Thursday, 1 September 2022

Bills

Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022

Second reading

Debate resumed on motion of Ms HORNE:

That this bill be now read a second time.

Mr MAAS (Narre Warren South) (10:06): It gives me great pleasure to rise to make a contribution on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. The bill of course does introduce nation-leading reforms to tackle gambling-related harm and address money-laundering risks at Crown in Melbourne in response to the Royal Commission into the Casino Operator and Licence.

It is the matter of harm minimisation that I would like to spend a little bit of time on in my contribution today, but indeed before I do it would be remiss of me not to respond to the amendment which was moved by the member for Gippsland South. The opposition here is proposing an amendment that would require the tabling of the special manager’s full reports to government. The opposition should already be aware—indeed they would be pleased to know—that the special manager already publishes a report every six months and that this is available via a very simple Google search, with the most recent report published on 7 July. The government will therefore oppose the amendment, just as it did when it was moved with the first tranche of royal commission legislation. It indeed would not be appropriate to table a special manager’s full report to the government before the regulator has made a decision on Crown’s suitability to hold the licence, and this will occur after the special manager’s term of appointment. Any public report that provides a running evaluation of Crown’s suitability gives rise to legal challenges due to information that is commercially sensitive and subject to legal professional privilege. The public release of the full report would fundamentally undermine the important work of the regulator to determine whether Crown has returned to suitability.

Transparency of course is important, but we know that with transparency there has to be some proper management that is put in place because the stakes, as we have seen, are really very, very high. The publicly available report provides adequate disclosure before the end of the special manager’s term, and we think that that is appropriate. We are doing so much on this side when it comes to our casino in Melbourne. While those opposite seek to undermine the royal commission at every step they possibly can, we are getting on with this very historic and nation-leading reform to restore Victorians’ trust in that casino licence. Indeed a privilege it is to be able to hold that licence.

I did mention at the beginning harm minimisation. The Andrews Labor government has done much in terms of tackling gambling-related harm, more so than any other government, and I am very proud that this bill builds on that track record. We have already established a tough new regulator with a legislated focus on harm minimisation to guide every decision that it makes. As recommended by the royal commission, the bill will introduce a nation-leading mandatory precommitment system on all pokies at the casino. This means that all residents at the casino must fix a maximum limit on how much they are prepared to lose before gambling on pokies. It is the first scheme of its kind in Australia. I am very happy that the government has done that, but of course there will be more work to be done in this space in future.

The Victorian Responsible Gambling Foundation recently reported that Victorians lose some $2.237 billion on pokies. That was just in the last financial year, and that is an extraordinary amount. I am very, very grateful—indeed I give them a shout-out every time I step up here; incredibly grateful—to the Alliance for Gambling Reform, who do such great work in terms of public education and in terms of the public health aspects that go with the addiction that is inherent in gambling. Again I thank them publicly for the tremendous work that they do, particularly in this public education role.

If you go to the City of Casey, which my great electorate of Narre Warren South sits within, over 2021–22 there was $114 million of player losses across the pokies alone—$114 million, which is just outrageous. In terms of LGAs they are the second-highest losses in the state. I think there are about 360 000 people in the City of Casey, and what that means is that each person in that LGA is incurring losses of $40 per head every financial year; every person is flicking 40 bucks away. In the very civil society that is Victoria, that is just not on. There is a venue in the electorate—a repeat offender, I call it—that again had the second-highest revenue in terms of its takings, with losses of $14 million in the last financial year. It is just not on, as I said, in a civil society, and particularly when you consider the socio-economics of the great City of Casey and indeed the electorate of Narre Warren South. But I am very confident that the measures that the Andrews Labor government is putting in place and the work that we are doing will get to addressing these types of concerns. As I said in my inaugural speech, this is a Labor issue. It affects Labor people, and I have great confidence that we will keep doing the work to address this issue.

The implementation of this bill will require the casino operator to fully implement mandatory precommitment and the compulsory use of carded play and cashless gaming by December 2025 at the latest, and the time frame reflects technical advice on what is possible. Of course we need to be realistic that these are world-first reforms and require development of world-first technology. The mandatory precommitment system will need to be implemented by Crown by the end of next year. To allow for the development of technologies that do not currently exist, the full suite of harm minimisation and anti-money-laundering reforms will have a legislated start date of no later than December 2025. To complement this the government will work with Crown and the Victorian Gambling and Casino Control Commission to set earlier implementation dates on the remaining reforms, with the VGCCC to issue a binding implementation plan. The plan will set out key milestones for implementation of the full suite of harm minimisation and anti-money-laundering reforms. If Crown fails to comply with these milestones this will become grounds for disciplinary action for which penalties include licence cancellation and fines up to $100 million.

The legislation is the next step in this nation-leading reform to ensure that this disgraceful conduct uncovered by the royal commission will never happen again. The reforms build on the many priority measures that the Labor government has already implemented since the royal commission, including establishing the office of special manager to oversee Crown’s operations. It is a great bill. I commend the work of the minister, and indeed I commend the bill to the house.

Mr EDBROOKE (Frankston) (10:16): I rise to speak on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. Following the release of the report of the Royal Commission into the Casino Operator and Licence on 26 October 2021, the government acted immediately and put in train a process to deliver nine priority recommendations through the Casino and Gambling Legislation Amendment Act 2021. This included establishing both the special manager and the Victorian Gambling and Casino Control Commission that we just heard about from the previous speaker. It also provided the new regulator with strengthened and expanded powers to hold the casino operator to account.

