Govt warned of SkyCity pokie cost to society

Mr Joyce's department led negotiations with SkyCity over the controversial deal. Photo / Russell Smith

The Department of Internal Affairs has warned the Government that extra pokie machines at SkyCity, resulting from its convention centre deal, risks increased harm to the community, Steven Joyce confirmed yesterday.

Gambling opponents cite research suggesting the extra 230 pokie machines alone could cost society as much as $6.6 million a year. But with the Government touting a $90 million annual boost to the Auckland economy from the international convention centre, Cabinet "decided on balance that it was best to go with the deal", Economic Development Minister Mr Joyce said.

Mr Joyce's department led negotiations with SkyCity over the controversial deal, which was originated during discussions between the casino's board and Prime Minister John Key.

However, while Mr Joyce has released a detailed financial report on the deal prepared by corporate advisers KordaMentha, he has yet to release official advice about the social impact of allowing SkyCity an additional 230 pokie machines and 52 more gaming tables as well as ticket-in, ticket-out technology which increases gambling profits.

Questioned by Greens co-leader Metiria Turei, Mr Joyce told Parliament those effects had not been quantified. Mr Joyce said the department's advice would be released in time for the public to consider it before changes to the Gambling Act were made.

Ms Turei cited a 2010 Australian Productivity Commission gambling study which put the cost to society of each problem gambler as high as A$30,000 ($36,000).

"The SkyCity deal shackles Auckland with these increased problems for 35 years," she said.

Problem Gambling Foundation chief executive Graeme Ramsey said research suggested a strong link between the number of available gambling opportunities, such as pokie machines and problem gambling.

"It basically concluded that for every additional pokie machine you had that resulted in 0.8 of a problem gambler."

Costs at a glance

230 extra pokie machines at SkyCity
184 extra problem gamblers
$36,000 a year's potential cost to society of each problem gambler
$6.6m total annual cost to society of additional problem gamblers
$90m annual injection into the economy from the international convention centre