The Western Cape government has proposed a legislation that allows for the relocation of casinos to the more lucrative Cape metropole. This bill was slammed by casino bosses who claim that if implemented, it would have to a number of negative implications on the gambling business, such as loss of staff jobs, decrease in revenue, and lower profit margins.
This could also mean that land-based casinos can suffer a hit by the popularity and rise of their online competition, since the list of the best South African online casinos is getting bigger and better in time.
Let’s cover everything you need to know about the Cape Town casino move, the parties that get left behind, the public’s opinion, and what’s to be expected.
About the Bill
The Draft Western Cape Nineteenth Gambling and Racing Amendment Bill that was proposed this year tries to make amends to the existing Western Cape Gambling and Racing Act from 1996. This new legislation would permit existing casinos to be able to move to other areas. Casinos in Cape Town were allowed to operate in five of the city’s areas, and the respective owners of the casinos were given a permit to operate for 10 years in the designated region.
These operational exclusivity periods have now expired, hence all the noise and hype about this new proposed legislation that could change how and where casinos can operate in Cape Town.
The bill contains proposals to make casino licenses for the City’s eastern region, more specifically, Strand and Somerset West, and Tygerberg and Table Bay area. Finance MEC Ivan Meyer from Western Cape has stated that the bill has been proposed for a number of reasons that should have a positive impact on Cape Town, but it is yet to be presented before the committee.
A number of specialists wanted to comment on this topic. Chief Executive of Sun International Anthony Leeming said that any relocation by competitors would affect GrandWest Casino negatively, and that “any of the four licensed outlying casinos will be allowed to apply to the Western Cape Gambling and Racing Board for amendment of their licenses”.
He also added, “The amendment, if granted, will permit the respective casino operator to relocate their licensed operations from their existing locations in the outlying areas to the newly established Table Bay and eastern region.” In his opinion, GrandWest Casino could see a 24% decrease of gross gambling revenue, and the staff members of the casino will decline from 15 to 20%.
When asked to elaborate more on the consequences, he stated, “The majority of job losses will be from the casino, but a drop in footfall will result in additional and similar job losses in the supporting… operations at GrandWest, as many of these businesses are entirely dependent on footfall generated by the casino.”
The timeline for this bill was further explained by Jacques Booysen, chief executive at Tsogo Sun, who said: “We have seen the draft legislation and will submit our comments in terms of the process, with comments due by July 31. We are supportive of the possibility of relocating outlying casinos into the metropole as long as this is done in a manner that makes commercial sense for us.”
The Affected Sides
Local daily newspaper Cape Argus has revealed that the City of Cape Town received applications for the rezoning of Somerset Country Club with a motive to allow business activities and potential development of a casino with a hotel. This club is located on the corner of the R102 and the N2, and the applicants are Messrs Headland Planners and Southern Sun Hotels – which is a division of Tsogo Sun.
A notice undersigned by Gregory Pick – the DA councillor is indicating that the property would be subdivided into five portions. A general business zone, a zone for the construction of a casino and a multi-level garage, and a portion for the development of a 120-room hotel. Tsogo Sun, however, hasn’t officially confirmed that they are going ahead with this project.
There’s been a lot of discussion about who’s affected the most by this bill, and what kind of impact will these relocations of casinos have on the local economy. Alan Winde elaborated the risks that relocations carry: “One has to be very careful when this is being done. One of the provisions we would have to look at is what happens to the people who get left behind. We would also consider what happens to the local economy that will be affected by the relocation. What needs to be stressed is that everything will be taken into account before any decision is made”.
Public and Expert Opinion
The application for developing a new casino and a hotel in Somerset West that we mentioned above has provoked a number of outages from the community who are not satisfied with how transparent the City has been. The initial period for objection was due to the 6th of August, but a spelling error on the advert for public comments on the plan has given residents more time to express their concerns and opinions.
Brett Herron, the mayoral committee member for transport and urban development said: “However, it had to be re-advertised because there was a typo in the original advert. The re-advertising period started on August 5, 2018, and will run until September 3, 2018. Thereafter, the City will refer all of the comments received to the developer to respond to. Once the developer has responded to the comments or objections, the City will compile a report consisting of all of the public comments and the developer’s response to those comments. This report, together with the development application and other required documents, will serve before the Municipal Planning Tribunal for a decision”.
While this thing with the residents has been going on for quite some time now, a few expert opinions and arguments also reached the spotlight. Expert Pieter Human has raised a few realistic concerns about the local economy in case a new casino gets opened. His thesis on the social impact of casinos in Western Cape was published at the Stellenbosch University, and it raises some really good points. “The National Lottery and the slots route operations has the lower- to middle-income sector as their target market and already makes gambling easily accessible to anyone in the Helderberg. This is generally a very vulnerable sector of our community and the social impacts of compulsive gambling on this sector could be potentially devastating,” Pieter Human said.
It remains to be seen how everything plays out, but if Tsogo Sun gets approved and go forward with the development plan, the complex itself would create 650 permanent jobs from both, in-house staff and outsourced opportunities.
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