The Casino and Liquor Legislation Amendment Act 2022 was passed by Parliament in June of this year and delivered a further two royal commission recommendations to strengthen the powers and functions of the inspectors. The act also embedded a focus on harm minimisation, ensuring this shapes every single decision the regulator makes, which I think is a core underpinning philosophy and principle that should be adhered to. I am sure it is a commonsense approach. I am sure many people would say, ‘Well, why wouldn’t they be operating to that principle in the first place and historically?’. We have also expanded the grounds for disciplinary action against the casino operator and completed the transition to a new regulator, the Victorian Gambling and Casino Control Commission.

As we have also previously heard, in the financial year ending 2022 Victorians put $2.237 billion into pokies. Now, I guess it depends on where you stand on the issue as to whether this is a donation or this is a game or this is harm—and I am sure we could argue all three—but from a local member’s perspective I understand that this is a revenue-raising function. A revenue-raising sector, you could call it, but as a local member I only see in reality the harm of gambling. That might be because I am a local member and the door is always open and people come to me for help, to get referrals and to talk; it might be the case that I might be a little bit biased. I might not be objective, but I certainly, as I have said in this house before, do not see people screaming from the rafters in Frankston that they have changed their life by playing the pokies. So I think any sort of regulation—and the implementation of these world-first harm minimisation and anti-money-laundering reforms—is a great step in the right direction. Like many people I was absolutely shocked with what the royal commission found and the recommendations that had come out and been made by that royal commission to ensure that this sector was cleaned up—and the company in question, Crown.

The royal commission recommendation to establish a single-patron bank account was delivered by the Victorian Gambling and Casino Control Commission on 29 June 2022, and a direction was issued to Crown Melbourne. I think this is, again, another commonsense approach, a practical approach, to bring tangible benefits to make sure that we are actually minimising harm. This is something that many people do not have an issue with. Many people might go to their local RSL, they might have a beautiful feed, especially if they are at the Frankton RSL—again, I might be biased, but they are a great bunch of people—and they might put $5 into the pokies, and to them it is like getting a scratchie for your birthday, I guess, or something like that. But people do have significant problems with these machines. We have seen in Frankston the very high-profile case of a VFL football club, an independent VFL football club which is now going great guns, the VFL Dolphins. They are a magic organisation but went through a really bad time. Part of their economic woes were caused by pokie licences and the fact that I think there was an idea that these machines are designed, through algorithms, to make money, not to give money out en masse. But there is another level to that, and that is the licensing of them as well. I do not think that was taken into account as it should have been, and times changed and the licences changed as well.

The government supports the remaining 21 recommendations, of course, and is acting to deliver the key reforms across five areas. They are: preventing money laundering and other criminal activity at the casino; minimising the impact of gambling harm; enabling the ongoing operation of a casino in the event the operator’s licence is cancelled, suspended or surrendered; regulating the ownership and governance of the casino and its holding companies; and strengthening casino tax arrangements. This bill is very important in the way that it is adapting to the problems and overcoming those problems so we can create a safe environment, or as safe as we possibly can—there is more work to do in that, but it is an evolution—for people to enjoy this pastime, if that is what you would like to call it. It is legal and many people enjoy it, but they are just ignoring the figures. And hearing the previous member talk about the money that was invested, or thrown away, in pokies in his LGA was just astounding.

There are some other really interesting parts of this bill. I could stand here and talk for many, many hours about this bill and how good it is, but there are a couple of really interesting parts to it. I think that in addition to implementing the royal commission recommendations, the establishment of an action to overhaul the state’s precommitment system, YourPlay, is a well-founded idea and is welcomed by every member in this place. It basically enables mandatory precommitment. The bill will require any person who plays a gaming machine under a loyalty scheme at a casino to use YourPlay to track their play, and that is really important, that people can actually see how much money they are putting into a machine. They can measure the outcomes and they can see for themselves—it is there in black and white. It might be in a room with no clocks, it might be dark and there might be flashing lights and all those psychological stimuli that are used to keep people in those rooms, but they can see a black and white disclosure of their information. It also enables the Victorian Gambling and Casino Control Commission to publish information about individual venue compliance with the YourPlay obligations, which has obviously been an issue. It is also an offence for a casino operator to not disclose information about their loyalty scheme when requested by the Victorian Gambling and Casino Control Commission or the minister as well.

Further to that, the bill will impose stricter obligations on the casino operator in relation to excluded persons. This is very important. We are making it an offence for the operator to have an excluded person on their premises, to enter the premises or to remain in the premises. The days of ‘Oops, we didn’t realise there was an excluded person who belongs to an outlaw motorcycle gang in here being treated as a high roller’ are gone. There are now restrictions on that, and there are, even more importantly, consequences.

The bill also enables the ongoing operation of a casino where the operator’s licence is cancelled, suspended or surrendered. The bill basically ensures a smooth transition to a new casino operator, and that is the aim of that particular clause. But it also includes provisions that authorise a manager to act as an agent of the former casino operator, require the former casino operator to support a manager and prevent third parties from taking possession of property such as gambling equipment while being used by the manager as well.

All in all, as many people on this side of the house have spoken about this bill, I do not want to be treading over ground that has been spoken about at length, but I will say that I am fully in support of this bill. It is in line with community expectations about health and safety, including the right of Victorians to be in a safe workplace and actually not have people smoking around them. The bill will remove Crown Casino’s exemption under the Tobacco Act 1987 so that smoking is banned from all areas of the casino. As Commissioner Finkelstein made very clear in his report, holding Victoria’s casino licence is a privilege, not a right, and the Victorian people are entitled to a casino operator that acts with integrity and transparency at all times. There are no exceptions there. They are also entitled to a casino operator that works proactively to stamp out money laundering and other illegal activities, and this bill is a vital step to get there. I commend this bill to the house.

Mr CHEESEMAN (South Barwon) (10:26): It is with some pleasure that I rise this morning to make my contribution on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. I must say, I do so having had at the commencement of this week the view that I would not make a contribution on this particular matter, but as the week unfolded I reassessed that position and decided that I would indeed make a contribution to this debate.

