Commission refuses application for new pokies venue at the Wellington at Botanical Gardens, White Hills

Wednesday, 23 August 2017

On 4 July 2017, the Victorian Commission for Gambling and Liquor Regulation heard an application from Bendigo Stadium Ltd to introduce 44 pokies at the Wellington at Botanical Gardens in the City of Greater Bendigo.

The City of Greater Bendigo opposed the application but did not appear at the hearing.

On 18 August 2017, the commission refused the application.

As a new pokies venue, the commission first considered the proposed plans for the premises and determined it was satisfied the premises were suitable for the management and operation of pokies.

The commission then determined:

  • the proposal is likely to have a slightly positive economic impact
  • on balance, the range of social disbenefits in aggregate clearly outweigh the social benefits, and there is likely to be a detrimental social impact.

As a result, the commission determined there would be a small net negative social and economic impact on the well-being of the Greater Bendigo community if the application was approved, and hence the 'no net detriment' test was not met.

In making this determination, the commission weighed the following economic impact benefits and disbenefits:

Benefits:

Gaming expenditure not associated with problem gambling was given marginal weight.

  • The proportion of new expenditure not attributable to problem gambling was considered an economic benefit. New gaming expenditure at the venue was estimated to be approximately $391,698 to $446,536 in the first year of trading and there was an anticipated transfer rate of expenditure of 79% from other gaming venues. Although the commission considered the transfer rate to be lower than expected, the extent of the new expenditure was still expected to be relatively low.

Expenditure on capital works was given low weight.

  • The venue would be redeveloped, including the creation of the new gaming room, with an estimated value of between $1.7 million and $2 million. While the value of capital works was significant, it was unknown how much of the expenditure would be retained in Greater Bendigo.

Employment creation was given marginal weight.

  • While the applicant estimated an additional 12 FTE jobs would be created in gaming operations and food and beverage service, the commission considered the financial information suggests it was more likely to be 8 FTE jobs at best. Further, the anticipated transfer of expenditure may result in a transfer of employment from nearby gaming and hospitality venues.

Supply contracts and complementary expenditure was given marginal weight.

  • The redevelopment of the venue would result in additional demand for food and beverage services. However, the estimated increase in the value of supply contracts of $150,000 was not supported by evidence. There was also uncertainty as to how much of these supply contracts would be retained in Greater Bendigo.

Community contributions was given marginal weight.

  • An additional $85,000 per year would be given as community contributions which would have a positive economic impact on community groups in Greater Bendigo. However, these contributions would only be for a short period of time as the entitlements to operate the 44 pokies will expire in August 2022.

Increased gaming competition in the City of Greater Bendigo was given no weight.

  • Although the application would result in players having an additional gaming venue in Greater Bendigo to choose from, the Bendigo Stadium Ltd already operates two gaming venues with 145 pokies. Accordingly, Bendigo Stadium Ltd would increase its share of gaming in Greater Bendigo and decrease the competitiveness of other existing pokies venues.

Improved financial position of Bendigo Stadium Ltd and purchase of freehold of the venue was given no weight.

  • While Bendigo Stadium Ltd submitted the additional pokies would enable it to purchase the freehold of the venue and improve its financial stability, the commission determined the applicant is already financially sound and its financial viability is not dependent on the additional 44 pokies.

Disbenefits:

Gambling expenditure associated with problem gambling was given low to moderate weight.

  • The portion of new gaming expenditure attributable to problem gambling is an economic disbenefit. The immediate area of the venue exhibits lower levels of socio-economic disadvantage as compared with Greater Bendigo as a whole. However, the catchment for the venue exhibits mixed socioeconomic profiles and residents in this area exhibit more indicators of vulnerability to problem gambling than average for Greater Bendigo. The commission considered the venue is a club and the number of pokies is small to moderate, which are both factors that are less attractive to problem gamblers. Although Bendigo Stadium Ltd is an experienced gaming operator at three venues (including two in Greater Bendigo) with responsible service of gaming practices in place, there was insufficient evidence of appropriate implementation of these RSG practices. While a club venue can be considered lower risk due to membership requirements, the commissioners found that 'sign in' requirements for visitors were not enforced when they visited the two club venues in Greater Bendigo currently operated by the applicant.

Potential diversion of trade from other gaming venues and retail facilities was given marginal weight.

  • The business plan was to grow the bistro and gaming at the venue, which would likely result in a diversion of trade from other gaming venues and retail facilities. While the anticipated transfer rate of gaming expenditure was quite high, it was expected to be spread across a number of existing gaming venues in Greater Bendigo.

In making this determination, the commission weighed the following social impact benefits and disbenefits:

Benefits:

Improved facilities at the venue was given marginal weight.

  • A redevelopment of the venue was proposed. However, other than the addition of the gaming room and a larger car park, the redevelopment would only provide improvement to the existing facilities, rather than adding new facilities.

Increased gaming opportunities for those who enjoy gaming was given marginal weight.

  • The new venue would better serve the needs of gaming patrons by providing an additional venue at which they could choose to play. The location of the venue, being some distance from other gaming venues, would mean the impact was increased.

Social benefit derived from increased community contributions was given marginal weight.

  • The additional $85,000 per year to be given as community contributions would have a positive social impact on community groups in Greater Bendigo. However, there was no certainty as to what parts of the community would be likely to benefit.

Disbenefits:

The possibility of increased incidence and impact of problem gaming on the community was given moderate weight.

  • A proportion of total gaming expenditure at the venue will be associated with problem gambling. Adverse impacts associated with problem gambling include health, jobs, finances, emotional states and relationships. The catchment area of the venue exhibits mixed levels of socioeconomic disadvantage (but is generally lower than Greater Bendigo as a whole) and includes areas with more indicators of vulnerability to problem gambling than the wider Greater Bendigo community. While venue-specific factors will reduce the risk of problem gambling, the commission considered there was a lack of evidence in relation to the implementation of RSG practices at the existing gaming venues operated by Bendigo Stadium Ltd, which may be transferred to this venue.

Location of premises was given marginal weight.

  • The location of the venue was found to have a number of attributes that were a negative impact, as they would increase exposure to gaming in an area that was previously free of gaming. This included the venue being located in an area offering other family friendly activities that previously had no access to gaming.

Community attitude was given low weight.

  • The Council, as representative of Greater Bendigo residents, objected to the application and submitted the additional pokies would have a negative impact on the health and well being of its residents. There was an overall negative community attitude to the application.

The loss of a pokies free venue from the local community was given marginal to low weight.

  • The introduction of pokies would result in the loss of a pokies-free venue for the local community to conduct social activities. The venue is in an area that has not previously contained pokies and is in close proximity to the Botanical Gardens and White Hills recreation reserve which are family friendly spaces.

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