Critics sound alarm over online gambling as Halifax casino revenues dwindle
The province is considering online casino-style gambling at the same time the physical casino is losing cash
Critics of the gambling industry say they're concerned about a recent move toward online gambling, especially in light of the Halifax casino's uncertain future.
Elizabeth Stephen, a counselling therapist who works with people with gambling addictions, said news that the Nova Scotia government has cleared the way for online casino-style gambling is "pretty significant."
"What's behind that?" said Stephen. "Is it because the physical casino is in such decline and perhaps is even going to close down? Is it to replace that revenue?"
The Nova Scotia Gaming Corporation, the Crown corporation that oversees the gaming business, released documents to CBC News showing the Halifax casino has struggled with declining and unsustainable revenues for approximately 15 years — even before the arrival of COVID-19.
The documents raise the possibility of moving the casino away from its waterfront location, but the corporation said those decisions are on hold during the pandemic.
"My sense is that the government is looking for alternative revenue streams, hence the talk about the online casino," said Bruce Dienes, chair of Gambling Risk Informed Nova Scotia (GRINS), a non-profit that aims to reduce gambling harms.
"The problem with that, of course, is if you want to go to a brick-and-mortar casino, you have to actually go to a brick-and-mortar casino. You have to really intentionally do that, you have to be there for a certain piece of time.
"Online, if you've got a phone or if you've got any internet connection, 24/7 you're at risk of being impacted negatively by that casino."
'Two very different offerings'
Officials with the Atlantic Lottery Corporation have said establishing an online casino is necessary to try to counteract the growing popularity of offshore websites. It has said about $100 million a year leaves Atlantic Canada through gambling on offshore websites that have few safeguards.
Bob MacKinnon, the Nova Scotia Gaming Corporation's CEO, said there are similarities in the gambling that takes place in a physical casino and online.
"I think it is possible that some of the casino business that we would have had at the Halifax casino has gone online. There's no way for us to know an exact number," he said.
"But I'll also add that generally over the longer term, we would think of them as two very different offerings: that some people like to go online, and many people like to go for a broader entertainment experience where there's music, there's food, there's shows going on, in addition to the gaming offerings."
Stephen said the people she treats in her practice often start gambling in a physical casino, but later move to other venues, such as bars with video lottery terminals.
"I think [casinos] are the foundation in some places for the start of gambling, and the kind of glamour of gambling and the excitement of gambling," she said.
Stephen said most people who come to her with gambling addictions have become addicted to VLTs, although a few have been addicted to table games such as poker or blackjack.
"They get to the point where they're spending way too much time there and more money than they can afford to lose. And so often their first step is to exclude themselves from the casino. Often, though, they don't do that until they maybe have reached bankruptcy," she said.
Falling revenues
The Halifax casino hit peak revenue of about $75 million in 2006-07, which fell to about $54 million in 2014-15 — a drop of about 30 per cent that MacKinnon said was not sustainable.
Visitation during the pandemic is down 90 per cent, and MacKinnon said it's believed the Halifax casino will make about $9 million this year.
The casino in Sydney, N.S., failed to meet its revenue and visitation targets for the two years leading up to the pandemic. In 2018-19, the Nova Scotia Gaming Corporation hoped the Cape Breton casino would have revenue of $22.1 million from at least 410,000 visitors. Instead, it brought in $19.5 million from 372,000 visitors.
In 2019-20, its targets were $19.2 million in revenue and 410,000 visitors, but it ended up with $18.8 million from 344,806 visitors.
Dienes said it shows a need for the province to move on from the gambling business, which was legalized in Nova Scotia in 1995.
"Here is a business model that's failing, that isn't meeting the needs of the customers. And rather than acknowledging that and moving on to a different kind of business — a different way to entertain, a different way to raise funds — they're trying to increase the risk and increase the access for something that people clearly don't want," he said.
Dienes said gambling is "psychologically manipulative" and he disagrees with the government's stance that online gambling can be done safely.
"This is something that's been created by government policy," he said.
High-stakes bets
Will Shead, an associate professor of psychology who primarily researches gambling, said he's doubtful that limitations can be placed on online gambling that would keep people safe.
"We don't really know what effect this is going to have on people. You can make arguments and say this is how it's going to work, but it could potentially be disastrous for people to have access to such high betting limits online," said Shead, who teaches at Mount Saint Vincent University in Halifax.
Shead is also a board member of Gambling Risk Informed Nova Scotia, whose members are particularly concerned about high-stakes wagers online that could lead a gambler to lose thousands of dollars per hour.
The Nova Scotia Gaming Corporation has said the online casino would include age and residency verification, privacy controls, self-exclusion options, deposit limits, time displays, analytics on player activity and information about responsible gambling.
But Shead said he's concerned about young people finding ways to get around age checks, and about research that shows people are more likely to use drugs and alcohol while gambling online.
In a physical casino, people are not supposed to be allowed to gamble while impaired, he said. According to its code of conduct, Casino Nova Scotia will refuse entry to someone who is impaired by alcohol or drugs.
"I'm not sure if that happens all the time," said Shead, "but it's certainly not going to happen in the confines of your own home."
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