Government takes an online gamble

Last week the Minister of Internal Affairs let the Lotteries Commission introduce online gaming for Lotto products. Online gambling is a highly addictive form of gambling which targets people while they are alone and isolated from their communities.

As a safety precaution the Minister has limited the amount that someone can spend on online gambling to $150 a week, which seems odd given that beneficiaries have the highest reported rate of expenditure on gambling, according to the Department of Internal Affairs, and that a single person under 25 years old on the unemployment benefit is entitled to $153.46 a week (or over $184.17 if they are 25 or over).

Why did the Department not want the last $3.46?

Yesterday in Parliament the Minister failed to give an assurance that he would not extend on line gambling to include even more addictive forms of gambling such as instant gambling and scratchies. He then faced this question from Sue Bradford:

Sue Bradford: How does the Minister justify introducing a product that can be paid for only by credit card, when such cards attract interest in this country at the moment of up to 24.9 percent; and why on earth is a Labour Government promoting gambling on credit anyway, especially when low-income people are among the most vulnerable to this form of addiction?

Hon RICK BARKER: The problem with transferring money currently is that under most banking proposals money takes days to go through the various accounts. With a credit card, transfer is instantaneous. Or people can get themselves a debit card, which is the same thing but in a positive balance. I have advised the commissioner of the requirement that when the banking system changes, the commission will change with it and will require people to buy positively rather than negatively through credit cards. I accept the member’s point, but this was the only way the innovation could be financed.

And it seems it needs to be financed. After all, the government seems to be addicted to gambling. It delivers significant funding for programmes that it would otherwise have to pay for itself.

38 Comments Posted

  1. tuesday

    Your straw man arguments are tedious. Is gambling potentially addictive? Yes. Who was arguing otherwise? Is gambling always addictive? No. Very few people are gambling addicts.

    If people have access to the internet, you cannot stop them gambling. It is beyong your control. So stop being a narrow minded git, yourself 😉

    PS: Marketing can’t **make** you do anything. If it did, companies would be spending a LOT more money on it. Most marketing fails. THe marketing that does work resonates with the consumer.

  2. You have a point in regards to addiction and limiting the spread of such machines, but by saying that “Convienence, ease of access, constant reminders of its existance…. all make the consumer use it.” you seem to think that you think we are living in a land where people are *forced* to buy things at say, gunpoint. Which of course we certainly bloody well aren’t.

    The proceeds from pokies send $240 million per year “to a mix of sporting, educational, health, arts and other charitable purposes. A similar amount is contributed to the Government in GST and duty.” http://www.cga.org.nz/files/aboutCGA.asp Do some research!!

  3. Sue Bradford is right about gambling being very addictive its not just the benefectories that get caught up in it, either.
    The majority of you posting this blog appear to me to be narrow minded gits who are so far removed from the realities of life you cant open your minds to the power of addiction. Surely you all must have learnt some lifeskills over the years and gained a little wisdom not to have such an attitude.
    Call these people on benefits who ‘could’ gamble all their money on lotto primeviel idiots if you will but gambling is a very real addiction and it hits not only the poor.
    (Although youve gotta be pretty lazy to have such an addiction and not get off your butt to get to the lotto shop.)
    Maybe we should all be a bit more tollerent of other peoples weaknesses and make room for that.
    As for peoples choice, take ‘coke cola’ MARKETING was the tool that got everyone buying that. Look how its taken off over the years and still goes strong. The more you shove something in ones face the more likely they are going to be to do it wether its bad for you or not. Convienence, ease of access, constant reminders of its existance…. all make the consumer use it.

    Im not so worried about lotto tickets going on line as one person pointed out you have to wait up to a week to find out if you have won. The more instant the price the more alluring. Im worried about when the put instant kiwi on line and the things that go with it. Thats when it will be a problem for gamblers.

    As beshakey pointed Pokie machines are the most dangerous for gamblers. People who would never be weak to other forms of gambling seem to fall prey to these. People in all positions have been through the courts in regards to dishonesty caused by getting hooked on these pokie machines. They are in your face wherever you go. Get them out of the pubs and restaurants is what i say and put them back into the casinos and clubs where they belong. The proceeds are only going to the wrong sources anyway. What the government is making on them is getting used on mopping up the damage and even that is not enough.

