Hon Peter Dunne
Minister of Internal Affairs

17 May 2017 Speech

Opening address: Australasian Casino and Gambling Regulators’ Conference

Pullman Hotel, Auckland

Tena koutou katoa

Ka mihi kit e iwi manawhenua

Ka mihi hoki ki nga manuhiri no te Ao Rau rangatira maa, tena koutou, tena koutou, tena koutou katoa

It is a pleasure to open this year’s Australasian Casino and Gambling Regulators’ Conference.

Today, I will briefly share with you some thoughts about your Conference theme “regulatory excellence”.

But first, I want to reiterate the warm welcome provided by the mihi whakatau and waiata.

Thank you all for joining us in Auckland, especially our international guests and speakers who have travelled from across Australasia and further afield to be here.

We welcome you with great pride to the unique mix of cultures, long history and beautiful landscapes of Tāmaki Makaurau.

I would also like to give particular acknowledgement to Graeme Reeves, Chief Commissioner of the New Zealand Gambling Commission.

I would also like to acknowledge Peter Cowsill, the Manager of the Casino Compliance team in Auckland, who is retiring in two weeks’ time after 20 years of service to the casino sector.

Peter was a Gambling Inspector for the Department of Internal Affairs when New Zealand’s first casino opened.

He has provided a strong customer-centric approach and contributed to significant changes in the approach to regulation over those years.

Peter is in the audience today and I thank him for his service.

And I would like to acknowledge all of the speakers who will share expertise during the Conference.

Thank you for your willingness and enthusiasm in taking the time to be here.

Role as Minister to oversee gambling regulation

As the Minister of Internal Affairs, I am responsible for the New Zealand Government’s gambling policy and the legislation that provides the regulatory framework for gambling activity.

The regulation of gambling has received a lot of attention over many years, and there have been concerted efforts to devise effective legislation and regulations, which are the tools of your trade.

As you will all be aware, the regulation of gambling continues to engender strong feelings, both for and against, and this is an important part of the environment in which we all operate.

Whether we like it or not, gambling is a highly emotive issue to many people for a variety of reasons.

New Zealand’s Gambling Act balances the community benefits from gambling against the harm that can result from gambling.

It has a broad range of objectives, including: controlling the growth of gambling; minimising problem gambling; ensuring that gambling is fair; minimising opportunities for crime; and ensuring that money from gambling benefits communities.

The balance between harm and return from gambling

According to a report published in The Economist earlier this year, Australia wins the jackpot of having the biggest gambling losses per resident in the world – an estimated $990 per resident in 2016.

This figure is around 40% higher than Singapore, the runner-up, and around double the average of other countries featured in the report, including the United States, Canada and Britain.

New Zealand came in at sixth place.

About 80 per cent of the New Zealand population participates in gambling at least once a year.

Around $2 billion is spent on the four main forms of gambling – TAB betting; Lotto; casinos; and gaming machines located mainly in pubs and clubs.

It is within this context that gambling regulation in New Zealand aims to enhance the positive dimensions of gambling, and to reduce its negative dimensions.

An example of gambling’s positive impact is the special Lotto draw that raised over $2.7 million in funds for the regions affected by the Kaikoura Earthquake in November 2016.

This generosity and community spirit in the face of adversity fits with Lotto’s goal of raising money for the community.

On the other hand, we are all familiar with the potential for addiction to gambling and the destructive behaviour that can result from it.

Its impact on individuals, families and communities is something we all have to consider in our roles.

I know that you face this same tension in your respective jurisdictions – the need to enhance the positive aspects of gambling and reduce its negative aspects.

Regardless of whether this is recognised in your governing legislation, balancing the economic and entertainment value of gambling with the social harm that can accompany it is a challenge all our societies face.

Minimising harm from gambling is a topic I take particular interest in as I am in the fortunate position of also being Associate Minister of Health, with responsibility for gambling as a public health issue.

This provides me with a holistic perspective and enables me to keep a broad overview of the wider gambling environment and harm minimisation issues.

This hopefully helps our policy responses to be more consistent and better coordinated.

Professor Max Abbott’s presentation about the past, present and future of gambling and gambling-related harm in New Zealand will also provide a host of relevant information on this important topic.

I hope you will all take away some valuable insights.

Class 4 review

While New Zealand’s Gambling Act is considered to be working generally well, we are looking at how Class 4 gambling operates - that is, gambling in pubs and clubs on electronic gaming machines.

In New Zealand, the net proceeds from gaming machines return to local communities to help fund a wide range of activities.

Every year approximately $300 million is returned to the community, to the direct benefit of sports clubs, community groups, events and recreational facilities.

Gaming machine use has been in decline since the introduction of the Gambling Act in 2003.

