Proceedings of the Standing Senate Committee on
Legal and Constitutional Affairs
Issue 3 - Evidence for December 2, 2004
OTTAWA, Thursday, December 2, 2004
The Standing Senate Committee on Legal and Constitutional Affairs, to which was referred Bill S-11, to amend the Criminal Code (lottery schemes), met this day at 10:50 a.m. to give consideration to the bill.
Senator Lise Bacon (Chairman) in the chair.
[English]
The Chairman: We are studying, Bill S-11, lottery schemes. Our witness this morning is Mr. Azmier, a Senior Policy Analyst of Canada West Foundation.
We will hear from you, and I am sure my colleagues will have many questions to ask.
Mr. Jason J. Azmier, Senior Policy Analyst, Canada West Foundation: I am a Senior Policy Analyst with Canada West Foundation, a research institute located in Western Canada. It is non-profit and non-partisan.
I have been there for 10 years. My degrees are in commerce and political science, from the University of Calgary.
In 1997, I began researching gambling as a public policy issue. That led to the development of a four-year study on the gambling policy in Canada. The study produced 18 reports. There are about 700 pages of printed material. I have provided you with some information on it.
The study was unique in a couple of ways. It concluded in 2002. While I am still commenting and speaking on the work, we do not keep track of all the latest statistics. I am familiar with them and can speak to them, but they are not my area of expertise.
I will mention other items of note about the work that I have done. It was not funded by any federal or provincial government group, nor any advocacy groups either pro or against gambling, which is somewhat unique as well in any of the studies done to date. There tends to have been a government or advocacy group backing other studies. The conclusions from my work are unique as a result of that as well.
We were deliberate in not using normative judgments of good or bad associated with gambling. The information was provided upon which individuals could make decisions regarding good or bad. We did draw conclusions and make recommendations. I provided you with a copy of them today in our final report. Under seven headings, there are a number of smaller recommendations some of which are on points relevant to the discussions today.
I am here for information so I thought I would highlight three key findings of our work that I think are related to the bill under discussion.
I found reference a number of times in the proceedings to date regarding the public survey we did in June of 1999. This public opinion work was across the country; 2,200 Canadians were consulted. It is the only public opinion work we have to date that provides a national perspective on gambling to this extent.
The question of whether video lottery terminals, VLTs, should be moved was specifically asked. We asked: ``Should video lottery terminals be limited to race tracks and casinos?'' Seventy per cent of Canadians agreed with that statement.
Please turn to page 2 of the handout. I provided more information to underline the strength of this agreement. It is somewhat remarkable. Forty-nine per cent of Canadians were in strong agreement with this statement. We asked about 18 different policy questions. This came in as number two. The only question with stronger agreement was whether bingo halls should be limited to access of 18 years of age or over.
The strength of the agreement is remarkable when you look at some of the demographic breakdowns. The SA column refers to strong agreement. Region, education level, income, sex, employment status or age did not matter. There was strong agreement against all of those demographic variables by a three-to-one factor over the strong- disagreement group.
I would also highlight that we asked questions regarding participation to determine if this were just a specific segment of the group that was strongly in favour. Religious participation had no effect. Forty-eight per cent of those who never attend church indicated strong agreement that this is something they would like to see implemented.
We asked whether they did or did not participate in gambling, just as a preference issue. It made almost no difference. There was 47 per cent strong agreement. Adding the agreement numbers, you get to the 70 per cent range on this public policy issue.
I draw your attention to the item labelled ``segment.'' We did a segmented analysis of our data set, grouping Canadians into five groups: anti-gambling — those who have strong moral convictions against gambling; those who are concerned about gambling; those who are moderate; those who are disinterested —the biggest group in Canada; and those who are pro-gambling. Even the last group that I mentioned, pro-gambling, were in strong agreement. Thirty-seven per cent strongly agreed, even though they were pro-gambling, that the location of VLTs should be limited, with a two-to-one ratio over strong disagreement.
This issue regarding the movement of video lottery terminals is not an emerging issue. I can refer you to 1995 to the first provincial study that looked at gambling policy in the provinces. It was done in Alberta. One of the first and strongest recommendations of that 1995 review, three years after the introduction of the machines, was that they should be moved out of the bars and into the casinos. The lottery review committee included five sitting MLAs at the time in Alberta. MLA Judy Gordon is on record several times in suggesting that this was something the public wanted and desired.
Drs. Garry Smith and Harold Wynne, whose study is also in your package, went through Alberta Hansard. They found that in 1996, the-then gaming minister in Alberta recommended to the Ontario counterpart that VLTs should never have been put into the bars in Alberta. As you probably know, Ontario shortly thereafter changed its viewpoint on VLTs.
I also had the opportunity to follow the citizen-led actions in Alberta that led to the development of petitions of over 250,000 signatures, the largest municipal petitions in Canada to date. It related to matters of voting on VLTs. Thirty- seven municipalities in Alberta voted on VLTs in 1998. I watched that process from start to finish as part of my work.
The voting was done on the hard-line question of all VLTs or none. There was no middle-point position.
Even with those hard-line positions, the people of the province voted about 55 per cent in favour of keeping the machines, which would be replicated a year later in the New Brunswick province-wide referendum on the same question.
We were following the process to identify what the middle-position outcome would be. What do you really want to see happen? Through some polling work that we did, we could get to citizens regarding that.
