The Standover Lobbyists Club


Does anyone remember the line, "from those who do, to those who don’t?" The full-page newspaper ads that claimed there was no scientific evidence of the harms of passive smoking were taken out by the tobacco industry more than two decades ago. The advertisements caused outrage in Australia’s public health community and won the tobacco industry few friends. Nor did they stop the long march to tougher cigarette regulations. The Hawke and Keating governments continued to toughen the packaging laws and slowly wound back the advertising privileges of the industry. 

It was just another skirmish in the long battle to combat the lethal effects of cigarettes in our society. The fight continues: passive smoking is still causing perhaps 1 per cent of the world’s deaths annually. And yet, after tens of millions of deaths and dozens of crippling lawsuits, Big Tobacco is still fighting hard against government plans to make its packaging less attractive and marketable, this week announcing it would take the issue to the Federal Court.

The big tobacco companies are not the only industry fighting government reforms aimed at helping out nation’s most vulnerable. The clubs lobby is also breathing fire over planned changes to poker machine regulation being pushed on the Gillard Government by Tasmanian independent Andrew Wilkie.

As we know, Wilkie holds a crucial House of Representatives vote in Australia’s knife-edge parliament. Part of the price for his support of the Gillard Government is reform to the gaming machine industry in order to try to reduce the harm caused by problem gambling.

And there’s plenty of harm. The scale of the misery caused by poker machine addiction is a blight on our community. According to Wilkie, "there’s something like 95,000 Australians who have been identified as problem gamblers with poker machines. And they account for something like 40 per cent of all of the money that is lost on poker machines in this country." According to the Tasmanian government and Productivity Commission figures cited by Wilkie, problem gamblers lose approximately $2.6 billion on the pokies in Australia every year.

Much of that misery takes place in the large clubs and pubs that have metastasised across the outer suburbs of Australia’s cities. According to the Productivity Commission, Australians spent around $10.5 billion on gaming machines in pubs and clubs in 2008-09 alone. Walk into a club in the outer suburbs on any weekday and you can see problem gamblers. They’re not hard to find: the Productivity Commission says that "while problem gamblers may account for only 0.7 per cent of the total adult population, they may account for between 10 and 40 times this among gaming venue patrons at any one time."

The Productivity Commission’s comprehensive 2010 report on gambling is a must-read for those seeking a careful and comprehensive analysis of the issue. The report builds on the Commission’s groundbreaking 1999 report, which put the problem of problem gambling on gaming machines in the national spotlight of the first time. It demonstrates why reform is well overdue.

Unfortunately, in 2011 in Australia, industry lobby groups have realised that reform can be fought and defeated in the media.

The template, of course, was the mining industry’s campaign against the Mining Super Profits Tax, a hugely successful campaign that swung so many hearts and minds against the Rudd government that some think it was the beginning of the end of Rudd’s prime ministership.

Now, Clubs Australia, the peak industry lobby group for the registered clubs, has launched a campaign all of its own, calling the proposed changes "un-Australian".

The campaign marks a new low in Australian political debate. The full TV commercial, entitled "A Licence to Punt: It’s un-Australian" is not only offensive, sexist and laughably cliched, it’s also misleading, even deceitful. The Government is not proposing a licence to gamble, and the clubs know it. What is being discussed is what’s known as mandatory pre-commitment technology, in which someone who sits down at a poker machine will have to nominate how much money they are prepared to gamble away. Once that limit is reached, they won’t be allowed to exceed it. 

Big clubs are a particularly pernicious influence on public policy debate in this country. It was the big clubs in New South Wales, through their hugely powerful lobby group Clubs NSW, that successfully prevented liquor licensing reform in the state for years. The big clubs have also exercised an unhealthy influence on some parts of the ALP, particularly in western Sydney, where clubs such as Panthers are some of the largest gathering places for seniors and retirees in the entire region.

And despite their huge gambling revenues and multi-million dollar budgets, registered clubs still enjoy huge tax exemptions as supposedly "non-profit" organisations. It’s a loophole which doesn’t prevent them from vacuuming up billions in gambling losses from mostly poorer Australians.

The bullying style of the clubs and pubs lobby was on vivid display yesterday, when South Australian Senator Nick Xenophon held a press conference to attack the "It’s un-Australian" campaign in Adelaide. The Senator was only halfway through his presser when the Australian Hotels Association’s Ian Horne crashed it.

"You are spinning the community," Horne reportedly told Xenophon. "He’s accused us of lying, he’s accused us of basing our campaign on lying," he told the assembled journalists.

If Clubs Australia and the AHA really want to pick a fight with Xenophon and Wilkie on this issue, they may just have met their match. Xenophon is a seasoned anti-gambling campaigner who remains immensely popular in his home state. Clashes like this show why: he’s one of the few politicians in the land prepared to stare down the standover tactics of an industry out of control. Such confrontations show the dark side of lobbying in this country. They also help the likes of Xenophon and Wilkie get re-elected.

For the government, things are not quite so simple. This fight marks yet another clash with a big industry group, at a time when the government desperately needs to demonstrate some discipline and composure. As Fairfax’s Phil Coorey quipped today, "it is difficult to think of a powerful interest group not at war with this government."

Partly, this is the government’s own fault.

The desire of sectional interest groups to meddle in electoral politics is as old as democracy, but the modern precedent was set in 2007 with the Your Rights At Work campaign, which many credit with defeating John Howard. The rot really set in during the Carbon Pollution Reduction Scheme debate, when the government caved in to rent-seeking from the big polluters. Noting the effect their extensive anti-government media campaign had on the flow of free permits to pollute, big business really went to town during the mining tax debate, believing they could kill of the tax altogether. They didn’t completely succeed, but the end result was certainly revenue-positive: after Julia Gillard’s compromise on the rate and breadth of tax, tens of billions of tax revenue were wiped from the budget estimates.

Now every mid-sized industry group thinks they can gain important policy concessions simply by booking a substantial campaign of television commercials. As long as this government shows itself vulnerable to such campaigns, the problem will only intensify.


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Ben Eltham is New Matilda's National Affairs Correspondent.