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April 15, 1999
Community Services
Standing Committees
Meeting topics: 
Community Services -- Thur., Apr. 15, 1999

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HALIFAX, THURSDAY, APRIL 15, 1999

STANDING COMMITTEE ON COMMUNITY SERVICES

1:00 P.M.

CHAIR

Ms. Maureen MacDonald

MADAM CHAIR: Let's call the committee to order. You have your agenda in front of you. We are here to once again hear from Porter Dillon Limited and Sterling Research Incorporated. I think probably we will look at the final report.

MR. CHARLES MACDONALD: Madam Chair, before we start, can I say a few words?

MADAM CHAIR: Certainly.

MR. CHARLES MACDONALD: It is in both the first report and now it is in the second report, I see today. It goes to the Act to impose a moratorium. In both reports . . .

MADAM CHAIR: What page are you looking at?

MR. CHARLES MACDONALD: Page 2 on the original one we got, ". . . commits to a study to provide information on which to base a decision to further restrict or ban the machines.". That is entirely out of line with what is in the Act. It is nowhere close to what the Act says. We are following this, it seems to set the tone for what we are doing in this study and it is totally contrary to what we have in the Act.

MADAM CHAIR: I think what we should do is table your concern for full discussion . . .

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MR. CHARLES MACDONALD: We have a basic discussion with the methodology and what they attempted to do in this process. What you have in the Act, if we read the Act, in no way is it set to restrict or to ban. It is not the understanding of the Act, nor is it the intent of the Act. For this group to sit down here and give us a study, or two of them now, one on top of the other, based on that fundamental premise totally throws the basis of this. This is not worth the paper it is printed on at the present time.

MADAM CHAIR: Well, Mr. [Charles] MacDonald, let's table that concern until we hear from the consultants and the committee can have a discussion with respect to that, because your interpretation of the Act may not necessarily be the interpretation of all members of the committee.

MR. CHARLES MACDONALD: It is an Act of the House, not an Act of this committee.

MADAM CHAIR: I have made my ruling. We will have this discussion and we will proceed with the agenda. Thank you.

MR. CHARLES MACDONALD: Thank you for the time.

MADAM CHAIR: I would like to welcome you back. We will start with Mr. Heseltine bringing us through the update.

MR. JOHN HESELTINE: We don't have any particularly elaborate presentation today. Last time we met, we presented a report which I think I would describe as next to final. All we indicated was that there were some loose ends to tie up and we tried to do that.

I guess among the things that we have done is to add an executive summary to the report. In relation to that - and I am willing to respond to the committee's comments on this - we have put the conclusions in the executive summary as opposed to and in fact, we deleted the sixth chapter. Recognizing that all along we have indicated that our purpose here was to provide information and not to recommend to the committee a particular course of action.

We also expanded some of the discussion in Chapter 3 with respect to pros and cons of VLTs. We had some earlier interviewing material that was not entirely incorporated in that chapter in the previous version, so we added some of the insights that we gained from those interviews on both sides with respect to both the pros and the cons.

The other information that we have added, I have provided the overheads that we had last time with one additional overhead. I thought that giving that overheard presentation again would just give the structure of our report fairly quickly. This is a summary really of the additional material that we added to Chapter 5. What we have done is to add some detail about the specifics of economic costs in terms of lost productivity. So, there is a group of

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VLT players who are problem players and it can be assumed from testimony and research that there is some loss of productivity in the workplace and in other respects with respect to their difficulties with VLTs.

There is also some assertion with respect to bankruptcy. The Focal survey has indicated that problem players are more prone to be in debt and so on. So, we have included some discussion with respect to the potential to determine the incidence of bankruptcy within that group. We have also discussed, at some length, the issue of rehabilitation.

Furthermore, in that section, we have added some further discussion on the possible impact on illegal distributors. The focus groups that we had indicated that many problem VLT players, in particular, in the event VLTs were banned or made illegal, would probably turn to illegal operations which were in place in the province before legalization, and that First Nations reserves were another alternative identified for VLT gaming. There is also a reasonable basis, in the information, to assume that there will some shift to other forms of gaming such as the casinos, charitable gaming, perhaps, to harness racing and other existing options that are legal and would continue to be legal.

Finally, we have retained pretty much the discussion that we previously had in the report with respect to licensed establishments and recognizing the fact that they will be the group most negatively affected, in the private sector at least, in the event that steps are taken to restrict or ban VLTs. I would add that through the course of this discussion, we are simply trying to outline what the likely consequences are of particular courses of action and we are not recommending any particular course of action to the committee or the Legislature.

The report has been with the committee for some time and there has been discussion in the media. We have been contacted by several of the related agencies and had some discussions with them. We have tried to respond to some comments that we received from the Gaming Corporation and from the authority. At this point, our primary interest would be to get additional comments from the committee that we can respond to with respect to either the facts or the interpretations that are in the report as we presented it previously.

Finally, what we circulated today is a new draft final report. It does have this additional information and in some places, where we identified either problems with the wording or problems with the facts, we have tried to improve it. However, substantively, it is quite similar to the preceding report. So, we are open to questions.

MADAM CHAIR: Thank you. The floor is open for questions now. We will divide the time again as we have done previously. I will keep a speakers' list and the time.

Mr. Montgomery.

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MR. LAWRENCE MONTGOMERY: I think the same as my colleague. I don't think that it is our mandate to suggest what, in actual fact, will take place. It is pretty hard to talk about the report we just received, but in terms of the last paragraph on Page 2, "In particular, we have assessed the likely impacts of changes that would reduce or eliminate VLTs as contemplated by Bill 17.".

I don't think that that is our mandate. Further to that, if you turn to Page 19, I don't think that these are all of the options that are pointed out in the second paragraph, " further reduction . . . modification of VLT . . . methods to limit VLT . . . public education . . .".

Indeed, not that we are advocating endorsing other options, but there could be other options such as lifting the moratorium. So, I think that the scope of the bill, that the bill has suggested for the study, I don't think that it ties in with our mandate.

MADAM CHAIR: Are you suggesting an itemizing of further options on Page 19 of the previous draft that we had received this summary report for the consultants to be included? If so, that is probably a helpful thing to . . .

MR. MONTGOMERY: I am referring to Page 2 where it indicates that the bill does not contemplate reduction or elimination of VLTs. Nothing is said in that bill to refer to it. The study is to be a socio-economic impact of video lottery terminals in the province within six months.

MADAM CHAIR: I would like to hear from other members of the committee with respect to that.

Mr. Pye.

MR. JERRY PYE: First of all, Madam Chair, I am not going to comment to that directly, but I want to go to our handout, the Socioeconomic Impact of Video Lottery Terminals. On the very first page, Changing the Environment, I did ask some questions with respect to the change in the environment of eliminating, I should not say eliminating, but reducing the amount of prize pay-out, along with restricting the amount of credits that can be played at a particular time on the VLT machines. I don't see that in any new changes there or if there have been any changes.

Most recently another item has come to my attention, under Changing the Environment, and I think we should recommend a ban of all ATMs or credit card debit machines from facilities where VLTs are located.

The reason why I say that is simply because yesterday I heard from one of the proprietors in the business that people actually sell ATMs to these proprietors. They are constantly getting calls sometimes as high as 10 a day to have ATMs located in their facilities.

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This causes people to spend more money than they normally would spend, because within a walking distance inside the facility they are able to access both their banking accounts and their credit card accounts and I think that this, in itself, is a very serious issue and should be looked at.

Also, the issue with respect to off-track betting. Off-track betting is in fact another form of gambling in Nova Scotia that historically has been taking place for some period of time through racetrack betting but you no longer have to attend a racetrack, you just go to a facility where off-track betting comes in. There is one particular establishment in the constituency that I represent. Off-track betting, as you know, gives people the opportunity to bet any amount of money. There is no restriction on the amount in off-track betting, prior to the race starting they are able to put their money in and then bet. Not only that, after the races have expired and so on, they are able to go to the VLT machines and spend whatever money they have left as well.

