Tasmania can’t afford a bet on the pokies

by Leanne Minshull and Bill Browne

The poker machine industry has been shut down in Tasmania since the 24th of March. The industry is set to re-open on Friday the 26th of June.

Re-opening these venues will provide immediate employment to staff previously stood down. However, our research shows that, in broader terms, poker machines (“pokies”, “electronic gaming machines” or “EGMs”) are a drain on the state economy and on jobs.

Tasmania has been hard hit by COVID-19, suffering more job losses per capita than any other state. It can therefore be assumed that Tasmanians are also receiving a high level of JobSeeker and JobKeeper support per capita. These payments are designed to assist the unemployed and provide stimulus into a supressed economy. Poker machines are highly profitable for owners, but low return for job creation.

Our analysis shows that, since the lockdown began in late March, around $42 million that would normally be spent on the pokies has not been spent on the pokies.

$42 million spent in Tasmania could create:

  • 398 jobs in Food and Accommodation; or
  • 236 jobs in Arts and Recreation; or
  • 427 jobs in Health Care and Social Services; or
  • 125 Retail Trade jobs

Estimates of jobs directly related to pokies vary widely, but businesses that include gaming activities themselves estimate that only 19% of their employees are working directly in gambling roles.

The state budget has also been hit, with the Premier acknowledging the state will go into a $700 million deficit.  Our research finds that under most models, the cost of EGM-related problem gambling (up to $184 million in 2011 dollars) far exceeds revenue from EGM-related gambling taxes and fees ($53.4 million in 2016). Given the current position of the state’s budget, and the impact (social and economic) on the community from COVID-19, re-opening the pokies represents a net financial burden to the state.

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