a. General intro

The Casino Association of South Africa represents the interests of the country’s legal casino gaming industry, as well as the growing public that the industry serves. CASA’s emphasis is on playing a constructive and positive role in the evolution of good public policy and good governance in respect of the casino industry.

CASA represents all but two of the companies operating in South Africa’s commercial casino industry and represents 35 of the 37 casinos in the country. CASA’s members are:

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b. A word from our Chairman

This edition of the annual CASA Survey again presents a comprehensive snapshot of South Africa’s casino industry, and the extent to which it continues to play a constructive and beneficial role in the national, provincial and local economies. It paints a laudable picture of an industry that is alive to its social responsibilities, a major creator of employment and a provider of reputable and trustworthy leisure opportunities for all sectors of our society.

Quite correctly, South Africa’s scrupulously regulated gambling dispensation demands of the casino sector the most exacting standards of accountability, not only to government regulators, but to the broader society within which we conduct our business. The Survey is but one of the instruments by which CASA and its members seek to meet this obligation, in the belief that over the years of its publication it has provided a unique narrative of the development and growth of the country’s casino industry as it has unfolded since its legalisation in 1996.

One of the principal reasons for the demonstrable success of the casino sector and its ability to contribute so significantly to the realization of South Africa’s development goals has been the constructive relationship that exists between the industry, government and regulators. This has been achieved, I believe, because we share a common interest in ensuring not only that the industry overall is both socially and economically successful, but also that it both is, and is perceived to be, safe.

But in South Africa, as in any regulated jurisdiction, the profitability of the casino industry is intimately dependent on what government allows us to do, requires us to do and forbids us to do. And in the same way that our industry is vulnerable to government, governments are instinctively vulnerable to public opinion. Confronted by popular misgivings about the social impact of gambling behaviour, the first reaction of government – any government – is more intervention, greater control and stricter regulation. When that happens, we must be in a position to defend ourselves against policy initiatives that are not based on sound evidence.

The CASA Survey provides one such defence against policy-making that is not soundly based on facts. By making available these data about the performance of the casino industry, we seek to ensure that legislators and regulators are equipped with sufficient empirical evidence to produce good public policy outcomes. Of course, to obtain a fully exhaustive picture, this Survey should be read in conjunction with other occasional CASA publications and data bases, and the research published by the National Gambling Board and the National Responsible Gambling Programme.

These industry efforts to assist in the establishment of a stable, predictable and coherent regulatory dispensation are fundamentally important, as a muddled policy environment makes it extremely difficult for the casino industry to operate with any degree of certainty. Casino companies will invest in expansion and refurbishment and create jobs most confidently when government is self-assured, comprehensively informed and proactive in setting the rules of the game. Where governments fail to put in place unambiguous, predictable and consistent legislative and policy frameworks, the sustainable development of our business becomes almost impossible.

It is CASA’s hope that this edition of the Survey will go some way towards ensuring that outcome and prove as useful as its predecessors in providing the reader with all the information that is required to understand the dynamics of South Africa’s casino industry.

Jabu Mabuza
Chairman Casino Association of South Africa

Should you need further information about our industry, or CASA and its activities, please contact our national office by e-mail (info@casasa.org.za) or phone +27 21 409 2460.

c. A word from our Chief Executive

This is the eighth successive year in which the Casino Association of South Africa has published its annual Survey of Casino Entertainment, in fulfilment of our obligation to gather, analyse and disseminate reliable data about the state of the country’s casino industry, its contribution to national and provincial tax revenues, and its considerable contribution in the field of corporate social accountability.

The year has not been an easy one for our industry. The satisfactory macro-economic stability on which we have historically been able to depend now appears at risk, for there are signs that domestic inflation has been creeping upwards, driven by unsustainable wage settlements in the public sector, increases in property rates and utility costs, and deteriorating basic services such as water and electricity.

At the same time, high levels of household debt are still restraining consumption, which should be a principal driver of growth during our recovery from the global recession. This can only be sobering news for an industry such as ours, which relies on restored levels of disposable and discretionary income.