To me I think - and this is just a point of mine - that an off-track betting facility should not be located in the same facilities where VLT machines are. That's just a thought of mine and it does not reflect this committee any way but it reflects a double exposure to people to give them the opportunity to spend money that they rightfully don't have. It just taps into those other individuals.

As well, at our last meeting, there was some comment with respect to 6,400 problem gamblers in Nova Scotia. I think that was the number that was used, but the people who were directly affected as a result of those 6,400 problem gamblers was never determined. I am wondering if you have gone back and checked to see? There is a ratio number, I think that you used 2.5 or whatever the number may have been, to double that and it could very well be doubled. Someone had made the comment with respect to how it might very well have the impact of 120,000 Nova Scotians because of these 6,400 problem gamblers. So I would like to see some clarity on that, because if, in fact, there are 6,400 problem gamblers in Nova Scotia, there are more people who are affected as a result of that. Those are the families of those problem gamblers in some cases. So, to address the issue of rehabilitation you also have to address the issue of the socio-economic impact on the family as well. I would like to have some feedback on that.

As well, with respect to Mr. [Charles] MacDonald's issue with respect to what the Act says. On Page 1 in the final report that we received here today, the Porter Dillon report, I think it says that Bill No. 17, entitled An Act to Impose a Moratorium on Additional Video Lottery Terminals and to Provide for a Study of Video Lottery Terminals. I think that you know, Madam Chair, there might be some justification in what both MLA Montgomery has said and MLA [Charles] MacDonald, because I don't think it really spelled out that there ought to be the elimination of VLTs within that Act. So I think that that is something that we should look at very closely to see if, in fact, that is true. Thank you.

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MADAM CHAIR: Mr. Chambers, do you wish to respond?

MR. KERRY CHAMBERS: I'd like to respond to three of the questions. First of all, I went back through the transcripts of the focus group that the honourable member viewed and there was mention of lowering credits in that one focus group by a couple of the problem gamblers, more specifically, three. So, there was no mention of that among the problem VLT players in New Glasgow and that is why it is not included in the report because I would not consider that to be an overall finding, it is not something that came out of all of the focus groups as such.

In response to estimating the impacts on families and others from a problem VLT player or a problem gambler in general, I think it is beyond the scope, given the resources that have been provided to us, even with the focal study and what not, we would be clutching at straws. There are all kinds of numbers that are thrown around, for example, one problem gambler influences 15 people, there are other numbers that are used. The problem is that generally speaking each problem VLT player is within different circumstances. Some live alone, some live with a wife and children, some work, some don't work, so to come up with an overall average, an overage head count would be quite difficult given the resources that are available. If government is willing to put out some more money, I would be more than happy to take that issue on.

MR. PYE: Madam Chair, I just want to make one comment to that. I think, Kerry, that is awful. Kerry, I think that is a cop-out. There are such standards internationally, surely, there must be, that tell you what the impact of a problem gambler and how many people are directly, we are not asking for a scientific research here that says definitively that here are the number of people who are going to be affected. But we do want some kind of a reading when this goes to the Legislative Assembly that how many people have the potential, at least, to be affected by gambling in Nova Scotia and by those 6,400 people. When you tell me that you can't define that, I have some difficulty coming to grips with that kind of a comment that you can't give some sort of an answer.

MR. CHAMBERS: Let me put the comment back into context and that is, the numbers that are typically generated are generated from people who are in treatment. People who are in treatment typically are different or could be different, let me correct myself, than people who are in the general population. There is a wide range of impacts and a wide range of phases that problem VLT players are going through at any given time and to sit down and state categorically that 10 per cent or 20 per cent or 15 per cent of Nova Scotians are affected by problem VLT play would be a hazardous thing to do.

MR. PYE: The final issue was not addressed, Madam Chair, and that was with respect to the banning of ATMs and credit card debits from facilities.

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MR. HESELTINE: Well, I think that issues raised by the committee like issues raised by stakeholders who we interviewed have merit and I will make sure that it is referenced in the report when it is finalized.

MR. PYE: Thank you.

MR. JOHN JOZSA: On the last sentence on Page 2, there are two thoughts in that sentence and let me unpack it, maybe. "In particular, we have assessed the likely impacts of changes that would reduce or eliminate VLTs . . .". That comment is made with respect to the economic impacts. We need to rewrite at least the first part of that phrase and maybe eliminate our interpretation of Bill No. 17. But in order to measure the impacts of anything, I have to build a model of well, okay, what would happen without that event, so I can look at the difference. That's is what the first part of that sentence talks about and maybe, obviously, not in a clear way, that what we did was said, okay, we have to postulate, what would happen if we didn't have VLTs? Not that anybody ever intends that to be the case, but how else can I measure their effect, with and without.

The last five words are, well, as I have said, is something that we should not probably have interpreted the bill on our own. Put it down to fast typing, but the first part of that (Interruption) I don't have an agenda here and that is all there is to it. I just don't have an agenda. I have to deliver to you what I can measure and tell you what I can't measure. The first part of that sentence is simply a reference to the previous sentence, the manner in which I have to measure impacts with and without. The last phrase, again, I just don't have an agenda here.

MR. CHAMBERS: I would like to also add that I would personally like to go back through the Hansards and see what the initial committee meetings directed us to do as consultants because I am not quite certain that our directions weren't somehow skewed or put in place and we possibly wrongly interpreted the directions that were given to us and that probably could be found in the Hansards.

MADAM CHAIR: Mr. LeBlanc.

MR. NEIL LEBLANC: I haven't sat on this committee. I am filling in today so bear with me if I go over items that have already been covered. There is one thing that I am hearing on the street and perhaps you could clarify it, especially in regard to the VLTs, that they are in the process of changing them and making them even more consumer friendly in the sense that they will take bills so people can just sit there and pump bills into it and never have to leave their seats. This is what we are hearing and it really alarms me in the sense that when we are talking about trying to control, to some measure, the addictiveness of certain people, that we are doing things to make it consumer friendly even to a greater extent. I have another question besides that but maybe you can comment on that one.

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MR. HESELTINE: Well, that information or that possibility wasn't communicated to us through any of the people we consulted so it is not referenced in the annual report.

MR. LEBLANC: Did you ask the question? You didn't ask the question. You are not aware of it but it isn't something that you have asked the question whether they are contemplating it or not?

MR. HESELTINE: No, we didn't ask the question and, in fact, much as Mr. Pye's comment with respect to ATMs, you are raising an issue which certainly has value to it, to at least be referenced in the report. How much at this point in our study we can go beyond the simple fact that that is something that is under consideration, I don't think that is a possibility but we can provide our commentary, I guess, of what the implications might be.

MR. LEBLANC: I think it is important in the sense that I am not sure if you finished your work, if not, then the committee can do its own research, but that is my understanding that it is either being contemplated or it is in the process of being implemented or whatever. So I think it is something that should be looked at because I think those are the kinds of concerns that we have.

In regard to the ATMs, a lot of us eat out in Halifax and I just noticed the ATMs, and they are not the normal banking machines, they are these other types of banks, a little machine in the corner and it is amazing how they are usually very close to the locations that have these certain machines called VLTs. So I think there is a movement afoot to make it more accessible to get funds. It all begs the question as to whether that should be something that we should be pushing.

The other question I would like to ask and it is in regard to questions that were asked in the House, especially as to there are funds which are being put aside for problem gamblers and part of the problem is whether or not we can gain access to the funds or whether people can gain access, or the programs can gain access to those funds. In your study, did you look at the effectiveness or response of the government in the sense of trying to provide assistance to problem gamblers?

MR. HESELTINE: We did, yesterday afternoon, as a matter of fact, add information from the Gaming Corporation with respect to the fund, the status of the fund, the expenditures that have been made from the fund and, in fact, they are summarized on a table in the report. One of the comments in the report is, in fact, that we don't have the information to be able to comment on the effectiveness of the expenditures that have been made but they are listed there in terms of where they have gone based on what the corporation has told us.

MR. LEBLANC: Has the fund been accumulating? It hasn't gone down, in other words.