The results are on page 4 of the work. About 54 per cent responded to an open question that VLTs being restricted to casinos would be the best solution. Removing all VLTs comprised another 17 per cent. The strong point of view of Canadians, had they had the opportunity to vote on these issues, would have been to move them to the casinos at that point in time.
Our findings were that this position has the greatest appeal to Canadians because it satisfies the libertarian arguments regarding freedom of choice, the right to play, but it still addresses the accessibility concerns about people stumbling into bars that may not otherwise have any predisposition to gamble and the additional factors of alcohol, which has been spoken to before.
There were a few publicly held concerns about the negative impact on the hospitality sector as a whole. There were vocal concerns from individuals in hospitality associations that were involved, but, in surveying, that did not come up as a concern.
My conclusions on the matter, which I have previously written on, is highlighted by one of the recommendations at the end of the report. Gambling policies in this country ought to best reflect the desire of Canadians. Therefore I would be supportive of what this bill is attempting to accomplish because it does satisfy that goal.
Changes of this nature ought to be in the interests of the provincial governments in their desire to maintain gambling revenues. By matching public desires with current policies, the provinces are less likely to have public outrage that could be caused by several thousand people changing their mind, which would cause a complete reduction of gambling revenues that are arguably quite important to governments.
The second point this morning relates to the distribution of revenue. As you may be aware, each jurisdiction handles this issue somewhat differently. The average for the country is about 25 per cent of return of the profit to the retailer with about 75 per cent going to the governments. While this represents significant cash injection for the retailers, it is significant out-transfer of revenues from the region. Redistribution to that region is more indirectly through government services. There is a re-injection of cash to that area but it is on an indirect basis, not a per-capita or per- spending basis. Whatever your region happens to contribute through VLT play, it will get back the same as others regardless if they have VLTs or not.
These data suggest that there is no positive economic outcome associated with that activity. This is particularly true in areas where there is little tourism spending. If the VLT playing is being done only by locals, then it is only trapping 25 per cent of the money the individuals are spending in that area. There are much better economic activities and local community generating options available than VLT play. While changes in this activity may result in some bars closing, other restaurants and forms of entertainment may open up as a result. We cannot say that we will lose two servers in a hotel as a result of the changing of VLTs. The servers will find employment elsewhere. There are more efficient forms of capital expenditure available in the rural regions.
I spent about a year studying rural economic development over the past two years. I have not seen any issues regarding how VLT activity is positive to rural economic activity.
The situation is compounded by the fact that while the revenues are leaving, all the social costs are staying. The bulk of social costs are staying in the community that is doing the spending while the return to the community is only a small portion of what it is actually spending.
On the matter of revenue, my final point is that it is unclear what change, if any, this activity would have on government revenues. The change it would bring to the individual retailer revenues is clear.
The concentrations of slot machines that have been done thus far have proven successful at raising revenues. The use of player incentives and advertising could also help reduce the impact of the change, or perhaps even negate any impact should this be decided as a necessary goal of a government.
There are specific social costs and net benefits associated with gambling generally and electronic forms of gambling specifically. I would like to begin with a caution against using these kinds of data for your final decisions on an issue. Conclusions and good information of this nature is likely 10 to 15 years away from our current level of understanding of the issue.
We understand the kinds of things that are gambling costs. If you want to flip to the next page, there are listings of the kinds of things that are social costs, but we have little on quantifying what the costs are. They include bankruptcy; loss of productivity in the workplace; judicial, policing and incarceration; family distress, marital distress, divorce, depression and counselling; and suicide, which is probably the most problematic. At this point, very little counting is done on any of these measures and not in a comparative or systematic way.
As the issue gains profile, police, doctors, judges, coroners, psychologists and teachers will all develop means to have accounts of this information. It is at an embryonic stage at this point. We can say what costs should be included, but it is difficult to do a net balancing.
However, I would urge you all not to dismiss a lack of progress in our ability to count these measures as an understanding that they are nonexistent. The costs do exist, and they might be quite large. The fact we are not able to measure them does not mean they are not of value, particularly related to suicide. In the research area, we have an opportunity to speak to the survivors of suicide, and none of the dollar values matter to those individuals. It continues to ring true, I am sure, in your deliberations.
For your consideration, to give you an idea of what kinds of things can be done, I have included a few pages out of the Australian National Review that relate to social costs and the attribution of those social costs specifically to electronic forms of gambling. This kind of review is long overdue in Canada. It has been called for repeatedly by researchers. I would echo that we need the same kind of review in Canada.
The findings in the National Review were that problem gamblers tend to prefer electronic forms of gambling, which is also true in Canada. Electronic forms are responsible for almost three-quarters of the negative costs of gambling, which is table 9.4 of the Australian study. The study concluded that game machines were the least likely form of gambling to provide any net community benefit, which has much to do with the lack of labour intensive outcomes and the specific elements of gaming play.
My concluding comments will be on how VLTs are unique. Researchers have attributed the uniqueness to several primary factors. One is the speed. You can make up to 1200 bets per hour on a three-second outcome. That is a very reinforcing concern and shows also the speed at which an individual can lose their money.
