Transcript by the National Gambling Board

ECONOMIC IMPACT OF
LEGALISED GAMBLING IN
SOUTH AFRICA, SINCE 1994
NATIONAL GAMBLING
BOARD
OBJECTIVES

COMMUNITY ATTITUDES AND
PARTICIPATION IN GAMBLING

IMPACT OF GAMBLING ON H/H
WELFARE LEVELS

GAMBLING’S CONTRIBUTION TO
SA’S ECONOMY

INTERNATIONAL COMPARISONS
METHODOLOGY:
SURVEY SAMPLE

Telephone interviews
: 1 000

Personal interviews
: 1 050

Total
: 2 050
PERSONAL VIEWS ON GAMBLING
Not acceptable
to me but have
no objections to
gambling by
others
14.8%
Acceptable to
me
73.0%
Not acceptable
to me
12.2%
REASONS FOR
NON -PARTICIPATION
Don't gamble at all
32.8
Lack of money
29.7
Against religious
beliefs
21.9
No access to gambling
facilities
0.8
Other
14.8
0
10
20
Percentage
30
40
PARTICIPATION IN GAMBLING
BY MODE
National lottery
71.3
Casino gambling
19.3
Horse betting
15.3
Sports
2.3
Bingo
7.2
Internet/On-line gambling
0.6
Other
2.4
None of the above
27.5
0
20
40
Percentage
60
80
GAMBLING FREQUENCY BY
MODE
70
64.1
60.5
60
53.4
50
40
30
24.5
20.8
21.5
20
11.1
10
9.2
8.5
3.3 4
6.3
5.4
Monthly
Less often
0.8
0
0
Daily
0
Weekly
Casinos
0
Twice weekly
Lottery
0
Fortnightly
Horseracing
GAMBLING AS A LEISURE
ACTIVITY FOR SOUTH AFRICANS
60
52.2
50
44.6
40
33.0
30
24.0
23.8
Can't say
Disagree
22.4
20
10
0
Yes
Casinos
Horseracing
PARTICIPATION RATES OF LESS
AFFLUENT
% Share in:
Lottery Casinos

Unemployed

<R6 000 income per
annum

No formal schooling
27,2
22,1
23,3
21,2
3,5
3,0
EXPENDITURE ON GAMBLING
60
57.1
50
40
30.5
30
20
9.1
10
2.1
0.9
0.3
0.1
0
%
Less than
R50
R51-R150
R151-R300 R301-R500
R501R1000
R1001R2000
More than
R2000
IMPACT OF GAMBLING ON
HOUSEHOLD WELFARE LEVELS
OBJECTIVE:

Propensity to gamble

Expenditure displacement

Impact on retail sales
PROPENSITY TO GAMBLE
(Def: % of h/h expenditure allocated to gambling =
total spend - prizes)
Propensity 2001
= 1,30 %
= R6,8 billion
Propensity 2002
= 1,90 % (Estimate)
= R10,6 billion
Growth 2001 – 2002 = 46 %
PROPENSITY BY MODE: 2001
Casino
Bingo
Horse betting
Lottery
Total
Propensity
0,91 %
0,002 %
0,20 %
0,19 %
1,30 %
Per R100 gambled
R70
15c
R15
R15
R100
EXPENDITURE DISPLACEMENT
CHANGES IN H/H EXPENDITURE
CPI WEIGHTS: SERVICES GOODS
INCREASE (1975 – 2000):
• Education
+ 324 %
• Health
+ 244 %
• Communication
+ 201 %
DECREASE:
• Reading matter
• Clothing & Footwear
• Furniture
• Cigarettes & tobacco
-65 %
-63 %
-58 %
-33 %
EXPENDITURE DISPLACEMENT
SUBSTITUTION CAN BE EFFECTED
FROM:
•
•
•
•
Retail spending on goods
Expenditure on services
Other forms of gambling
Savings
IMPORTANT DISPLACEMENT
ITEMS