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MR. HESELTINE: In the report I believe the current balance that was given to us in February was something in the order of $2.5 million.

MR. LEBLANC: That is the working total.

MR. HESELTINE: Something in the order of $900,000 has been spent out of the fund, before that balance, and I believe roughly another $900,000 to $1 million is committed to various programs which are listed in the report. But that is subject to final approval, as I understand, by the agency.

[1:30 p.m.]

MR. JOZSA: Also in response to the question of making them more consumer-friendly, we have addressed the issue that VLTs are a form of convenience gambling. I was asked at the last meeting if, moral issues aside, as a businessman would I buy one. I said, absolutely: high demands, willing customers, low operating costs and cash business. They are a form of convenience gambling as opposed to a lottery ticket, where you wait for a week to see if you win; as opposed to the casino, where you have to go to the casino. VLTs are within 5 or 10 minutes of almost every person in Nova Scotia. It is something you do.

Therefore, it is a legal product and the answer to your question is going to be, anything to make them more convenient. Just like Coca Cola makes it more convenient for the customer to buy, they are probably going to buy more as opposed to less.

MR. LEBLANC: I have no problem. If you make it more convenient, you make more money. The problem is that there are also people who are suffering from it. The whole question is as to whether or not we, as government who are the operators of these machines, put in effect regulations that do just the opposite of trying to control the amount of people being abused by the machines. I think that is the whole point of this study and for us, as legislators, trying to get some information so that if you want to make some decisions based on your research, then at least you have the information present.

MR. JOZSA: Our objective is to say, what are the impacts of VLT use? Obviously, if it is more, we are going to have more of this. The question is, is it a question of should we? Well, that is on the other side of the table, I'm afraid.

MR. LEBLANC: I will ask one last very quick question. In regard to the funds for problem gamblers as to whether or not the government should be administrating that, or whether or not people outside of government should be the ones distributing, because we are having arguments. You can watch Question Period is you want. Recovery House is coming up in the sense that we find that the funds are not being spent. We have some organizations which are very effective and are arguing that they are not getting funding. They are accumulating more money in the fund, which seems to be ludicrous and, in fact, people are

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having problems. Have you looked at that as to whether the government should administer that or whether it should be outside?

MR. HESELTINE: We haven't offered an opinion as to what the right way to do it is. I will point it out to you so you can find it easily in the report that was circulated today. It is on Page 69, Table 5.3, summarizes what you have been asking about.

I would say with respect to the question you have just asked, what you can see from the table is, in fact, the government or the Gaming Corporation is distributing money from the fund to various agencies and, I assume, within whatever restrictions are placed on them by the granting arrangement, those agencies are applying that money in what they consider to be the best way possible. So, I would suggest that the current system is allowing for some mix in terms of how those monies are being dispensed.

MR. LEBLANC: If you look at the numbers that are there, (Interruptions) I would say most of them are going to research versus into direct help.

MR. CHAMBERS: I would also like to add that from my direct knowledge that any community-based resource can apply to the Department of Health for a grant of up to $5,000 to help, or assist in any way, community-based projects that would deal with problem gambling. So, there is I think some grass-roots funding available.

MR. JOZSA: Also in terms of guidance of where the money should be spent, or how, I think it is important to look also at where problem VLTs players - and this is what we are dealing with specifically - go for assistance; either go for assistance or receive unsolicited assistance. There is no one source that dominates. There are 9 or 10 different sources listed on Page 67 and Page 68 and they are all in the 6 per cent, 7 per cent, 8 per cent range and 9 per cent range.

So, if I am looking at this and taking the business model as okay, wait a minute, how is my market looking for help, but how am I going to get to my potential customer, my potential market, even before I decide who is going to administer the funds, I would want to say, wait a minute, how are people looking for help, that is what they are used to doing; good, I am going to go with the flow and organize a program, if you are asking for my studied opinion on this as opposed to my personal opinion. How would I organize a program to say, good, if this is the way they are used to looking for help maybe I should just go with the flow, make it easy on myself.

Exactly whether it is government administered or private foundation, I don't know, but the key job is to make sure that whatever program happens for information or rehabilitation is at least going into the channels that they are used to finding help so we make it easy for them, rather than forcing them to go to a Drug Dependency centre when we find

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out that only 5 per cent ever called for help to a Drug Dependency centre, whereas more went to Gamblers Anonymous or to their family doctor.

MR. LEBLANC: The only thing I will say, this has been going on since 1991, this is 1999 and we are sitting here almost at the infancy stage of giving help to gamblers who are addicted. So any way you cut it, the bottom line is that the present administrators of the fund have failed in the sense of putting the programs in place. That is a matter of opinion but it is the one that I hold, in the sense that we should be doing more for these people.

We are still doing studies and I look at the numbers you have here, we are probably talking 60 per cent to 70 per cent on studies, 30 per cent to 40 per cent on actual people doing the assistance to these people. So, you have to ask yourself, are we failing the problem gamblers? I have people in my community who are addicted and their families call me and it is not a whole lot of fun when they are crying on the phone; you would like to have someone to be able to send them to. I think, if anything, they are crying for help. So, I am just putting that on the table and hope the committee will look at it when we go on. I would like to thank you for your answers.

MR. MONTGOMERY: Yes, I think we have to watch what we say in terms of what this study purports to do. It is a limited study at best and when you use 49 people in total to come up with results and small numbers per group, you have to question some of the reliability here. Generalizing statements may be sufficient for focal groups but beyond that I can't see how much reliability we are going to be able to take with regard to this.

One of the things that was indicated in the report on Pages 51, 52, 53 and 54.

MADAM CHAIR: Which one?

MR. MONTGOMERY: Well, I doubt very much we can relate to the report that we have just received so I will go on that basis.

MADAM CHAIR: Excuse me for one second. Which pages again?

MR. MONTGOMERY: Pages 52, 53 and 54 that talk about the different groups and talk about the economic impact, being almost neutral or very little economic impact. At the same time, when we questioned last day, that is recorded on Page 7 in Hansard, that the economic impact is considerable. I would like to address a question to the group, why was it told to us last time around that the economic impact would be considerable whereas in the report it indicates it almost being neutral? I guess that is really what my question is.

MR. JOZSA: There are two questions and one is that this study is not based on 49 people, it is based on the Focal survey, to a large extent it is based on 12,000 and then it is based on an assembly of other published research and it is based on our focus groups. So,

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frankly, the data base that Nova Scotia has on VLT players - and Kerry will correct me now - it is, to use an over used phrase, world-class. The data in social research is just about as good as you are going to get. That's not, I don't think, an issue here at all, at least by comparison with other jurisdictions.

Secondly, on the economic impact. The net impact is, as I said last time, 175 jobs, that is the net effect of VLT play in Nova Scotia. If I opened a factory and employed 175 people, I would be on the front page of the Mail-Star. So is 175 small or big? I can tell you that if you eliminate VLTs because of money that will flow out of the province, we will have about 175 fewer jobs, that's what I can tell you. That's the economic impact of VLTs and because of the high profitability of VLTs, a large portion of the profit can go to government because they cost very little to run, they are a very profitable business. That's the truth. That's what we can calculate. So is 175 big or small? That's all I can tell you.

MR. HESELTINE: Perhaps I could just add something to what John said with respect to the statement in the prior report that the impact is slight. One of the reasons for taking out Chapter 6 was that it was restating some of the preceding material, in fact, I think as John has just said, it is very much a matter of opinion whether 175 jobs is a big impact or a small impact. In the interest of wanting to avoid stating an opinion about it and simply allowing the committee and the Legislature to decide for themselves whether or not that was a worthwhile benefit of the current situation with VLTs or not, is now basically the way it is presented in the report. So we try as much as possible there to avoid, I guess, evaluated statements about the outputs from the work.

MADAM CHAIR: Ms. Atwell.

MS. YVONNE ATWELL: Madam Chair, just going back to what Mr. LeBlanc was talking in terms of VLTs where you could put in a bill and actually play it out. I think that is available at the casino right now, right now you can do that. So the technology is there. As a matter of fact, I think at the casino they don't provide change for anything less than $20, so they encourage you to use the machines to make change. So that technology is here.

