SA's liberal betting gets state fretting

October 2, 2008

By SLINDILE KHANYILE

Durban - The government is considering setting up a commission into the gaming industry as it thinks it might have been too liberal in the 12 years since gambling was legalised.

Mpho Mosing, the deputy director for regulated industry at the department of trade and industry, said yesterday that the commission would assess the multibillion-rand industry in detail to establish if any activities should be curtailed.

The body would also investigate possible illegal activities, she said, but nothing had been finalised. The issue was being debated in the department.

A proposal has been sent to Mandisi Mphahlwa, the trade and industry minister.

"The minister is concerned with the proliferation [of betting activities]," Mosing said. The department was also aware of possible negative effects, such as gambling addiction.

Mosing said person-to-person betting was one of the illegal activities to be probed.

According to the National Gambling Board of SA (NGB), the country's main forms of gambling are casinos, racing and betting, bingo and limited payout machines. There are 38 licensed casinos in the country but one is not yet operational.

The two horse racing firms are Phumelela and Gold Circle.

The NGB's statistics for the financial year to March 2007 showed that gross gambling revenue was R13.5 billion, a 15 percent increase from the previous year.

Casinos contributed 86.2 percent, betting 10.8 percent, limited payout machines 2.6 percent and bingo 0.5 percent.

Thebi Moja, the acting chief executive at the NGB, said that gross gambling revenue rose to R15.6 billion in the 12 months to March this year. The sector contributed about 1 percent to gross domestic product.

Gambling was first legalised in 1996. The Complete Wiehahn Report on Gambling in South Africa, published in 1995, recommended that there should be 40 licensed casinos. Two licenses are still to be issued.

Mosing said the commission would not review the Wiehahn report but rather the industry, to see what improvements could be made. It would also look at socioeconomic effects.

There are at least 130 000 people employed in casinos, racing and betting.

Meanwhile, in July the bill permitting online gambling was signed by former president Thabo Mbeki.

Implementation has been delayed because the money bill, which stipulates how taxation will be handled, and the relevant regulations are yet to be finalised.

Compliments Mercury

www.busrep.co.za/index.php?fArticleId=4639278

The print version also has some other interesting facts:

1. Gross gambling revenue for the year to march 2008:R15.6BN. Gross gambling revenue for the year to March 2007: R13,5bn
2. Casino Association of SA members invested R56M in corporate social development.
3. There are 38 licensed Casinos (but one is not operational yet.
4. There are at least 100 000 people employed directly and indirectly by the horse racing industry.
5. There are at least 30 000 people employed by casinos
6. Phumelela and Gold Circle are the horse racing companies.
7. the rest is a breakdown of what companies own which casinos

Compliments The Mercury - Business report (print media)

The intersting facts that stand out for me are the amount of people the racing industry employs (100 000) and only 10.8% of the market according to this report.

We now know why the operators are so keen on "virtual racing" (UK and others).

This is probably a short sighted approach as there is 86% available to claim. Can you imagine what an additional few percent would mean for the racing industry. Lets hope that the legislators bare the employment ratios in mind when they start clamping down.

Lets take it one further, lets hope that legislation makes it tougher for Casinos to operate and they start looking to racing for investment oportunities. If you have these guys marketing the product (racing) you just cant loose.

Notice that the Lotto is not mentioned by this reporter which can only mean one thing. Government does not consider the lotto as gambling. HMMMMMMMMMM

Well at 13.9 million to one, not a gamble, more an highly improbable investment?

It is also a concern that the shareholders of Phumelela earn far more collectively (pro rata) than the entire casino industry players whilst genuine stakeholders (owners, trainers, punters, breeders, etc) eat humble pie! For simplistic illustration; for every R1 proft that casinos make, horseracing's shareholders earn about R8 more. In perspective, horseracing contributes about 10% whilst the casinos 80% of gambling revenue! Also, the horseracing industry has a strangle-hold on the media (The Citizen's Racing Express), and advertises aggressively, even trying to outdo the Lotto!

I maintain that-
1. betting outlets in townships ought to be limited/restricted; that argument held in the assigning of casino licences.
2. no add-ons be permitted to the horseracing industry, such as bingos, 1-arm bandits, casinos, etc
3. the tax level be increased (since this is no more a Section 21 industry) to set up an empowerment/transformation facility encompassing all role players; white and black, to broaden the base of direct participation. Why should this industry be given preferential tax concessions as against other businesses? Then, there should be tax cuts all round!
4. firmer control of betting licences for liquor outlets/restaurants. Here, often, parents bring along youngsters. I have seen a number of these kids filling in the forms and even studying the race cards! Besides, when there are racemeetings early in the am, the pubs open their doors, despite the licensing regulations.

We are becoming a nation of full-time gamblers (and boozers) and part-time workers and parents! Horseracing is supposed to have been a sport; not a business to benefit some who cannot even tell the difference between a race horse and a mule!

The NGB remains a toothless and inefficient watchdog. What have they ever done for horseracing? The Wiehahn report into gambling was a political exercise to justify the introduction of gambling opportunities to enrich a handful of blacks and create a farce of BBEE (jobs, upliftment, development, etc). Where else in the, even 1st world, do you see such an array of gambling opportunities? Worse, wherein more than 40% of its population is illiterate/uneducated?

Responsible Gambling is also a joke! They have no finite figures to tell us the extent of problem gambling, related suicides, criminal inclinations, financial ruination, family disintegrations, etc.

It's time, those of us who still have a semblance of a conscience, said 'Whoah!' It's totally immoral to justify gambling on the pretext that it generates over 25% of tax revenue- at what cost?

To make an informed decision is one thing- but, to gamble one's meagre salary on intuition, 'tips', 'hot machines', dream numbers, tata ma-chance, etc borders on the precarious & injudicious; be it horses, casinos, or Lotto!