Like many Victorians I have had the opportunity over the last 20 years or so to enjoy the opportunity from time to time of heading along to the casino for various functions or indeed for a night out with some friends. I have historically never been a large better. I have never taken a particular interest really in horseracing, and I have not been someone who has really played the pokies that much at all. I cannot say that I have not, because indeed I have, but it is not a normal part of my week’s activity to have a wager or a bet. But what I do recognise is that the Crown Casino here in Victoria, I think, is Victoria’s largest private sector employer. It has indeed been a fixture of the Victorian economy now for more than 25 years. It was established in the early 1990s, if my memory serves me correctly.

I think the regulations and legislation that underpinned the operation of Victoria’s only casino in some ways really did not keep up with the creeping management practice that had over many years been introduced into that casino, where we saw a whole lot of behaviours of individuals introduced into that environment, which saw money laundering and other practices that really were not in keeping with the operator having effectively Victoria’s only casino licence. Indeed we saw a very brave decision made by this government to put in place a royal commission to get to the bottom of those behaviours. Indeed we saw through the Royal Commission into the Casino Operator and Licence some 33 recommendations being made to the Victorian government about a new way forward to ensure that we have a set of legislative arrangements that will see the community maintain a level of confidence in the operator of the casino and their being able to continue to operate, but with new legislation in place that is in keeping with what the Victorian community expects, and that is an environment that is safe for workers, safe for people to go to and where criminal enterprise is prohibited, is banned and is excluded from that particular environment for very good reason. That is a very good thing.

I certainly know in my community—and I am pleased to see the member for Lara here—across the City of Greater Geelong we see of course regular reporting of the amounts of losses made at pokie venues. It is a staggering amount of money. I certainly know in hearing many other contributions made on this bill but also in other public policy debates how worried many members of Parliament are with respect to pokie machine losses. As I say, I am not someone who particularly enjoys it. I do not get any particular enjoyment out of it really at all, but I do know that the industry does put in place in their venues certain psychological clues that can, I think, lead to, in many instances, people putting more money into those pokie machines than what they otherwise would like to do. As I say, we see staggering losses in many Labor constituencies across the state, and certainly in Geelong that is the case.

Often we see a heavier concentration of pokie machines in what I would describe as working-class areas and communities that can least afford to see those losses. I would hope that in the years to come there is an opportunity to reflect on the harm that the pokies do to the Victorian community and we can continue to find ways to protect Victorians from that to make sure that we do not see excessive losses made by those that least can afford it.

I am not someone who is opposed to these things, and I am not someone who regularly goes to pokie venues or the casino. I certainly will have a wager on the Melbourne Cup. I generally do not do particularly well because I do not wager through the course of the year and do not have a practised eye for it. I recognise these industries as legitimate industries in the Victorian economy and recognise that they employ thousands of people, but in making sure that these industries can flourish, prosper and can do well here, we need to make sure that there is not exploitation and there is not a circumstance where people are losing more than they can afford to do, and I think we need to continue to strive and work hard to make sure that we do that.

I will continue to look for opportunities to contribute to these types of debates. I think they are important. I certainly know that down in my part of the world people have historically gone along to the Geelong Cup and some of the other country race meetings and people do enjoy going to some of our pubs that have pokie venues. I recognise and support the employment and opportunities that people have around those venues, but we just need to have a mind and be careful that we do make sure that people do not get addicted to these things and that we support people, we support the community, to ensure that we have on the one hand a viable and functioning industry that can continue to employ thousands of people, where people can participate in a safe way and where we minimise the opportunity for people to get addicted.

This bill is indeed important in terms of the Victorian casino. As I said earlier, it is Victoria’s largest private sector employer. We want to see it prosper. We want to see it do well. But we do need to make sure that criminal enterprises particularly do not again get a foothold in our casino to launder money and do the other things that they may have been involved with. That is important so that our casino has a strong social licence with strong legislation in place to help support it, because we do want to see the Crown Casino for many years to come playing an important role in the Victorian economy.

Mr FOWLES (Burwood) (10:36): It is of course my absolute delight to be making a contribution on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. Like everyone in this chamber, I cannot wait to find out what I am about to say. This is clearly a package of reforms that have been brought about by a particularly egregious set of behaviours—frankly you would have to say an almost wilfully blind set of behaviours—from the management of Crown, who turned their back on a whole range of standards required of them and a range of behaviours required of them as well. I think it is a great shame that we find ourselves in this position, but nonetheless, having conducted the Royal Commission into the Casino Operator and Licence and having established a whole bunch of regulations out of that royal commission, I look forward to all of those recommendations being picked up. In fact we have delivered on a bunch of them already, and this bill delivers the second tranche of recommendations out of that royal commission. It is important work. I thank the commissioner. It is work that the government, in responding to it, is absolutely picking up, ensuring the integrity of the casino and the integrity of the casino regulator and that Victorians can have confidence in the system.

I think one of the most ambitious reforms in this bill is the eventual move to cashless gambling as well as needing to set precommitment levels and gamble with a card. We are now saying: gone are the days of anonymous transactions inside the casino. Gone are the days of being able to move vast amounts of cash across casino tables. We are limiting cash to $1000. This is all in time, I should hasten to add. We are talking about an implementation date of 2025. We are saying: no more vast amounts of cash coming through the casino. No more anonymous transactions. If you want to go to the casino, it is a perfectly legitimate and legal activity, but you need to know that there will be an audit trail. I am in favour of audit trails. I am in favour of payments being made by traceable means. I think that is an entirely appropriate response to some of the challenges we have seen here and in other parts of the universe.