The other is not really a question but it goes back to what Mr. [Charles] MacDonald was talking about in terms of the bill. Do we have a copy of the bill?

MADAM CHAIR: Yes, we do.

MS. ATWELL: I was just wondering, because that is something that maybe we want to look at again. Also, look at the mandate as you had recommended, that maybe something is out of whack. I guess my understanding from the bill was that we were looking at imposing a moratorium on additional video lottery terminals and also to provide the study. So it was like two things that I got from that. The moratorium, I believe, was probably connected to the study, to find out what the impact would be. I think that was the extent of my understanding

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anyway that we were supposed to do those two things. I just wondered if that is in the mandate. That's my interpretation of that.

MR. HESELTINE: I wonder if I could comment on that. My understanding I think is very similar to what you have just said. I think that with respect to the earlier comment, I think that obviously an option arising from the bill and the study is to lift the moratorium and to return to the situation that prevailed before the moratorium. In that respect, the statement on Page 2 of the report might well be corrected simply by adding the words, whether or not to ban or restrict VLTs. As the writer of that sentence, then I am responsible for not stating it as fully as it should have been.

MS. ATWELL: Just one more question. So the moratorium was imposed as of June? It was imposed. Okay. So that is in keeping with what you had to do I believe. Then, of course, the socio-economic study is what we are talking about now, so I can't see or I don't find a problem there as Mr. [Charles] MacDonald has suggested.

MADAM CHAIR: Mr. [Charles] MacDonald.

MR. CHARLES MACDONALD: Madam Chair, I will go on record, I will be honest. The Porter Dillon report, and I am telling you, that you changed the mandate that was authorized under Bill No. 17. I don't think there is any doubt about that and, therefore, you have changed the whole direction of the report and how you want the outcome of that report to lay with the general public. Having said that, I will go on, but I want that on the record.

On Page 8, Figure 2.2, can you tell us where you came up with the figures that went into Figure 2.2, provincial government revenue from gambling from VLTs and slots?

MR. PYE: We are dealing with the old one, are we?

MADAM CHAIR: The March 1999 report, the summary.

MR. CHARLES MACDONALD: I haven't read the last one yet.

MR. HESELTINE: The source of the information which isn't on that table, which should be on that table, is Canada West.

MR. CHARLES MACDONALD: That is Canada West.

MR. HESELTINE: I am sorry, the figure is Canada West, the table is the Gaming Authority, as it says underneath the table.

MR. CHARLES MACDONALD: I guess we understand where that came from.

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On Page 21 when you use the SOG Screen in the survey in collecting your participants, was it SOGS?

MR. HESELTINE: SOGS.

MR. CHARLES MACDONALD: Was it that screen that you used in . . .

MR. CHAMBERS: I am sorry, what was the question?

MR. CHARLES MACDONALD: Was that the screen that you used when you were selecting your participants in Nova Scotia?

MR. CHAMBERS: Yes, that is South Oaks Gambling Screen, which I am not comfortable with but right at this moment it is widely accepted around the world as the most reliable tool for assessing problematic gambling.

MR. CHARLES MACDONALD: It is not a reliable source. It is inaccurate for what we are doing and you admit that in the report as well.

MR. CHAMBERS: I would suggest that it is inaccurate if you - it is a 20 point scale and if you go below 10 points, it is suggested to be inaccurate. Mark Dickerson of Australia, who is a well-known gambling researcher, has demonstrated in a paper that at 10 points or above, you are probably talking about a true, pathological gambler.

MR. CHARLES MACDONALD: But your SOGS is thought to overestimate problem gamblers in the general population. That is your own statement within this.

MR. CHAMBERS: That is true.

MR. CHARLES MACDONALD: So the figures that you give in this report, by your own admission, are not right.

MR. CHAMBERS: That is not correct.

MR. CHARLES MACDONALD: It is not correct?

MR. CHAMBERS: No.

MR. CHARLES MACDONALD: Maybe you can correct us, then.

MR. CHAMBERS: Okay, I will correct you. If we take the SOGS and take a score of 10 and above, which we did for people who were deemed to be problematic, the literature suggests - the literature from around the world, the international literature - that that is an

[Page 15]

acceptable limit. That is what we did. So someone who scored 10 or above on the SOGS was considered to have problematic VLT behaviour. Someone who scored less than 10 was considered to not be problematic. As a matter of fact, for the non-problem players, we only took people who scored zero. I stand corrected, we took two people who scored a two and it turned out one of those individuals was showing signs of some problem behaviours. In other words, we only took people who scored zero on the SOGS as being non-problematic and we took people who scored a 10 on the SOGS as being problematic which, according to Mark Dickerson - and I stand by Dickerson's research - would indicate a problem gambler, in this case, a problem VLT player.

MR. CHARLES MACDONALD: May I go to Page 8, top of the page. You talk about the percentage of VLT gambling and 70 per cent of monies and you go on in that top paragraph, ". . . presenting a disturbing contrast to the 80 per cent regulated payout . . .". Disturbing contrast.

MR. HESELTINE: I think I should respond to that because we did have communication with the Gaming Authority about this and certainly acknowledged that the language there is open to misinterpretation. What we have changed it to, based on some discussions with the authority is to point out that people cash out at 70 per cent. There never was an intention to imply that the machines are paying out less than the regulated 80 per cent or the reported 95 per cent. It is simply that people play them and then cash out in such a way that they retrieve 70 per cent of the money that was put into them. The language with respect to disturbing contrast, I believe, has been eliminated in the new report.

MR. CHARLES MACDONALD: Very disturbing that we would even put it in.

Page 11. I know my time is running out. Postpone paying bills, 6 per cent, 5 per cent among problem players. It seems to indicate the problem players don't postpone paying bills as much as a normal player does. Is that the indication we get from that?

MADAM CHAIR: Mr. [Charles] MacDonald, which page are we on?

MR. CHARLES MACDONALD: Page 11, bottom of the page, "VLT players used the following sources of money to play in past year:".

MR. CHAMBERS: No, what that would indicate is 5 per cent . . .

MR. CHARLES MACDONALD: Of the 6 per cent?

MR. CHAMBERS: Well, there were 6 per cent of the entire sample who postponed paying bills. Out of that 6 per cent, 5 per cent were among problem players. In other words, 1 per cent of the total sample were non-problem players and had postponed paying bills at some point in time. That is how I would read the Focal . . .

[Page 16]

MR. CHARLES MACDONALD: So among problem players, which is less than 0.92 per cent of the population, something like 5 per cent or less of that population would have . . .

MR. CHAMBERS: No.

MR. JAMES MUIR: It is 83 per cent.

MR. HESELTINE: I think we should probably reformulate that but elsewhere in the report I believe we have indicated the potential, I guess, of problem players to be in debt and the figures for problem players are certainly very high relative to non-problem and non-player groups.

MR. CHARLES MACDONALD: I have one last question at the present time, if I may move on to Page 30, Madam Chair. Again, and I am talking about the language used in this report and how they indicate VLT players, the bullet at the centre of that page, "A few participants in both groups also considered the machines to be 'addictive':". What do we consider a few? Who were a few participants in both groups? Is it a few of the 49? Is it a few of 6,400 or is a few of the 12,000 that you allude to?

MR. HESELTINE: I am sorry, on Page 30, could you tell me . . .

MR. CHARLES MACDONALD: The bullet on the middle of the page, VLT players.

MADAM CHAIR: Which section?

MR. HESELTINE: Where it begins, "We asked the non-problem players . . .".

MR. CHARLES MACDONALD: What you are saying is, "A few participants in both groups also considered the machines to be 'addictive':". We have two problems with that, the word addictive which you are using in there and you are using, a few participants. Now when we say a few participants, are we saying a few of the 49 in three focal groups or four focal groups?

MR. CHAMBERS: Yes, we are saying a few of the 49 of the . . .

MR. CHARLES MACDONALD: So what is a few, one, two?

