Gambling Amendment Bill (No 2)

I rise to take a call on Part 1 of the Gambling Amendment Bill (No 2), and, I have to say, I do find it a bit intriguing. This bill was first introduced to the House in 2007, and then came back to the House for its second reading in 2009. In fact, just looking at the report from the Government Administration Committee, the people who were on that committee then were Shane Ardern, Darien Fenton, Brian Donnelly, the Hon Harry Duynhoven, Sandra Goudie, and the Hon Dover Samuels. Sue Bradford was the Green Party MP who was sitting in as a non-voting member. It strikes me that quite a considerable amount of time has passed since 2009 until now. When I looked through the previous speeches, particularly in the first reading of this bill, which was like a historical investigation for me, those speeches did say that part of the reason for the bill—and particularly for this part as well—was around wanting to tweak the original 2003 Gambling Act. That Act was still fairly new at that time—we were only 4 or 5 years into it—and there were some anomalies that needed to be addressed. I commend the Minister of Internal Affairs, the Hon Peter Dunne, for bringing this bill back to the House, but I do have to say that quite a lot of time has elapsed since that second reading in 2009 and the Committee of the whole House, where we are about to address the bill today, although I do acknowledge that it first came back to the Committee of the whole House in July this year.

We have introduced quite a substantial number of Supplementary Order Papers on the substantive part of the bill. They are in the name of Kevin Hague but I do have to note that, because of the amount of time that has elapsed, the original submitter of those Supplementary Order Papers was actually Sue Bradford. A lot of those Supplementary Order Papers actually refer to reducing gambling harm. In particular, proposed new clause 22 on Supplementary Order Paper 65 talks about increasing gambling harm prevention measures like player tracking and pre-commit cards. I note that in the passage of the last term of the 50th Parliament, although there have been other gambling bills that have come through this House, none of those bills and the discussions we have had around them have actually yet succeeded in getting this type of gambling harm reduction measure in place. I would hope that the Minister will be considering our Supplementary Order Paper this time around, for this bill.

Our Supplementary Order Paper 65 also talks about limiting and changing the meaning of “authorised purpose”, so that it basically reduces the ability for the proceeds from gambling from class 4 machines to go towards “the maintenance and development of racing club infrastructure and racecourses, including the payment of wages and salaries and purchase of goods and services ancillary to this purpose and the promoting, controlling, and conducting of race meetings under the Racing Act 2003, but not including the payment of racing stakes:”. We do not believe that it is reasonable for one form of betting, which is class 4 betting, to go to the pockets of those who own racehorses and who are providing the racehorses, and who already get paid from the betting from that form of gambling. We do not think it is reasonable, and we certainly do not feel that it falls within the strict interpretation of what “charitable purpose” means, or funds that should be used for a charitable purpose. I have never really heard of a racehorse owner who was a charity case, but perhaps the Minister can define that as well.

The basis of our Supplementary Order Papers is really around wanting to ensure that communities are able to choose whether they have gambling outlets in their communities. The Supplementary Order Papers also seek to ensure that the proceeds of gambling and those funds—and, let us face it, around about 40 percent of the proceeds of class 4 gambling comes from people who have very limited control over their gambling habits—are redistributed fairly. There have been cases and cases and cases, well documented in the media and throughout this House as well, in other gambling legislation, showing that frequently there are rorts and all sorts of dodgy dealings around the distribution of funds. I think, actually, that that has sometimes occasionally happened in Ōhāriu. The Minister may be able to comment on that as well.

We are quite concerned that we should be able to ensure that this legislation enables the fair distribution of funds from gambling and that most of the money that comes from gambling that is to be distributed for charitable purposes should go back to the communities where the money was gambled—for example, to ensure that the money from Jokers pub in Manurewa, which actually has quite a large take from gambling, does not go to the Otago rugby club and actually gets spent in Manurewa. It is the people in that poor community—particularly the people in that poor community with limited control over their gambling behaviour—who contribute the funds that are to be used for a charitable purpose.