Household necessities
Dissavings
Postponement in procuring luxury items
Other entertainment
IMPACT ON RETAIL OUTLETS
GAMBLING EXPENDITURE IS
SOURCED FROM:



Decline in savings
Increase in household income
Displacement from other items
Only latter will impact on existing
retailers
GAMBLING SECTOR’S
CONTRIBUTION TO SA’S
ECONOMY
TOTAL ECONOMIC IMPACT IS:
Initial or direct impact
+
indirect impact
+
induced impact
GDP CONTRIBUTION: 2000


Initial impact
Indirect and induced
= R3,0 billion
= R6,1 billion

Total impact
= R9,1 billion
GDP CONTRIBUTION OF
GAMBLING SECTOR: 2000


INITIAL IMPACT
TOTAL IMPACT

PROVINCES:
- High population concentrations : 0,5% - 0,75%
- Rural-oriented provinces
: 0,25% - 0,5%
= 0,38 % OF GDP
= 1,13 % OF GDP
CONTRIBUTION TO CAPITAL
INVESTMENT
• 1997-2000 = R10,1 billion
• Contribution to SA fixed investment = 2,1 %
DISTRIBUTION BY PROVINCE:
•
•
•
•
•
•
•
Gauteng
Western Cape
KwaZulu-Natal
Eastern Cape
North West
Mpumalanga
Northern Cape
53,5 %
18,0 %
11,4 %
5,9 %
5,5 %
5,0 %
0,4 %
•
•
Free State
Limpopo
0,3 %
<0,1 %
DIRECT EMPLOYMENT
DISTRIBUTION BY PROVINCE, 2000
•
•
•
•
•
•
•
•
•
Gauteng
North West
Western Cape
KwaZulu-Natal
Eastern Cape
Mpumalanga
Free State
Limpopo
Northern Cape
40,5 %
20,6 %
10,9 %
9,8 %
8,5 %
4,2 %
2,9 %
1,8 %
0,9 %
CONTRIBUTION TO
EMPLOYMENT, 2000
 Direct employment
 Indirect and induced
 Total
16 103
34 570
50 673
 REPRESENTS 1,1 % OF FORMAL SA JOBS (2000)
EMPLOYMENT BY RACE
(INITIAL)
63.8
70
60
50
%
40
23.7
30
9.5
20
3
10
0
Africans
Whites
Coloureds
Asians
COMPARISONS WITH
INTERNATIONAL JURISDICTIONS
SA IN SADC: GROSS GAMING
TURNOVER (GGT)
SA contribution

Gross casino turnover
84,4 %

Lottery
88,6 %

All modes : GGT
78,5 %
SA IN SADC :
GROSS GAMING YIELD (GGY)
SA contribution

Gross casino yield
73,9 %

Lottery
89,1 %

All modes : GGY
76,0 %
RATINGS OF SOUTH AFRICA’S
GAMBLING POSITION
World Ranking (2000)
GNI/capita
91
GGT/capita
28
GGY/capita
38
GCY/capita
17
Lottery sales/capita
46
PROPENSITY TO GAMBLE
SOUTH AFRICA 2001 :
2002 :
1,30 % (GNI = $3 020)
+1,90 %
N/A
USA
0,6 % (GNI = $34 100)
NEW ZEALAND
1,04 % (GNI = $12 990)
AUSTRALIA
3,10 % (GNI = $20 240)
GAMBLING ATTITUDES
USA VS. SA
80
73.0
70
60
51.0
50
40
28.0
30
20
14.8
12.2
16.0
10
0.0
5.0
0
Acceptable
Ok for others
SA
Unaccepatable
USA
Refused
CONCLUSION
It is probably safe to conclude that SA portrays a
relatively vibrant gambling sector making it one of the
countries with the highest propensities to gamble.
This becomes more problematic in view of SA’s relatively
low income per capita:
USA 11 x SA
Australia 7 x SA
New Zealand 4 x SA