Published in the Mandarin Premium
18 October 2023
You want money laundering with that? Minns’ pokie policy jumps the shark
There are times in public policy when even the most practised suppression of the ethical gag reflex is tested to its outer limits. On Tuesday, the ethical stench surrounding the NSW Minns government’s position on poker machines had many reaching for the Buscopan Forte to cope with the nausea.
“Gambling costs aren’t just measured in dollars; there are also family impacts including time away from loved ones, impacts on physical and mental health, and community impacts,” lamented David Harris, the NSW minister for gaming and racing.
“The first Minns Labor government Budget delivered $100 million funding injection to reduce gambling harm across NSW.”
Don’t mention the lost savings or mortgagee-in-possession forced sales.
The $100 million comes from fines the Star Casino was hit with after getting busted red-handed breaking money-laundering laws.
“This huge funding injection will allow for the enhancement of services and initiatives to reduce harm in the community from gambling,” Harris roared.
He specifically cited:
$6.4 million to enhance self-exclusion and introduce third-party exclusions in pubs and clubs;
$3.4 million for the independent panel, established in July this year, to run and evaluate a cashless gaming trial in pubs and clubs, with expressions of interest recently called for venues to take part;
$21.7 million each year, for three years, from 2024-25 to fund other gambling harm minimisation initiatives and reforms, including those recommended by the Independent Panel; and
$10 million in additional investment in 2023 for the Responsible Gambling Fund, through the Office of Responsible Gambling, for the provision of GambleAware Counselling and support services.
Conveniently, neither Harris nor Minns mentioned the revenue the state rakes in from gambling victims, nor how much they have forecast it to increase, despite the clear harm the pokies industry does.
Excluding casinos — which rake in a fortune from pokies but blend the revenue in with other forms of gaming — pokies in pubs and clubs delivered $2.258 billion in state taxes in the 2023-24 NSW budget handed down by treasurer Daniel Mookhey. That rises to $2.669 billion in 2026-27 across the forward estimates.
The pokies payout for the Minns government from the current Budget over the four years of forward estimates is $9.847 billion, a figure almost certainly massaged down to make it less than an eye-popping $10 billion.
To put that into context, the total estimated Sydney Metro cost is $21 billion, a decade-long infrastructure renewal project Labor has repeatedly questioned the value of.
But here’s the kicker — the Labor Party, through its affiliated clubs, effectively owns and operates pokies. We’ll get to that in a moment.
Getafix and the magic potion
As Australia’s founding state, NSW has always had a complex and enduring relationship with vice, addiction and revenue wrought from social harms.
It dates back as far as the Rum Rebellion in 1808, when the town was so awash with grog as a currency of payment (because of a lack of coin) that it deposed Governor Bligh.
Such was the depravity, dereliction and corruption of the Rum Corps, officially called ‘The NSW Corps’, they were used as a touchstone when Geoffrey Watson KC described the corrupt activities of NSW Labor powerbroker and kingmaker Eddie Obeid, who remains in the custody of His Majesty for his criminal conduct in public office, at the opening of the Independent Commission Against Corruption hearing into his nefarious affairs.
Just this month Obeid, alongside son Moses, unsuccessfully sought to have his custodial sentence overturned.
Booze, sex and drugs have, for at least half a century, been the mainstay of the vice industries that created assorted crime empires that rose and fell.
The urban lore, and lure, of Sydney’s sinful lifestyle is the subject of a major literary, dramatic and documentary obsession: the Underbelly franchise; Blue Murder; The Big League; Mr Sin; Rake; and, more recently, Dr Michael Mohammed Amad’s seminal portrait of youth experience in south-west Sydney, The Lebs.
But where the state really got its hands dirty was with the proliferation of gambling, especially the extension of electronic gaming machines into pubs as opposed to their former confinement to clubs and casinos.
The long game
Pokies have been legal in NSW since 1956, a first mechanical and then electronic fix that uses an algorithm to return a set amount of cash to the punter across a set number of plays. The delta of the equation always favours the house. The amount the house makes is dependent on whether or not the punter walks away or chooses to gamble their initial win rather than bank it.
At this year’s NSW election, pokie reforms became a lightning-rod issue as the outgoing Perrottet government looked to progressive popular sentiment to start reining in the influence of the pokie-funded clubs.
It was a bizarre moment in state politics because NSW Labor simply refused to support the crackdown on pokie profits, despite the very evident social harm they cause to communities, especially more vulnerable migrant and lower socio-economic demographics previously unfamiliar with technologies architected to profit from addiction.
The pokie-palazzos of Sydney’s west are iconic. Any of the Dooleys (Catholic) clubs. The Blacktown Workers Group. Panthers. The Bankstown Sports Club.
Walk into any of these venues and it feels like Las Vegas compressed into a city block (or small suburb for Panthers, which, to be fair, is a footy club.)
Then there’s the Randwick Labor Club (Limited), which has conveniently omitted the word Labor from its trading name. Its branding is now just the Randwick Club. Funny that.
The Randwick Club’s declared poker machine takings for the 2022 financial year in its annual report were $2.8 million, a solid rebound from the previous year that extracted $1.9 million from gamblers.
But it’s a minnow compared to serious clubland.
Blacktown Workers Group declared “poker machines — net clearances” of $49.1 million in its 2022 annual report, a massive improvement over the previous year’s $30.8 million pokie take.
Only one genuinely analytical piece on the influence of the gambling industry on Australian politics has ever been done, and it comes from the ABC, which strangely failed to heavily promote it or propel it forward with any committed vigour.
It is a very inconvenient piece.
It’s still there, and breaks down the cascades of donations and money as best it can, which is necessarily incomplete but admirable in cutting through the opacity and spin.