I want to take the house briefly through a bit more detail around the money laundering. In particular we are establishing this framework to have carded play—that is, identified players—for all gaming machines and table games. So we are setting a framework here. This is a framework only at this point. We are not saying that as of tomorrow you are going to have to swipe a card in order to play a table game. We are giving the operator plenty of time to get their ducks in a row around this. The framework obviously gives a time frame and establishes the de minimis point now in terms of what is required, but it also allows that to be fleshed out with regulations over time. I am sure there will be plenty of work and plenty of discussions between the operator, the regulator and the government on a range of these matters over the course of the next few years, but it is absolutely a statement of intent that this government is delivering a phase-out of cash in the casino. Effectively we are going to make a cashless gaming environment other than for the limit—the entirely reasonable limit—of $1000. If you are moving vast amounts of money over gaming tables in the casino environment, that is absolutely fine as long as you do it in a traceable way—that you are identified at the point at which you sit down and that if you do want to gamble more than $1000 you conduct an electronic transaction in support of it. You cannot just launder cash from other sources using the casino as the laundry.

On the new identity verification rules, patrons will be required to have their identity verified, and that is in order to receive a player card and ultimately to play these games. They will need to have their identity verified in order to swipe that card. This stops of course cards being handed around and people moonlighting under different identities. If you have got winnings of more than $1000, you need to have your identity verified at that point too. Some may argue that this is intrusive in some way, but the reality is that having transactions that are traceable improves the integrity of the system, improves confidence in the system and limits the ability of criminals and criminal organisations to use the casino for a purpose other than for which it was established. The purpose for which it was established was to allow people to gamble in a safe and perfectly legitimate way within the confines of the law. What we are seeking to outlaw here is not that ordinary gambling activity—not the sort of mum-and-dad activity—but activities that sit well beyond the ordinary operation of the casino.

December 2025 is plenty of time—over three years. It is plenty of time for the operator, the regulator, the government and other stakeholders to get their ducks in a row. Yes, there will be a cost to these reforms to the operator, and there will be some development costs attached to those technologies. But, frankly, by being a global first mover we are probably ultimately handing to Crown something of a competitive advantage. They will be able to use these technologies in other jurisdictions. They will probably be able to sell these technologies that they develop in other jurisdictions, as many jurisdictions around the world are dealing with exactly these issues.

The other thing the bill does is ensure that in the event the operator’s licence is cancelled, suspended or surrendered, a statutory manager appointed by the government has the full set of powers required in order to run the casino. One would think that this architecture might well have been in place when the casino was established. That is not the case, and so the licence revocation rules were drafted as a pretty blunt instrument and I think, in truth, drafted because they were needed to be seen to be in there but it was not really thought they would ever actually be enacted against an operator. Well, we have seen through some of the appalling conduct identified by the royal commission that we do need to have real teeth around this ability to pull a licence. But if we are going to cancel or suspend a licence, we need to make sure that the 10 000 workers—many of them members of the United Workers Union, of which I am a member—are able to continue working without disruption to their lives, because ultimately a whole bunch of these behaviours and the things that were allowed to go on were not the fault of the gaming table attendants, the cleaners or the cooks, they were the fault of decisions by senior management.

So we need to protect that workforce, and the way you do that is by enabling the ongoing operation of the casino and a smooth transition to a new operator if in fact the licence is cancelled. It is a prospective penalty, but it is now a prospective penalty with real teeth. It is moving out of the realm of the hypothetical and into the realm of the actually enactable response to any future misbehaviour, or an assessment that is ongoing by the regulator that Crown is unable to fulfil its broader public obligations in operating what is of course currently a privately held business.

One of the other amendments which I think is interesting is picking up the recommendation of the royal commission that approval will be required from the regulator if more than 5 per cent of the shares of the casino operator or its holding companies are to be acquired. This is an important check on the concentration of power of ownership of the operator in the hands of someone who may not be a fit and proper person or entity to run the casino. That is an important check on that, and not dissimilar to a range of other ownership caps that operate in other domains. I thank the Minister for Consumer Affairs, Gaming and Liquor Regulation, who is at the table, for bringing these reforms to the house, and I wish this bill a speedy passage.

Mr STAIKOS (Bentleigh) (10:46): It is a pleasure to rise to make a contribution on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022, which is a bill that amends various acts of Parliament to strengthen anti-money-laundering measures; implement mandatory precommitment and other gambling harm minimisation measures at the casino; enable the ongoing operation of the casino in the event that the operator’s licence is cancelled, suspended or surrendered; reform existing ownership and governance arrangements; and deliver additional reforms, including removing smoking from the casino.

I think we were all horrified by the revelations in last year’s royal commission into Crown Casino, the Royal Commission into the Casino Operator and Licence. The report made 33 recommendations. This government is implementing those recommendations and in some areas going above and beyond what the royal commission recommended, because the conduct that was revealed in that report is simply unacceptable—completely unacceptable. This government has been very strong in its response, not only to ensure we are upholding the law—we are addressing issues like money laundering—but also seeking to minimise gambling harm.

I have never been a fan of electronic gaming machines. I think people have a right to go out and have a bit of a punt, have a bit of a flutter. Like alcohol, for instance, or other forms of entertainment, it is about self-control, but of course there are people in our community who struggle to exercise appropriate control when it comes to gambling, and we have a duty as a society to protect them. I am really supportive of some of the measures, both in this bill and in the last bill related to the royal commission, where we are seeking to minimise gambling harm. For instance, just looking in my own local community, I think electronic gaming machines are probably dying a slow death. In the last couple of years two clubs in my electorate have shut down—the South Oakleigh Club, which was actually in East Bentleigh, and also more recently the Bentleigh Club. I know of many clubs around the state, including some AFL clubs, who are really, really keen to get out of electronic gaming machines. The reality is that the scourge of problem gambling is just transferring to other modes of gambling. Gambling in many ways has never been more accessible—it is accessible just on your smartphone—so as a country perhaps the federal government needs to look at ways in which we can address problem gambling where it is conducted remotely via smartphones. That is probably the next step as a country in addressing problem gambling.