There is the creation of illusion of control or skill associated with the gaming machines. The appealing lights, video and sound enhancements is particularly well matched with the youth that are built on a video game generation. There is deliberate non-random programming of the machines to introduce a few extra near-misses to create the illusion that you are close to winning, or to change and have more small wins and fewer big wins. The accessibility of the machines in non-gaming locations is appealing.
I will turn to my area of greatest strengths on a policy aspect of how VLTs are different. They are unique. Unlike other forms of gaming in this country, we have seen an expansion of the type of gambling after introduction. VLTs are the only form of gambling where we have seen more restrictive controls placed successively. In the 14-year history, we have seen them change from non-age restricted locations such as corner stores to the bars and lounges. We have seen them capped in total number. They have been announced and then retracted in some provinces. They have been voted out of communities and subjected to the largest ever municipal petition. There have been attempts to make safer by slowing them down. They have been relocated out of poor neighbourhoods. That makes this form of gambling unique in an otherwise permissive gambling environment in this country.
The Chairman: While studying VLTs and gambling, we discovered that underground, illegal terminals are operating where VLTs have been officially banned. Have you studied that phenomenon?
Mr. Azmier: We looked at gambling and crime generally, and specifically at illegal VLTs. You are probably aware that illegal VLTs were one of the mains reasons for bringing in the legal version of the activity. At this point, it is difficult to say whether any change in the number of legal or illegal machines based on the bill under consideration would make a difference. Illegal machines do exist, but they generally offer a prize for an individual who gets a particular score on an amusement machine. A bar will encourage people to play amusement machines. A high score earns you a small cash prize. That is also included in the illegal numbers. Betting on pinball and pool is included in the numbers on illegal machines, so it is not necessarily clear how many black-market machines that look just like the government ones would pop up. If we moved all machines out of bars and lounges and into casinos, you would be better able to tell whether you are playing a legal or illegal machine. Currently, because there are so many illegal machines, if there are three illegal ones and three legal ones, you will not necessarily know the difference. If there are machines where they are not supposed to be, you would know that it may be illegal.
The Chairman: We have been informed that a high percentage of pathological gamblers are addicted to VLTs. Could you give us more detail on the correlation between pathological gambling and video lottery terminals?
Mr. Azmier: That is not my area of research. I am aware of what the research suggests which is that problem gamblers overplay electronic forms of gaming. I provided you with about 30 pages of the Alberta study by Dr. Smith and Dr. Wynne, which came out in January 2004. It underlines your point relating to overplay. Only one in five or one in 10 Canadians play video lottery terminals at all, so when it is said that the average contribution is $200 to $250 per capita, if only one in 10 is playing, $2,000 to $2,500 is actually the average contribution.
It is said that about 20 per cent of the play in Alberta is by problem gamblers, so that translates to roughly $200 million coming from problem gamblers in that province.
The Chairman: In Quebec, a program was recently launched with the main objective of reducing the presence of VLTs. Lotto Quebec has taken some measure in its 2004-07 plan to address the problem of accessibility and visibility of VLTs. Are you aware of the plan? What is your opinion of the measures proposed by Lotto Quebec?
Mr. Azmier: I am aware of the plan. I believe that all public health approaches to gambling — policies based on the research that suggests that there is a healthier approach to gambling — are positive. As to whether it is a big enough step, it is certainly a bold step for a government to take, and it is unique among governments in Canada, so there is some merit to it. However, it is definitely not the solution Canadians are looking for. They would like to see gambling in gambling-specific locations.
The Chairman: You also said that the social costs related to VLTs are high for Canadian communities. You mentioned job losses and even suicides. Can you approximate how much the negative side of VLTs cost society?
Mr. Azmier: I would love to. As I pointed out in the presentation, I think it would be a disservice to jump to that number with almost no input data. As I said, doctors are not currently measuring this, police are not tracking this and coroners are just starting to ask the questions; and even those are not cohesive.
How can we begin to aggregate those numbers and provide a numerical quantification when we are literally 10 to 15 years away from being able to develop a trend analysis? I can tell you that the cost is significant, and we must not dismiss it simply because we cannot quantify it.
Senator Andreychuk: I want to thank you for your research. This is the start of a very interesting debate. Previously we were just identifying the issues. You have given us much more and I am pleased to see that the Canada West Foundation continues to do this absolutely necessary work. I commend you on this initiative.
You say that the negative impacts have neither been quantified nor studied adequately, and I understand that, because that is what we were grappling with. Even from the first surveys you have done, can you tell us whether there is anything in the negative impacts that is different in this VLT gambling than other types of gambling? Is there anything different in the negative impacts here as opposed to other addictions such as alcohol and drugs? You have noted the categories as economic, problem gambling, work, study, legal, financial, health and treatment. From my experience practising law and sitting on the bench, I believe that many of those are the same. If you have an addiction problem, it shows up in the workplace and in family stress, and leads you to medical services.
Is there anything unique about VLTs in particular and gambling in general?
Mr. Azmier: The unique concerns related to VLTs are the easy accessibility and the speed. An individual can lose money at a much more rapid rate. The preference of problem gamblers for VLTs is also well known as a form of addition, because it provides positive reinforcement so quickly. It distinguishes itself as uniquely problematic and the public has picked up on that, not only through research efforts but also through individual knowledge of people who have played these games. One in three or four say they know a person who is a problem gambler, so individuals are starting to become aware of this as well.