We are also quite keen, through our Supplementary Order Papers, to be able to ensure that councils and local communities have more say over where gambling premises can be. We have seen time after time, particularly in places like Ōtara, Papatoetoe, and Ōtāhuhu, a prevalence of gambling clubs—pubs really; but they are more like pokie parlours—being positioned right near community facilities and liquor outlets. These are the communities that provide the most money to community funding from gambling proceeds, because they are the ones in which there are more problem gamblers per head of population. We would like to see those communities be able to have some say over whether they want these gambling facilities in their midst. We know that this Government in the last term actually took quite a few steps towards restricting the rights of communities to have a say over things like where they can do things. We know that in South Auckland, particularly, the communities themselves are saying that they want more control. We see this in places like Ōtara, with the Ōtara Gambling and Alcohol Action Group, a phenomenal group that promotes activities around healthy eating and entertainment options. I have seen group members out and about, and I have seen them celebrating pokie-free bars in Manukau, for example, as a way of trying to highlight the fact that you can have a night out without actually having to be in a place that provides pokies as a form of entertainment, when all too often that entertainment is the cause of harm and addiction in many families in those areas.

We are not quite sure, actually, what a lot of the point of this bill is, given the period of time that has elapsed since it was introduced in 2007. We have been assured that it has around about 25 technical amendments. To some extent we are not opposed to them, but we do want to make the point that we could strengthen this bill by implementing the Supplementary Order Papers in the name of my colleague Kevin Hague. I would urge the Minister to take those on board and maybe even adopt them as his own. Thank you.

I have to confess, I am just refreshing my memory of the Gambling Amendment Bill (No 2). I would like, first of all, to acknowledge the Minister whose name is on the bill, the Hon Rick Barker, a very competent and excellent Minister of Internal Affairs. Of course, this bill was introduced back in 2007, and I would like to congratulate him on his foresight.

I would say, however, that one of the reasons this bill came about in the first place was that the then National Opposition was concerned that the Gambling Act—it was originally called the Responsible Gambling Act, and after Parliament was finished with it, it became just the Gambling Act because it decided that the word “Responsible” no longer applied—was too prescriptive and that, in fact, it would date too quickly. Indeed, that proved to be the case, at least in some instances. So this amendment bill was introduced by Rick Barker in 2007 in order to try to keep up with some of the changes. I am, therefore, delighted that, given National’s concern about how quickly the bill would date, it has expedited this process and, 7 years after the bill was introduced, we are now making progress here in the House.

If we turn to Part 1 in particular and look at some of the definitional issues that are covered by Part 1, it is very clear that the Act would date very quickly because of the technology changes that have come in since then. We are talking a lot about gambling machines, and there are some technical provisions on that that I know my colleague Stuart Nash is intending to speak about so I will not steal his thunder, but there are other provisions here around electronic means, which I relocated again just before—for example, instant game and remote interactive gambling. There have been huge technological advances since this bill was introduced—and, in fact, since the Gambling Act itself was passed back in 2003—that make this legislation necessary.

I would, of course, point out that I think the Minister in the chair, Peter Dunne, is now the fourth Minister of Internal Affairs to be in charge of this bill. Rick Barker introduced the legislation. Richard Worth—things did not quite work out for him—then picked up the legislation after that. Chris Tremain, I think, was after that, and now Peter Dunne. Have I missed one? I must have missed—

💬 Hon Peter Dunne: You might have missed two.

I have missed a couple. So there have been a few other Ministers along the way. Actually, no, I think Nathan Guy was the Minister of Internal Affairs for a little while there. So this bill has passed through many hands.

Of course, it is a largely technical piece of legislation, and there are a variety of Supplementary Order Papers designed, I guess, to try to bring the bill up to speed with what has happened in the 7 years since it was introduced. But it is a necessary piece of legislation because it deals with some loopholes and so on. I am aware that there is another gambling amendment bill also on the Table, which I am sure Parliament will get to in due course.