But going to what is in this bill, the first thing I would like to say is that in many ways the Liberal Party had their fingers all over what was happening at Crown. Helen Coonan of course was chair when all of this was taking place. But also we found out recently that Peter Costello never declared that he was a lobbyist for Crown when the member for Malvern was the Minister for Gaming. Then we also had that sweetheart deal, which was dismantled by the last bill relating to the royal commission, which was put in place by the previous Liberal government and basically made Crown untouchable. This arrangement meant that Crown would be entitled to compensation for any changes to the rules governing its organisation. This was all under the watch of the Liberal Party. So it has taken this government to just clean up what has been happening at Crown, and proudly so. The royal commission made 33 recommendations. We are implementing each and every one of those recommendations, and as I said, in some cases we are even going far beyond what was recommended. For example, the royal commission recommended that the maximum penalty Crown could face be $1 million, and our last legislation increased that maximum penalty to $100 million, so far above and beyond what the royal commission recommended.

This bill in many ways is very innovative. For example, the carded play technology is a world first, I believe—never before seen anywhere in the world. But also the mandatory precommitment that is in this bill for Crown will go a long way to minimising the harm that gambling can inflict on people. I know that these are very important issues. I have been in this place for eight years, and when I am out on the street, even at the supermarket, it is one of the things that does come up, and it comes up because it really has impacted many, many people’s lives over long periods of time. We are finally seeing a lot of actions being taken in this place and in other parts of Australia to try and minimise the harm that gambling can cause.

In terms of money laundering, these reforms will address the increased risk and occurrence of financial crime that occurs when people can access the casino and make large, anonymous financial transactions. As I said earlier, the bill will establish the framework to make carded play compulsory for all gaming machines and table games, with future regulations and technical standards to prescribe how carded play will operate in practice. The bill will introduce cashless gaming through the phasing out of cash at the casino by prohibiting a casino operator from accepting more than $1000 in cash from patrons in a 24-hour period. Under the new identity verification rules patrons will be required to have their identity verified to receive a player card and to swipe that card before playing any game at the casino or being paid winnings of more than $1000.

As I was talking about earlier in the contribution, this government has done more to tackle gambling-related harm than any other government, and this bill is building on that track record. We established the tough new regulator, the special manager, with a legislative focus on harm minimisation to guide every decision that it makes. As recommended by the royal commission, this bill will introduce a nation-leading mandatory precommitment system on all pokies at the casino. This means that all Australian residents at the casino must fix a maximum limit on how much they are prepared to lose before gambling on pokies—the first scheme of its kind in Australia and something that has been talked about for a very long time being implemented by this government at Crown Casino.

The bill will require the casino operator to fully implement mandatory precommitment, the compulsory use of carded play and cashless gaming by December 2025 at the very latest. This time frame reflects technical advice on what is possible. We need to be realistic; these are world-first reforms and require development of world-first technology. The mandatory precommitment system will need to be implemented by Crown by the end of next year to allow for the development of technologies that do not currently exist. The full suite of harm minimisation and anti-money-laundering reforms will have a legislated start date, as I said, of no later than December 2025. To complement this, government will work with Crown and the Victorian Gambling and Casino Control Commission to set earlier implementation dates on the remaining reforms, with the VGCCC to issue a binding implementation plan. The implementation plan will set out key milestones for implementation of the full suite of harm minimisation and anti-money-laundering reforms.

The bill will ensure that in the event of licence cancellation, suspension or surrender a statutory manager appointed by the state will have the full set of powers to run the casino. The bill will also ensure that the area on which Crown Melbourne is licensed to operate the casino is the area that would be subleased to any new casino operator. There are many other parts of the bill that go a long way to implementing the recommendations of the royal commission. I just reiterate that there will be more work to do as a nation to minimise new forms and new technologies of gambling-related harm. There is a lot more work to do, but certainly I think this government is up for the challenge. This is an important step in solving the issues at Crown, and I commend the bill to the house.

Mr TAK (Clarinda) (10:56): I am delighted to rise today to join my neighbouring colleague the member for Bentleigh to speak on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. This is another important bill, and I thank the minister at the table, the Minister for Consumer Affairs, Gaming and Liquor Regulation, for bringing this forward. Over the last 12 months we have seen a host of legislation in this space being delivered. That shows the commitment of the minister and this government to delivering on the recommendations of the Royal Commission into the Casino Operator and Licence and also to gambling harm minimisation, which is extremely important to many of my constituents.

It is exciting that this legislation will implement most of the remaining recommendations of the royal commission, with a focus on harm minimisation and improved governance. One of the remaining recommendations will be brought in via separate standalone legislation, whilst others will be delivered through directions issued by ministers or the Victorian Gambling and Casino Control Commission (VGCCC) in an administrative arrangement, but again it is exciting that most of the remaining recommendations are being delivered here today. The focus on harm minimisation is welcomed by many of my constituents.

I have spoken on gambling-related harm in the Clarinda district many times before in this place, and it continues to be an issue for many. Last Thursday I visited Make a Difference Dingley Village, an amazing non-profit that has been delivering food relief for over 30 years to residents in Kingston and Greater Dandenong. On Thursday they provided meals and food boxes and food and utility vouchers. They also do a great deal of work with financial counselling and debt forgiveness. Firstly, a thankyou to the CEO, Marion Harriden, and her team of volunteers for the amazing work that they do in support of the community. It was a humbling experience last Thursday. Around 100 people have been showing up weekly for food relief, with many affected by homelessness and family violence but also many families affected by gambling.