MR. CHAMBERS: Probably two to three, as in most dictionary references.

MR. CHARLES MACDONALD: No, the term that you put in there is a few. We have to quantify what a few is and what is in your population that you are talking about. A few of a 1,000 might be 100. A few of 10 may be 1 or 2. I think that has to be differentiated.

[Page 17]

MR. CHAMBERS: Perhaps we should go back to the last public opinion survey which shows that the vast majority of the public think that VLTs are "addictive". That was in the annual Gaming Authority Report.

MR. CHARLES MACDONALD: That is perception. We are educating the people on that.

MR. CHAMBERS: That is what this is. This is perception as well.

MR. HESELTINE: We are working to finalize this report and I think we can get a specific number for the final draft.

MR. JOZSA: Also, in answer to the question, the data on Page 3, they are correct except they are for the population. I think we will improve the presentation of that. When you look, for example, at postponing bills, if you look at only problem VLT players, one-third of them say, I postponed or didn't pay my bills and I relate that to my VLT play. If you are just looking at the problem group of that 6,400 or whatever the number it would be, one-third of them say, yes, I postpone or don't pay bills and I relate that to my VLT play. The data on Page 3 are for the entire population of VLT players. I think maybe if we used absolute numbers, it might be more clear what those data are saying. I must admit, I get lost myself sometimes in percentages of which group. On Page 11, we will certainly take that last piece of information and clarify what is meant by it.

MADAM CHAIR: Mr. Pye, I have you next.

MR. PYE: MLA Neil LeBlanc made a comment that, in fact, people were telling him that the VLT machines were going to become more user-friendly. That is not my understanding. My understanding is that they were doing just the absolute reverse, trying to make them not user-friendly and to restrict people from using them. If you people have any comment with respect to that or if you have heard anything, then I think it is important to tell the committee.

Also, MLA LeBlanc questioned the dispensing of funds to people who are, indeed, problem gamblers. I know that I asked the Minister of Health if he considered that gambling was, in fact, a health-related problem - and Hansard will reflect that in the spring during the budget debate - and he implied, yes, but that he had no control over the Gaming Authority and wished the money were coming through to the Department of Health so that people who needed access to that money could, in fact, have access to it. Those were my major concerns.

You caught me off guard, Madam Chair, because I was listening so intently to Mr. [Charles] MacDonald. I also want to say that this committee is not restricted, even though there is within the bill what ought to be done, this committee, when it makes recommendations, is not restricted from making a recommendation that will say that this

[Page 18]

committee endorses total elimination of VLTs in Nova Scotia. I don't believe it is, is it? I guess I am going to ask you, the Chair, the committee does have that within its mandate if it so chooses, does it not?

MADAM CHAIR: The committee has the power to make recommendations based on the report; the committee has within its mandate the ability to make no recommendations, to simply table the report. This is an ongoing debate that has occurred here at the committee about whose role or responsibility it is with respect to the making of recommendations. We have already agreed that it was not the responsibility of the consultants, but rather it is our responsibility as legislators to determine that. That is a debate that still needs to occur.

MR. PYE: Thank you, Madam Chair, because I thought earlier on, when we were discussing this and I was in full support of the consulting firm making some recommendations - and I think I am on record in the committee's Hansard with respect to that - I want to say that it was unanimous, I believe, that members of the committee felt it was in the committee's domain to make recommendations, and I certainly hope that the committee is prepared to make recommendations.

MADAM CHAIR: Mr. Chambers.

MR. CHAMBERS: I would like to try to address the question about the machines being more user-friendly versus more restrictive. I am not totally familiar with what is going on with the Gaming Corporation. I do know that they have a tender out to bring new VLTs into the province. My understanding, from reading media reports, is that those machines are intended to appeal to a broader base of Nova Scotians in terms of the type of games that are on them, if I understand it correctly - and I stand to be corrected - which would increase the number of people playing them. I also understand that part of the mandate of that tender is to clearly show how the manufacturer is going to minimize risks to the participants. I am not privy to that tender, but I have heard about it.

[2:00 p.m.]

MADAM CHAIR: Mr. Muir.

MR. MUIR: Madam Chair, I would just like to go back to the point that Mr. [Charles] MacDonald raised at the beginning of the meeting, the phrase on Page 2, what is said there, was your frame of reference, when you designed the study, to come up with results or data or information or findings that would lead to the elimination of VLTs?

MR. HESELTINE: No.

MR. MUIR: I just want that on the record because it is clearly, if that was your frame of reference . . .

[Page 19]

MR. HESELTINE: I think in every meeting we have insisted here that from the time we were originally interviewed about taking this study, we have insisted that we did not want to put recommendations in the report and it is precisely for that reason that we have always considered and we have always said that the decision here, ultimately, is one that is going to be based on judgement and the Legislature should judge.

MR. MUIR: I think it is important that the committee be assured of that because clearly his point was a very valid one.

MR. JOZSA: At the risk of belabouring it and talking down, we do make a lot of references to, if VLTs are eliminated, in the absence of VLTs; the only reason we do that, and especially with the economic impacts and the measured impacts, is to set up the model, with and without. I don't do a lot of in-between cases because there is an infinite number of in-between cases so you are obviously going to see a lot of references. To tell you the impacts of VLTs, I have to set that model up. Maybe I am talking down and I apologize, but I just want to make that absolutely clear.

MR. MUIR: Another question, just going back to that chart on Page 11 which indicates that VLT players used sources of money, there must be about 10 or 12 of them listed there that seem to be what I would call negative categories. What about just routine, leisure or pocket money or something like that; how many people would have used that?

MR. CHAMBERS: I am not certain that the Focal study addressed that issue, but I will look . . .

MR. MUIR: I am just trying to see, was this the largest source? This could have been 5 per cent or 2 per cent of the money they spent, or they could have been spending 98 per cent instead of going to the movies or going to see the Mooseheads or coming to Truro to watch the Bearcats, or whatever.

MR. CHAMBERS: Yes, your point is well taken.

MR. JOZSA: I think if you read that, what that says is that 6 per cent of VLT players postponed paying bills, of all VLT players. Which means, when we look at those numbers, the majority of people took it out of their normal discretionary income.

MR. MUIR: That is my point. If that is the case . . .

MR. JOZSA: Okay, I see what you are getting at.

MR. MUIR: . . . the point is you are saying - at least it can be read - that the money going into these machines comes because they are not paying bills or they are dipping into their savings or they are dipping into their household monies.

[Page 20]

MR. CHAMBERS: Put differently, 94 per cent of VLT players did not postpone paying bills.

MR. MUIR: The other part of that, because I see that as pretty impactful - or has a lot of impact in that table - did that 6 per cent do it 100 per cent of the time?

MR. JOZSA: The exact question was, in the last year have you, in the survey, so it could have been once, twice or three times.

MR. MUIR: Okay, I think that should perhaps be dealt with in the text. There could be some doing it 100 per cent of the time, I am just saying that it may be one time and the indication is that . . .

MR. CHAMBERS: I think the focus group research meshes very nicely with the Focal Research in that it shows that problem players are typically not doing this all the time.

MR. MUIR: That's fine.

MR. CHAMBERS: Again, with respect to the comments made over here about the reliability of focus groups, they are absolutely correct. You cannot generalize the larger population, et cetera, but the trends are there; you generally do get trends from focus groups.

MR. MUIR: One of the things that was intriguing to me, just looking at the study, you made a statement on Page 44 and Page 45, which is that when a person became a problem player, although they liked to win, it didn't make any difference, the money had no bearing to them.

MR. CHAMBERS: That is an observation that we made.

MR. MUIR: The other thing, I guess, and this was dealt with in a little more depth last time but I don't really understand about bonuses, is you indicated they would chase this bonus which had money, but that is simply to win. You indicated that they quite often would chase that bonus, even though with that amount of money they could not recoup their losses, simply for the thrill of winning. I guess that says to me, if you are getting into this win thing - it is like a professional politician to me, some of them keep coming back. (Laughter)

Anyway, it seems to me, if that is the case, then perhaps the feeling that the person would channel that opportunity to win in other directions besides a VLT is very real, if it is the winning thing that is the important thing. It is sort of the thrill of the chase.