The bulk of the provisions that I want to speak to are actually in future clauses of the bill, but just to give you another example, things like eftpos devices are better defined in here. There was eftpos 7 years ago, so I am not sure what the necessary change is, but there are a variety of changes that are being made simply to bring the law up to date with technological advances and changes that have happened.

I do want to talk about the purpose clause in Part 1. There is an amendment here—the very first amendment under the purpose clause, clause 4(1)—that changes the purpose of the overall legislation by omitting “the harm caused by” and substituting “harm from”. This is something that I would quite like to have an explanation from the Minister on, about what the justification for that is, because it seems to me that “harm from” gambling could actually be more narrowly defined than “the harm caused by” gambling.

One of the overall purposes of the Act, I think—if you go back and look at the principal Act—is that we want to try to reduce the harm caused by gambling, so I would like to know why the wording has been changed there in the purpose clause. It is now around “the harm caused by” gambling and it is being changed to “harm from” gambling, and it seems to me that the latter definition could well be interpreted as being more narrow than the definition that is in the Act at the moment. So I would like to know what the justification for that wording change is.

I am pleased to take a call on this bill. I just acknowledge the work that has been done, obviously, by previous Ministers and committees, particularly those colleagues of mine who have been on the Government Administration Committee.

We are dealing here with Part 1, and, as the former speaker, Chris Hipkins, has noted, this is quite a technical part primarily around definitions, so I will try to keep to that. I suppose the overall balance, though, for the Government is how you take something like gambling—definitional and otherwise—and acknowledge that for many Kiwis it is something that is enjoyable, fun, consciously entered into freely, and so forth, but for others, of course, it becomes a problem, an addiction, a disease, or however we define it. So that is the balance that we attempt to seek here. I found that across my own work in the community over the years, visiting different organisations within my electorate of Tāmaki that have gambling machines—particularly those of the class 4 variety—it is that tension ultimately between Kiwis who enjoy quite responsibly the act of gambling and those who enjoy it in a way that is not healthy for them.

So I want to pick up the latter question put forward by Chris Hipkins, which was why, in clause 4(1) in Part 1, around the purpose, we are changing “the harm caused by” and substituting that with the “harm from”. I think ultimately what it tries to indicate is that gambling itself can in some instances be the primary cause of trouble, or in other instances it is the secondary form. It is something that contributes, if you wish, towards someone’s harm. So if someone is in a vulnerable position, a financially troubled position, or whatever you wish to call it, gambling itself may not be that which caused it. It may be an indirect cause, but it may be a direct cause. So, in other words, it is saying that there is some harm from gambling, but it might not necessarily be the absolute reason why a person is in a situation of harm. So it is a subtle—

💬 Chris Hipkins: But why narrow it?

I actually do not think it narrows it. My colleague across the Chamber asks why it is narrowing. In fact, I think this broadens it, ultimately. The older definition in Part 1 of “the harm caused by” is saying that if someone is in a vulnerable position and is a gambler, the harm caused is by the gambling. This change to substitute that with “harm from” broadens it out and says that, actually, there can be a whole lot of contributing factors that have led to the situation. Gambling informs it, but it is not necessarily the only one, and I think that is probably a healthier way to approach the whole question of gambling.

More often than not, if I was to draw from my previous experience, addiction breeds addiction, so often people who have serious gambling problems may also have a tobacco problem or areas of issues with their finances, alcohol, and so forth. I think actually this change to the purpose clause acknowledges that in a very subtle way, by saying that actually gambling, again, is a part, a contribution, a contributing factor, or perhaps a secondary element in this.

But overall, as I said at the start, Part 1 is definitional. I think it is really important that this bill gets this right. A serious amount of consideration has been put into this bill by the Government Administration Committee. It is trying to work with an area that is quite evolving. I know a number of members have pointed out that this bill was first put forward in 2007, but a lot has changed. We see even in the Supplementary Order Papers that things are changing again. We learn as we go along.

