Costs vs. Benefits of Gambling in S.A.

The South Australian Centre for Economic Studies report on the "Economic Impacts (positive and negative) of gambling within the South Australian community” has finally been released - 13 months after the South Australian Independent Gambling Authority (IGA) received it and according to Duty Of Care’s research officer, Sue Pinkerton, “one day after the IGA had to respond to a Duty of Care’s freedom of information application seeking a copy of the report”. The report can be read in it's entirety at... http://www.iga.sa.gov.au/pdf/EonomicImpacts_website.pdf

This study commissioned by the IGA is split into two. Phase 1: develop, prepare and present a comprehensive report on the profile of the Gambling Industry in South Australia and Phase 2: undertake further research and analysis and prepare a report on the economic impacts of gambling in South Australia. The two phases are drawn into one report submitted in June 2006. The second phase of the study asks and answers the questions:

What is the economic contribution of the gambling industry?

What is the economic impact of gambling on other industry sectors , on other forms of expenditure, on employment patterns? and

What are the economic benefits and costs of the industry?

Some of the key findings from the report are as follows:

South Australia per capita spend on gambling has reached 84.2 per cent of the national average (up from 55per cent in 1978 –79).

South Australian's now lose more than twice the amount on EGM’s than every other type of gambling combined.

“It is incontrovertible that EGM’s are responsible for the substantial increase in problem gamblers, just as they represent the real driver of continued growth in real gambling expenditure”.

The modest boost to job growth in the hotels and clubs (0.7) after the introduction of EGM's has come at the expense of approximately 4,000 jobs in the café’ and restaurant sector.

Increases in gambling expenditure is principally driven by falls in net household savings rates. EGM expenditure grew by 54 per cent whilst income grew by only 24 per cent The participation rates on EGM’s have not increased.

The total social cost of electronic gaming machine related problem gambling ins South Australia in 2003—03 is estimated to range from $528 million to $960 million

The total benefits of EGM gambling in South Australia in 2002—03 are estimated to range from $378 million to $472 million.

Despite the scale of benefits consumer enjoy form having access to EGM’s for the State as a whole, the range of net benefits from EGM’s are estimated to extend from $582 million to $56 Million; even taking the lowest estimate of costs and highest estimates of benefits the net benefit is still negative.

The more disadvantaged a region is in socioeconomic terms the higher their EGM expenditure.

Areas with higher levels of EGM expenditure per adult were found to have higher total crime offences per 1,000 persons ion 2002-03.

Despite claims that Casinos generate national and international tourism, the study found that the great majority of casino revenue is derived from local residents.

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