Online gambling advertising is set to be banned within three years after a Parliamentary report recommended sweeping changes that would apply a ‘public health lens’ to an industry that extracts $25 billion from Australians who lead the world in gambling losses.

The government should implement a “comprehensive national strategy” to manage online gambling advertising, including a “phased, comprehensive ban”, the Standing Committee on Social Policy and Legal Affairs Inquiry into Online Gambling and Its Impacts on Those Experiencing Gambling Harm advised.

Recognising the growing social and financial harm of widespread online gambling and simulated gambling in other media, the inquiry offered 31 recommendations anchored by the establishment of a central national online gambling regulator “with the sole purpose of reducing harm”.

Data factors heavily in the recommendations, which include the provision of de-identified customer data to support “approved researchers”, establishment of a national clearinghouse for gambling research, and the creation of a ‘data vault’ system that provides real-time operator data to the regulator and researchers.

Australian banks and payment system providers would be engaged to crack down on transactions to known illegal gambling operators, while technological blocks would isolate offshore gambling websites and illegal gambling operators.

The report also suggests that wagering service providers (WSPs) be required to apply a “standard behavioural algorithm to reduce online gambling harm” – suggesting that potentially vulnerable punters would be proactively identified and engaged.

These and other recommendations underscore a national strategy for online gambling harm reduction that should, the report recommends, “be based on public health principles” and aim to prevent gambling harm from occurring; intervene early when there is risk of harm; and provide appropriate treatment and support for those experiencing harm.

“Australians lose the most to online gambling because we have a weak and fragmented regulatory framework, which places all the onus for reducing harm onto the person who gambles,” committee chair Peta Murphy said in introducing the new report, entitled You Win Some, You Lose More.

“Online gambling is unlike other forms of entertainment because of its potential to cause psychological, health, relationship, legal and financial harm to individuals and those around them,” she said, noting that gambling often progresses to become a behavioural addiction and is also a “key risk factor for suicide”.

“Harmful industries have shown they will identify and capitalise on any gaps in marketing restrictions and that they are taking advantage of the less regulated online environment,” Murphy said, flagging an “inescapable” flood of online gambling that has been “strategically marketed along sport” to manipulate an “impressionable and vulnerable audience” into thinking that sports and gambling are “inextricably linked”.

Targeting the root causes of pervasive gambling

The percentage of Australians participating in online gambling increased from 12.6 per cent in 2010 to 30.7 per cent in 2019, the report notes, with $25 billion in losses recorded annually – the highest per-capita spend on legal gambling in the world.

The Albanese government will consider the recommendations, which come after months of work to better understand the online gambling environment – including implementing National Consumer Protection Framework (NCPF) measures including a ban on use of credit cards for online wagering; updated anti-gambling messaging; and the impending launch of a national self-exclusion register called BetStop.

The report also recommends a crackdown on gambling-like activity built into interactive games including social casino games, ‘skin betting’ of in-game items, and the ‘loot boxes’ found in nearly 60 per cent of the games on Apple and Google app stores.

Such games are popular among young Australians, the report notes, with up to 40 per cent of adolescents reporting gambling in digital games last year and 36.5 per cent of teenagers saying they had purchased loot boxes.

Mooted remedies include spending controls, transparent odds and drop rates for items, and the disabling of algorithmic loot box features that would be required to be configured on an opt-in basis.

The National Classification Scheme would be applied to games from online app stores, with those featuring simulated gambling subject to a warning label.

“Some interactive games can share striking similarities with monetised forms of gambling,” the report says, noting research that links simulated gambling as an adolescent with real gambling once those adolescents reach adulthood.

“The development of addictive behaviours early in life can be a precursor for other addictive behaviours to develop later.”