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Casino and Gambling Legislation Amendment Bill 2021

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Samantha Ratnam
Leader of the Victorian Greens
2 December 2021

I welcome the opportunity to speak to this bill today, but I have to say that it is a bit strange to be on my feet in this place actually agreeing with the approach the government has taken on Crown Casino. I rise to speak in support of the Casino and Gambling Legislation Amendment Bill 2021. The changes in this bill are perhaps the first actual consequences that Crown has ever faced for its appalling behaviour over many years, and it has taken us a really long time to even get to this point. This government and previous governments have spent years shielding Crown from the repercussions of its bad behaviour. Despite allegation after allegation of corruption and misconduct by Crown and shocking evidence of criminal activity, this government repeatedly sidestepped widespread calls to crack down on Crown. Instead, the minister and the Premier constantly excused Crown’s behaviour and reiterated their belief that the regulator was doing its job, despite all evidence to the contrary.

It took a damning inquiry across the border in New South Wales for the government to finally act. The royal commission inquiry into Crown Casino was long overdue. While the Greens welcome the findings and recommendations of the Royal Commission into the Casino Operator and Licence and support the full implementation of the recommendations, we cannot help but be dismayed that Crown has been given yet another chance, especially given the scale of wrongdoing revealed in the course of the royal commission. Commissioner Finkelstein described Crown’s behaviour as disgraceful, variously illegal, dishonest, unethical and exploitative. To quote some of Commissioner Finkelstein’s comments:

The catalogue of wrongdoing is alarming, all the more so because it was engaged in by a regulated entity whose privilege to hold a casino licence is dependent upon it being, at all times, a person of good character, honesty and integrity.

It is difficult to grade the seriousness of the misconduct. Some was so callous that it is hard to imagine it could be engaged in by such a well-known corporation whose Melbourne Casino Complex is visited by millions annually.

Looking at the laundry list of the misconduct, it is clear that the commissioner’s disgust with Crown was warranted. The money-laundering allegations that kicked off the Bergin inquiry were only the tip of the iceberg. There were repeated breaches of law by Crown and its staff, both in Australia and overseas. Crown allowed serious criminal conduct to occur within its walls and only encouraged the junkets that were backed by drug trafficking and organised crime syndicates. Crown cheated the government out of millions of casino tax for years by classifying its loyalty program promotions as winnings paid out from poker machines when calculating its gambling tax bill. It is likely that the total amount of unpaid tax, the result of a full decade of deliberate tax evasion, is much higher than the $61.5 million Crown repaid in July—not to mention years earlier pressuring the government into ditching the high roller tax. It repeatedly obscured information or provided misleading information to the regulator and other external bodies, and it took every opportunity to cancel, restrict or totally avoid having any external reviews. It believed itself untouchable, so much so that senior crown staff were able to bully the Victorian Commission for Gambling and Liquor Regulation (VCGLR) inspectors out of doing their jobs.

Of course Crown created a culture where gambling harm was not only facilitated but encouraged. People who gambled at Crown were three times more likely to experience gambling harm than those who gambled elsewhere. Players were left alone to gamble continuously for more than 12 hours with no intervention by staff or encouraged to keep gambling despite already being hundreds of thousands of dollars in debt.

In light of all this wrongdoing, Commissioner Finkelstein found that Crown was not suitable to hold a casino licence. He said, and I quote:

When these facts came to light, it was inevitable that Crown Melbourne would be found unsuitable to hold its casino licence. No other finding was open. The only difficult question was what should be done in that circumstance.

But ultimately Crown was given another chance, a two-year grace period to change its ways. I am not surprised, because Crown has very successfully managed to convince an entire state that it is simply too big to fail. It has done this by funnelling thousands and thousands into major party coffers, by providing a revolving door from ministerial and advisory roles into cushy corporate jobs and ensuring both Labor and Liberal governments do its bidding, by preying on the vulnerable and by using its growing wealth to avoid consequences for its bad behaviour.

In the minister’s second-reading speech she noted that ‘Crown will be given one, and only one, opportunity to reform itself’—a bit rich coming from a government who has given Crown second chance after second chance after second chance and years of special treatment, like having lower tax rates on its gaming revenue compared to every other gaming venue in the state or being allowed to operate special unrestricted pokies that would be illegal anywhere else.

It begs the question: after all the misconduct, all the wrongdoing and all the harm caused by Crown, what on earth will it take for Crown to actually lose its licence? And what will it take to bring the casino operator into line? Commissioner Finkelstein noted Crown has embarked on a program of reform, including overhauling its board and senior leadership team, and that the likely success of the reforms warrant giving Crown another two years to get it right, with heavy oversight and monitoring, including appointing a special manager who will effectively have control of the casino for the next two years. But actually tackling the gambling behemoth we have created in this state requires not just change within Crown’s corporate structure but also actual change led by the government, and it is good to see the government acknowledging this and beginning this work in this bill today.

