The four charts that show pokies are the most destructive form of gambling

Poker machines have reached such saturation levels in NSW that gamblers are now losing more than $7 billion on them each year – vastly more than the amounts lost to betting on racing, sports and other events.

Four graphics based on analysis of gambling data by the Herald show why poker machine reform has jumped to the top of the political agenda ahead of next month’s NSW election.

A key reason pokies are the focus of attention rather than other forms of gambling is the pervasiveness of electronic gaming machines and the sheer scale of player losses.

Dr Charles Livingstone, a gambling researcher at Monash University’s School of Public Health and Preventive Medicine, says poker machines have “colonised social space in NSW more effectively than probably anywhere else on earth”.

The state’s pubs and clubs have more than 86,000 electronic gaming machines which delivered a record profit of $3.8 billion in the first half of last year alone.

In the decade to 2020 poker machines accounted for 65 per cent of annual gambling losses in NSW, on average, analysis by Queensland Treasury shows.

In 2018-19, the last financial year unaffected by COVID-19, poker machine losses at NSW pubs and clubs totalled $6.53 billion – about six times the amount lost to betting on racing, sports and other events (including elections).

Poker machine losses per person in NSW during 2019-20 totalled $1042 compared with $224 for casinos and $186 for wagering (which includes bets made on horse racing, sports and other events).

The composition of gambling taxes collected by the NSW government underscores the dominance of poker machines.

The latest budget forecasts 62 per cent of all gambling revenue will come from gaming machines this financial year, dwarfing other gambling taxes including lotteries (16 per cent) and racing (14 per cent).

Last month transport minister David Elliott claimed people would shift to alternative forms of gambling if there is greater poker machine regulation.

“We can’t say to nanna ‘You can’t put $20 into the pokie machine after bowls’, because she’s just going to put that $20 on scratchies and lottery tickets in the newsagent on her way home,” he said.

Elliott called for a “holistic approach” to reform that included all forms of gambling.

But Livingstone said player behaviour during COVID-19 shutdowns suggests greater poker machine regulation is unlikely to result in a mass switch to other gambling options.

“If Mr Elliott is correct, everyone who had ever used pokies would have jumped online and started gambling during COVID lockdowns, but there was no evidence of that kind of substitution effect,” he said.

Another reason poker machine gambling has attracted so much political attention is the social harm it causes.

The NSW government Gambling Survey 2019 found poker machines to be the second most prevalent form of gambling in the state after lottery tickets.

But poker machines are an especially dangerous form of gambling.

The gambling survey report concluded poker machines “stand out as a form of gambling that is of greatest concern…with participation predictive of the highest risk of problem gambling.”

It found 36 per cent of poker machine gamblers in NSW “indicate some degree of gambling problems” and that 84 per cent of problem gamblers in the state had participated in poker machine gambling during the previous year.

Livingstone said the design of electronic gaming machines successfully employ psychological principals to maximise users’ bet sizes and increase the addictive potential of games.

“There is no question that pokies are the biggest single cause of gambling harm in Australia,” he said.

The findings of an investigation by the NSW Crime Commission into money laundering through electronic gaming machines, released in October, has also ramped up pressure for reform.

The commission’s report said, “criminals are funnelling billions of dollars of “dirty” cash through poker machines in pubs and clubs every year in NSW, but there are no effective controls or data collection to identify or prosecute those involved.”

The commission estimated about $95 billion flowed through poker machines in NSW pubs and clubs in 2020-21, and described NSW as “the gambling capital of Australia”.

It recommended the introduction of mandatory cashless gaming cards to reduce money laundering through electronic gaming machines.

Our Breaking News Alert will notify you of significant breaking news when it happens. Get it here.