I was also reading during the week about the work the City of Kingston is doing to combat problem gambling, and I am looking forward to supporting that work whenever and wherever I can. Kingston loses more than $80 million to poker machines in an average year, and the City of Greater Dandenong is similar if not worse—often upwards of $87 million per year. The cruel reality in Greater Dandenong, as one of the most socially disadvantaged local government areas in the state, is that these residents can least afford it. We know it is about so much more than what that money can do. Gambling has real social, emotional, financial and health impacts. The connections with alcoholism, family breakdown and family violence are stark.

I am glad to see this bill here today, particularly the measures relating to minimising gambling-related harm, and I will expand on this here. The bill acquits recommendation 10 of the royal commission, which recommended that the Victorian gaming machine precommitment system, YourPlay, which allows players to track their play and set limits on time and money spent on gambling, be made compulsory for players of gaming machines at the casino. YourPlay is an important harm minimisation and consumer protection measure that provides a player with the ability to set limits on the amount of time and money they want to spend on gaming machines and keep track of the time and losses as they play, to assist them to make informed decisions and stay in control of their gambling.

Further, the royal commission recommended that players take a mandatory 15-minute break after 3 hours of continuous play, preventing patrons from gambling for long periods of time with little or no staff intervention. To support the recommendations, the bill amends the Casino Control Act 1991 to provide for short-term exclusion orders to be made by both the casino staff and the VGCCC, allowing them to give a verbal direction to patrons to take a break and leave the gaming area. This break can be between 15 minutes and 24 hours at the discretion of the person making the direction. These are important changes that I am happy to support here today, and I am happy to see the consultation that went into the changes.

During the drafting of the bill the Department of Justice and Community Safety undertook targeted consultations with industry, researchers and harm minimisation stakeholders to seek their views. These included the Alliance for Gambling Reform, the Australian Gambling Research Centre, the interchurch alliance on gambling harm, the Victorian Responsible Gambling Foundation—including their lived experience advisory group—and Crown. This consultation was particularly focused on the recommendations on harm minimisation as well as money laundering, which I will touch on in the remaining time, and to inform the technical aspects of the bill.

As I just mentioned, there are also some very important amendments in this bill to strengthen anti-money-laundering measures. The royal commission exposed systemic money laundering and other financial crimes at the casino and attributed its increased risk and occurrence largely due to the anonymity with which people could access the casino and make large financial transactions. So the bill will address this issue and consequently minimise the risk of money laundering and other criminal activity by implementing recommendations 1, 2 and 3 of the royal commission—namely, requiring players to have their identity verified before playing any games at the casino and before receiving winnings over $1000, requiring carded play for all gambling so that all gamblers are required to swipe or insert a card prior to commencing gaming on gaming machines and table games; and prohibiting the payment or acceptance of cash over $1000 per day.

These are important changes that will much improve transparency and accountability, which is important for my constituents for several reasons. Unfortunately the links between labour hire and money laundering are quite well documented. We have worked hard with the Labour Hire Authority and made major reforms to the industry to better protect workers, particularly farm workers in my electorate. Investigations and work are ongoing with the labour hire authorities regarding illegal phoenix activity, shadow directors’ money laundering and breaches of tax law, and I look forward to supporting that work wherever and whenever I can. These are important reforms for my constituents which add to the existing measures that have been implemented to address money laundering and criminal activity. Again, thank you to the minister for bringing this bill before us today. It is positive to see many of the remaining recommendations of the royal commission being delivered here today. I look forward to working with the minister, our councils, our community groups and others to deliver gambling harm minimisation measures as well as anti-money-laundering measures. These are important changes for our community, and I commend the bill to the house.

Mr RICHARDSON (Mordialloc) (11:06): It is important to rise and speak on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022 and follow the member for Clarinda and his contribution. This is an important step in regulation of an industry and particularly Crown after substantial findings of the Royal Commission into the Casino Operator and Licence—33 recommendations. This is the next stage in important reform that strengthens the oversight and integrity of Victoria’s casino.

At the time of the royal commission these were the words used: ‘disgraceful’, ‘callous’—deplorable conduct. For many years Crown Melbourne had engaged in conduct that could be described in one word: disgraceful. Some was so callous that it is hard to imagine it could have been engaged in by such a well-known corporation, a corporation underpinned by a board which should have had the highest principles of corporate governance in such a vulnerable and risky industry. Commissioner Finkelstein went on to say:

When these facts came to light, it was inevitable that Crown Melbourne would be found unsuitable to hold its casino licence.

But in those recommendations there was a two-year window because Crown had started to engage on a significant pathway of reform, and Crown itself underpins the jobs of more than 11 000 Victorians. So the Premier, at the time, could not have been clearer: Crown was not just on notice, it was on far more than notice, and they would lose their licence if there was not substantial reform underway. This is what the bill goes towards and what we will speak about today, but it is important to reflect also on the legislation that came before, at the end of 2021—nine important recommendations that were prioritised and responded to in record time. This set the framework, including the appointment of Commissioner O’Bryan, who was the first IBAC Commissioner and was appointed to oversee every single aspect of the casino operations. He is a substantial figure in Victoria’s integrity system, having been the first IBAC Commissioner, providing a significant service in leading Victoria through this phase as well as really important work into the future. This bill adds to some of those important recommendations that were so critical and urgent to secure the future of Crown, if it is going to continue, or some iteration of employment through there as well.

I wanted to particularly highlight some of the changes around preventing money laundering and highlight all the dedicated work of the more than 18 000 Victoria Police members each and every day who put themselves on the line to address crime, corruption and some of the horrors that we see in the quite salacious practice of money laundering and what that underpins in criminality. Crown for so long were asleep at the wheel and negligent in their duty, undermining the good work and hard work of our law enforcement agencies, who were doing all they could to protect and serve our community but were being failed time and time again without these basic checks and basic supports that should have been in place throughout this time. These changes in legislation will, again, be a significant hamstring to criminal practices and will make sure that money-laundering practices that have been there in the past are stopped into the future, making criminality even harder in Victoria. So this is a really important reform around protecting Victorians, stopping those money-laundering practices and making sure that we are supporting our Victoria Police members, who do an incredible job to protect our communities each and every day.

