Page 2876 - Week 10 - Thursday, 15 August 1991
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per cent, whereas the legislation in the ACT limited the pay-out ratio to between 80 and 90 per cent, and was set by regulation at 87 per cent.
The clubs came to me and said, "Look, we would like to be able to make a pay-out of 92 per cent, or whatever, to be able to compete with large establishments in Queanbeyan and to provide a better service for our members". At first I thought that seemed a very reasonable thing to do. We looked into the legislation and we discovered that it did not allow us the flexibility to provide a pay-out ratio greater than 90 per cent. When you take into account the one per cent plus or minus variation that clubs require not to break that legislation, it meant, in effect, that the highest ratio that they could go to was some 89 per cent, which, of course, is marginally different from 87. On top of that, it is inconvenient for them to order machines from the manufacturers that would be set at that particular ratio. It would be a very small market and the cost per unit of each of these machines would be rather expensive.
That, I think, is the background of where this legislation originally came from. It was the desire of the clubs to provide a better service to their members and to be able to provide a higher pay-out ratio than that which prevailed in the existing legislation. Extensive consultation was entered into with the clubs and as a result the legislation that we have here today meets their requirements; but it is breakthrough legislation in a lot of ways.
As I said, previously the amount of return on investments in poker machines - I will call them poker machines because that is how people generally refer to them, although I know that they are known officially as gaming machines - was linked to between no less than 80 per cent and no more than 90 per cent. It had been set for many years at 87 per cent. It was determined that, if we were going to change, what was the point of changing the upper limit from 80 per cent to 95 per cent or 80 per cent to 92 per cent, whatever it might be. What we were really interested in was a guaranteed higher return for the people who use the machines.
It was decided that a minimum return of 85 per cent seemed generally fair; that clubs could not set a return rate lower than that level. Then, in trying to come to what should be the upper limit, the thought was: Why should there be an upper limit? Why should the Government intervene with an entrepreneurial club which may wish, for various reasons, to put on promotions or whatever to attract customers into their premises and want to set a return of 97 per cent? For that matter, they may wish to have a promotion where there is 105 per cent return. I see the look of horror from the Clerk, who is involved with one of the licensed clubs here in the ACT, the Irish Club - a very fine establishment.
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