significant amount of money. Indeed on one ship I won money on Monopoly.John Carter: That would be right—funny paper money!PETER BROWN: I say to that member that I won real money on Monopoly. One never knows what merchant seafarers used to get up to. As I walked through the lobbies yesterday—and this is true—a young reporter came up to me and asked me whether I had ever been to a strip club. I spent a significant amount of my time as a merchant navy officer yet I was asked whether I had ever been to a strip club! I am not confessing to going to a strip club but I am confessing to having gambled.I have seen the downside of gambling. I have won money—luckily I guess—but I have seen the downside of gambling. If I cast my mind back I remember that I have seen crew members when their gambling was mixed with alcohol attack one another with knives with weapons. I have been the officer who has had to intervene to calm those crew members down. I have seen seafarers go ashore and lose—Hon David Carter: Now he’s talking about the New Zealand First caucus.PETER BROWN: The member thinks that this is a joke. He thinks that the bill is a joke. [Interruption] The member at the back is a joke; Tau Henare is the biggest joke I have met when it comes to politics.The downside of gambling is very significant. I have seen seafarers in particular go to clubs and sit behind pokie machines sometimes operating two or three at a time. I have seen that happen in this country with shore-based people. I have seen them lose almost the shirt off their back—I am talking about some of the fellow seafarers I have sailed with. There is a downside to gambling. I am fortunate that I was not addicted to it; I enjoyed the fun of it. I enjoyed a day at the races—I have not been there for quite some time—I could put the odd dollar on here or the odd dollar on there and I could walk away. But I could not really understand why everyone did not have the same attitude. I have seen people who continued to bet to invest their money and to almost lose their shirts.The Gambling Act that was passed in 2003 was a step in the right direction. This legislation is an amendment to tidy up the flaws and to address the shortcomings in that Act. I listened to Eric Roy; I thought he made some very good salient points and he did it with a degree of humour on which I congratulate him. I listened to Lindsay Tisch the National member before him who also made some points about how the Act is not gelling together correctly. But those issues will be taken care of at the select committee. This is an important bill. It is exceedingly important that the gambling industry operates corruption-free. It is an industry that must have integrity as Eric Roy said before me. It is an industry that is important to New Zealand but it must be well run—it must be run fairly and it must be run straightforwardly as everybody understands.We have in this country an expanding horse racing industry and it is a large credit to the Rt Hon Winston Peters that the taxation regime around that industry has been improved no end. There is potential for it to develop and to become a major industry—a major tourism industry may I suggest. That is the importance of gambling-type industries to this country.The area of problem gamblers though is significant. If an individual does not have the control of self-discipline then society has the obligation to impose discipline. We cannot allow the activity of gambling to undermine the lifestyle of any—the lifestyle of families or the commitment of one member of a family to another—as it has the capabilities of doing.It is very important that this House sends this bill to the select committee. It is pleasing to note that what is a Government bill obviously has the support of both the Government and the National Party and that for once they are not playing politics. They are going to send the bill to the select committee and make an honest endeavour to get it right. I think it is well understood by MPs that if this sort of legislation is not handled correctly then somebody will suffer. It will not be MPs but somebody will suffer. There must be controls on gambling to protect society from itself if you like.New Zealand First will support this bill to go to the select committee. We do not have a member on the select committee so we are putting our faith and our trust in Government and National members to apply themselves to this bill in a conscientious and diligent manner. I know that Mr Tau Henare will not have a clue what I mean when I say that but his colleagues will tell him that this is an issue that has to be addressed comprehensively by the select committee. [Interruption] Do members hear the ramblings in the background?Hon Tau Henare: Hear the ramblings in the background.PETER BROWN: Yes hear the ramblings!Hon Tau Henare: Hear the ramblings.PETER BROWN: Ha ha! The member should have been a comedian. Oh he is a comedian.I hope that the select committee will address this bill in the manner it should and that the bill comes back to the House in a correct form. I take the points that Lindsay Tisch made. I hope that the bill comes back in a correct form that will advance the legislation of this country so that gambling legislation will be all the better for it. New Zealand First will support the bill.SUE BRADFORD (Green): Three years ago in 2003 the Gambling Bill passed through this Parliament without Green Party support. At the time we believed that bill was a woefully inadequate response to the proliferation of harmful gambling