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Following the lead of the province of Quebec, the leaders of the province of Ontario are now examining the possibilities of starting their own provincial online gaming and poker outlets.
Facing a deficit of $24.7 billion this fiscal year, the government of Ontario, headed by Premier Dalton McGuinty, is attempting to find ways to make up that shortfall. Premier McGuinty has previously shot down the ideas of increasing taxes on alcohol sales in the province, but he seems to be willing to discuss the idea of the province opening up its own online gaming and poker portals. With the appointment of a new director for Ontario Lottery and Gaming in Paul Godfrey, the discussion of the new online operation is moving forward.
Godfrey, who is currently the president and CEO of the National Post newspaper and has previously held the CEO post at Metro Toronto and a similar position with the Toronto Blue Jays, has stated that he believes that the implementation of a provincial online gaming and poker outlet would benefit Ontario as a whole. It is estimated that Ontario’s citizens are responsible for approximately $1.9 billion a year in action on online gaming sites and Godfrey believes that Ontario is losing out in taxes and other revenue through not having an outlet for its citizens. “Money is going out of this province to other provinces as well as offshore sites,” Mr. Godfrey stated.
The opposition to legalization and regulation of any Ontario-based online gaming outlet is pointing out many issues that concern them. In an interview at TheStar.com, Jeff Derevensky, who heads McGill University’s International Center for Youth Gambling Problems and High Risk Behaviors, weighed the pros and cons of Ontario’s ideas. With more than 2000 online gaming sites available worldwide, Derevensky states that, “If they can recoup a slice of it, then that (money) could be better used in government-run programs.”
The downside of opening up a provincial gaming operation is that Ontario’s youth haven’t been prepared for such activity, Derevensky notes. While the Ontario school system has instruction in other possible problematic areas as alcohol, drug usage and underage sex, there is nothing in place that deals with the potential pitfalls of online gaming. If the Ontario provincial government was to open up a government run online gaming and poker site, “It puts more young people at risk,” Derevensky said in TheStar.com article.
Ontario already has an active lottery and gaming establishment but, according to TheStar.com, the operation has faced several problems. Revenues have been declining because of a loss of previously seen American action: because of stricter border controls, fewer Americans are crossing the border to take part in Ontario’s gaming options. While Ontario Lottery and Gaming pulls in approximately $6.5 billion per year, the company has had several problems that have made the news, including lawsuits from people who say their product made them gambling addicts, according to TheStar.com.
Canadians are free to participate in online gaming and poker, but the different moves by Ontario and Quebec are a grab at getting their share of the money made by these sites as well as being able to enact governmental controls on such activities. The Kahnawake Gaming Commission, located outside of Montreal, is the hub of the online gaming industry, licensing and managing many of the top online sites in the world. Because the KGC operation is a private company under the Mohawk Nation’s control, however, the provincial governments see no revenue from the venture.
Earlier this month, Quebec announced that it would be opening its own state-run online gaming and poker site later this year. Quebec’s Finance Minister Raymond Bachand has predicted that the new operation would generate $50 million in dividends within three years of activity. With its budget shortfall, this could be what Ontario is looking at as a way of cutting into the deficit without raising taxes in other areas.
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