  4. Ari,

    I’d decriminalize all drugs, as Mo Mowlam suggested, and for the same reasons.

    >>personal details to open two accounts?

    There are various ways. Google use behavioral pattern matching in order to protect Adsense. Browser plugins, cookies, IP, data cross-matching. You’re going to catch all but the most determined/ tech savvy, and those people ‘aint mucking around with Lotto.

    >>online is about as easy as it gets

    You cannot stop people gambling online now. It is utterly beyond the control of the US government, let alone you. No matter what laws you make, or what restriction you place on the New Zealand lotteries commission, you can be gambling within three minutes with a credit card.

    And those funds are heading offshore….and they ‘aint going to charity. THAT is your alternative. Non-gambling, like non-drinking, isn’t an alternative you control.

  5. Ari

    No I will not support the sale of cannabis for the reason is that it is an illegal and harmful drug.

    Simply really.

  6. The free market is not a good tool to manage gambling. It is not a good tool to manage cigarettes.

    We don’t even have a free market on most of our goods, so I see very little reason we should make the market entirely free on the most harmful ones, like cigarettes or alcohol, and I don’t see why that shouldn’t extend to gambling, either. They certainly shouldn’t be banned from legal sale- as we’ve seen with soft drugs, that approach doesn’t work very well- but I see no reason to make them easy to get at.

    Given your support for this proposal, BB and BP, I expect to see you proposing unregulated free market sale of cannabis, too, for consistency’s sake. Like gambling, it has negative effects- but we believe in the free market here, don’t we boys? People won’t buy it if they don’t like it, and that solves everything! I’ll welcome your voices on decriminalisation of course, even if I’m proposing heavy regulation of any commercial sale. 😉

    Back to business though- shopping online is about as easy as it gets, and that’s why this service as proposed is unacceptable. I’d like to see a very, very low spending limit per week, probably equivilent to Lotto’s most expensive product, and a restriction imposed that they may only charge through debit. I don’t care how slow it may be- require people to queue the payment at least a week in advance and you’re golden. Also, by creating demand for faster debit processes, Lotto would actually help add more options for internet shopping.

    I’m also curious of the technical details of how they plan to implement their limits, too. I believe unique accounts were mentioned, but what is to stop someone using different credit cards or personal details to open two accounts? How will they do this without tracking MAC or IP addresses?

  7. Toad

    I am far from a one eyed party hack (to steal BP’s term) for instance you could never accuse me of being a fan of John Key, hell I resigned from the National party because of the man.

    I am bit like BP in as much as I see the Nat’s as the lesser of two evils, lest face it ANYTHING would be better than the current lot.

    While I am on that, the Greens would do well to consider carefully before doing what we all know you will do and go with Labour after the next election, should you be in a position to support a Labour led govt then you may well end up killing off the current center left led Nat’s.

    Should the Nat’s not make it across the line this time (highly unlikely I know) they will be forced to return to their original hard right origins (god I wish they were like that now) and there is NO CHANCE that you will eve get any green policies through once Key is ousted.

  8. kahikatea – I’d like to propose a frogblog “comment of the year” award – and at this stage your one above would be my nomination!

  9. Lotto is much less likely to be addictive than the housie evenings the Labour Party uses for fundraising.

  10. I’m not a party hack. Truth be told, when it comes to political parties, it’s a choice of least worst for me.

    I’m not a gambler myself. I support the free market and choice. There are downsides to that freedom, but it is better than the alternatives

  11. I accept Lotto is relatively benign BP, compared with pokies and some of the internet scam gambling sites. But my point is that when there are already so many gambling option available to people, why should OUR GOVERNMENT add another?

    BYW, BP, strange to see you defending the Labour Government over something – BB too!

  12. But with the push of a button, marketers can, and do, create hundreds of new gambling channels. It’s happening on the internet, as we speak. You appear to be under the impression you can control access, but you cannot.

    At least with Lotto, the channel is relatively benign, and the proceeds stay in New Zealand.

    Of course, some people have problems with gambling, as some people have problems with all manner of addictions, but that is life. Most people do not, and never will.

