Stimulated spending

Let me understand this. According to this news report, in Queensland, $14 million extra was spent on pocker machines than expected in December.

The big jump last year clearly coincided with the Federal Government’s $10 billion handout on December 8, aimed to be spent in the retail sector to energise the slowing economy.

But it seems many Queenslanders poured the money into the pokies, hoping to turn it into a massive pay-day.

This coincides with the Government’s stimulus handout that month. Queensland has around 20 percent of the population, so about $2 billion of the government’s $10 billion handout likely went that way. That means that for each extra dollar, Queenslanders got in, they splurged less than a cent (0.7 to be exact) on the pokies.

To put that in perspective, Queenslanders spend around $2b each year on poker machines or around one percent of their total spending (approximated by Gross State Product of around $200b). So the shocking news is that Queenslanders took their extra stimulus income and didn’t spend as much as usual on the pokies — thereby depriving the Queensland government of much needed tax revenue.

3 thoughts on “Stimulated spending”

  1. Joshua

    The ‘maths’, seem problematic – essentially because of the sparcity of the data supplied. The $2 billion to Qld seems reasonable but how , and on what basis, do we jump to the assertion that Qld ‘splurged’ less than 1 cent per person on pokies?

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