NSW to Bring in Cashless Pokies as Battle Against the Clubs Heats Up

gambling reform nsw pokies cashless gaming card perrottet

The NSW government has declared an all-out war on one of the most powerful lobby groups in the country in an effort to tackle the social harm caused by gambling.

The battle of the pokies has been raging for months now, with high-profile sackings and dirty tactics across the board, and the problem is shaping up to be a key election issue when NSW goes to vote next month.

In the latest saga, the NSW government has announced that cashless pokies will become mandatory across the state by 2028. In one of the biggest gambling reforms ever undertaken in Australia, the changes are set to be passed through parliament later this year.

Full details of the new rules can be found at the bottom of this rolling piece.

This new development comes as the Liberals and Nationals face down polling indicating they will be turfed out of government. As such, the Coalition appears to have picked an issue and run with it, all in an effort to control the narrative of the low-hanging fruit of a social problem most people aren’t thrilled about.

The Liberals have forced Labor into making a call on a subject they are clearly reluctant to talk about, and Labor is awkwardly trying to position themselves as offering something different to the government — a position that makes them seem either complicit in the gambling racket or uncertain. Next to the firebrand defiance of Coalition MPs, it’s a weak look.

NSW Labor had hoped to replicate the success of their federal counterparts last year — swanning into government purely off the back of being Not the Other Guys, but the gambling issue has opened a chink in that armour. Standing for nothing and keeping your head down might get you by, but appearing to stand against something people actually want might not.

Still, it is only one issue out of a handful that the Coalition is hoping to pin electoral success on. They’re likely going to take some heavy flak for the management of jobs and the icing out of unions in strike and labour negotiations that have plagued education, healthcare, and transport, not to mention the twin crises of the cost of living and housing. However, they are hoping to make up ground in the traditionally Coalition-weak areas of climate change and the environment.

The NSW government has poured millions into projects designed to rev up electric vehicle uptake and is in open competition with other states and territories to become the most welcoming of next-gen transport.

But it’s unlikely to be enough to save their bacon after years of scandal and corruption, hence why they’re making one final push for social reform via something everyone can understand: the pervasive menace of the pokies.

Whether it will work on not remains to be seen. Here’s what you ned to know about this goliath-and-goliath struggle between some of the country’s most powerful institutions and people.

How Problematic is Gambling?

Australia and gambling go hand in hand. Ever since 1788, white colonial settlers have loved to make a wager or take a punt on the horses. However, it was in 1956 that the true history of pokies in the state of NSW started to shape up.

Back then, illegal slot machines were everywhere. In an effort to regulate the practice, ClubsNSW was given the right to run pokies in a controlled manner to streamline the whole thing. The clubs had good connections to politicians, even back then, and were frequented by returned servicemen who the government wanted to support.

One historian of the clubs in NSW described the legal change as “dramatic.”

“Clubs went from being little scout halls to the Taj Mahal. In half a decade the whole thing changed completely,” Nick Hartgerink has written.

Now, the profit of pokie machines in NSW alone sits at $23 million per day. Gamblers in the state lose an estimated $2.1 billion per year to the machines, according to Liquor and Gaming NSW statistics.

It’s not just the money that the government has a problem with. The social cost is really what they’re going after. As Rob Stokes, Cities Minister (and arch-supporter of the NSW Premier Dominic Perrottet) told Parliament, the “comforting stereotype of the suburban bowlo nestled in a quiet street under the gum trees” is gone. Now, clubs in NSW are “bloated concrete bunkers separated from their community by vast treeless carparks.”

He went on to say that “Human misery is a financial lifeblood for many NSW clubs.”

In fairness, it’s not just a NSW problem. Australia has one of the highest problem gambling rates of any country in the world. Roughly 80% of the country gambles, with an estimated $25 billion lost to gambling annually. In Victoria, the social cost of gambling, based on productivity loss and psychological and relationship damage, is estimated to be around $7 billion each year.

That being said, NSW is a special case. Other states and territories do not give gambling such free reign. WA, for example, bans gambling machines outside of casinos whereas citizens of NSW have more opportunities to gamble than virtually any other place on Earth. There are more pokie machines here than there are anywhere else except for Nevada, the home of Las Vegas.

Outside of the issues associated with ‘legitimate’ gambling, the NSW Crime Commission released a damning report into gambling in the state, saying that organised crime is washing billions of dollars through the pokies. They proposed a number of key reforms to create paper trails that will give greater oversight into who is spending what and allow police to track the proceeds of crime far more easily.

