In late October, New Matilda began our series on James Packer’s proposal for a new casino in Sydney. I worked on this series with Lawrence Bull.
Through its media management strategies and political networks across the NSW Liberal and Labor Parties, Packer had been able to make his casino seem like a foregone conclusion. He has achieved first stage approval for a second casino in NSW from the Premier Barry O’Farrell without any independent or public scrutiny.
The deal however has not yet been finalised. Casinos require licenses for which owners pay fees and taxes on turnover and there are processes for checking to see whether those proposing to run them can pass a “fit and proper test” and financial scrutiny. But the NSW government led by Barry O’Farrell is planning to by pass these laws and work through the ‘unsolicited proposals’ procedure which avoids a debate about whether the community wants another casino or not. O’Farrell has appointed ex head of the Commonwealth Bank David Murray to examine the proposal in the second stage of the approval process. It is very likely there will be allowance for public submissions. Public submissions would be allowed if the procedures set down the NSW Casino Control Act were followed.
Packer’s proposed hotel with casino is part of Barangaroo, a huge Lend Lease development on publicly owned land near old Sydney docks. The likely site is on what is known as Barangaroo South where it would be built near the water, along six three commercial towers and a residential development.
To really explain this story, we needed to provide some history rather than simply a blow by blow description of the game which clinched the deal.
The story goes back to the early 1990s when Kerry and James Packer were bitterly disappointed when they failed to win the tender for Sydney’s single casino. They kicked up a hell of a ruckus and got some help from the Labor party but couldn’t win over the Casino Control Authority which had been set up to regulate the newly legalised casino industry. ( If you are interested in this aspect, read Paul Barry’s book, Who Want’s to be a Billionaire? )
You could say however that the story of Packer’s Liberal party links goes back even further than that to the days of notoriously corrupt Liberal Bob Askin government whose successful election campaign in 1964 was directly funded by James’s conservative grandfather, the media boss Frank Packer. Bob Askin used to play poker at Frank ‘s home. James’ uncle, Clyde, was a NSW MP.
Links between senior Labor figures and the Packer family are just as strong as Liberal ones.
In the first story, we look at how the impression that the second casino was a fait accompli has been achieved and review some of the relevant political background. There is also a chart showing the current shape of Packer’s complicated business empire. At the top of the Chart is Consolidated Press International Holdings (CPIH) and behind that the family trusts where the private profits end up. Sadly we can’t tell you much more as the trusts are secret.
We start the second story in February this year when James Packer’s announced that he proposed to ‘gift’ Sydney with a 6 star casino/resort on the public land part of Barangaroo. This announcement was made through an exclusive interview on the front page of the Australian Financial Review. We look at how the Liberals and Labor locked in behind Packer.
Supporters of the casino repeat James Packer’s claim that his casino will be an economic winner for the people of NSW. But has anyone seen a copy of the Allen Consulting Group report on which he relies? As Greens John Kaye said in an interview I did with him, consultants will come up with what is required and will limit their findings to what questions are posed. We wanted to know if Premier O’Farrell had seen a copy of the report at the time he endorsed the proposal, just two days after Packer had formally announced it. At the time, O’Farrell said that Packer had mentioned his desire for the casino on a number of occasions when they met. So when did the plan really get hatched? It could even have been back in the days of the Labor government which was repeated to be on the cusp of awarding Packer with a casino back in 2007. We’d like to know the answers to these questions, but unfortunately O’Farrell preferred not to answer them.
Why we posted the O’Farrell questions
I think that part of independent Journalism should let the public know when people won’t answer their questions. It should be part of the extra transparency offered by online publishing. So New Matilda published the questions. If you have any suggestions about how to get the answers put up a comment on New Matilda, or send me a direct message to call you via twitter @Wendy_Bacon or email to New Matilda or me at firstname.lastname@example.org
The Packers’ Liberal party links go back a long way but the family’s connections to Labor are just as impressive. We compiled a list of people in their current network across business, media and politics. You can also find out how much the Crown directors are paid. I was also struck although not surprised to see that they get free services at the Crown casinos in Perth and Melbourne. When you think about how much rooms and food might cost, this item alone could be worth many thousands on top of the annual income from directorships.
The next story in our series focused on how casino regulation is supposed to work in NSW and how O’Farrell’s plan to “get on with it” removes a lot of safeguards put in place to protect NSW against organised crime and corrupt influences which have a history of targetting casinos. If NSW wanted to have a new casino, the first move would have been to amend the Casino Control Act to make it possible to have more than one casino in NSW. At the moment only one is allowed. After that the procedure is set out very clearly in the Act. You call for expressions of interest, then hold a tender which involves detailed checking of applicants. The unsolicited proposals legislation raises risk of improper influence and has few of the safeguards in the Casino Control Act.
We also look at the the Independent Gaming and Liquor Authority‘s ongoing investigation into whether Packer’s company Crown should be allowed to raise its shareholding from 10% to up to 25%. Through a public submission, Stephen Mayne has raised some significant issues which he wanted the Authority to follow up during its inquiries. There are lots of issues the inquiry could explore – but will they?