opportunities in this country. I believe that the past 3 years have proved our analysis to be sadly correct.In that time pokies have continued to flourish particularly in our poorer communities. There are still over 21000 pokie machines operating in New Zealand and in some places their impact is particularly dire. For example recent figures show that Kawerau the district with the country’s lowest median income of just over $17000 a year has the dubious honour of spending the most on pokies per head of population. In just 3 months between April and June this year the 72 pokies in the Kawerau district took in $111 for each of the district’s nearly 7000 people—that is men women and children. If we take babies and children out of the equation and all those who do not gamble just imagine how much some people in Kawerau are pouring into those machines. Nearby Rotorua also a low-income area has the third-highest spend on pokies in the country. In Northland there are almost three times more pokie machinesper person than the national average. Kaitāia for example has 158 pokie machines per 10000 people which is way above the national average of 59.In districts like these and many others of a similar demographic a very few people are losing an enormous amount of money which is contributing hugely to the eternal cycle of debt and despair in which so many affected individuals and families subsist. Pokies continue to be the predominant source of gambling harm in New Zealand. That is no surprise given that these machines are deliberately designed by psychologists to addict people and that they are conveniently placed in our poorest districts to catch the most desperate amongst our population.At the same time it is clear we also have serious issues around what is happening in our casinos. News reports over the last few months have started to reveal the unexpected extent of criminality associated with life in at least two if not more of our major casinos particularly those in Christchurch and Auckland. Although the Green Party has welcomed belated recognition by the Department of Internal Affairs in two recent reports that organised crime money-laundering and loan sharking have a firm foothold inside our casinos we are really unhappy with the way the Minister of Internal Affairs seems so relaxed about what is happening and does not seem to realise the serious nature of what is going on there. He does not seem even to understand the illegal nature of some of the activity or that ongoing harm is being done to individuals their friends their families their employers and their communities for as long as he so calmly tolerates it. I wish that Mr Barker could open his ears and his eyes to some of the stories from the problem gamblers whose lives and whose families’ lives have been completely wrecked and that he could begin to comprehend the seriousness of the situation in which this country finds itself.The Green Party continues to call for a full public inquiry into the state of gambling in Aotearoa New Zealand as we believe that this is the only way victims of harmful casino and pokie-related activity can have the confidence to come forward confidentially and reveal what they know and be taken seriously without fear of reprisal. At the same time the Green Party believes that it is imperative that the scope of the Gambling Amendment Bill (No 2) before us today is substantially broadened. This bill could have been a heroic effort by the Government to deliver major reform to overcome some of the worst impacts of the gambling sector. Instead it is a series of what the Minister the Hon Rick Barker himself calls “technical amendments and … minor policy enhancements” and nothing else. Because on the face of it these new minor amendments are in themselves useful the Green Party will not be opposing the new bill at its first reading but we may well change our position to one of opposition to the bill if it is not subject to major changes during consideration by the select committee and the House.This bill provides us as responsible members of Parliament with an opportunity to institute major reform of the gambling industry in this country rather than just continuing to tinker around the edges. I do not accept the statements made by the Minister and Darien Fenton earlier in this debate tonight that a bill like this is not an appropriate vehicle for major reform. There is nothing to stop this Parliament from using it in this way if we have the will. I am sure we are going to see a large number of submissions encouraging us to do so.There are a number of additions and changes that the Green Party would like to see made to the Gambling Act through this amending bill. First of all the loophole regarding the requirement for territorial authorities to consult when reviewing policies needs to be closed. Currently local bodies can roll over their gambling policies indefinitely without any public consultation. This needs to be stopped. Second I believe we should be considering whether class 4 consents—that is consents forpokies—should last for an infinite period or whether they should have a set time period similar to liquor licences. Third councils should have the ability to place conditions on consents and not be limited as they are at present. Ultimately the Green Party believes that councils should have the power to determine whether there are any pokies in their district at all and not have to live with the current situation in which they are gravely restricted in the limits they can place on numbers