In terms of its relationship to other forms of addiction, some of the research, which I think is accurate, suggests that it is more problematic on the financial side, of course, because it is very difficult to lose as much money through an alcohol addiction as one can through a gambling addiction. There are more fraud and crime-related issues associated with this form of gaming.
Depression and suicide would have a lesser impact with this addiction than with alcohol and drugs, for example. I believe that the Australian study also found this.
Senator Andreychuk: Not having studied this matter in depth until we received this legislation, there was always the comment that if VLTs in Saskatchewan were pulled the out of small towns, it would hurt their economy. You are saying it would not. Therefore, it draws me to the conclusion — tell me if I am right — that there has been lobbying on the part of those who have the VLTs because they will lose the income, as opposed to the broader local community. That is an education gap, I guess?
Mr. Azmier: It is factual that there has been lobbying. There have been expenditures. All the public debates usually involve an element of the hospitality industry. I believe that is true. Some of these licensees are receiving $100,000 a year from gaming activity, so there will be an impact associated with that. My point to you senators would be, it is not a net loss to the community. In fact if you are trapping more of the revenue locally, similar forms of spending might occur on other forms of entertainment. There might be a local theatre group or other local forms of entertainment that would spring up to replace this spending. Northern Alberta is the highest per-capita gaming activity on electronic forms of gambling, in this country. It has to do with individuals in the oil and gas industry having money to spend. They are looking for something to do with their time when they are up there and right now the gambling industry is taking that time. There could be other things developed to better and more efficiently fund the rural activities that have more positive outcomes and do not have as high a social cost associated with them.
Senator Andreychuk: Just a final one on Aboriginal gambling, certainly in Saskatchewan. We had the Aboriginal gaming commission strike an agreement with the Saskatchewan government. Are there any trends or statistics about the Aboriginal issue? Is it a better benefit to the Aboriginal communities because it is controlled differently, or are the statistics pretty well universal for whoever gambles in whatever mode?
Mr. Azmier: No. Specific demographic ethnic groups of the population have a higher propensity for addiction and that holds true in gambling. I have not done any specific studies of Aboriginal groups, but the studies that have been done on this matter show that by factors of perhaps 2, 3 or 4, there are more Aboriginal gambling addiction problems than among the general population. Other studies have tried to get into the Asian populations and have similar types of conclusions.
Senator Andreychuk: Is there a better economic benefit to the Aboriginal communities that have taken on casinos in their area? You told us how it breaks down in the local community and I am interested whether there is more economic benefit to the Aboriginal community that gets into gambling casinos, et cetera?
Mr. Azmier: Whether it is Aboriginal or not, in order to have a net positive impact on the community, you have to be drawing people from outside the community. I am not sure to what extent that occurs. Certainly, some of the northern Aboriginal casinos in Saskatchewan are benefiting from tourism-based activity. This is not VLT gaming though. Let us distinguish a VLT from a casino that is both a labour-intensive activity and a tourist destination. VLTs in hotels are likely capturing some tourism activity because there are individuals staying there. Whether they are from within the region or not is hard to determine. No studies I know of have looked at whether VLTs are keeping a large amount of tourism dollars in the area. That is the only way you can view that as a positive net benefit. Otherwise money is leaving the area and coming back indirectly through broader government services.
Senator Ringuette: I am looking at page 25 of the study, the second report that was done. On page 25, table 3, these are interesting numbers because Alberta, as we all know, has the highest income per capita in Canada. We see also that Alberta has the highest yearly gambling per capita. I do not know if there is a relationship there. I guess I should have pre-empted my question with the following: Does Alberta have VLTs in different locations or is it restricted to specific casino locations?
Mr. Azmier: Alberta has VLTs in bars and lounges. They have slot machines in casinos and racetracks.
Senator Andreychuk: Some communities have voted them out.
Mr. Azmier: There are seven communities that have voted them out. As of February, they have started to remove them, six years after the votes. It took a long series of legal challenges to the votes because, of course, those challenges basically funded themselves. The more machines that were in, the more revenue they were able to generate.
Senator Ringuette: Looking at this same page, just above table 3, it says, ``Moreover, Alberta's ratio of one VLT per 374 adults ranks second lowest in the nation.''
Mr. Azmier: Alberta has fewer VLTs and they are played more. The machines in Alberta are played for longer than elsewhere.
Senator Joyal: Are the VLT-addicted customers allocated equally between men and women in Alberta as much as you can say?
Mr. Azmier: Equally, no. There are more men, generally, but it is not disproportionate. It is in the package of materials I provided.
Senator Joyal: Is it roughly one third or two thirds? Just give a rough figure to give an idea.
Mr. Azmier: They play roughly at the same rate. The person from the population that chooses to play a VLT is roughly the same. Whether the addiction levels are the same I would have to look that up for you.
Senator Joyal: When was the VLT introduced in Alberta?
Mr. Azmier: 1991 was a test run at the Calgary Stampede and Klondike Days, and 1992 was the full introduction.
Senator Joyal: It was well before 1985?
Mr. Azmier: After 1991 and 1992.
Senator Joyal: Do you know of any other countries where the VLTs are as accessible as they are in Canada — that is in the store on the corner of the street or any bar? In the United States or Australia, are they as available as they are in Canada?