MR. CHAMBERS: I would like to comment on that. I would like to go on record that this is entirely speculation, and I am following this up in my own personal studies. I think that part of the winning is a sense of empowerment for the individual. Now whether or not they

[Page 21]

get that empowerment from winning on a VLT machine or winning at golf or something else, is hard to determine. Personally, right now, the big question for me is, why does somebody who wins $500 or $800, instead of getting up and walking away, put it right back into the machine?

MR. MONTGOMERY: They want to win more.

MR. CHAMBERS: That is one reason, to win more, but then it comes back to the win. It seems to me, and this is entirely speculation, that there is a desire to win among problem players. It is not necessarily the game, but that bears further analysis.

MR. JOZSA: Speaking as an economist, I am not going to speculate on this. The transaction you just described to me, to an economist, is a very rational transaction. If we were only in things for the money, well, I wouldn't be doing this, I would own a Tim Hortons franchise. But I have other objectives. Everyone who makes a financial transaction, the objective is not just to win, it is the fun of winning, hearing the bells ring or watching the golf ball go in the hole and I just spent $300 bucks on that driver and the thing went in the hole; one shot less all summer. Whoop-de-do. That was a transaction they agreed to make, an economic transaction. It is a rational transaction. So gambling is not simply about the money. It is entertainment. It is fun. The bells ring. I had a good time. You and I may or may not agree with that way to get your fun but right now it is legal, and there you go. As an economic transaction, it is completely rational. Yes, that is the way things work.

MR. CHAMBERS: I would take it further than that and again, in speculation, say that it may be fulfilling some need for that particular type of gambler.

MADAM CHAIR: The speakers' list is exhausted at this point. Mr. [Charles] MacDonald.

MR. CHARLES MACDONALD: Can we go to the report, and you provide information throughout that report from the Canada West Foundation. Isn't it a fact that Canada West Foundation is a declared anti-VLT proponent? They are strictly anti-VLT. We are here using their research in this document and it is documented that they are anti-VLT, but yet you use their information as if it were the gospel truth.

MR. HESELTINE: We used information from a number of sources. Actually, I don't believe we have used Canada West information except in Chapter 2 and I think in only a couple of occasions where they appeared to be the best source of trans-Canada information, where they were providing lists of expenditures, and so on, in the different provinces that weren't contradicted by any other information that was available with respect to that. That was purportedly factual information; it was quantities as opposed to the opinions of Canada West.

[Page 22]

MR. CHARLES MACDONALD: But shouldn't we let the people know in this document that really Canada West is opposed to VLTs when we use that information? I think it is only right that we inform the public of the information that we are using.

MR. HESELTINE: I don't have any difficulty with indicating what the perspective may be, but I do feel that the information that we have provided, or taken from them, was corroborated in other places and was not information that particularly reflected their opinion.

MR. CHARLES MACDONALD: It is not tainted by any means?

MR. HESELTINE: Not to the best of my knowledge. There is information in the report certainly from a whole variety of sources, including writers and researchers who are clearly anti-gambling and those who are clearly in favour of gambling.

MADAM CHAIR: Mr. LeBlanc.

MR. LEBLANC: Madam Chair, could I make a comment in regard to this? The only problem I have with that, Charlie, is that when the Gaming Authority comes up and has statistics on the other side, we could sit here and say, no matter what they say, they are biased because all they want is the money and they are trying to make money. I think it comes back to the question that my colleague just said to me, that whether or not they have hired people who are responsible, respected and who have done some research, I think a lot of times these numbers are always right within certain amounts of probability. It is the same thing as polling.

I think it comes from perhaps both sides of the issue, whether you are using the Gaming Authority or even this Canada West, which I am not familiar with. If you sat both of them down in a room, they would probably agree that they are relatively accurate. I think it would probably be good to do some research on both sides, but I tend to think that the information is probably accurate within so many percentage points.

MR. CHARLES MACDONALD: I have always found with numbers, you can make numbers work for you whichever direction you want to use them. You can take the same numbers and the same figures and give them to two different people and come up with two different analogies. That is numbers, but I think we should be cautioned on some of the research that is referred to in our report.

MADAM CHAIR: Mr. Heseltine.

MR. HESELTINE: I wonder if I could just add one thing to it. Certainly with respect to the figure you pointed out, it doesn't have a source that is from Canada West and I will add it. I would also like to point out that we have been at pains in this report to document our sources at some length, I would say more than we normally do, precisely because we do know that this is an issue of some political importance with a variety of different perspectives on it.

[Page 23]

As much as possible, we have tried to indicate where we got numbers from, where opinions are being stated from, and so on. The report is pretty extensively footnoted to take that into account. I hope people can certainly trace back where our information is and where it's coming from.

MR. CHARLES MACDONALD: But it was amazing you didn't have that heading under that report. You left that one out there hanging as to where you got it from.

MR. HESELTINE: I apologize for that.

MADAM CHAIR: Are there any further comments? I would like to go back to that little section that we started the discussion around with respect to the terms of reference. I am wondering if, for members of the committee, because I have looked at not just the Act - I think the Act is okay to look at - but I think we need to look at the terms of reference that, in fact, we asked for submissions around and then became the basis of awarding the tender to this group of consultants. Perhaps what we could do, in that section, is substitute what we said in the terms of reference, which are simply the following: "to assess the social and economic implications of VLT gaming on Nova Scotians to assist the all Party committee in determining if, after considering the positive and negative impacts, VLT gaming in particular exceeds the limits of social acceptability in Nova Scotia.".

It takes away that to ban or not to ban terminology and it goes back to the original parameters very clearly, what those parameters were.

MR. HESELTINE: I wonder if I could ask this. I am not sure it's easily at hand in my office, so could we have a copy of that? I think that makes sense.

MADAM CHAIR: Sure, not a problem. Well, I would say, if you don't have your Ph.Ds already, a Ph.D defence will be quite simple after this.

MR. CHARLES MACDONALD: Can we ask more questions? We are not finished, are we?

MADAM CHAIR: Well, I had nobody else on the speakers' list, but if you have more questions.

MR. CHARLES MACDONALD: There are a couple of things I would like to say. The analogy on Page 63, contrasting legalizing illicit drugs to VLTs, we find that totally inflammatory. It is not necessary in a report of this nature.

MR. PYE: When you say, we, who are the we who find that totally inflammatory?

MR. CHARLES MACDONALD: On this side of the House. Is that okay, Mr. Pye?

[Page 24]

MR. PYE: That's fine. As long as I know who the we are.

MR. CHARLES MACDONALD: ". . . the legalization of marijuana could provide revenues to the state along . . .", and we go into all this medical benefits and what not, ". . . various formulations. The moral question of abolishing VLTs is no exception.". I don't think that kind of wording is necessary in a report of this nature. Surely if it is something that we want to sit down and legislate for the province or look at, as legislators in the province, we don't want inflammatory statements. It is not necessary. We need facts and the best facts that we can possibly get, that is what we need from these reports.

MR. HESELTINE: I agree with you totally and I certainly don't want any of the content of the report to be lost in a side issue about how we've phrased this particular issue. Some of this language is still in the report we submitted today, so I will review it and see if we can address it in a different way.

MR. CHARLES MACDONALD: Before we leave it, if I may go to one more. I want to note that we had no focus groups that were included from among industries and leaders of communities and that sort. What we have here is totally 49 participants and you are asking us to make major decisions based on 49 participants.

MR. CHAMBERS: There were 49 participants and $119,000 study done by Focal Research.

MR. CHARLES MACDONALD: Well, $119,000 doesn't make a bean a rose, when you come down to it, it doesn't make any difference if it is a $1 million study, sir.

MR. HESELTINE: I would like actually to respond to that, because it will allow me to ask the committee for permission for something relating to this. We were contacted as I mentioned by the Gaming Authority and the Gaming Corporation. Mr. Chambers had a meeting with the Gaming Authority pertaining to the previous draft of the report. The Gaming Corporation sent us a letter specifically asking for the opportunity to review this report before it is finalized.