While the decline has slowed in the past three years, the future of this class of gambling, and therefore community funding, remains uncertain.

The review of gaming machine gambling is looking at how the level of community funding can be sustained.

The review will consider whether we should concentrate our efforts on changes within this class of gambling, or whether there is potential to increase community funding through other avenues within the gambling portfolio.

I see that on Friday, Bruce Robertson, Chair of the Class 4 working party, will be sharing his thoughts on working with the community.

The Class 4 working party is a technical reference group that represents a large part of the industry in New Zealand and has built collaborative relationships with the regulator.

I welcome its establishment and the input that it has been able to have to date, and I look forward to that continuing in the future.

The Class 4 review is an example of the constant need for exploration of whether legislative frameworks are fit-for-purpose, and whether the regulatory regimes sitting beneath them are cost-effective.

Such exploration is especially necessary as gambling participants have increasing potential to move away from traditional forms of gambling, like electronic machines, to online and digital platforms.

It is essential that regulators and regulatory systems are equipped to accommodate any changes to the future of gambling.

Regulatory excellence

This brings me to the theme of this year’s conference, “regulatory excellence”.

This is an important topic and a crucial part of realising the purposes of the Act.

Achieving regulatory excellence is a significant goal, and both regulators and the parties they regulate have important roles to play.

The New Zealand Government expects that a regulatory system should deliver a flow of benefits to the country that exceeds its costs, and that a regulatory system should be an asset, not a liability.

Assets require maintenance and it is important that we maximise the long-term value of regulatory systems.

This means ensuring that systems are flexible; proportionate; fair; and easy to access and understand.

The Government expects regulatory agencies to adopt a whole-of-system view that incorporates a proactive, collaborative approach to monitoring existing systems, and which supports regulatory change.

A crucial element in doing this is to include regulated stakeholders, through supporting them to understand and meet their regulatory obligations, and by promoting opportunities for engagement and collaboration.

I am aware that efforts to achieve regulatory excellence are making a positive difference.

I am sure that this focus is continuing to be welcomed by stakeholders in the casino and Class 4 gambling sectors.

This helps to achieve negotiated outcomes and a problem-solving approach to improving compliance with regulations.

Working with our stakeholders in these ways, where appropriate, means that regulatory intervention can be better designed and unintended consequences are avoided.

Regulatory stewardship

This treatment of regulation as an asset to be sustained over the long-term reflects the concept of regulatory stewardship.

It involves looking at our environment, understanding what the future might look like, and assessing whether our regulatory systems can cope with that future.

It is a whole-of-system, lifecycle view of regulation that focuses on how we regulate, rather than the detail of what we regulate.

Shared challenges and interests

This whole-of-system approach is a way of thinking about regulatory excellence and provides a foundation on which to acknowledge our common interests and problems.

I recognise that many of the issues currently facing the casino and Class 4 gambling sectors in New Zealand are not unique.

There are many challenges and opportunities you share as regulators from across the Australasian region.

Technology in the digital age

I note that a number of the sessions will focus on digital and online forms of gambling, which is a very relevant topic in light of our shared interest in the digital space.

A regulatory future-focus is integral to responding to unprecedented, rapid growth in technology and digital forms of gambling.

While this growth creates opportunities, it also demands refined thinking about how the ways we regulate casinos and Class 4 gambling, to ensure they are fit for the future.

Despite the advantages of technological progress, the pace of change creates significant challenges for regulatory agencies.

Such tensions can expose the prescriptive nature of legislation, and may lead to more principle-based, technology-neutral legislation in the future.

Increasingly cyber-savvy customers and regulated parties expect sophisticated, easy-to-use transactions with government.

Regulators also need to be agile to respond to increasingly sophisticated use of technology by criminals and those who wish to evade regulatory requirements.

A particular challenge in the digital age will be how regulators minimise the harm that gambling can cause.

More people have the potential to access gambling outside of traditional boundaries, through digital platforms.

This is shaping the likely future of gambling.

As regulators, it is important that we have the right skills to respond to this evolution.

While online gambling is already firmly established in many other jurisdictions, we are somewhat behind the trend in New Zealand.

To be candid, we are not sure why this is and are trying to better understand the pattern.

Concluding remarks

Any thinking about regulatory excellence and establishing best-practice needs to take account of shared expertise and collective experience.

This conference is an excellent opportunity for you to connect, communicate, and learn from each other as you share your knowledge and experiences.

I encourage you all to make the most of this valuable opportunity and wish you all the best for a productive and informative few days.

I also hope you will have the chance to enjoy the sights, food and activities Auckland has to offer.

Thank you for your attention this afternoon.

I wish you well in your work.

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