Mr. Azmier: It is a large world so there is much variance. Australia has — what you would call, I think — the outcome of this bill. They have specific locations where you can go and play these machines. You may have a restaurant, a bar, and a gaming establishment and a shoe store. They are store-front type operations, where you can play these types of games. They are gaming rooms, gaming houses.
That would likely provide greater access than what you are suggesting. Non-age-restricted outlets, such as corner stores, began in New Brunswick in 1990. That has been changed and there are no corner-store VLTs in Canada, whereas there are still some in the State of Nevada, for example. I believe that the highest-profile state to remove its VLTs is South Carolina, after introducing them three years earlier.
Senator Joyal: We cannot draw a line of behaviour such that they are more accessible in Canada than they are in other Western countries.
Mr. Azmier: You could draw different behaviour lines within Canada, for example, British Columbia and Ontario versus the other provinces
Senator Joyal: In your presentation, you referred to the petition endorsed by 250,000 Canadians. I am interested in your comment about the fact that those who are opposed to the accessibility that we currently have find themselves allocated equally among what you call ``libertarian versus church goers.'' It cannot be labelled a moral issue, per se, but rather a social issue. You did not elaborate on it but it is an important element for us to consider.
Mr. Azmier: Some elements of gaming policy are that way and this is one of them if it crosses beyond the morality- based arguments. There is a general anti-gambling community, which we identified, that is opposed to all forms of gambling activity. There are those who, within varying degrees along with other forms of gambling, will join in and echo those viewpoints. This one is our number two issue after age restrictions at bingos that has the greatest number of voices in agreement. This particular issue is more of a social concern than a libertarian or freedom-of-access concern.
Senator Joyal: In endorsing this legislation, we are not taking a stand that has motivation on moral grounds but on grounds of the social impact on the community.
Mr. Azmier: I cannot identify any group that is opposed to the basic principles of the outcome of this bill, other than the owner-operators of the machines.
Senator Joyal: On page 4 of your brief, it states that 54 per cent of the people that you polled in June 1998 were supportive of restricting VLTs to casinos. Did you ever measure the potential impact that that could have on the income in Alberta referred to on page 25, as well as in other statistics that I have from your ``Gambling in Canada'' special report of 2000. I quote your Canada West Foundation: ``Alberta is identified as raising $525 million for VLTs.'' If Parliament were to adopt the bill, could you give us an idea of the potential loss of income relative to that $525 million should VLTs be restricted to casinos in Alberta?
Mr. Azmier: That is a good question. I will introduce a point of clarity. Since 1998 when this activity occurred and we received a strong message, the government essentially filled the casinos with slot machines. There are now more slot machines in this country than there are VLTs — about 39,000 slot machines, and this is ongoing. At the time of the impact would be one answer. Then, it would have probably resulted in a shift of location and very little revenue change. Now, because the walls are filled to capacity with the machines, I think we would see some bars going out of the bar business and calling themselves gaming centres, rather than see any shift or movement to the casinos. The casinos are already fairly well stocked with electronic forms of gambling. At this time, the answer would be yes, it would have an impact if we were to get rid of the machines altogether because there was no place to put them. The Alberta government would introduce a secondary policy change, such as designating more locations as gaming establishments in order to retain those revenues. It is almost impossible to say what the outcome would be. There would still be options available to governments to keep their revenue streams flowing. There would be few options available to the hospitality industry to keep its revenue streams flowing. Governments have many means available to them for maintaining their revenues. I do not worry about governments based on what you are suggesting today.
Senator Joyal: This consideration is important because it would have an impact on the provinces.
Senator Milne: I want to come back to your first question, Senator Joyal, about the gender distribution on page 131 of the last portion of this. It says that there was near equal representation of males and females in each VLT gambler sub-type. On the next page, it also mentions ethnicity. The most revealing statistic in this category is the susceptibility of Aboriginals for experiencing a VLT-related gambling problem. Mind you the sample size was small at only 34 but of those 34, 29 per cent scored as a moderate risk and 38 per cent scored as problem gamblers.
Mr. Azmier: That would be about three times the level of other categories.
Senator Joyal: On the basis of your study, I want to commend the Canada West Foundation. I have seen other studies prepared by other professors. Mr. Garry Smith, Mr. Harold Wynne and Mr. Timothy Hartnagel prepared a study published in March 2003 for the Alberta Gaming Research Institute. I am sure you know the work well.
It seems to me that we are trying to understand the effect that the adoption of this bill could have on the provinces. According to your study on the reality of VLT gambling, if the machines were to be restricted to casinos, racetracks or specialized gambling locations, the impact would be minimum because gamblers would redirect their efforts to other places from the corner stores. That would incur minimum impact for the provinces.
Mr. Azmier: It is a manageable impact. Governments have other policy avenues available to them to address the changes. In 1998 in Alberta, for example, slot machines were introduced in the casinos and at the racetracks. In Ontario they were introduced at the race tracks. Other policy instruments are still available to the provinces that will not be affected by this.
Senator Cools: I would like to take the opportunity to thank Senator Lapointe for bringing forth this issue and creating this debate. My mental capacity has expanded on this matter.
I really feel good about that. I want to thank you for that.
My question relates to the phenomenon of addiction. I do not know if you can help me or give me some insights. At first, when I heard Senator Lapointe use the word ``addiction'' for gambling, I thought this word was being used in a descriptive, figurative way to give emphasis to the particular problem. Somewhere back in the mists of time, I remember studying addictions, and we were all taught at the time that an addiction is a particular phenomenon whereby a foreign substance becomes a part of the physiological function of the human body. The body physiologically begins to need that substance as it needs, for example, oxygen or natural processes. In other words, that foreign stuff became an enormous, natural part of the person's existence.