But that said, this Survey reveals the considerable economic benefits which the State continues to derive from the casino industry. During 2011, South Africa’s casinos were responsible for more than R14 billion of the R17 billion that was generated by all forms of legal gambling. This turnover yields significant tax revenues, especially for the provinces where casino taxes and levies in most cases represent the largest percentage of own-revenue. In fact, an analysis of the value added statement of the casino industry clearly indicates that in the 2011 financial year some 39.31% of income from the industry accrued to government.

It is thus in the national interest that Government should approach with great caution the imposition of further regulatory restrictions or demands that may threaten the profitability of the casino industry and its ability to create jobs. This is particularly the case in respect of new taxes, which are bound to have an overall negative impact on casino turnover and thus on the tax payable to provinces, as well as on the sustainability of the approximately 52 000 jobs that the industry currently maintains.

The casino sector is already faced by a regulatory environment that is becoming increasingly onerous as new BEE requirements, corporate social investment demands and community expectations are being imposed as a condition of licence by all provincial gaming boards.

For that reason, arguably the most significant development in the year covered by this Survey has been the release of the long-awaited final report of the Gambling Review Commission. CASA took full advantage of several opportunities to submit comprehensive submissions to the Commission and also had the opportunity to make oral representations.

Overall, the report spoke favourably of South Africa’s casino industry, finding that, on the whole, it is very well run and compares favourably with casinos anywhere else in the world. Importantly, it found that the approach taken by the South African government to encourage limited forms of casino-based destination style gambling, rather than allow for the proliferation of small and medium-sized gambling clubs throughout the country, appears to have worked well.

It further commented on the considerable capital investment that has been made by the industry, and the consequent benefits that have accrued to the tourist and entertainment sectors. On problem gambling, it found that the incidence has remained relatively constant, despite the significant growth in the size of the gambling industry, suggesting that harm minimisation measures have been relatively successful.

CASA’s experience in engaging with the Commission once again reinforced our conviction that the sensible regulation of the gambling industry cannot take place in an information vacuum and it is therefore imperative that lawmakers have at their disposal up-to-date and dependable knowledge of the social and economic impact of legalised gaming in South Africa. It was therefore encouraging that the Commission explicitly recognised the need for public policy to be based on empirical research.

This edition of the Survey – and its predecessors – thus represents part of our mandate to assemble and disseminate factual and reliable information about the casino industry to all interested parties, in order that it may provide policy-makers with a firm and tested foundation of data.

CASA has in the past expressed its concern about the unpredictable consequences of the approaching reality of legalised online gambling on the established casino sector. In this connection, the Gambling Review Commission has proposed that a maximum number of licences should be determined for online gambling, to allow for the controlled rollout of online gambling and to monitor its socio-economic impact over time. Too little is known at this stage about its impact on problem gambling to be able to allow a free market. In addition, the approach to limit the number of landbased gambling opportunities can be substantially undermined, if online gambling is not strictly controlled and limited.

CASA supports this approach and remains of the view that online gambling should be regulated and that land-based casinos, because of their already licensed and regulated status, should be given priority to bid.

Until then, online gambling remains unlawful in South Africa and this has recently been confirmed by the Supreme Court of Appeal, after years of protracted litigation between the Gauteng Gambling Board and Piggs Peak Casino. The SCA judgment ruled that players who participate in online gambling are doing so illegally, as is any organisation purporting to provide such a service or any financial institution facilitating such transactions.

This rapidly changing environment will further test CASA’s essential role as not only the official representative of the interests of the country’s legal casino gaming industry, but as a publisher of well-researched data about the sector. Rigorous, predictable and effective regulation is a cornerstone of the casino industry, but must occur within a policy context that is informed and rational. It is therefore CASA’s hope that this Survey will contribute to that store of knowledge by providing elected officials, other decision-makers and the public with comprehensive, timely and accurate data about the important role the casino industry plays in the economies of communities nationwide.

d. Staffers at the CASA office

Charl Faurie is CASA's General Manager. He comes from an extensive career in the diplomatic corps where he served in Washington DC, Copenhagen, and Stockholm. During this time he was also involved in peace negotiations between Angola and Mozambique as well as negotiations between South Africa and the European Union on the Trade Agreement.

Monica Mazula is generally the first voice you'll hear when you phone the CASA office as she joined the team as a receptionist in October 2004. Monica, who matriculated from Maitland High School, attended Boston City Campus where she obtained her Certificate in Electronic Secretarial Studies.