Australia: Gaming Machines and Pre-Commitment – Possible Australian Federal Legislation

Last Updated: 23 April 2012
Article by Jamie Nettleton

There are two sets of bills currently being reviewed that seek to introduce various legislative requirements at the Australian Federal level which have the objective of maximising harm minimisation through the operation and use of gaming machines. These are:

  • the National Gambling Reform Bill 2012 and two National Gambling Reform (Related Matters) Bills 2012 (the Government Bills). These bills, which are in draft form only, set up a national regulator with the responsibility of implementing precommitment and other harm minimisation strategies in relation to gaming machines and gaming machines venues and the imposition of additional taxes relating to the supply and operation of gaming machines; and
  • the Poker Machine Harm Reduction ($1 Bets and Other Measures) Bill 2012 (the Senate Bill). This seeks to implement the recommendations of the Productivity Committee on a national level by introducing a $1 bet limit, a $20 deposit limit and a limit to jackpots to $500.

In order to understand these bills, it is necessary to review the debate that has occurred concerning the manner in which gaming machines should be regulated at the Federal level, as that policy has developed over the last couple of years.

Productivity Commission

In June 2010, the final report of the Inquiry of the Productivity Commission into Australia's gambling industries was released. For a summary, see our FocusPaper entitled "Gambling - Australian Productivity Commission Final Report on Gambling (June 2010) - What does this mean for the gaming machine sector?" 1 . This report contained a number of wide ranging recommendations relating to gaming machines including the introduction of a full precommitment system, the display of dynamic warnings and $1 bet limits. These recommendations were to be implemented in accordance with a strict timeline.

Wilkie/Gillard Agreement

Almost immediately after the release of the report of the Productivity Commission, there was a change in the Prime Minister, with Ms Julia Gillard being elected to that position by the Labour Caucus. In August 2010, the Federal election was held and, after extensive negotiations with independent members of parliament, the Labour government was re-elected. It was able to govern with the support of some of these independent members of parliament.

One of these independent members, Mr Andrew Wilkie MP, entered into an agreement with the Prime Minister (the Wilkie/Gillard Agreement) which contained a number of commitments relating to the approach to be taken by the Government in connection with the recommendations of the Productivity Commission relating to gaming machines.

These included the following commitments:


  1. Implementing a best practice full precommitment scheme – that is uniform across all States and Territories and machines – consistent with recommendations and findings of the Productivity Commission ... Implementation of pre-commitment arrangements will commence in 2012, with the full pre commitment scheme commencing in 2014 ...
  2. Supporting the Productivity Commission recommendations in relation to poker machines dynamic warning displays and cost of play displays.
  3. Implementing a $250 daily withdrawal limit for ATMs in venues with poker machines (excluding casinos).

7.6 ...


In the absence of agreement with the States by 31 May 2011 on any of the reforms detailed in Clause 7.5, the Government will unilaterally seek to legislate in order to achieve these reforms ... If required, the Government will support Commonwealth legislation through the Parliament by Budget 2012.

7.8 ...


The Government agrees that as soon as it is practicable, it will seek to establish a Select Committee of the Parliament .... to progress a 11 national response to the full set of recommendations in the Productivity Commission report. "

First Inquiry of the Joint Select Committee

In accordance with the Wilkie/Gillard Agreement, a special Joint Select Committee on Gambling Reform was formed as a joint committee of the Federal Parliament (the Joint Select Committee). This was chaired by Mr Wilkie with Senator Xenophon as the deputy chair.

The first Inquiry, which was referred to the Joint Select Committee on 30 September 2010 by the Senate, focused on the design and implementation of a best practice full pre-commitment scheme. Among the recommendations of the Joint Select Committee set out in its report that was released on 6 May 2011, were the following:

  • the introduction of a mandatory precommitment scheme applying to all players of "high intensity" gaming machines by 2014;
  • the introduction of dynamic warnings as part of the pre-commitment system;
  • the use of a pre-commitment card which incorporates a self-exclusion option for use by players of gaming machines;
  • the establishment of a national independent regulatory body to oversee mandatory precommitment; and
  • the exclusion from the mandatory precommitment scheme of "low intensity" machines (where those machines featured a $1 bet limit, a $500 maximum prize and a $20 deposit limit).