So we are seeing some of the definitional changes, including around what a “class 4 venue” is. A simple amendment to the words—a little bit like changing “the harm caused by” to “harm from”. A “class 4 venue” now is seeing the whole notion of “conduct” change to operation. I think that is an important distinction. Again, the very fact that the class 4 facility is operating is separated from just how it chooses to conduct itself. I think that provides clarity there. The former member—or the previous member, rather; he is not former yet—was talking about an eftpos device. It has just broadened that out. I think that 7 or so years ago, eftpos for us was a very specific device, and it was separate from credit cards and so forth. Now it is almost a ubiquitous phrase that we use.

The definition of a “gaming machine” has been changed here in Part 1. That is noted now to be something that is either “totally or partly mechanically or electronically operated,” and it is something that is “adapted or designed and constructed” for gambling purposes. Again, it is very clear that there is an array of devices that can be employed here. Ultimately, as it says here in Part 1, this device, this gaming machine, is something that “is played or confers a right to participate, whether totally or partly, by the insertion of money …”.

I tend to agree with Chris Hipkins’ definitions around “the harm caused by” and “harm from”. One, to me, is causation, and the other is lot more passive. It does not matter if you are in deep financial stress and you turn to gambling to get yourself out of that financial stress, no matter what that may be, that is still harm caused by gambling. You get yourself into trouble from gambling, but I actually agree with my colleague Mr Hipkins. I think one is a lot wider and one is about the causes of gambling, which is really what we should be dealing with in this bill. Harm from gambling—well, it does not have the same ring or the same causation as “the harm caused by”, but that is last thing I will say on that.

Gambling is a rather insidious disease. I do not think there is anything good or enjoyable about gambling. I do not mean to sound like a wowser but there are 50,000 New Zealanders who have a gambling addiction. For every person with a gambling addiction there are probably five or six who are affected by it, and they include the employer who might have had money stolen or the family members, and so on and so forth. The media is full of stories of people who actually have stolen, whose lives have been ruined, who have lost marriages, lost their houses, lost their jobs, let alone substantial amounts of money and their self-respect.

But what I would like to talk about is clause 5(5A) and the definition of a “gaming machine”. I was not aware until Mr Hipkins mentioned it that there is actually another gambling bill on the Order Paper. When I had a look at this bill it really is a 2007 bill, because even though in 2007 we had the internet and we had all those whiz-bang devices that we have got now, gambling really did not come to the fore on the internet until the last 2 or 3 years. In fact, what we are finding is that a lot of people are not actually going to casinos because there is a stigma associated with playing the pokies or putting money in those slot machines. But they can now do it in the comfort of their own home and the privacy of their own home, so somewhere we need to include on here something to do with the internet. I am sorry, but maybe the Minister of Internal Affairs can tell me whether this bill will come before Parliament yet again with another amendment as technology continues, or is the new bill that is on the Order Paper about internet banking and the regulation around that—not internet banking; internet gambling, and the regulation around that.

💬 Hon Ruth Dyson: Some people sort of see it as banking.

That is true—that is true. The other part of internet gambling—which is so insidious, of course—is that there is no tax paid on it. People say that the best way to launder money is obviously by going to a casino and that is how you do it, but at least Skycity and other operators like that actually do pay tax, whereas there is actually no tax paid on internet gambling. It is a major concern. As the Minister in charge of the bill is a former Minister of Revenue, he will know the impact of the internet. It has had a significant effect on the amount of revenue the Government can collect. With the amount of money spent on gambling, the tax implications are significant. So can the Minister inform me whether the bill we have on the Order Paper is about regulating internet gambling, or whether there will need to be Supplementary Order Papers around this to bring that in.

