File Photo (Image Credit: CFJC Today)

By Nancy Bepple

Sound Off

SOUND OFF: How will BCLC survive the COVID-19 pandemic?

Nov 25, 2020 | 1:52 PM

WATCHING AN AD ON TV LAST NIGHT for Spin Casino made me wonder about the future of BC Lottery Corporation, one of Kamloops largest employers. How will COVID affect the long-term viability of one of Kamloops’ most stable and profitable corporations?

BCLC must be worried. As the weeks stretch into months, the shutdown of provincial casinos has had a huge hit on the Crown corporation’s revenues. In the province’s quarterly financial update in September, BCLC yearly revenues were forecast to be lower by $894 million due to the closure of casinos as part of the COVID-19 pandemic protective measures. Given that in February, the lottery corporation forecast a revenue of 1.4 billion, that’s a huge drop.

But it’s not just the drop in revenue BCLC must be worried about, but also whether the gamblers will return.

With COVID shutting down brick-and-mortar retail stores in Ontario, business owners aren’t just worried that they might not survive the shutdown. They’re worried, even if they survive the shutdown, their customers who have moved to online shopping won’t come back when the shutdown is over. BCLC must be equally worried gamblers will switch to online gambling too and not come back to a brick-and-mortar casino.

Whereas a brick-and-mortar casino is fixed in place, online gambling can be located anywhere. BCLC provides online gambling. But so do many other companies around the world.

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As BC casinos stay shuttered, companies like Spin Casino, licensed by the Malta Gaming Corporation, are luring BC gamblers to their sites. And when gamblers are on other sites, that is where the money goes.

Gambling revenues are an important source of funds for the government. Before COVID, BCLC contributed more revenue than forestry, oil and gas, or other natural resources such as mining. It contributed more than liquor sales or BC Hydro. The gambling revenues were greater than taxes collected for fuel, tobacco or property transfer taxes.

In all, gambling revenues contributed about 2.2 per cent of the provincial revenues. But with COVID, and the closure of the casinos, that number has tanked.

The lottery corporation was already facing challenges before COVID. An Ipsos poll found 45 per cent of people aged 18 to 34 do not spend any money on gambling in a month, compared to 36 per cent of 35 to 54 years old.

Even before COVID, BCLC knew it had to attract younger customers, to replace the aging demographics in its casinos. One study found that Canadians between the age of 18 and 24 are more interested in Xbox and PS gaming than casinos. Meanwhile, the demographic most interested playing slots are between 55 and 64.

Now, BCLC not only has to attract younger customers, it also has to lure back its existing clientele.

If the current gamblers shift to online gaming run by out-of-country casinos, then those revenues are lost to BCLC. No revenues for BCLC means lost revenues to the provincial coffers.

Sometime, someday, we’ll get out of COVID. But when we do, just as with brick-and-mortar stores wondering about their future, BCLC must be wondering if the brick-and-mortar BC casinos will be quite as profitable. Concerning for the provincial government services that rely on the gambling revenues. Equally concerning for Kamloops is how a possible reduction in casino revenues might impact the BCLC workplace here in Kamloops.

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Editor’s Note: This opinion piece reflects the views of its author, and does not necessarily represent the views of CFJC Today or the Jim Pattison Broadcast Group.