These reforms will address the increased risk and occurrence of financial crime that occurs when people are moving large sums of money through financial transactions at casinos. We have seen a substantial amount of coverage on that, and it is worth giving a shout-out to the Sydney Morning Herald, the Age and 60 Minutes for the report that they did exposing some of these very troubling practices, not just in Victoria, that we see across some of those governance issues and some of the huge failures in accountability, wilful ignorance and oversight. This is where we find ourselves today with these important recommendations. The bill will introduce this cashless gaming system by the phasing out of cash at the casino, prohibiting casino operators from accepting more than $1000 in cash from patrons in a 24-hour period. Under the new identity verification rules patrons will be required to have their identity verified to be able to play and receive a playing card or be paid winnings of more than $1000.

Another important element to these reforms is harm minimisation. A lot of members have talked about the impacts on their communities. It also interplays with the responsibilities I have in supporting the Minister for Mental Health in mental health and social inclusion. The harm of debilitating gambling addiction is a health issue. It is a mental health and wellbeing issue, and we have to treat the support of people who are stricken by the addiction of gambling in such a way, supporting them in their communities and reducing the harm wherever we can. The Andrews Labor government has done a substantial amount of work to tackle gambling-related harm, more than any other government before it. This bill builds on that track record. We have already established a new, tougher regulator with a legislated focus on harm minimisation to guide every decision that it makes.

As was a key recommendation of the royal commission, the bill will introduce a nation-leading mandatory precommitment system on all pokies at the casinos. Importantly, this means all Australian residents at the casino must fix a maximum limit on how much they are prepared to lose before gambling on pokies, the first scheme of its kind in Australia. This is really important in terms of how we are supporting vulnerable people. We have seen examples where people literally take their pay packet out and then they lose it all in one day. We are making sure that we have got mandatory precommitment. This has been a battle. I remember there being a significant discussion battle in previous federal governments in the Rudd-Gillard era around mandatory precommitment. There has been a lot of politicisation of issues here, and it makes perfect policy sense to protect vulnerable Victorians, indeed Australians, who might face the substantial impacts of gambling harm. So I really welcome this part of the recommendations so that vulnerable Victorians are not exploited. Then also on top of that we need to make sure that we do all we can in supporting Victorians in their mental health and wellbeing journey if they are facing gambling addiction and all the elements that that brings, and the impact that that has on their loved ones, on their communities and on themselves into the future.

Some of these reforms, particularly around mandatory precommitment, are going to take some time to implement—by 2025. That will be at the latest—December 2025. This time frame reflects some of the technical challenges in bringing this about. But make no mistake, we are focused on this in our policy setting. We want to deliver these reforms and make sure that we protect vulnerable Victorians.

Another key element of this bill is the ongoing operations of the casino. We are well into the first year of determining whether Crown are a suitable licence holder in Victoria. If we do not see substantial improvement, they are out—that is it. But we need to make sure that we are protecting the more than 11 500 thousand workers who are underpinned by their business. That is why the bill will ensure that in the event of a licence cancellation, suspension or surrender a statutory manager appointed by the state of Victoria has the full set of powers needed to run the casino. That gives important certainty to those people whose livelihoods are underpinned by the work of our Crown Casino. But make no mistake: if Crown are not cleaning up their act, they are out, they are gone. The Premier could not have been clearer on this. They got so close to the edge of it. Reflecting on some of those recommendations and given that window, if they had not gone down a pathway of reform, if the board had not substantially changed over that period of time and we had not seen some of those gains—and there was not such a drastic impact to the employment and livelihoods of so many Victorians—I think there could have been a different journey taken.

We remain committed to making sure that these reforms are implemented in full. The more than 650 pages of the royal commission’s report are harrowing reading, and when you look at the royal commission recommendations of other jurisdictions as well and the investigations that have been had, this has been a deeply concerning phase in the casino industry and the gaming sector. The time for reform was long ago, but we are not wasting the moment as we critically change these outcomes and make sure that we are strengthening that integrity into the future. These are just another part of the Andrews Labor government’s strong reforms of Crown, ensuring the accountability of this sector into the future.

Mr PEARSON (Essendon—Assistant Treasurer, Minister for Regulatory Reform, Minister for Government Services, Minister for Housing) (11:16): Thank you, Acting Speaker Connolly, and it is wonderful to see you in the chair this fine spring morning. First day of spring—spring has sprung. I know the member for Malvern is very excited by the fact that it is spring and the sun is shining. It is good to be up and about. I am delighted to make a contribution on the Casino Legislation Amendment (Royal Commission Implementation and Other Matters) Bill 2022. I think that this bill is very important, and my good friend the always eloquent member for Mordialloc has talked about the implications of the failure to act in relation to these matters.

In preparing for this bill I was just reflecting on the journey that we have gone on as a society and community and how the world is changing rapidly. It is changing so incredibly quickly that there is a need to make sure that the statute books reflect the values of society today, but it is also important that business reflects the aspirations of the community. The member for Malvern probably is a similar age to me—I think he is a little bit older than me—and would recall some of the discussions about the Hamer government converting the Windsor into a casino, which was something that Kennett was keen on. Hamer was somewhat attracted to it but decided not to do so. There was a bit of talk and discussion, and then obviously Cain was opposed to having gaming machines or a casino. It was the Kirner government that started that process to establish a casino, which was fulfilled by the Kennett government. I think that to some extent there were arguments at the time. Those of us of a certain age would recall that people would get into a bus and go to Moama for a weekend away playing the pokies, and that was something that was done because you could not do it in Victoria.

