The issue of rising gambling addiction rates across Australia has become a cause for concern – more and more individuals across the country are becoming addicted to gambling, and researchers want to get to the root of the problem. While the implementation of pokie reform is around the corner, which is believed will help reduce problem gambling rates, it is becoming apparent that poverty is a major cause of gambling addiction. A recent research project explores this issue, evaluating the impact of the presence of poker machines on low-income areas across Australia.

The study begins with an overview of electronic gaming numbers across Australia. It highlights the rapid growth of the market in just under a decade. From 1992, when poker machine expenditures were just 200 million, to 1998, the number has increased exponentially. By the turn of the Century, more than $1.7 billion was being spent on poker machines and other electronic gaming devices, a number which continues to grow today.

Impact on Poker Machines in Low Income Communities

In Victoria in 1992, total gaming machine losses per week amounted to $5400. By 1998, the number grew to $32 000. By contrast, the amount of total disposable income for residents of the area only increased by $17 000 from $77 000 to $94 000. In Maribyrnong, gaming machine losses totalled $7000 in 1992 and increased to $53 000 by 1998.

The report often references the area of Maribyrnong, which has the lowest average income per person in Australia. Curiously enough, the area also has the highest number of poker machines, per capita, outside of Melbourne.

Over the years, research has attempted to prove that the increase of poker machine activity has had positive benefits on the economy of low-income areas. These purported benefits include an increase in jobs in the gaming market and increased retail consumption. However, this study finds that gambling losses are funded by savings rather than income, which does not make it an alternative form of consumption. Additionally, with income increasing at a slower rate than gambling losses, it is likely that expenditures were taken from other areas of consumption, resulting in poor performances for the retail and hospitality industry.

The research presented in the paper by James Doughney and Tony Kelleher is mainly methodological, presenting ways to address the issue of poverty and poker machines. As such, the findings are preliminary and will likely lead to more in-depth studies.

To read the full report, click here.