  13. No, BP – my post was mostly concerned with not extending the opportunities for people to gamble. It is the increase in access to gambling options that I am concerned about.

    I do know a little about this – from a very personal point of view. A good many years ago I had a partner who was a compulsive gambler, and her inability to address this issue was a major factor in our relationship ending. Essentially, my income paid the bills and hers fed her addiction.

    Even though I thought she was an honest person, despite our relationship difficulties, I discovered that she subsequently stole from a community organisation she was involved with to feed her addiction when she no longer had access to my money to support it.

    My current partner also had a gambling problem, but we have managed to address that by staying away from places where there is a temptation to gamble. But the more gambling options there are, and the more places there are to access them, the more difficult this becomes.

  14. I can track you without your IP address or a cookie. The white-hat versions of Spyware and Adware may well be tracking you as we speak…..

    It’s even easier once someone has to login….

    I’ve been caught by them before, and I’m in the business!

    Thought your post was mostly concerned about poor people? The determined and clever are going to route around any block you put in their way. Catching the less clever and less determined is easier, and I’d imagine these are the people you’re mostly worried about.

    In which case, online provides an easy and cost effective way to monitor them.

  15. Yep, that would be another way too, BP, but I certainly know how to get around it, and I’m no IT whiz.

    It’s not just poorly educated, unintelligent and low income people who have gambling problems either, BP. Remember the solicitor Keith Edwards who defrauded his firm’s trust account of millions of dollars to finance his gambling habit.

  16. Also cookies. Match the cookie to the account. If the same cookie accesses multiple accounts, you can cross-reference those accounts (IPs, payments data, behavior etc). This can be compromised, but the user would have to really know what they’re doing.

    Most people don’t know how easily they are tracked online. I think the chances of some unemployed/low-income person with a gambling problem understanding the various means of online tracking is almost non existent.

  17. Toad

    When these people who exist on handouts from me then yes they should be held accountable, when they earn their own they can do what they like with it.

  18. >>how they can enforce the persona limits

    Behavior pattern matching.

    Do you know how Google protect their adsense business from advertiser fraud?

  19. Toad,

    “it’s accessibility”

    Type “Te#as H@ld ’em”, or any other gambling game, into Google. Go on.
    What do you see? Thousands of online gambling sites.

    Are you going to shut down the TAB as well?

    >>The worst thing about the online Lotto proposal though, is that you can only purchase a ticket online using your credit card. Encouraging people to gamble on credit is just plain irresponsible.

    It’s none of your business what people do with their credit cards.

    I think your attitude to carbon trading is highly irresponsible, but it’s a free country. At least, it used to be….

  20. And come to think of it, I’m puzzled as to exactly how DIA can limit the amount people spend on online gambling in a week or a month.

    If it’s by IP address, they run into the same problems as with internet polls – the problem gambler will just use a different computer or change their IP address. And using IP address to limit it would prevent several people in a one computer houshold for each gambling their monthly limit.

    If it’s by credit card number, the problem gambler will just acquire (and probably already has) several credit cards.

    And they can’t use any unique identifiers established for other purposes, like NHI numbers, becasue this would breach the Privacy Act.

    So anyone got any idea how they can enforce the persona limits Barker is talking about?

  21. >>Did somebody say “nanny state??

    We have a welfare state, therefore I’m advocating a solution within that framework. It’s called pragmatism.

    Given free reign, I would disestablish the welfare state tomorrow.

  22. Toad

    You just don’t get it do you.

    Sue B (and you by the sound of it) want to control all of our lives just because a few have problems with the pokies.
    Personally I also think that gambling is a mugs game but that does not mean I want it controlled or banned, if people want to play the pokies at their local pub they should be able to do so.

    They should also be able to use their credit card in what ever (legal) way they see fit.

  23. Votes from those who see the damage from gambling? Not that this is *exactly* the issue, but a perception will have been created.

  24. Greens playing red yet again! If you want votes (you do want votes don’t you?) stick to green issues.By the way… All gamblers are loosers as far as I’m concerned.

  25. Yes, Sam. How ironic. BP and BB are always bleating on about the “nanny state”, but here are proposing something that takes all responsibility for personal financial management away from people.