Our interest is to see this be as accurate as possible. My preference would be to meet with the Gaming Corporation with the permission of the committee.

MADAM CHAIR: I would like to hear what members of the committee think about that. Mr. LeBlanc.

MR. LEBLANC: Madam Chair, being that they presented the report to the committee, being that we are aware of what their first intention to say is, and I will be very candid about it, and going back to the Gaming Authority whereby they can gain information, I, personally, wouldn't have an objection to it. If you hadn't put your report to us and gone there maybe

[Page 25]

I wouldn't feel so comfortable. I go back to what I said before, you are using percentages and so forth, if they can shed some light that might even give more credence to those numbers being used that Mr. [Charles] MacDonald is showing such objection to and if they are going to be a little more accurate, then even better for us as committee members to make decisions. That's my first reaction to it and I would like to hear other members, maybe if they can enlighten me differently I would be prepared to change my mind but that is my first inclination.

MADAM CHAIR: Mr. Pye.

MR. PYE: I guess, Madam Chair, the Standing Committee on Community Services was instructed to carry this finding out and I don't know if I am so open and receptive to having this go before the Gaming Authority or the Gaming Corporation for input. From my understanding, you have already had a conversation with the Gaming Corporation with respect to this report, haven't you?

MR. HESELTINE: We had, in fact, asked for information which was supplied by both.

MR. PYE: And you received the information that was supplied from them.

MR. HESELTINE: They have seen the report that we previously submitted, it was distributed through the . . .

MADAM CHAIR: It is in the public domain, right now.

MR. PYE: The report that has come here now, the April report, it will be in the public domain as well and they will get the opportunity to see that as well. Give me some logical reason as to why this committee should engage in conversation with and/or about this report with the Gaming Corporation.

MR. HESELTINE: It would largely be from our perspective, it allows us, I think, the easiest exchange over the content of the report and if there is information that is inaccurate. As I have said, certainly there is a lot of data in the report and we would like it to be as correct as possible.

MR. PYE: And we trust that you, as consultants, will do that.

MR. HESELTINE: Well, we have certainly done our best.

MR. PYE: That gives me the impression that you are going to be drafting this report or writing this report for the Gaming Corporation and not the Standing Committee on Community Services, when in fact you do that. Now, that's just my opinion, Madam Chair.

[Page 26]

We have to take it as we receive it. We then pass it on to the public and they have the right to scrutinize it before it becomes legislative material as well and they will have that. Surely, they have access to the government of the day which in fact they will express their views and concerns to the government of the day with respect to the contents of the report.

MADAM CHAIR: Mr. Jozsa, if you need to add and then Mr. [Charles] MacDonald.

MR. JOZSA: There are some questions that we have been asked though that are, and this is a matter of trust, I guess, the logical reason why we would like to speak to them, and maybe with a member or the Chair present it would be fine with us, because some of the questions that I see are easily answered like a wording problem and they are more factual. We don't have opinions here, we are reporting information and structuring it in a way that you could see through maybe the fog of all the numbers as to what was left on the table as core issues that are as yet to be decided or social issues. So, the logical reason I would give is that a lot of the questions I have seen are easily answered.

From a marketing perspective, it is always good to make sure that you heard the objections or concerns and say, listen, okay, we either have an agreement to disagree or hey, it was a simple thing to solve. That's the reason I would give. We are not going to change numbers just because somebody disagrees. As a matter of fact, for my part, my certification requires that any time I comment on someone's work, I have to communicate with them, so for my part where I had mentioned other studies, I have already spoken to those people and said, am I getting what you did here right or am I misinterpreting it? So, logically, I don't have any problem.

MADAM CHAIR: Mr. [Charles] MacDonald and then Ms. Atwell.

MR. CHARLES MACDONALD: I would think that anything that brings clarity to a report and gives us a final report that is as accurate as we can get it in Nova Scotia and the figures and all that is contained within the report, all we are asking is for that kind of accuracy and that kind of a report, not one that leads us down the garden path or a path leads us astray in what we have to decide in the future.

MADAM CHAIR: Ms. Atwell.

MS. ATWELL: Are there any reports that you used that came out of the Gaming Corporation?

MR. HESELTINE: Not a report as such but we got two pieces of correspondence yesterday in response to specific questions that we asked with respect to Mr. LeBlanc's question with respect to the fund and harness racing, which wasn't reported in any of the Alcohol and Gaming Authority's reports because it is not their responsibility. So we had some communication with them as a source of information and in the context of that and I guess

[Page 27]

their review of the preceding document, they got in touch with us and indicated a desire to speak to us.

MS. ATWELL: So they want to meet with you to discuss this report, is that my understanding?

MR. HESELTINE: Yes. I would say as far as this is concerned that the report is very close to completion and I am only looking to ensure that the details are accurate, not to revisit the subject matter, the approach or anything like that, in the report, just the numbers - we got some good advice from the Gaming Authority with respect to how to phrase this issue with respect to payout of the machines and so on. I welcome that and I think it helps simply to create a better product.

MS. ATWELL: My concern was, why the meeting? If you have the report and you read it, you can always put those ideas in writing or assist in clarifying some of this in writing. So, I just wonder, the need to sit down face to face and discuss this was just a little bit of a concern.

MR. HESELTINE: I guess that is the other perspective.

MADAM CHAIR: Mr. LeBlanc, then Mr. Montgomery.

MR. LEBLANC: The only thing I will say, I wasn't aware that they had had access to one in March, when I made my original comment, but I still go back that all members have their copies in hand, so it isn't something that we don't know what you have drafted. In the face of that I don't see any objection to meeting with them, but I do have one objection, that if it slows the process down any length of time, then I have a problem. So, do you have any indication as to what kind of time-frame you are referring to for this? I am asking a question. Is this a month's delay. I don't want to get to that.

MR. HESELTINE: No, we have a delivery date for a final report of April 29th. We have to make revisions to this report; obviously, fairly modest revisions and that is what I see from the discussion today. There are certainly some issues that have been raised here and we will address them, over the next couple of days to make those changes. We want to be providing a final report on about April 22nd to the committee.

MADAM CHAIR: Mr. Montgomery.

MR. MONTGOMERY: In the study itself on the right-to-play issue that was discussed among all the different groups, there was pretty much a 50/50 split. Now, if we were to relate this study to the general population, do you think it would come out the same or would the fact that the non-playing group perceived a great percentage of people who were problem gamblers, or problem players if you like, to have extreme difficulties, in other words,

[Page 28]

lost everything. How would it play out in terms of the total population, that is what I am wondering?

MR. CHAMBERS: We conducted a survey last summer and the question was asked - I can't remember the exact wording, but it came down to - should the community have the right to ban video lottery terminals, should it be up to the individual to have the right to play, or do you not have an opinion? I don't have numbers in front of me, but it was something like 44 per cent, margin of error, thought the community should have to right to ban them; 33 per cent thought it should be up to the individual; and 10 per cent did not have an opinion.

Now, if we loaded the question with, given that people lose their homes and everything else in from of that, I am sure it would drive up the number of people who would favour a ban. The trouble with any survey question, with any research, as you have aptly pointed out, is its reliability and applicability and that it is based on perceptions and everything else.

There is one point that I would like to make about this study, particularly the focus group method. It was a budgetary constraint and that is what we came to at the first, saying that we would be limited to focus groups and there is that problem with general reliability. So that is your question. I think that in the general population, you would probably find somewhere around a 50/50 split, but I am not sure. I would be interested myself to go back in and ask the question.

MR. JOZSA: To embellish that a bit, I am glad you asked that question because it demonstrates the net we tried to put together here. Kerry just described surveys that his company has done previous to this work. We have used the 12,000 person survey from Focal Research and we have done our own focus groups. When we lay those things on top of each other, we start to get a pretty net. The answer to your question is, yes, all three or four pieces of work tell us that non-players' perception of players is that they are always in debt and poor; frankly, the facts differ.

