Some 25 000 slot machines located in 31 casinos across South Africa contribute some R1,7-billion in annual revenue to the national government via taxes, having replaced 150 000 illegal slot machines in operation in 1996, according to National Gambling Board chairperson Chris Fismer.
Speaking at a business briefing in Johannesburg recently, Fismer was reflecting on his just-concluded year as chairman of the International Association of Gaming Regulators (IAGR), which represents regulators in more than 50 jurisdictions and countries throughout the world.
“Here in South Africa, efforts to prohibit gambling met with farcical results,” he said. “By 1996 there were 150 000 illegal slot machines operating openly and brazenly in urban areas throughout the country, paying no tax, in an industry closely associated with other forms of vice, including prostitution and drug dealing.”
Today, revealed Fismer, there were only 25 000 slot machines in South Africa, in 31 casinos which had generated nearly R12-billion in new investment and annually contributed some R1,7-billion in taxation to government. Moreover, this new industry was vigorously and effectively regulated, had closely monitored and high standards of probity and player protection, and it was responsible for substantial investments in public infrastructure, including two international convention centres and over 5 000 new hotel rooms, among other investments.
Fismer said that many of the issues which shaped gambling policy in South Africa eight years ago had now become prominent on the political agenda of governments and regulators internationally.
“Perhaps the most gratifying aspect of my chairmanship over the past year of the IAGR was the increasing focus in international gambling policy circles on social issues, such as the empowerment of local communities and problem gambling.
The approach being adopted to many of these issues is one which we pioneered in South Africa at the time we crafted the country’s new gambling policy framework after 1994.”
He added that for a South African to have served as the chairman of the IAGR was a significant endorsement from the international community for the way in which gambling policy had evolved in South Africa, along with its legislative model and its tightly controlled regulatory environment.
He told the breakfast briefing that South Africa, in choosing to legalise, tax and regulate gambling, had adopted a realistic approach to the world’s “second oldest industry”. He said that it had never been realistic to consider a totally free market, as in Spain or Namibia where competition had eroded public interest benefits, or prohibition, making the point that the prohibition of alcohol in the United States in the 1920s and 1930s had not only not restricted the supply of liquor, but instead had created and enriched a vast criminal network which operated underground.
South Africa had also earned considerable credit in other jurisdictions for its approach to the issue of problem gambling, he noted. In 2002 the National Gambling Board had created the SA Responsible Gambling Trust (SARGT), a public/private sector partnership of government regulators and industry to oversee the National Responsible Gambling Programme (NRGP).
“The NRGP is the only programme of its type in the world which is jointly controlled by government regulators and the private sector, and the only one internationally in which treatment, research and public education are integrated in a single initiative. This model, and the fact that funding is sourced from the private sector, and is substantial, is unique among gambling jurisdictions world-wide.
“Over the past three years, the NRGP has provided free, professional medical treatment to almost 2 000 problem gamblers, and its toll-free help line has telephonically assisted a further 2 500 callers. In total, the help line has received some 40 000 calls since June 2000. The NRGP provides a 24-hour, seven day per week free service in eight of South Africa’s official languages, and the treatment network extends to 32 cities and towns in each of South Africa’s nine provinces.”
The country had also pioneered official policy with regard to empowerment, and while in South Africa this focused specifically on creating opportunities for the previously disadvantaged, the country’s approach had set a precedent for other jurisdictions in terms of the involvement of local communities in both decision-making and neighbourhood participation in casino and other gambling developments.
“As proud as we are of our successes in the BEE arena, we recognise that these accomplishments need to be tested. The National Gambling Board, therefore, has commissioned a team, to be led by Professor Barney Pityana of Unisa, to test our assumptions and to conduct a thorough BEE audit of the industry. This places us at the forefront of national initiatives to advance empowerment in business.”
Fismer said that South Africa’s legislative framework was currently undergoing an extensive overall, in which government responsibilities were being redefined to ensure greater efficiency. The role of regulators with regard to the socio-economic effects of gambling were being strengthened. – I-Net-Bridge