I think that the journey we have been on as a community has changed over the course of that time. When you look at the way in which people are consuming gambling products now, it is very different to what it was five years ago, 10 years ago—and unheard of 30 years ago. It is important that the regulatory environment reflects some of those changes. The reality is that poker machines overwhelmingly would be defined as a mature or declining asset class in the sense that a lot of younger people now will not play the pokies. I was at my local on a Saturday afternoon recently. I popped in and there were half a dozen guys having a bet on the races, and they were betting on their phones. That would not have been something we would have contemplated 10 years ago, would be my guess, certainly not 20 years ago. There is a need to make sure that there is an appropriate regulatory environment in place. As the member for Mordialloc has indicated, what we have seen over recent times is systemic market failure in the sense that we have seen a business model predicated upon turning a blind eye to illicit activity and money laundering.

I think that something like 2 per cent of the population are problem gamblers. The question would be: what do we think is a fair proportion that that 2 per cent should contribute to a business like Crown Casino? You would probably say, ‘Well, it should be 0 per cent’, because in a perfect world you would have no problem gamblers at all making any contribution whatsoever to the casino. The reality is, though, that problem gambling takes many forms, and people are on a journey. People do not set out to become problem gamblers, but they can probably get drawn into quicksand and it becomes apparent over the course of time. The question probably is: what do we think a fair percentage is? What do we think a fair percentage should be, a contribution? Now, I think that probably in days gone by there would be a view that we will let the market determine it, have a laissez faire approach, that the best form of regulation is the lightest form of regulation, and we will let the market take its course. I do not think that is where the community is these days. That might have been the case back in the 1990s and the 2000s, but where the community is now is we do not believe that should be what occurs in an asset like this, that we need to make sure we have got an appropriate level of regulation to protect people who are vulnerable and, as the member for Mordialloc said, we need to make sure that proceeds of crime are not being laundered through the casino as well.

Blackstone is the company that is behind the private equity push to purchase Crown casinos, and I note from preparing for this debate—I did not know this—that Blackstone was founded in 1985 by Peter G Peterson and Stephen A Schwarzman. Peterson and Schwarzman put in $400 000 worth of seed funding. They had previously worked at Lehman Brothers. Blackstone is actually a cryptogram derived from their names, because ‘schwarz’ is German for black and Peter, or ‘petros’ or ‘petra’—the masculine and feminine renderings of the word respectively—in Greek means rock or stone. I am quoting Wikipedia on this. So there you go; you learn something every day. Wikipedia—it is so rich, and I would encourage all members, in preparing for any debate, to dive into Wikipedia—

A member interjected.

Mr PEARSON: It is a bit rich and it is different. These days, as the member for Malvern knows only too well, we are, if nothing else, frustrated thespians in this great chamber.

Peterson and Schwarzman led to that. If you look at Blackstone now, they are a big real estate player, they are a big commercial property player; they have got about US$800 billion in funds under management, and they have made this decision to make this investment. Now, with private equity I think over the journey they have shown that they are very good at running businesses. They are very good at turning businesses around. The people I have met who have worked in private equity are highly numerate and very intelligent, and they know how to place a bet, as it were. I would have every confidence that they would recognise the environment that they are operating under, that they would not be placing this bid if they thought that they were going to lose. They have got every hope and confidence that they will, through good, efficient management, make sure that they can turn this around.

Indeed if you look at the way in which investors are viewing the world, what was previously corporate social responsibility, which was a buzzword 20 years ago—it had some meaning and relevance then, but I am not really sure the way in which it was manifested then necessarily did justice to that concept—and is now environmental, social and governance, it is something that is starting to become more prevalent and more prominent. I think that when companies make these sorts of investments they are looking very carefully at the broader impact that investing in these businesses has on a community or a society or globally.

Yes, in this particular case it is a private equity investment, and one thing I know about private equity is they go in, they make an investment, they turn it around and they flip it, because that is where they make their money, and then they move onto the next thing. They do not tend to hold them for long; they tend to come in, turn it around—buy low, turn it around, sell high—pocket their money and move onto the next transaction, which is fine. There is nothing wrong with that, but I think that they would recognise that they have got an asset class in poker machines which are starting to decline in terms of their usage, they have got a highly regulated environment, a high level of scrutiny. If they do not get this right, if they fail to turn this around, it not only means they will potentially forfeit their equity investment—that notion that ‘The billions that we paid out to own this business could be taken away from us if we fail to act, if we fail to be seen as being appropriate and responsible people to operate a business like this’—but it also means that there is no payday, there is no ability for them to turn this around.

So that is why I have got confidence—and I may well be proven wrong on this point—that when you have got organisations like Blackstone making this sort of investment, they tend to be very smart people, they tend to appraise risk. They would know what needs to be done and they would recognise that if they fail to act, then there is a consequence that would be dire for them and their investment. That is why I think that the world has changed, the world has moved on; the hopes and expectations of the community are different now from what they were 10 years ago, 20 years ago and 30 years ago, and the onus and the expectation on Blackstone as the operator will be very high. I am a glass half full person; I am hopeful and confident that they will do the right thing. But it is about making sure that this asset can continue to operate. It is about making sure that people can still be employed down at the casino, because it is not just the people on the gaming floor, it is everything behind the scenes and it is the other ancillary activity that occurs. We need to make sure we get this right, because if we do not then we are going to have effectively a stranded asset with workers that will lose their jobs. I do not think anyone—apart from the Greens political party, who I never hear on these matters—would want to see that. I think that on this side of the house and on the other side of the house we would want to see a viable casino continuing to employ thousands of hardworking Victorians, because it is the right thing to do.

Mr FREGON (Mount Waverley) (11:26): I move:

That the debate be now adjourned.

Motion agreed to and debate adjourned.

Ordered that debate be adjourned until later this day.