One of the major changes is the creation of a new gambling and casino regulator, the Victorian Gambling and Casino Control Commission—VGCCC. The new regulator will have stronger powers to force Crown to answer questions and provide information. It is great to see the government finally commit to overhauling the gambling regulator.

The Greens have been raising concerns about the ability of the VCGLR to properly oversee Crown’s activity and hold them to account for their wrongdoing. Way back in 2017, in one of the first things I did in this Parliament, I moved to refer the VCGLR to an inquiry, a motion that was voted down by both sides of this house. It turns out we were right. The regulator had its hands tied, unable to properly regulate Crown, keep it in check or properly fulfil its oversight and scrutiny roles. Crown’s sheer size and power meant it was practically untouchable, and the government simply looked the other way.

It is also really good to see the separation of the gambling and liquor regulators into separate bodies. We heard from whistleblowers over the course of the royal commission that the liquor side of the regulator sucked up more and more time and resources and that the gambling inspectors were severely limited in their ability to do their job.

In another welcome move, the bill increases the maximum penalties under the Casino Control Act 1991. When Crown was fined a paltry $1 million for its failure to properly manage its junkets earlier this year, the government and the regulator pointed out that the $1 million fine was the maximum available under the act. But for Crown, a billion-dollar behemoth, a million was loose change. The new penalties will hopefully provide a stronger deterrent to Crown in their own language, money—that is, if the new regulator is able and willing to actually hand them out. The $1 million maximum fine was the first time the maximum had been given to Crown, despite many other clear breaches of the law for so many years. The real test of the success of these reforms will be how often the new powers are used and whether the new regulator will actually have the courage to wield its full regulatory powers.

The government is also finally ripping up Crown’s compensation clause, where Crown was entitled to a $200 million payout if the government did anything to harm Crown’s bottom line. This outrageous provision was the legacy of the previous Liberal government and meant no government could introduce harm minimisation protections on pokie machines, reduce the number of machines or increase the casino tax rate. With the removal of the compensation clause, the government has finally started down the path towards proper gambling reform and actual harm minimisation measures.

Commissioner Finkelstein was especially critical of the way Crown exploited the many vulnerable people who visited the casino, describing the manner in which Crown Melbourne deals with the many vulnerable people who have a gambling problem as perhaps the most damning discovery by the commission, and I quote:

Crown Melbourne had for years held itself out as having a world’s best approach to problem gambling. Nothing can be further from the truth.

However, this bill stops short of introducing any actual harm minimisation provisions. We understand that the government is likely to introduce a bill in the new year which will implement the remaining recommendations, including those that address gambling harm. The Greens hope that the government takes this opportunity to actually implement world-class gambling harm minimisation measures in Victoria and, in the spirit of this bill, go above and beyond the recommendations of the royal commission—so not only the mandatory binding precommitment system, as recommended in the final report, but also dollar bets on pokies across the state; reduced spin rates on pokie machines; the removal of pokies in the casino that operate in unrestricted mode; higher tax rates on Crown’s pokies and gaming tables so that it actually pays its fair share of tax for once; and we have to get gambling money out of politics once and for all. We have seen its corrupting influence, and it must stop now.

Finally, I want to take a moment to remind the chamber of a group of people who have largely been forgotten in the story about Crown—the workers. We hear often about Crown’s key role in Victoria’s economy or that it is one of the state’s biggest single-site employers but very little about the people in those jobs. I was privileged to have the opportunity to meet with members of the Crown workers union before the report was handed down, workers who have bravely shared their stories of working for Crown and their anxieties and fears about the future. And throughout the two years of the pandemic Crown’s workforce especially suffered. Not only were they repeatedly furloughed on and off over the last two years, this year they were left in fear of paying the price for Crown’s bad behaviour, losing their jobs if Crown lost its licence, while at Crown, who is at fault, the executives were unscathed. Crown’s leadership were more interested in saving their own hides and securing their own leaving bonuses than supporting the many workers they employed. I would urge Crown’s new management to remember the many humans who they employ and to retain the current conditions and that the government develop a plan to protect workers should the casino operator change in two years. I encourage the special manager to genuinely engage with Crown’s workers, really listen to them and include those who know the place inside out in the decision-making process right from the start.

The saga of Crown Casino in Melbourne is one of the biggest corporate and political scandals this state has ever seen. It is a story of how governments privilege billionaire corporations and corporate donors over the people, letting them write their own rules. Crown is the biggest casino in the Southern Hemisphere. Its size has meant governments have been too scared to act against it and is the primary reason it has kept its licence. The test of the government’s commitment to reform will be whether it is prepared to reduce the size of Crown’s gambling operations and prioritise addressing gambling harm so that the too-big-to-fail excuse is not pulled out again in two years time. I am supporting this important bill with the hope that it is just the first step of this government reining in the devastating harm the gambling industry does to people, and I look forward to continuing to work with the government to put the Victorian community first.

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Samantha Ratnam
Leader of the Victorian Greens
2 December 2021
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