It’s never hard to find a government agency wanting to rain on someone’s parade. The news that office sweepstakes on the Melbourne Cup could attract a $1,000 fine from the Department of Internal Affairs almost made me spit out my coffee this morning.

However, the Department of Internal Affairs warns that office sweepstake prize money cannot exceed $500 and those who breach the rules could face the long arm of the law.

This means tickets for the 24-horse race can cost no more than $20.83, according to a spokesman.

Any money raised must be returned as prizes and no one is allowed to profit from organising the sweepstake.

Violating these regulations could incur a fine of up to $1000.

Source: http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10845375

Has the Department of Internal Affairs ever considered that regulating gambling simply raises the cost of “problem gambling”?

Most Melbourne Cup office sweepstakes are an innocent little flutter. They have nothing in common with feeding $500 into a poker machine or spending all night playing blackjack without an edge.

The lower level of competition in the gaming industry means that occasional gamblers will look towards alternative options, including office sweepstakes. If it’s easier to organise an office sweepstake than go down to the TAB it means the odds at the TAB either aren’t good enough or aren’t advertised well enough for occasional gamblers.

By cracking down on naughty middle class office sweepstakes the Department of Internal Affairs is not only propping up the NZ Racing Board monopoly but raising the cost of gambling – more competition in gambling would lead to more competitive odds and thus lower the cost of gambling alongside lowering the cost of problem gambling.

It is also amusing that the Department of Internal Affairs has never considered the level of the fine. If the fine is only $1,000 that’s hardly an incentive against running an office sweepstake with prizes of greater than $500. If the expected profits to the promoter are greater than that, with a low probability that a random Internal Affairs inspector shows up, then it’s a rational crime under Gary Becker’s model.

I wish that New Zealand would bring back the bookies. The impersonal nature of online betting through the TAB is nowhere near as enjoyable as going to the races in Aussie and having a yarn with a quick witted bookie at Randwick or Rosehill Gardens. Who would bother with an office sweepstake when you can go to a race day event with a proper bookie?

 

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