Productivity Commission – Inquiry into Gambling Supplementary Submission C. Livingstone 1 and R. Woolley 2 1 Department of Health Social Science, Monash University 2 Centre for Industry and Innovation Studies, University of Western Sydney Introduction Our attention has been drawn to criticism of aspects of our article ‘Risky Business: a few provocations on the regulation of electronic gaming machines’ (Livingstone & Woolley 2007) in a submission to the present inquiry by Clubs Australia, notably that contained at pp. 87-92 of Submission No. 164. This submission will briefly address the criticisms set out at pp 87-92 of the Clubs Australia submission. We have also identified some other estimates of the proportion of EGM expenditure attributable to problem gamblers. Core elements of the Clubs Australia critique The Clubs Australia critique of ‘Risky Business’ focuses on our calculation of the proportion of EGM revenue attributable to problem and at risk gamblers. Clubs Australia’s principal arguments appear, in essence, to be as follows: 1. We failed to account for the expenditure of low and no-risk gamblers in our calculation of EGM expenditure, thus by implication significantly over- estimating total EGM expenditure; 2. The prevalence estimates generated by the 2003 Victorian prevalence study (CGR 2004) (which also incorporated a validation study for the newly developed Victorian Gambling Screen, or VGS) were inaccurate and unreliable because of small sample sizes and poor study design; and 3. The Caraniche data utilised to provide estimates of gambler expenditure were based on an opportunistic sample and were therefore not representative of Victorian EGM users. The balance of this submission addresses these issues. Response to the Clubs Australia critique 1. We failed to account for the expenditure of low and no-risk gamblers in our calculation of EGM expenditure, thus by implication significantly over- estimating total EGM expenditure Clubs Australia’s criticism of our calculations rests on the assumption that by failing to account for the expenditure of non-problem (i.e., low risk or no-risk gamblers) we ignored the substantial expenditure of that group, and that by doing so we inflated the aggregate expenditure of EGM users by 2.3 times the actual amount.