    And, BB, Sue Bradford is not talking about “banning” Lotto or anything else here. It is all about access to gambling. It is no coincidence that alcohol-related problems increased when supermarkets were allowed to sell booze and people no longer had to make the effort to go to specialist liquor stores.

    Same with pokies – it’s accessibility that is the big issue. If we got rid of the pokie bars so people had to go to a cassino or chartered club if they wanted to play them, there would be far less problem gambling.

    If people want a Lotto ticket (as I sometimes do), than make them make the effort to go to a Lotto shop to buy one, rather than being able to do it at a click of the mouse during a moment of boredom or impulsiveness.

    The worst thing about the online Lotto proposal though, is that you can only purchase a ticket online using your credit card. Encouraging people to gamble on credit is just plain irresponsible.

  26. “Instead, pay landlords and other services direct. Pay the supermarkets direct and hand the parents a debit card that can only be used for certain items. Pay a small amount of discretionary cash. Monitor the childs welfare. If it increases, the parents can go back on to a regular dole/DPB payment. ”

    Did somebody say “nanny state”?

  27. Those who can’t handle the benefit shouldn’t be given one.

    Instead, pay landlords and other services direct. Pay the supermarkets direct and hand the parents a debit card that can only be used for certain items. Pay a small amount of discretionary cash. Monitor the childs welfare. If it increases, the parents can go back on to a regular dole/DPB payment.

    That is looking after people. Throwing money at people who can’t handle it – isn’t.

  28. I knew I’d get to say this: ‘won’t someone please think of the children!’ i.e. stupid parents getting less money makes it rather difficult to feed/clothe/educate their kids.

  29. So stop handing those with “gambling addictions” cash, then.

    Online Lotto seems to be a fine way of seeing exactly how much certain beneficiaries are being overpaid, and re-routing that money to worthy charities.

  30. BeShakey

    Of course there are addictions, my point is that just because a small percentage suffer from addictions that is no reason to stop the rest from having a punt or purchase a lotto ticket.

    Banning everything is the hard left approach (unsupported by the evidence) that enshrines in their people the mindset that they do not have the ability to decide for themselves.
    They (and this is the ultimate goal of the left) feel they must look to the government for advice on how to run their life’s.

  31. ““If beneficiaries are playing Lotto, we’re clearly paying them too much money?

    Very good point.”

    Only if you accept the hard right dogma, unsupported by the evidence, that people always act rationally. Of course one of the key counterexamples (remembering that people that believe this ignore the facts) is addiction, and people can certainly have gambling addictions.

  32. BP

    “If beneficiaries are playing Lotto, we’re clearly paying them too much money”

    Very good point.

  33. a) If beneficiaries are playing Lotto, we’re clearly paying them too much money.
    b) Peopley have hundreds of thousands of online gambling channels available to them right now, including the TAB. Lotto is benign, by comparison.
    c) Online Lotto buying activity by individuals is monitored, but that isn’t the case in stores.
    d) Why must we always bow to the lowest common denominator? Online Lotto will be a more convenient channel for many.

    You really are coming across as a bunch of prudish killjoys……

  34. For goodness sake Greens!….are you trying to ensure that you do not make the 5% threshold?

    Keep Sue B locked up until after the election, this type of nanny state approach to ADULTS does not impress anybody.

    If the rest of us want to purchase the odd Lotto ticket on line then we should be able to do so, if we want to spend (waste) the odd $20 in the pokies then we should be able to do so.

    You cannot and should not legislate to stop the enjoyment of the vast majority just because a few people are addicted to gambling, they are the ones with the problem not us.

  35. A bit misleading to claim that online gambling is highly addictive in the same paragraph as a discussion about online Lotto. There is a wealth of evidence that the addictiveness of gambling depends on a range of factors. Online gambling may be more addictive than offline gambling, but Lotto style gambling is considered very low on the addiction scale.

    Consider the real problem cases – pokies for instance, one of the key factors is the instant feedback you get. In the case of Lotto it takes up to a week to get that feedback (in the case of Keno a day). Gambling is a problem, but just like alcohol, banning it outright sounds like a recipe for disaster. Better instead to focus on the real problem cases, like pokies and predatory casino practices, and ban or regulate these, than get up in arms about cases that are far less of a problem.

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