Ostensibly, this is what the NSW government is seeking to reign in when it talks about gambling reform.

What’s the Premier’s Plan?

Perrottet aims to tackle the problem by introducing what is known as a ‘cashless gaming card’. The cards will require gamblers to pre-load funds before gambling and will come with a host of restrictions on how, when, and where a person can gamble. All machines in the state will have to be refitted to only allow these cards if the proposal goes ahead.

In addition, the government has also said that it will introduce a higher tax on revenue from pokie machines. They have estimated that the change could bring an additional $364 million into the state’s coffers over three years.

How’s That Going?

A limited trial of the new scheme is already underway in Newcastle, with further trials to be rolled out early this year. Results have yet to be gathered and analysed, but it’s likely we’ll have some of this information soon.

ClubsNSW has launched a series of attacks on the trials, and the concept in general, saying it’s tantamount to government surveillance. Posters with messages telling customers to say no to cashless gaming cards have gone up throughout ClubsNSW venues while executives within the organisation and their allies have come out in opposition to the cards.

However, that might not be all that the organisation is doing.

Did ClubsNSW Dig Up Perrottet’s Nazi Uniform in Revenge for Pokies Reform?

At the start of the year, Perrottet announced in a press conference that he dressed up in Nazi uniform for his 21st birthday. It’s not the kind of thing a politician admits to unless they absolutely have to.

Perrottet has claimed that he “doesn’t know” if there is a photo of him wearing the costume but, considering he turned 21 in 2004 and those tiny 4-megapixel digital cameras were all the rage back then, we’re willing to be that there is a photo out there in a manilla envelope in some private detective’s desk drawer. If there wasn’t, why would you come clean about the Nazi thing? Deny, deny, deny is politics 101.

While the revelations were shocking and distressing to the public, and devastating to the NSW Liberal’s election chances, they were also very, very convenient for anyone who hates Perrottet and wants him gone — and one very large and powerful organisation that Perrottet and the NSW Liberal Party has been feuding with springs to mind.

For legal reasons, we’re not saying that ClubsNSW had anything to do with digging up this dirt on Perrottet, but the timing of the revelations is interesting.

Heads Roll as Battle of the Pokies Heats Up

A few weeks after the totally normal ‘the Premier cosplayed a Nazi’ revelation, the Liberals scored big when the head of ClubsNSW, Josh Landis, was sacked.

Landis was forced to resign after the ClubsNSW board voted to terminate his contract over comments he made about Perrottet.

“I think it’s fair to say that the premier has very little understanding of this issue and has acted from his conservative Catholic gut rather than based on evidence,” Landis said in reference to the pokies debacle.

“What he’s done is create hyper-anxiety among the industry and among people who go to clubs, and hyper-excitement among those who want reform”.

Perrottet did not hesitate to strike, firing back that the comments were an “attack on every single person of faith in our state,” and that “there is no place for comments like that in modern Australia.”

Landis issued an “unreserved” apology for referring to the Premier’s faith, but his fate was sealed and his dismissal was announced the following day.

Landis had been CEO of ClubsNSW and executive director of ClubsAustralia since 2020, a position he worked up to from senior policy officer in 2007. He was a staunch opponent of gambling reform and has frequently claimed that clubs couldn’t survive without gambling. He also attended training in the US where he learned, from one of the directors of the National Rifle Association, how to target and influence politicians.

NSW Set to Introduce Cashless Pokies by 2028

“Today we make a once-in-a-lifetime change to create a better NSW,” Perrottet announced on Monday, February 6.

“We address the number one recommendation from the Crime Commission, and we will end money laundering in pubs and clubs, while protecting jobs and supporting communities”.

The cashless pokies decision will see all gambling machines in the state only accept the new cashless gaming cards the government is bringing in. They have said that clubs will be assisted in the financial transition to the new model.

It’s the biggest change in a range of new measures this legislation will implement. In addition, the government will ban political donations from both pubs and clubs, effectively severing one of the key ties to political influence that the hospitality sector has had for decades.

2000 machines will also be bought back from NSW’s venues in an effort to cut the number of pokies in the state.

A ‘Transition Taskforce’ will be established to oversee the rollout of these changes, with a full roadmap for how the state will go cashless to be published next year.

We’ll keep you posted as this story inevitably unfolds.

Related: The NSW Government Versus the Gambling Industry: Will the House Win?

Related: NSW Gov Stakes Its Reputation on Cashless Gambling Cards

Read more stories from The Latch and subscribe to our email newsletter.