Auditor-General releases VCGLR report

By Andy Young

Victoria’s Auditor-General (AG) has published its ‘Regulating Gambling and Liquor’ report, which looks at the work of the Victorian Commission for Gambling and Liquor Regulation (VCGLR).

VCGLR was formed in 2012 when the Victorian Government brought together the functions of two predecessor regulators — the Victorian Commission for Gambling Regulation (VCGR) and Responsible Alcohol Victoria (RAV). In his report the AG notes that “VCGLR's budget and staff were reduced by around 30 per cent in the four years from 2012, compared to the resources of RAV and VCGR, which had a combined budget of $41.3 million and staff of around 287.

“VCGLR has also lost experience and expertise, with 24 experienced officers departing on redundancy packages offered as part of the Sustainable Government Initiative in 2012, followed by a further 22 redundancies up to mid-2014.”

The AG’s report assessed VCGLR licensing and compliance functions, its performance and reporting and its collaboration with other agencies.

The AG was critical of VCGLR’s licensing division, saying that it has made “limited progress over the past two years in reorganising the licensing division, training staff and providing improved guidance material to start moving towards a more risk-based approach to licensing activities”.

The report added: “Much work remains and weaknesses in VCGLR's approach mean it still cannot demonstrate that it properly examines and assesses all licensing applications in line with legislative provisions before approving them. These weaknesses are more significant for liquor applications and arise because VCGLR largely accepts the information provided to it by these applicants at face value. It relies heavily on both the honesty of applicants and the diligence of Victoria Police and potential objectors to raise issues about the suitability of applicants, amenity issues or social harms associated with these applications.”

Although the AG did state that he had identified instances where VCGLR had granted licences without fully identifying and assessing the applicants, he did add: “VCGLR has recently acted to address weaknesses in its quality assurance for licensing processes and needs to continue its work developing a more robust, risk-based approach to scrutinising applicants.”

The AG was more critical of VCGLR’s compliance performance and its monitoring and inspections of licensed premises.

The report said: “VCGLR has not adequately monitored compliance with gambling and liquor legislation.

“Compliance activities are not sufficiently risk based because VCGLR has focused on meeting a target number of inspections, rather than directing inspections to where noncompliance has a high risk or high potential for harm. This approach to compliance does not support the legislative objectives for harm minimisation.

“VCGLR has not adequately managed its compliance monitoring functions due to longstanding serious and systemic weaknesses in the design and operation of its compliance activities.”

In terms of what VCGLR is doing to correct these issues, the AG reported: “VCGLR has identified and started to address many of these issues since late 2015, and its proposed actions to better organise and train its inspectors and target its activities based on relevant data and indicators of risk are reasonable. However, these actions are not yet sufficiently developed for us to assess whether they will improve the effectiveness of VCGLR's compliance activities in minimising harm and protecting the community.”

VCGLR is also responsible for regulating and monitoring Melbourne's Crown Casino and the report was also critical of the regulator’s performance of casino supervision. The report stated: “VCGLR has not paid sufficient attention to key areas of risk in the casino's operations, such as detection of people excluded by Victoria Police, responsible gambling and money laundering.”

It added that VCGLR is now moving to correct these issues by establishing a dedicated casino team.

TheShout has contacted VCGLR for comment.