Now, listening to this debate, I have been understanding more vividly that this gambling thing is a form of compulsion. It seems to be something that can take over people's lives with great ease.
I am wondering if in your work at all you touch on these issues. What is it, really? Is it a physiological thing or a social phenomenon? At the end of the day, these behavioural compulsions, as driving and dangerous as they are, are still social behaviours.
Maybe you have not touched that, because this is the kind of thing that could preoccupy many scientists for a donkey's years. Could you tell us what is happening in those people when these kinds of drives take over their lives?
Mr. Azmier: Certainly, I understand you have had Dr. Jeffrey Derevensky and Dr. Rina Gupta here last year, probably speaking to a different committee and similar issues. They are experts on the topic. You are not far off the mark in your terms of addiction, but it is an internal chemical substance which we are looking at addressing. The chemical reaction associated with gambling play is serotonin and other chemicals that occur which a person becomes dependent upon receiving on a regular basis that is fueling this compulsion.
The actual terms that we use to define so-called problem gamblers seem to shift on a regular basis. The measures by which we identify them are worth knowing for your discussion. There are, of course, individuals who seek treatment from psychologists and others, and they can be identified as having an addiction. When we talk about numbers for Canada or Ontario or other provinces and how many problem gamblers there are, it is done by survey, using a questionnaire that has been replicated and proven to have some merits. It is often done by telephone. Individuals are called up and asked, Have you had this kind of problem, such as missing appointments, not spending time with family, or debt-related problems? Individuals answer a number of those types of questions, and the scoring is based on a certain number of questions they answer yes to that indicate a problem related to gambling.
The addiction side of it is probably being able to identify that this is a specific gambling problem. In talking about aggregate numbers, it is individuals who have a gambling problem and might also have a drug and alcohol problem or several other mental health issues contributing to it. We do not have the precision that scientists do when they treat an individual in front of them.
Senator Cools: The interesting thing about addictions is they often occur in combinations. For example, heavy smokers are quite often heavy drinkers.
Mr. Azmier: The same co-morbidity problems occur with gambling.
Senator Cools: On page 131, where you have laid out characteristics of the gambler, I notice that they are not young people, when I look at the demographic data by subtype under ``age.'' The gender does not surprise me. I know about that. I am surprised about the age. Most of them are older, not younger. They are not 25-year-olds. For the most part, they are over age 40.
Mr. Azmier: You have to look at two sets of numbers. One is who generally plays. That is one category of number, and then there is, who has problems with their level levels of play. That is a second category, and it tends to be a lower- income individual. I would use that with caution. Many of the questions that help classify problem gamblers are income-specific questions. They are likely to have debt problems if they have lower income levels. With higher incomes, they are less likely to have debt problems. They might still be playing too much of a particular game, but they are not likely to fall into the categories of description.
Senator Cools: Quite a few prosperous people go on junkets to Las Vegas, and they will not show up.
Coming back to the breakdown by country and income, I know it is low income. However, in a place like Alberta, is there any possibility that some of these results are related to the fact that Alberta still remains largely rural? It is still frontier in many ways because gambling, historically, was a frontier town's major entertainment, if you look back to the old Wild West. It is not quite a stereotype. For example, in remote communities, which are still frontier in a way, for example, Fort McMurray, do the rates get higher there?
Mr. Azmier: Northern Alberta is number one, right at the top, and Fort McMurray is up there. Individuals with higher income levels and less entertainment options tend to produce even twice as much revenue in some of those machines as elsewhere. Interestingly, Fort McMurray is one of the towns that voted the VLT machines out of their whole city, regardless of casinos.
Alberta has many unique things going on with it. I do not know if you have noticed that as Canadians. We certainly have. With the oil and gas industry itself, we have mused about how there is a general risk-taking behaviour associated with that province. It is not surprising to see it in its gambling activities. Digging holes in the ground looking for oil is a type of gamble in itself, and oil- and gas-industry workers tend to be some of the individuals that are playing at high levels.
Senator Cools: Many of those people live rugged and hard lives.
Mr. Azmier: Saskatchewan and Manitoba are also near the top in their play levels.
Senator Cools: It seems to me that Westerners or people in that area are coming out higher. There has to be an explanation. I am sympathetic to these blue-collar workers. They live rugged and hard lives. Thousands of them get killed every year in industrial accidents in this country, never mind the ones that are wounded and maimed. Two days ago I heard that in China 7,000 coal miners are killed a year. Maybe China has larger numbers.
It is interesting, and I thank you for that.
What you are doing for us is showing that there is a mine of information that points to needs for corrections that we did not know about. I am grateful for that.
Senator Eyton: I know something about the gaming industry and I like to gamble. The generalizations I have heard here this morning are simply not in my experience. It is a mix of everyone. Something over 90 per cent of Canadians gamble during the year on a regular basis, not at VLTs necessarily but by buying tickets or going to the casino, the racetracks or a whole variety of activities that are purely gaming.