and siting.Fourth the Gambling Act should promote the adoption of best practice in terms of harm prevention strategies. For example currently the Act does not allow the use of or even the trial use of new strategies such as pre-commit cards or player tracking systems. Consumer protection requirements including host responsibility should also be enhanced. Fifth we believe there should be disincentives against the gambling industry benefiting from problem gambling. Problem gamblers account for a disproportionate share of gambling revenue: over 25 percent of it comes from 1.2 percent of people—those gambling problems. Sixth distribution processes for gaming-machine funding should maximise community benefit and transparency and ensure equity in terms of its distribution. Although the Gambling Act made some reforms in this area we still have a long way to go.The Green Party believes that if we are going to allow the blight of pokie machines to exist in our communities the proceeds that go to community purposes should ideally be distributed through publicly accountable mechanisms like the Community Organisations Grants Scheme and the national and regional lotteries distribution committees rather than being allocated by the private pokie trusts. At the moment many community groups are held hostage by the fact that they receive funds from the pokie trusts to keep going. On top of this such groups are often trucked in to for example local body hearings in places like Kaikohe and Rotorua and many others to explain that pokies must continue in that district so that the local hospice rescue helicopter or sports club can be adequately funded.This is a sad indictment on the way in which parts of the community sector have themselves become addicted to pokies just as the individual players are. Even councils can fall prey to this addiction. For example it is ironic that the council in Rotorua has itself benefited from over $900000 in pokie grants—income derived from losses made by some of its poorest residents.As well the ability to prohibit and restrict Internet gambling needs to be revisited by this bill in the light of current international decisions and the existence of sites like RaceO NZ about which the Government seems unable or unwilling to take action.On 1 August this year the first set of figures from the Government’s electronic monitoring of gambling machines showed that spending on pokies increased by just under 5 percent between 2005-06 and 2006-07. This means that either the new electronic monitoring systems are spelling the end of scams and rorts that saw a portion of takings hidden by pokie providers or the gambling trusts have perhaps been less than fully honest in their recent lobbying of MPs and community organisations about their supposed decrease in takings and hence their reduced ability to fund community and sporting organisations. What is really going on with those trusts when in fact the proceeds are going up by 5 percent not declining?It is high time that the Government and this Parliament took a much stronger position on reducing the harm being done by gambling in this country. Ordinary people understand the problem. Just a few weeks ago around 7000 people in Manukau City made submissions to their council calling on it to adopt a sinking-lid policy on pokies in their district. They understand what is going on in South Auckland. They care. It is way past time that MPs and parties in this House—from all sides of the House—caught up with those people in South Auckland and took serious action to reverse theunacceptable social and economic costs that are being inflicted. This bill gives us an opportunity to do just that and I call on other parties and MPs here to join me.Dr PITA SHARPLES (Co-Leader—Māori Party): Tenā koe Mr Speaker. I would like to take a call on this bill as one who enjoys a game of blackjack and pontoon and craps and one or two others. However I do want to highlight the danger of problem gaming. The biggest-ever sales promotion leading up to Lotto’s 20th birthday this Saturday 25 August is full of expressions of joy. We are told that: “Since Lotto was launched in 1987 New Zealanders have won over $3.6 billion in prizes there have been thousands of happy winners and thousands of happy stories of positive changes in people’s lives.” Well I hate to be a killjoy but the story of gambling in Aotearoa is not exactly happy happy happy joy joy joy. Sure there have been changes in people’s lives—massive changes. Some researchers estimate that between 1 and 3 percent of New Zealand adults have experienced problems with gambling at some stage in their lives.Of course it is not just an individual problem. On average 10 to 17 people are affected by the problem gaming of one person. It is also estimated that only 15 percent of those with problems associated with gambling seek help. There will be many more affected people who are not receiving assistance. Gambling affects families and communities to tragic ends. In monetary terms $35 million is gambled every day here in Aotearoa—$35 million—and $5.5 million is lost every day. It is money lost by people many of whom can least afford to lose it.It is not just about some harmless fun with an armless bandit a shuffle of cards and a roll of the dice to see whether Lady Luck will strike. Gambling creates enormous harm especially in communities identified as high-deprivation or low-income. Dr Lorna Dyall describes this as an environmental hazard due to the placement of gaming machines in areas that are predominantly