Mr Barr announced the backdown at 6pm on Tuesday, one day after The Canberra Times revealed the change, and just hours after Mr Rattenbury told him he would move to overturn it on the next assembly sitting day.

"As a result of discussion within the community over the past few days, the government has decided to withdraw the regulation which allowed $50 note acceptors on electronic gaming machines in the ACT pending further work on practices in other states and implementation of cash input limits," Mr Barr said.

Ms Burch made the change in the days before Christmas, lifting the note limit for poker machines from $20 bills to $50 bills, despite Mr Rattenbury's opposition. She did it quietly, without announcement, and without even informing Mr Rattenbury.

Mr Rattenbury said Cabinet had not agreed to it, and the first he knew of it was when he read it in The Canberra Times on Monday.

Mr Barr is also believed to have been taken by surprise on the timing and Ms Burch was called into his office on Tuesday. It appears cabinet had expected the $50 change to be introduced alongside a limit on the amount people could bet at a time, but that limit is yet to be worked out or introduced.

Mr Barr's spokesman would neither confirm nor deny the scenario.

Mr Rattenbury said he had been surprised and disappointed. Lifting the note limit would increase the amount of money going into machines, exacerbating the risks for problem gamblers.

Mr Rattenbury said the change was in direct contrast to the Greens' gaming policy and he would not support it.

"The Greens have strong views on minimising the amount of money that can be bet," he said. "The harms caused by poker machines are well documented. They cause not only enormous financial hardship but can also contribute to serious issues like family breakdown …

"If clubs are not financially viable without the profits extracted from problem gambling, they should be considering their role in the community."

His views echo those from anti-gambling groups and gambling researchers, who say lifting the note limit will mean more money being spent on machines, most of it from problem gamblers.

Mr Rattenbury told Mr Barr he would move to overturn the $50 limit in February when the assembly sits, leaving Mr Barr no choice but to withdraw it or face defeat in the assembly.

Liberal Leader Jeremy Hanson also opposes the move, saying the case had not been made and he shared the concerns of anti-gambling groups.

"The way that this was done was sneaky. It was underhanded. It was deliberately aimed to implement a policy without any scrutiny," Mr Hanson said. "The manner in which this was done was underhanded and disgraceful by the Minister Joy Burch … Whichever way you look at it, this is a very bad start to Andrew Barr's administration."

Jeff House, chief executive of Clubs ACT, said he had emailed clubs on Tuesday night to advise them to take immediate steps to remove $50 notes from ATMs in clubs and to revert gaming machines to accepting only $20 notes.

He made no comment on the process that had involved clubs moving, in the past three weeks, to convert machines and ATMs to $50s and now back again. But he said his understanding had always been that the $50 note limit was to be part of a change that would also include a limit on the overall amount that could be bet.

"I look forward to the opportunity to further make our case for the reintroduction of $50 notes and we'll fully participate in whatever process the government decides to undertake from here," he said, urging consideration of the viability of clubs.

"The gross gaming machine revenue fell by more than 10 per cent in one month in November and there is a genuine issue about the financial viability of clubs at the moment," he said. "All clubs are working to change their business models … but that takes time."

Mr Rattenbury said the government's other changes to poker machine policy had been through cabinet and, while he had reservations about them, he would support them. The government will introduce a trading scheme, allowing clubs to buy and sell poker machines between them, with one in four machines that are sold forfeited. Trading between clubs is prohibited at the moment.

It is also scrapping its target of 4000 poker machines in favour of a new ratio of 15 machines for every 1000 people.