Beyond that, there are a hundred ways in which ordinary people gamble. To characterize them as blue-collar, uninformed, rural or agricultural is just wrong. It is not so. I will take a bus and we will go over to the casino across the river and I will show you the mix of ordinary Canadians who are there for entertainment. I find the generalizations sweeping and simply wrong.
Second, I have always been curious about the Canada West Foundation and I know some of the founders very well. Mr. Jim Gray was always a strong supporter and would speak to me often about it. However, I always found it peculiar that the Canada West Foundation picked this particular topic when there are all sorts of habits and all kinds of things that people do with their time, their money and their bodies. On a scale, I would put the gaming problem down here, and smoking or alcohol or overeating or obesity, all of those things as way more significant. Yet the Canada West Foundation, a long time ago, because Mr. Gray talked to me about this probably 10 years ago, has pushed this cause. Therefore I am incredulous to say the least.
I have a couple of points. The provinces regulate the industry and regulate it carefully. There are tough requirements. There are policies for problem gamblers and that is so right across the country.
Surely, here we are in Ottawa, we have given that up to the provinces, but they are the experts in the industry. If we are going to do anything here it seems to me we have to hear clearly and precisely from the provincial authorities, who know the business and who have the day-to-day experience.
Why would we not do that? Why should this committee not consider that as an appropriate examination?
Second, there was a nice feeling here that by simply barring these machines that there would be alternatives and there would not be significant negative effects. I believe that has to be wrong. The reason they generate income is because people play them. They are used to it and they do it and it is part of their entertainment. It is part of their evening's occupation, if you will, and there may be problem gamblers but there are policies for that. Perhaps they are not perfect but there are policies in place. I am sure there are significant effects and we should understand that before doing anything with the bill.
Third — the other side of it — most people that I know who play these machines, whether in a casino or anywhere else, are there for entertainment. The numbers are such that the industry measures them by the win per day per machine, roughly speaking. In general in Canada, looking at all the different locations and jurisdictions, it runs between $35 to maybe $50 or $60 per gamer, or per episode if you will, per day. At $35, or let us say a median of $50, that is about what it costs to take a couple of people and go to a movie, park a car, get a bite to eat and go home. It is an alternative form of entertainment.
The last point I wanted to question was your suggestion that the only people against this bill would in fact be the industry and people involved directly in the industry. I think that must be wrong as well. We should hear from the industry and we should hear from ordinary people that we have tried to describe here this morning to get some idea of how they feel about it.
I have a feeling that this has snuck up on people. It is significant and has different effects than I have heard around the table here today. I wonder why this committee cannot talk to the provinces who have the expertise, talk to the industry of expertise, talk to some players who can give us a better understanding of why and how they do it and what the effects are. I have tried to boil it down to four points but, in general, I am incredulous about the general exercise.
The Chairman: We wrote a letter to different ministers to send people here or send us a brief to study.
Senator Eyton: We should not do it unless we hear from them. We should make sure we hear from them. These effects are very significant.
The Chairman: The letters have already been sent, Senator Eyton, and we will call them at the beginning of the week to ask them when they can appear before us.
Senator Cools: Quite often, and I know many chairmen who have done this, they write to the various Auditors General and they do not respond, or if they respond they do not come. The day seems to be over when they think they should come before these committees. I remember one particular occasion where they once told us they were dealing with departmental officials and they already knew where they were going. We should press hard on it because it would be nice to re-establish the fact that they should come to these committees.
The Chairman: That is what was written in the letter. I will give you a copy of the letter that was sent.
Mr. Azmier: Canada West Foundation, as you might be aware, has a board of directors which help determine the research. Mr. Gray was the chair at the time the research was undertaken and he convinced the board this was worthwhile. At that point, he grew as dissatisfied as perhaps others might be with the outcomes of the work because we did not take it in a direction that had any normative conclusions regarding good or bad. The bulk of our material is available for your consideration as to whether or not you would agree. Certainly Mr. Gray got the occasional pat on the back but did not want to be involved in influencing the outcome of the work.
The significant effects that the senator referenced — and there will be changes involved, particularly among the industry that is benefiting from the access — my point was that governments have other tools available and they will likely switch to alternate forms of gaming revenue, and have been doing so over the last 15 years on a regular basis. It is hard to say what the net effect will be. There will be some effect, nonetheless. It is a manageable impact.
The last point relates to the number of individuals that play at gaming on a regular basis that are not problem gamblers. I believe 97 per cent of the population is not having problems associated with gambling. That is what most of us would see on a regular basis when we go into the gaming establishments. It is the 3 or 4 per cent that are having the problem that much of the research is focused on, whether it derives from the Canada West Foundation or not.
[Translation]
Senator Lapointe: May I ask Senator Eyton some questions?
The Chairman: No, you have to direct your questions to Mr. Azmier. You can talk to Senator Eyton afterwards.
Senator Lapointe: Summing up, Mr. Azmier, I have only one question for you. Some topics, such as horse racing, do not interest me at all. As the Senator was saying, there are persons like him who enjoy going to the track. He takes the bus to Rideau Carleton Raceway to play the slots and bet on the horses. I do not have a problem with that.
The one problem that we have not focused on enough this morning — and this is not a criticism on my part — is the issue of accessibility and visibility. Gambling is a major draw for young people and seniors in our cities and towns. When the Senator says that the choice is his as to whether to spend $50 at the movies or $50 at the slot machines, that is his business. However, persons who are addicted to VLTs can spend an entire day glued to the screen. It is a matter of visibility and accessibility. There is no one to control or monitor the amount of time people spend playing these video lottery games. Players' actions are monitored at casinos, whereas there is no supervision in bars. If you want proof, just look at the number of young people who hang out in bars.