decile 1 on the deprivation scale. Consequently the Māori Party has always said that we should manage gambling as a social hazard rather than as a harmless leisure pursuit. Just as people in communities are protected through management of chemical and biological hazards so too should there be protections in place to safeguard our well-being from gambling which we know is hazardous to health.In this context obviously the fact that the Gambling Act 2003 has not been all plain sailing concerns us. The Act is a large complex and very prescriptive piece of legislation so it is not surprising that there have been difficulties with its implementation. The purpose of that legislation includes both controlling the growth of gambling and minimising the harm caused by problem gaming. Those are worthwhile goals—goals that we will support.I turn to controlling the growth of gambling. As the first aim is to reduce the activity of gambling it is a major problem that so little progress has been achieved since the Act was introduced in 2003. The Department of Internal Affairs released figures on 1 August showing that the spending on pokies in bars and clubs has increased by just under 5 percent in the last year. The department installed an electronic monitoring system in April so we are able to produce accurate figures on pokie expenditure for the first time. We have to wonder what is going on when despite the legislation and despite the regulations the spending has still shot up by 5 percent. It is disappointing but obviously necessary that 4 years later we have to revisit some technical amendments to clarify the definitions sections and the various provisions relating to gambling venues and their enforcement.We heed the advice of the Problem Gaming Foundation that this review provides us with a great opportunity for all parties to get in behind substantial reform of the gambling industry. We in the Māori Party have been calling for investigations into loansharking and money-laundering at casinos and we have been consistently advocating for Māori to have a clear role in deciding the place of gambling in Aotearoa. This bill may provide us with the opportunity to do that. But we are pleased that the bill introduces some new provisions to identify and assist problem gamblers which we absolutely support. Gambling is a huge problem for Māori. Ethnicity and in particular identifying as Māori is now described as a key indicator of the likely risk of problem or pathological gambling.Dr Wīremu Manaia of the Problem Gambling Research Initiative has reported that for many Māori people their low socio-economic status makes them particularly vulnerable to gambling problems. What concerns us is that although one in three people who are utilising gambling treatment services identify as Māori reports indicate that Māori underuse the gambling treatment services in relation to need. There are a lot more Māori out there who are experiencing gambling-related harm than perhaps the figures tell us.So what does this mean in real terms? Well in 2003 the Salvation Army surveyed people accessing food banks in South Auckland. Over one-third of the people applying for food parcels had a problem gambler in their household and of that third 80 percent had two or more children. The legislation now requires venue managers and licence holders to take all reasonable steps to assist a person identified as a problem gambler. It includes prescribing the content and training standards for problem-gaming awareness training. The legislation also introduces statutory requirements for casinos class 4 operators to record problem-gambler exclusions and provides relevant information on request. Those are positive interventions which we are pleased to support. They demand greater attention to detail and care to identify and record individuals at risk and all of that has to add to greater awareness and a commitment to change.I want to draw the attention of the House to the courage and commitment of communities in fighting the hazards of gambling. Last week I heard some great news coming out of my electorate in Tamaki Makaurau. South Auckland is heavily targeted by the pokie trusts because they know that low-income people are more likely to develop problem-gaming behaviour than other sections of the population. Gaming machines are in fact five times more likely to be concentrated in the two most deprived deciles along with 50 percent of the TAB outlets. So it is hardly surprising that Māori and Pasifika peoples in South Auckland are over-represented in the statistics of people affected by problem gaming.Even worse there is a false illusion painted that gambling returns funds to the local community. The legislation requires that a minimum of 30 percent of gambling profits must benefit the local community but that is the community at large not necessarily the local community from where the money was gained. The Problem Gambling Foundation estimates that the local economy is losing 17 times more money than what the community groups are receiving back. Against that context it was really wonderful to hear last week that nearly 7500 submission have been received urging tighter restrictions on the number of pokie machines in Manukau. These 7500 submissions were from people standing up to take control of their community challenging the armless bandits to release their grip on the people of South Auckland. There are also many strong advocates such as Dr Lorna Dyall who have been calling for changes to the Gambling Act to empower communities