1. ECONOMIC IMPACT OF LEGALISED GAMBLING IN SOUTH AFRICA, SINCE 1994 NATIONAL GAMBLING BOARD

2. OBJECTIVES  COMMUNITY ATTITUDES AND PARTICIPATION IN GAMBLING  IMPACT OF GAMBLING ON H/H WELFARE LEVELS  GAMBLING’S CONTRIBUTION TO SA’S ECONOMY  INTERNATIONAL COMPARISONS

3. METHODOLOGY: SURVEY SAMPLE  Telephone interviews : 1 000  Personal interviews : 1 050  Total : 2 050

4. PERSONAL VIEWS ON GAMBLING

5. REASONS FOR NON -PARTICIPATION

6. PARTICIPATION IN GAMBLING BY MODE

7. GAMBLING FREQUENCY BY MODE

8. GAMBLING AS A LEISURE ACTIVITY FOR SOUTH AFRICANS

9. PARTICIPATION RATES OF LESS AFFLUENT % Share in: Lottery Casinos  Unemployed 27,2 22,1  <R6 000 income per annum 23,3 21,2  No formal schooling 3,5 3,0

10. EXPENDITURE ON GAMBLING

11. IMPACT OF GAMBLING ON HOUSEHOLD WELFARE LEVELS OBJECTIVE:  Propensity to gamble  Expenditure displacement  Impact on retail sales

12. 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 %

13. PROPENSITY BY MODE: 2001 Propensity Per R100 gambled Casino 0,91 % R70 Bingo 0,002 % 15c Horse betting 0,20 % R15 Lottery 0,19 % R15 Total 1,30 % R100

14. INCREASE (1975 – 2000): Education+ 324 % Health + 244 % Communication + 201 % EXPENDITURE DISPLACEMENT CHANGES IN H/H EXPENDITURE CPI WEIGHTS: SERVICES  GOODS  DECREASE: Reading matter -65 % Clothing & Footwear -63 % Furniture -58 % Cigarettes & tobacco -33 %

15. Retail spending on goods Expenditure on services Other forms of gambling Savings EXPENDITURE DISPLACEMENT SUBSTITUTION CAN BE EFFECTED FROM:

16.  Household necessities  Dissavings  Postponement in procuring luxury items  Other entertainment IMPORTANT DISPLACEMENT ITEMS

17.  Decline in savings  Increase in household income  Displacement from other items Only latter will impact on existing retailers IMPACT ON RETAIL OUTLETS GAMBLING EXPENDITURE IS SOURCED FROM:

18. Initial or direct impact + indirect impact + induced impact GAMBLING SECTOR’S CONTRIBUTION TO SA’S ECONOMY TOTAL ECONOMIC IMPACT IS:

19.  Initial impact = R3,0 billion  Indirect and induced = R6,1 billion  Total impact = R9,1 billion GDP CONTRIBUTION: 2000

20.  INITIAL IMPACT = 0,38 % OF GDP  TOTAL IMPACT = 1,13 % OF GDP  PROVINCES: - High population concentrations : 0,5% - 0,75% - Rural-oriented provinces : 0,25% - 0,5% GDP CONTRIBUTION OF GAMBLING SECTOR: 2000

21. DISTRIBUTION BY PROVINCE: Gauteng53,5 % Free State 0,3 % Western Cape18,0 % Limpopo <0,1 % KwaZulu-Natal11,4 % Eastern Cape 5,9 % North West 5,5 % Mpumalanga 5,0 % Northern Cape 0,4 % CONTRIBUTION TO CAPITAL INVESTMENT 1997-2000 = R10,1 billion Contribution to SA fixed investment = 2,1 %

22. Gauteng40,5 % North West20,6 % Western Cape10,9 % KwaZulu-Natal 9,8 % Eastern Cape 8,5 % Mpumalanga 4,2 % Free State 2,9 % Limpopo 1,8 % Northern Cape 0,9 % DIRECT EMPLOYMENT DISTRIBUTION BY PROVINCE, 2000

23. CONTRIBUTION TO EMPLOYMENT, 2000   Direct employment 16 103   Indirect and induced 34 570   Total 50 673   REPRESENTS 1,1 % OF FORMAL SA JOBS (2000)

24. EMPLOYMENT BY RACE (INITIAL)

25. 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 %

26. SA IN SADC : GROSS GAMING YIELD (GGY) SA contribution  Gross casino yield 73,9 %  Lottery 89,1 %  All modes : GGY 76,0 %

27. 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

28. PROPENSITY TO GAMBLE SOUTH AFRICA 2001 : 1,30 % (GNI = $3 020) 2002 : +1,90 % N/A USA 0,6 % (GNI = $34 100) NEW ZEALAND 1,04 % (GNI = $12 990) AUSTRALIA 3,10 % (GNI = $20 240)

29. GAMBLING ATTITUDES USA VS. SA

30. 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