Lottery companies should not be exempt from a ban on credit card use due to the harms they cause people with gambling addiction, according to financial counsellors, anti-gambling advocates and industry competitors.
The federal government has introduced legislation to ban credit card use for online wagering, citing high levels of community harm and people gambling with money they don’t have, but has proposed a carve-out for lotteries.
The Lottery Corporation has told a parliamentary inquiry that this is appropriate, arguing its products are “low harm” when compared with other forms of online gambling, such as sports wagering or online casinos.
“The relatively modest $11.75 average weekly spend per player highlights the inherently recreational nature of lotteries,” the Lottery Corporation said in a submission to the parliamentary inquiry into the issue.
“Despite very high participation, lotteries are associated with very low levels of gambling harm. This is mainly because they are infrequent, non-continuous, and low spend.”
That position is rejected by Financial Counselling Australia, which provides advice to people struggling with gambling addiction. The organisation’s policy director, Lauren Levin, told the inquiry that the government should ensure “no one is able to fund any form of gambling with money they do not have”.
“The lottery sector and its products cause serious gambling harm and should also be subject to the same consumer protection legislation as other online forms of gambling,” Levin said in a submission to the inquiry.
Financial Counselling Australia is also concerned the carve-out could lead to people with gambling addiction increasingly using lotteries to bet with money they don’t have.
“Carve-outs are a mistake and lead to market distortions,” Levin said. “Put simply, money flows to whatever segment receives a carve-out.”
The Alliance for Gambling Harm is also opposed. It highlighted research from the Australian Institute of Health and Welfare that found 30% of Australians gamble on lotteries at least once a month.
“A recent study also found that almost one-third of lotteries-only gamblers were at some level of gambling-related risk and that younger people, males, smokers, and more frequent e-cigarette users were more likely to report gambling harm from lottery products,” the submission said, citing a study published in the journal Addictive Behaviours.
“This evidence suggests that lotteries are not as substantially different to other gambling products and are not harmless as was once thought.”
Levin’s submission to the inquiry includes the testimony of a man who struggled with gambling addiction and used credit cards to purchase lottery tickets online.
The man is alleged to have spent about $900 on tickets each week, partly financed by winnings from poker machines.
“The Lotto is now online. The online shop doesn’t close,” said the man, whose identify has been withheld for privacy reasons said.
“For me, the Lotto online is more dangerous [than other forms of gambling] and the temptation is getting very hard.”
Australia’s largest online sports gambling company, Sportsbet, has also called for lotteries to be included in the ban.
“Sportsbet is concerned by this outcome due to the significant scope of harm given the maximum permissible spend and frequency of draws,” the gambling company’s submission said.
“For example, in Victoria where there are two operators who provide online keno, customers can spend up to $1,000 per entry with a draw occurring every three minutes.”
The federal government wants the ban to be introduced by the end of the year. The legislation would also give the Australian Communications and Media Authority enhanced powers of enforcement.
“Minimising this harm is not a set-and-forget exercise,” said the social services minister, Amanda Rishworth, when announcing the legislation.
“Bringing online wagering into line with land‑based gambling, where credit cards cannot be used, is another positive step.”
