June 4, 2016
SYDNEY MORNING HERALD STATE POLITICAL EDITOR
State governments are unlikely to take policy actions that will reduce the flow of gambling taxes. Photo: Virginia Star
With the NSW Planning Assessment Commission decision on consent for James Packer’s proposed new hotel, casino and apartment tower at Barangaroo imminent, much of the focus has been on the scale of the development.
That’s unsurprising given the displacement of public space and the sheer scale of the building being proposed.
Far less time has been spent focusing on how the new development will increase the NSW government’s reliance on the gambling dollar.
An artist’s impression of the latest Barangaroo design.
If it is approved, Packer’s new “VIP gaming facility” will not feature any poker machines; it was one of the conditions imposed on the new licence when it was legislated by the Parliament.
It will, however, be allowed an unlimited number of so-called “multi-terminal gaming machines” – otherwise known as automatic gambling machines.
These machines – occasionally found in NSW clubs and in the Star casino – are electronic versions of the popular “table games” such as roulette and blackjack.
Gambling experts suspicious of Packer’s long game have previously suggested the concession means it would be easy to switch to pokies by just swapping out one set of electronic terminals for another.
Crown argues that this would take an act of Parliament to achieve, which is true.
But as has been widely reported, Packer’s Macau gambling interests are doing badly thanks to a crackdown on corruption by Chinese government.
If this trend continues, it would not be surprising if the billionaire mounts the argument that he needs the revenue from pokies at some point in the future to keep his hotel resort viable.
But even setting this eventuality aside, Crown is guaranteeing its new development will deliver the NSW government a minimum of $1 billion in taxes in the first 15 years of full operations, including the $100 million licence fee.
That means a minimum of $60 million a year in gambling taxes from the operation will go to the government each year.
However, an economic benefit analysis commissioned by Crown from Allen Consulting states that “gaming taxes from Crown Sydney will be $114 million per annum”, so the figure could be much larger.
To put this in perspective, the 2014-15 budget papers forecast that in 2019 – the year before Packer is permitted to open his casino – the Star will hand over $299 million in gambling tax.
As poker machine policy in NSW has shown, once on the teat of regular gambling taxes, it is very unlikely that increasingly cash-strapped state governments will take policy actions that will reduce the flow.
Against this backdrop it’s interesting to note the difficult path to public release of the Baird government’s most recent report on gambling in NSW.
In 2013 the Office of Liquor, Gaming and Racing awarded a tender for research into the harm caused by various types of gambling.
The research was to “determine the type of harm likely to be attributed to each gambling product and the effects on the gambler and friends and family”.
“The research should determine the level of risk for harm for each of the gambling products,” it said.
Pokies and automatic gambling machines, horses and dogs, casino table games, lotteries, Keno, sports and non-sports betting would all be considered.
The tender for the work – worth $263,000 – was won by the University of Sydney’s Gambling Treatment Centre on October 23, 2013. According to the tender it was due to be delivered by “mid-2014”.
The university says there was a delay “due to the challenge, experienced by many research studies, of recruiting the required number of suitable participants”.
It was eventually handed to the department in December last year – 18 months late – but delivered nonetheless.
So where is the report? In March, Liquor & Gaming NSW said the research “remains unfinalised and is yet to be considered by the government. No date has been set for its release.”
In her second budget on June 21, Gladys Berejiklian will be unveiling the latest annual takings from gambling in NSW.
According to last year’s forecasts, pokies in pubs will deliver $623 million in tax revenue in 2015-16. The figure for gaming devices in registered clubs is expected to be $741 million.
Which report is likely to surface first: the decision on Packer’s casino resort or the gambling harm research?
Sean Nicholls is state political editor.
Source : The Sydney Morning Herald