All the research is starting to show the same pattern. That's why I am more and more confident that we are getting to the point where we know what we are going to know and it is time to make a decision. The data is very good. It is starting to show consistent results in all the surveys we do and either it is all wrong, which is unlikely in the extreme - we use different methods, focus groups, surveys, questionnaires, the whole nine yards.

[2:30 p.m.]

MADAM CHAIR: Triangulation.

MR. MONTGOMERY: So that would point to more education in terms of perception and what is actual fact.

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MR. JOZSA: There you go.

MR. HESELTINE: Yes.

MADAM CHAIR: Mr. Muir.

MR. MUIR: Madam Chair, I would just say that I think the request to meet with the Gaming Authority is a reasonable one and I can't see any problem. We do have the original report. The intent is simply to make sure that some of the data is accurate and if it is not accurate you might as well spend an hour and get it corrected.

MADAM CHAIR: I have a couple of questions around the process of the request for the meeting and I just want some clarification from you, if I could, Mr. Jozsa. You indicated that some of the questions can be easily answered. So, am I to take from that that the Gaming Authority has some questions from the draft and has indicated that that is the purpose of the meeting? What is the purpose? Who initiated the meeting and what is the purpose of the meeting?

MR. HESELTINE: Actually, I am the person they were communicating with. The Gaming Authority raised two specific issues, one with respect to the phrasing as I said about this 70, 80, 95 payout. I think we have settled that reasonably on the basis of the correspondence that we had. The other was with respect to the interpretation of the Canmac information in the report. We used the study that was previously done by Canmac Economics, which is a similar consulting firm and I guess, to some degree, challenged the Gaming Authority's interpretation of what that information meant and put that in the report.

Now, we have already moderated, I think, some of what we said because certainly we weren't saying it with respect to trying to present the Gaming Authority as trying to distort the picture. So we have tried to adjust it in that respect. But it still seems that it would be worthwhile to have a two-way discussion with the authority on the subject to make sure that they understand what we are saying and I assume in the other direction, that we understand their position on that.

Now, we also had correspondence from the Gaming Corporation, which is a separate organization. If I can arrange it, frankly, I would like to meet with them both together. The Gaming Corporation reviewed the report, gave us information. They are administering this area and I think the committee and we as consultants on this assignment would be best off to know that if there is any factual inaccuracies - which I don't think there are or I hope there aren't - we will correct anything that they can point out to us and explain in the same way what our sources were and why we are using these numbers in a particular way if they have any issues with what they read.

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MR. JOZSA: Specifically, with the question to me, the fact is that the questions on the economics and the impacts, I have already had personal communication with people at Canmac so I know technically and I know them well personally, as it is a small community - these economists - so we have an agreement as economists that I haven't taken them to places they wouldn't go or couldn't go. So that is what I am saying, they are in that sense easily answered because at least among the technicians we have an agreement that we haven't done something that would in some way impugn their report or question it. Mike Foster at Canmac does great work, he is a very smart man, so I don't have any problem with that.

MADAM CHAIR: Well, I would just like to say that I concur with Mr. LeBlanc that I think that we are all interested in seeing that the research is as accurate as possible and if there is some clarification but I would be reluctant to see it delayed. I certainly have concern if there is any possibility of influencing your research in any kind of way in terms of the methodology you have laid out, you have reported to us consistently. From the awarding of the contract we have had a lot of discussion here and at this stage in the report, it would be, I think, highly inappropriate to have that sort of raised with yourselves.

In the research community, there is no perfect research, all research has its flaws. You do your research, you make it public and the debate begins. In fact, that is what good research is supposed to do. It is at that stage, I think, that we need to look forward to quite a good debate around what it is that you have done. So I think it is really important to put that on the record.

I guess I would say that I am a little disturbed, as well, that if the Gaming Authority wanted to meet with you, the consultants, that they didn't make contact with the standing committee directly, because we are not some group of folks here off the street, and I think that should be put clearly on the record. We were given this mandate by the House of Assembly on behalf of the people of Nova Scotia and if the Gaming Authority wants to have some discussion around the work that is being done on behalf of the Legislature, then there is a process that should be followed and that process has not been followed. That doesn't make me really happy, I would have to say, as Chair of this committee. I want that on the record.

Having said all that, I feel very comfortable with your meeting in the interest of making sure if there are any minor modifications with respect to the accuracy of the statistics, citations, those kinds of things.

MR. HESELTINE: We will try to point out any significant changes that arise from those meetings so the committee knows what the source is and so on.

[Page 31]

MR. JOZSA: For the committee's comfort, of course, whenever a certified management consultant, me, takes on a job, I am your employee. If I am asked anything about your product, it is just like anybody else, I have to talk to the boss. The request that John made . . .

MADAM CHAIR: I appreciate that.

MR. JOZSA: . . . to the group is not highly unusual. It is just an automatic reaction for us. If we are asked for an interview, I call the Chair, if we are asked for anything.

MADAM CHAIR: We appreciate that.

MR. JOZSA: So that is just standard practice for us.

MADAM CHAIR: We certainly appreciate that.

MR. PYE: My question is, you have already been communicating with the Gaming Authority, and there are two bodies here, the Gaming Corporation and the Gaming Authority. I guess I have difficulty with the meeting. Why do you have to have a meeting with this particular body when, in fact, you can communicate in the same fashion that you have done and why did you have to come here and ask for permission to do that when, in fact, you could have received the same information without meeting with this particular body?

MR. HESELTINE: Well, the reason why I asked is that I got a formal request from - I believe her position is Vice-Chair - Dara Gordon of the Gaming Corporation . . .

MR. PYE: Acting Chair.

MR. HESELTINE: . . . to specifically meet with her. You are quite right, we have had informal contact with staff especially at the Gaming Authority; you can see in the report that we made pretty extensive use of their data. But the reason I am asking, as John says, you are our client so we have to ask for that permission and I felt that the formality of receiving the letter, saying that under these specific circumstances they wanted to review the report, demanded that we have permission to do it.

MR. JOZSA: The difference is, our previous contacts were to collect data without comment from them. We were saying, what can you give us that we can read and use and then do our analysis, whereas this current request is now a comment on our analysis, so that is why we have come to you with it. So, before, of course, we talked to a lot of people - hopefully, we had your trust to do so - so we could understand the information and then we do our analysis. Now they have questions about the way we have used it.

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MR. PYE: Madam Chair, as I understand, there is no motion on the floor, but I just want to record that I have a concern with the consulting firm meeting with both the Gaming Authority and the Gaming Corporation. I just want that to go on record.

MR. CHARLES MACDONALD: Do we need a motion, Madam Chair, or is it generally the consensus that they have that direction?

MADAM CHAIR: I think that the majority of people have indicated that the meeting should go ahead. We could put it to a vote, but I think it is a foregone conclusion, given what the discussion was. If you want a motion on the floor, feel free to make one, otherwise they will meet.

Well, thank you. I guess we will receive an amended version.

MR. HESELTINE: As I said, we are working towards an April 22nd or April 23rd date for delivery to the committee, for distribution to the members, so we can meet on April 29th and conclude the project.

MADAM CHAIR: Great, thank you very much.

MR. JOZSA: I just want to say one thing. I remember Mr. Pye taking the opportunity to attend some focus groups. If you want to come to this meeting with us, come along. You are part of study team. This is not going to be some kind of a secret meeting we are having over there.

MADAM CHAIR: I think perhaps when the meeting is organized, if you could let Mrs. Henry know so she could inform members of the committee, and members of the committee can determine whether or not they would like to participate in that discussion. I think that is a very good point. Thank you for making it.

MR. HESELTINE: I think, given the time-frame, that is going to happen in the next couple of days.

MADAM CHAIR: Is there anything else? Thank you very much. We stand adjourned until our next (Interruptions) Oh, sorry.

MR. MUIR: Just before we do that, the time of next Thursday's meeting is at 1:00 p.m.?

MADAM CHAIR: From 1:00 p.m. to 3:00 p.m.

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MR. MUIR: Thank you.

[The committee adjourned at 2:42 p.m.]