Here it talks about a device, whether wholly or partly mechanical or electronically operated—we all have a picture of those; you go down to a casino and there are thousands and thousands of them—that “is adapted or designed and constructed for gambling; and … is played or confers a right to participate, whether totally or partly, by the insertion of money into it or by the direct or indirect payment of money by any other means;”. So to me, this precludes internet gambling.

Although the Hon Rick Barker was a man of a lot of vision and foresight, I do not think even Mr Barker in his time would have foreseen the growth of the internet gambling industry and actually how many people can play it and the insidious nature that it has. In fact, in this day and age you can even buy your Lotto tickets online, so it is not just the overseas sites that are controlled by the guys operating out of Macau. This is actually the New Zealand Lotteries Commission. What we have done is made it easier and easier over the years—not incrementally, almost quantum leaps—for people to gamble away their money, but as a consequence of that, I see that a whole lot of legislation is going to have to be introduced to regulate this industry and actually keep people from harm.

As mentioned, there are 50,000 people in this country with a problem gambling situation, and we will need to do something about that, but in the meantime I am keen to know what the definition of a gambling machine is also because—

Following some informal discussion, can I seek the leave of the Committee for all of the provisions of the bill to be taken as one question?

The CHAIRPERSON (Lindsay Tisch): I am just restating the question. The question is that Parts 1 to 4—so that is Part 1 that we are already debating and clauses 1 to 3—stand part. Is there any objection to that course of action? There is no objection.

Thank you, Mr Chairman, and thank you particularly for that clarification, because when you earlier outlined the parts and the clauses, I think there was a little bit of confusion, so that is very clear—the whole thing as one debate, and everyone seems agreed on that.

Can I just back up a little bit and go back to the original point of this legislation, which, as other members have referred to, was actually introduced 7 years ago. Seven years ago the Hon Rick Barker introduced this legislation, and I recall the debates at the time. They were not as heated as some of the gambling debates that we have had around the behaviour of the Government, for example, with Skycity. There was a lot of cross-party agreement on the need for the legislation. The issue of problem gambling was becoming more and more known to members of Parliament, and I think there was a genuine desire to address that, but there was some concern at the time that the legislation was very prescriptive and, therefore, would soon become dated and we would have a need for amendments to update it.

I want to ask a question of the Minister in the chair, Peter Dunne, who, despite our political differences, I think shares with me an understanding of how the other works, and I think the Minister would have considered it. What I want to know is what the tipping point is—in terms of definitions that we know will become dated but we do not know how—with regard to having them in primary legislation as opposed to schedules. I would be very interested to know—not that it is going to make a difference in terms of support or otherwise of the legislation, but in terms of the best way of either redrafting or amending legislation such as this in the future, where we know that practices will develop, practices will change, and the current definitions will become redundant—what the best way is to ensure that they are kept relevant.

So I would like the Minister’s answer, if he has an opportunity—it may be this evening. Peak listener time is just about to come upon us, as the Minister is well aware. He knows that between 8 minutes to 10 p.m. and 5 minutes to 10 p.m. is when most people like to tune in to listen to what is happening in Parliament. But quite seriously, I would like it if he could just say what he thinks is the tipping point in that, because throughout this legislation you can see things that may well disappear in the very near future, but the intent to try to minimise harm is obviously still relevant, regardless of what the cause is.

So that was the reason that we had this legislation as an amendment in the first place—because the very concerns that were raised were shown to be correct in that respect—but I do not think we are getting it right in this legislation, because we have still got so many definitions in the primary legislation.

I want to have a look at Part 1 and the definitional issues that I think Stuart Nash and perhaps Chris Hipkins as well referred to. That is a very relevant example of the areas where the technology changes will in fact make the very sections that we are debating now become irrelevant to Parliaments of the future. So that is my primary question—what is the tipping point for definitions such as this, which are at the heart of the legislation? They are not minor; they are at the fundamental heart because they describe the triggers for either offences or other regulatory regimes or controls that are put on. So the very heart and soul of this legislation is included in the definitions.