to have the authority to remove gambling venues and pokie machines from outside of their area.We should expect there to be more cultural content in the existing services and that there should be increased cultural competence on the part of clinicians. We should expect a role in developing policy and legislation to deal with the problems alongside the Crown. That would involve tangata whenua membership as of right on the bodiesthat regulate gambling. The elimination of gambling harm must be an outright priority for this Parliament.The Māori Party members will support this bill. We look forward to hearing in the select committee process the ideas and advice about how best to facilitate community involvement in decisions about the provision of responsible gambling activities and which sections of our communities benefit from those activities. We support the first reading of this bill.JUDY TURNER (Deputy Leader—United Future): I stand on behalf of United Future to speak on the first reading of the Gambling Amendment Bill (No 2) 2007. As the Minister of Internal Affairs Rick Barker stated this amendment bill is both technical and policy driven and responds to implementation difficulties arising out of the 2003 principal Act. Part 1 of the bill makes about 14 changes to definitions Part 2 has about 64 clauses that are devoted to amending provisions relating to classes of gambling and classes of gambling institutions Part 3 relates to harm minimisation and Part 4 has some technical details.Overall the bill intends to widen the suitability criteria for gaming machine operators and licensed promoters to cover a wide range of offences and management provisions. For instance if a person has been the director of a company in receivership or a company that has been placed in receivership in a 7-year period that person is not suitable. If a person has been disqualified to act as a director of a company under the Companies Act that person is unsuitable. If a person is prohibited under the Insolvency Act from acting as a director that person is also considered unsuitable. Interestingly though the bill narrows the time frame under which a person is considered historically unsuitable from 10 years down to 7 years. I will be interested to see what submitters have to say about that.One of the second purposes of this bill is to introduce explicit obligations on grant recipients to use pokie grants appropriately including an offence for non-compliance. This is a particularly interesting area because many community groups in greater numbers are refusing in principle to apply for grants from pokie machines feeling that it would be perverse to have their services funded by the proceeds of gambling. The same organisations have expressed to us in United Future their huge pleasure in our ability to have negotiated with the Labour-led Government for a lifting of the cap on rebates on charitable donations so that community and charitable organisations are able to receive funding from a source that is more legitimate and that ethically measures up to the work they do. However it is even more tragic to think that those who do apply for a grant could actually at times be doing so under false pretences and we welcome the tightening-up of that.This bill also extends conflict of interest safeguards to all persons making decisions on gaming machine grants—not just those with key roles in the management of societies. It also strengthens the requirements on venues to bank gaming machine profits. That is an attempt to make sure there is much greater transparency regarding how much money has been taken from gambling activities.The bill also seeks to enhance regulation-making powers to better deal with problem gambling. This is largely about exclusion orders. Where a person has self-identified as a problem gambler the legislation seeks to make sure that those venues the person has requested to be excluded from follow through on that commitment. The bill widens the class of person required to use the policy to identify actual or potential problem gamblers to include people like venue managers so that more people are being very watchful. The interesting thing though in this particular part of the bill that I think needs further scrutiny by the select committee is the fact that the penalties for breaching that requirement have been reduced from—I think from memory—$10000 down to$5000. That is quite a substantial reduction in penalty. I would like to hear that reduction justified and I would like to hear what people have to say about it during the select committee process.The bill introduces requirements for the accurate disclosure of non-cash prizes as a consumer protection measure. I think that is a very wise inclusion. It provides more flexibility for clubs that wish to merge their club and gaming machine operations to address financial viability issues. This particular part of the bill is something I also signal some concerns about and interests in. In the commentary on the bill it states that it is expected as a result of this amendment bill that there will be an increase in funding for the activities of clubs that operate gaming machines in order to raise money for their own community purposes.I am not sure whether it is still true today but I remember some years ago discovering that organisations like St John Ambulance survived and were only financially viable because they owned pokie machines. At the time I considered that quite a bizarre set of circumstances. I am not sure whether St John Ambulance is still