The recommendations of the Joint Select Committee report met very strong objections from the clubs and pubs sector. This gave rise to a vociferous campaign against the proposals, which was targeted particularly at marginal electorates.

Termination of the Wilkie/Gillard Agreement

At the beginning of this year, the Government announced an approach that did not follow either the Wilkie/Gillard Agreement or the recommendations of the Joint Select Committee in its first inquiry. Instead, the Government announced that it intended to act in accordance with the recommendations of the Productivity Commission by introducing a bill that would implement voluntary pre-commitment measures. At the same time, it announced that there would be a trial conducted by clubs in the Australian Capital Territory, subject to the agreement of these clubs, which involves mandatory pre-commitment measures being applied to players of gaming machines. The results of the trial would then be assessed to ascertain whether mandatory precommitment is effective.

This approach was different to that contemplated by the Wilkie/Gillard Agreement and the recommendations of the Joint Select Committee in its First Inquiry insofar as it suggested that evidence from the trial is required before mandatory pre-commitment should be mandated.

As a result, Mr Wilkie withdraw his support from the Government and the Wilkie/Gillard Agreement was terminated in effect.

The Government Bills

In accordance with this announcement, the Government Bills were published on the website of the Department of Families, Housing, Community Services and Indigenous Affairs, in mid-February 2012. These proposals have not yet been introduced to the Federal Parliament but contain a number of measures which have the objective of achieving harm minimisation through the supply, operation and use of gaming machines. There are a number of core elements to the Government Bills, namely:

  • for all gaming machines to have precommitment capability on the basis that all gaming machine premises, except those premises which are considered to be small gaming machine premises, to have machines with pre-commitment systems in place by 31 December 2016;
  • for all gaming machines to have dynamic warnings in place by 31 December 2016;
  • for certain measures to be put in place concerning the operation of ATMs at gaming venues by 1 February 2013 – including the requirement to take steps to limit the amount that can be withdrawn from an ATM located at a gaming premises within 24 hours; and
  • the introduction of two levies relating to the operation of gaming machines, namely, a gaming machine regulation levy and supervisory levy.

These proposals were to be overseen by a new national gambling regulator.

The Government Bills set out a framework for the implementation of these changes but do not set out in detail a number of the requirements which needed to be met in connection with the operation of the pre-commitment systems. (For example, it does not set out the nature of any precommitment system, just the purposes which it 12 must achieve.) It is envisaged that these will be set out in regulations to be enacted in due course.

The trial to be introduced in the Australian Capital Territory in respect of mandatory pre-commitment measures was not contemplated in the Government Bills. Although announced by the Government at the time of release of the Government Bills, few details of the proposed trial have been publicised generally.

Response to Government Bills and Senate Bill

The Government Bills met various responses, ranging from a request being made by representatives of gambling organisations and clubs for more information relating to the government's proposals (which has now caused them to drop their lobbying campaign against the Government's proposals) to concern from Mr Wilkie, Senator Xenophon and other problem gambling advocates that the Government's proposals did not go far enough in achieving effective harm minimisation through the use and operation of gaming machines.

As a result, Senator Xenophon and two other Senators have introduced the Senate Bill as a private members bill into the Senate. This includes specific measures mentioned in the recommendations of the Productivity Commission, including:

  • a $1 bet limit;
  • a $20 deposit limit; and
  • a limit to jackpots to $500.

The Senate Bill has been referred to the Joint Select Committee for consideration as a separate Inquiry.

The Joint Select Committee has also announced that it will review in due course the Government Bills in the form in which they are introduced into Parliament.

Where from here?

There are two certainties in connection with the Australia debate relating to the introduction of pre-commitment mechanisms relating to gaming machines, namely that it will continue to generate considerable comment at the political level, and any legislative measures will be subject to lengthy debate, thereby delaying the enactment of any legislation at the Federal level. Also, the consideration of the Bills by the Joint Select Committee is likely to delay further any Parliamentary review of pre-commitment legislation. However, it is without doubt that the May session of Parliament will result in greater publicity being given to the issue.


1 _Australian_Productivity_Commission_Final_Report_on_Gambli ng__June_2010__- _What_does_this_mean_for_the_gaming_machine_sector259.aspx

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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