Page 1861 - Week 07 - Tuesday, 15 June 1993
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The amendments seek to omit the existing clause 7 of the Bill and to insert a new clause 7 and a clause 7A. Clause 7 will amend section 6 of the principal Act by omitting "6%" and substituting "5.75%", and clause 7A will amend section 8 of the principal Act by omitting from subsection (1) "0.75%" and substituting "0.5%" and by omitting subsection (2). I am moving these amendments to enable ACTTAB to reduce the commission rates deducted from win and place pools from 15 per cent to 14.25 per cent.
Madam Speaker, ACTTAB currently combines its win and place pools with the Victorian TAB. The South Australian, Western Australian, Northern Territory and Tasmanian TABs are all joined in this link, which is now called Super TAB. TABs which combine pools must use the same rate of commission deductions. This is part of ACTTAB's agreement with the Victorian TAB. If it does not follow suit, the ACTTAB will have to drop out of the linked pools. Madam Speaker, the Victorian Minister has advised me that he intends to reduce the Victorian TAB commission rate to 14.25 per cent, in line with the New South Wales rate, on 1 August 1993. The other members of Super TAB are able to meet this timetable. I am advised that the ACT is the only party required to amend its legislation to achieve the reductions.
The commission levied from ACTTAB turnover from win and place pools is currently 15 per cent. The "first charge" distributions are 6 per cent to the Territory, 3.5 per cent to the ACT race clubs, 0.75 per cent to the Racecourse Development Fund and the remaining 4.75 per cent to the ACTTAB for payment of operating costs, including 2 per cent agent fees. It is proposed, Madam Speaker, that the ACT Government reduce the "first charge" distribution rate by 0.5 per cent to follow the Victorian move. The adjustment is 0.5 per cent, not 0.75 per cent, because the win and place betting accounts for 67 per cent of ACTTAB turnover. This comprises 3 per cent of pools not linked to the Victorian TAB, mainly on Canberra meetings, and 64 per cent of pools linked with the Victorian TAB. Madam Speaker, if commission on 64 per cent of ACTTAB's turnover is reduced by 0.75 per cent, then the reduction in overall revenue, when expressed as a proportion of turnover, is 0.48 per cent and therefore 0.5 per cent has been used.
Madam Speaker, there is evidence that lowering commission deduction rates will result in an increase in turnover, with greater financial returns offsetting any decreased percentage rates. An increase of 5 per cent would more than offset the proposed reduction. Madam Speaker, this Government has decided to achieve the 0.5 per cent reduction in distribution rates through sharing the 5 per cent equally between the Racecourse Development Fund and payments to the ACT Government. The amendment provides that the changes be achieved by reducing the Racecourse Development Fund's percentage of ACTTAB's turnover by 0.25 per cent to 0.5 per cent and the Government's stated percentage of ACTTAB turnover by 0.25 per cent to 5.75 per cent.
This amendment is consistent with what applies in other States and Territories linked to Super TAB, where government and the racing industry will share the effects of the reduction in commission rates equally. The Government would still be able to compensate for the proposed financial reduction with the expected increased returns to Consolidated Revenue if turnover increased as projected.
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