funded in that way but it certainly concerned me then. This provision says that the Government wants to be able to increase the opportunity for community groups and non-profit groups like St John Ambulance to increase the funding they receive from those investments they have in gambling machines. I have some concerns about that and I share the sentiments that have been expressed by others in the House tonight. Pokie machines are the cocaine of the gambling industry—that is very very clear. Surely we should be making sure that the number of pokie machines is determined by regional considerations not by the funding needs of local community organisations.United Future is hugely hopeful about the next financial year when non-profit charities register with the Charities Commission and those who give to those organisations recognise the huge advantages they now have in their ability to give more of their income and receive a much better return in their tax return. We are hopeful that we will see a decreased reliance by charitable organisations and community bodies on the proceeds of gambling as New Zealanders step up to the mark and start to put their hands in their pockets knowing that there is a much more generous response by the tax department to their willingness to support community activities.We are happy to support this first reading of the bill but we signal that we are keen to see some of these issues clarified at the select committee. We are very keen to hear what submitters have to say.Hon GEORGE HAWKINS (Labour—Manurewa): Tonight we have listened to various speeches all basically in support of the first reading of the Gambling Amendment Bill (No 2) and its referral to the select committee. It is interesting that it is also a time of confession. We heard about Eric Roy’s dilemma over whether to go to the gambling parlour or the strip club. Obviously he chose correctly. We heard about Peter Brown and his days of being a sailor and gambling. We heard about Dr Sharples playing cards. Well I can tell members that when Parliament used to have all-night sittings plenty of gambling was going on around the offices here—and maybe the odd drop or two of whisky—and people used to play cards until the early hours of the morning.Hon Member: Bring it back!Hon GEORGE HAWKINS: Yes perhaps we could bring it back. It might be more interesting. Since it is time for confessions I tell the House that I was the Minister who took the original Gambling Bill through the House but people should not forget that gambling did not start in the year 2003. It has been going for a long time and of course we have tried to make sure that things are better than they were.I agree with Dr Sharples that the effect of pokie machines is very devastating in South Auckland. It is something that I believe is impacting on that community. On the other side of the coin of course are the sports clubs schools and cultural groups. I think Judy Turner mentioned St John Ambulance. All those groups have over the years become dependent on the income they receive from pokie trusts. I think it is quite good that they get money but of course becoming dependent on that money is something else.This bill is welcomed I think because we will look at some technical amendments. I imagine that those who submit on the bill will not make terribly many technical submissions. They will be either for or against gaming of any kind. It was not that long ago that Lotto started—20 years. Since it is time for confession I must say I have my tickets in my back pocket. I will probably be back here working next week because I will not win like lots of other people. That is what gambling is about. People have a little bit of hope. They think they will strike it big and it is worth maybe 20 bucks to have a go.Bob Clarkson: A bit like the Labour Government.Hon GEORGE HAWKINS: It is a bit like the National Government—a pack of gamblers from way back. They gamble against the ordinary taxpayer in New Zealand.I am pleased that the Minister is also taking up the much bigger issue which is the allegations about the Christchurch Casino. I think that is very very important.We have many people who are addicted to gambling. We feel sorry for those people who are addicted to alcohol and we do something about it. We spend almost $50 million a year on those with gaming addictions. That all comes out of the big pool of money and of course with that we are probably only scraping the surface. A lot of people do not know where to turn for help or they keep it from their families. When they hide it from their families there is a problem. In the Counties-Manukau area there are people who are still too scared to come forward for help. Sandra Goudie mentioned that a lot of money was available but people were not using it. That is one of the problems. It is an education problem—to get people to realise that if they have a mental health problem an addiction problem they can go for help.I am quite pleased that this bill will go to the select committee and as I said earlier people will make submissions. I doubt whether many of them will stick to the technical amendments. They will try to open the debate up again. I do not mind if people do that because I think talking about it is important. The publicity it will gain will help with the gaming issues in New Zealand. I support this bill’s referral to the select committee and I am sure people will welcome the opportunity to make submissions.Bill read a first time.Billreferred to the Government Administration Committee.