July 18, 2005

Government Marketing of Gambling

Responding to criticism over his government's expansion of gambling, Solicitor General John Les, the Minister responsible for gambling, told the CBC that he doesn't think the province is addicted to gambling. According to the CBC website, he argued that "…if we didn't have gaming revenue today our budget would still be balanced."

Les is either arithmetically challenged, hasn't read the budget or knows something about the budget that has been hidden from the public. The budget projected a surplus of $220 million this year, $620 million if the forecast allowance isn't needed. For each of the next two years the surplus is projected to be $200 million, $650 million in 2006-07 and $750 million in 2007-08 if the forecast allowances aren't used. Revenue from the BC Lottery Corporation is projected to be $892 million this year, rising to $1.021 billion in 2007-08. Most elementary students would be able to subtract and conclude that the take from gambling is much bigger than the projected surpluses even when the forecast allowances are included and more than four times bigger when they aren't. Perhaps the Minister would like to review the budget and explain the comments he made to the CBC.

Objections to the latest initiative to expand gambling in BC, Internet sales of lottery tickets, have been misinterpreted by some as an objection to gambling. Any realist knows that gambling is here to stay, and most people prefer to see government reap the profits. The issue is not whether gambling should exist or whether the government should profit from it; the issue is whether the government, or its agencies, should encourage people to spend a larger portion of their incomes on gambling. The service plan for BC Lottery Corporation indicates that is what government is doing through that crown corporation. According to the plan, "Increasing competition for the discretionary dollars of British Columbians will continue to affect BCLC's business environment. Consumers are becoming more sophisticated and knowledgeable about their entertainment options. Delivering high entertainment value and building loyal customer relationships are increasingly important as competitive differentiators." The plan also states that: "BCLC's product and distribution strategies are designed to stem losses to competitive gaming options and capitalize on revenue opportunities from emerging forms of entertainment." Most would see nothing wrong with encouraging gamblers to spend their money in BC rather than going down to the US, but it is not clear that anyone would agree that marketing should attempt to capture entertainment or other dollars that are spent on non-gambling activities.

There would be protests if government decided to encourage more drinking so as to reap greater profits (although some think it might be doing that with private liquor stores). There would certainly be protests if government advertised to encourage more smoking so as to grab more tobacco tax revenue. What's the difference when government, through BCLC, advertises and develops strategies to shift more spending to gambling? BCLC ads for lotteries are everywhere, storefronts, billboards, TV and radio. Have you ever seen that kind of attention in the advertising mediums devoted to programs on gambling addiction? Problem gambling advertisements appear to be limited to small posters in casinos. According to BCLC's service plan, 4% of the adult population has a problem with irresponsible gambling, but according to a 2001 study prepared for the Ontario Problem Gambling Research Centre , 9.6% of Ontario adults "are classified as "at risk" in that they have indicated relatively minor problems, 3.1% score as having moderate gambling problems and 0.7% are rated as having severe gambling problems." In a one year follow up study, the researchers found that approximately 10% of those in each risk category progressed to the next higher risk category, 80% of individuals with severe problems continued to have them one year later. Instead of using the 4% figure to minimize the prevalence of problem gambling, government should focus on the 14% who are at risk. Against that backdrop should the government be conducting marketing campaigns to increase gambling?