I am hoping that the Minister is about take a call, in which case I am very keen to hear the answer to that question. What is the tipping point? What can we safely leave in the primary legislation and not have to come back in the future and spend the time of the House making amendments to, when we all agree on the primary purpose of the legislation? And what can more usefully be put in a schedule, which can then, of course, be updated by Order in Council, particularly given that the Minister is well aware of the fact that there is widespread agreement in this area?

The member who has just preceded me, the Hon Ruth Dyson, sets a pretty stern challenge at this hour of the evening, but I will attempt to respond. To my way of thinking the fact that we have before the Committee tonight a bill that has been 7 years getting to this point is unsatisfactory, frankly, for a variety of reasons. That is water under the bridge, but I will just highlight the dilemma she poses.

As this bill goes through—and we already have Supplementary Order Paper 454, which I have tabled, amending some of its provisions because they need to be amended—I have a second bill, titled the Gambling Amendment Bill (No 3), awaiting its first reading, and that process will continue. I am of the view that what we are seeing—and it is my personal view only—is a fundamental change in the nature of the gaming industry in New Zealand. I actually put the words “in New Zealand” in deliberately, almost parenthetically, because I think the challenge for the future will not be in terms of how we regulate our domestic environment. So many of our gaming opportunities will be offshore, through the internet or through a whole range of other technologies, and they will be extremely difficult to control and to regulate. So to some extent in passing legislation of this type and amending it and trying to keep it fit for purpose, we are fighting a little bit against history, because the big challenge is going to be the nature of the games that lie ahead.

I recall being in this portfolio in the mid-1990s, and also being the Minister of Revenue at that stage, when internet gambling was first taking off. I remember being approached, quite properly, by two very large international internet gaming providers wanting access to New Zealand domain names because we were seen as reputable. The deal for New Zealand would be the name, and we would negotiate a form of tax payment. That never got beyond the drawing board for a variety of reasons. But even then I think it was an early warning sign of the nature of the way in which this industry was going to develop and has in fact mushroomed over the period of the last 20 years.

So the challenge, I think, is a twofold one. One is to try to regulate the terrestrial gaming environment within New Zealand as best we can and have legislation that is going to be fit for purpose in that respect. The second and more difficult one is to be at the same time keeping an eye on broader developments. Already we see challenges. You hear from time to time when a major sporting event occurs the debate, for instance, between the TAB and Centrebet over the odds that they offer. You see on occasion the debate around the extension—and I do not want to reopen it—of the number of gaming machines at Skycity last year and about the relevance of that in the context where people can actually go online in the privacy of their own home and gamble.

💬 Hon Ruth Dyson: We thought it was relevant.

So the point I am trying to make, and I think the member would agree with me, is that this is very much—whatever we do and however frequently we amend the law—a holding operation in respect of an environment that is changing rapidly. If anyone had said to anyone in this House 10 years ago that their lives would be governed by one of these—a smartphone—and that we would do all sorts of amazing things from one of these, I think we would have thought that was pie in the sky. Just apropos of that, I read this morning in a newspaper that we are about to see all home appliances—jugs and teapots and all those sorts of things—wired in such a way that you can charge your phone while you are using them. That just shows you how these things are changing.

So I cannot give the member an absolute answer to her question. I acknowledge its significance and I think our challenge is going to be that twofold one of making sure we have a proper, sustainable regulatory environment for the domestic territorial gaming scene, while at the same time making sure also that we do what we can to keep an eye on, monitor, and ensure we have best practice in respect of offshore operations—

I am sorry to interrupt the honourable Minister, but the time has come for me to report progress.

Progress to be reported presently.

House resumed.

The Chairperson reported the Employment Relations Amendment Bill with amendment, the Accounting Infrastructure Reform Bill with amendment and that the Committee had divided it into four bills, and progress on the Gambling Amendment Bill (No 2).

Report adopted.

The House adjourned at 9.56 p.m.