My question is as follows: Do you think that bars, which can be operated by some rather shady people, are law- abiding businesses?
[English]
Mr. Azmier: Are you asking me if I believe the laws are respected by the people?
The Chairman: By the bar owners.
Mr. Azmier: I apologize for my answer; however, this is not my area of expertise. If you are asking for my belief, yes, I do believe that they probably are respected by the bar owners. That does not mean that 100 per cent of the bar owners respect them. I simply do not have the knowledge. Researchers out there do suggest that the bar owners are not agreeing with it, but it is not something I have studied.
You mentioned that the accessibility and visibility question has not been addressed enough. What specifically draws an individual to a VLT is not something that the Canada West Foundation or I have spoken to. I can summarize some of the other work available and provide you with copies of the work available, but I would certainly ask you to explore it further. All I know is one of the factors in consideration of the problem. Individuals that are trying to avoid gambling can get self-exclusions from casinos but not from bars or VLTs. They are the individuals, and you probably have met them as well as I have, that the family members or the survivors of suicides have spoken to about the problem, saying, There was no way I could get self-excluded from a bar, so I kept going there for my activity. Those are the only personal experiences I have had that I can speak to.
Senator Joyal: Can you inform us of the kind of initiative you took to bring your conclusions to the Government of Alberta, or should I presume that the Government of Alberta is aware of the work you do?
Mr. Azmier: We have distributed all our reports to all the governments on an ongoing basis and have done a number of presentations.
Because of our desire to bring information forward, and also because of our desire to maintain charitable status as an organization, we did not get into advocacy on this topic. Information was provided to the various anti- and pro- gambling groups for their use to help bring forward ideas. If anything, we have been disappointed in the fact that we did not take that next step, but other individuals motivated by the work we are doing take the ideas forward and present them sometimes as their own and sometimes as our work. It was not necessarily done to change policy; it was done to inform policy on a particular topic. That is the work we undertook and something we held to specifically. If you look at the conclusions, they do get into policy changes that we think are needed, but we did not go beyond any other normal approaches of our work by trying to take that to the next level. I have not met with a single gaming minister. We sent the information, and they responded, through the media, mostly, with their issues. There are a number of things in here for the federal government and the Department of Justice. We have asked them to do an annual review or the national study that other countries have done. We would like the Department of Justice to do that, because they are in receipt of revenues for gaming activity. You know about the transfer that the federal government is in receipt of. We would like to see a review on that part, but that is the extent of our work.
Senator Eyton: I recognize there are problems in governance and regulation. In fact, we are concerned about minors and those who happen to be addicted, which, as you pointed out, is a very small minority. Do you think it is possible, rather than barring the machines themselves, to formulate some better structure or regulation so that, in fact, as they do with liquor and as they do with a variety of other activities, we can deal with the problem as it relates to minors and addicted gamers?
Mr. Azmier: Yes. I believe that is what your legislation is trying to do. It is not trying to get rid of all gaming activity or bar the machines. It is looking to move them into a place where they could do a better job of regulating play. That is my understanding.
Senator Eyton: You are suggesting that it be restricted to racetracks and casinos. There are a limited number of those and they are not within easy reach of most of the population. I know the Ontario experience in particular. Northern Ontario would be largely excluded. There are a few smaller casinos in Northern Ontario; six in total in the province.
Can you imagine the structure where the owners of premises who are not racetrack operators or casino operators could in fact attend to the challenge of supervising minors and addicted gamers?
Mr. Azmier: Yes, I certainly can see that happening, and I think that was Senator Lapointe's question about whether I believe this was being done. I do not know about the law and whether it is being properly upheld. The premises are supposed to be restricted, and most of my experience is, observationally only, that there is not a youth problem in the places I have been to. I have not spent any time in Quebec looking at that activity. There will be secondary options besides racetracks and casinos, and they probably will be things I have seen elsewhere. Some establishments could turn into gaming-only establishments as well, designated as such. I am sure they wish to maintain the gaming-type revenues. I am not sure this is permitted under the legislation, but that is something that I could see as possible.
Senator Joyal: I have a supplementary on the last question and answer. As I understand the amendment we are considering, the video poker would be restricted to casino, racecourse or a betting theatre referred to in section 204(8)(e) of the Criminal Code, and when you look at what is a betting theatre, it is a location:
authorizing pari-mutuel betting and governing the conditions for pari-mutuel betting, including the granting of licences therefore, that is conducted by an association in a betting theatre owned or leased by the association in a province in which the Lieutenant Governor in Council, or such other person or authority in the province as may be specified ... has issued a licence ...
In other words, it is a licensing place. In other words, even if there were no casino and racetrack, and racetracks are becoming rare now in Canada, the government of the province can license a theatre that is ''a place'' where betting activities can take place. It is not the total ban of accessibility in various regions where there is no casino or theatre. That is the way I understood Senator Lapointe's intention, if I may add a point of information for Senator Eyton.
The Chairman: If there are no further questions, senators, we will adjourn the meeting today, and we will meet again next Wednesday.
The committee adjourned.