The Canberra Casino's investment predicated on operating poker machines is the lure of fool's gold and will cause many of Canberra's not-for-profit community clubs to close. We don't need to look far to get a picture of the impact, because history gives us the answer.
In 1995, the opening of Sydney Harbour Casino (now The Star) saw the rapid demise of many registered clubs in Sydney. The impact was so profound even Fred Nile was concerned about the dire position of community clubs. He put the following questions to the then NSW Labor government;
"Is it a fact that the temporary Sydney Harbour Casino has already had a dramatic impact on the income of inner city registered clubs? What action will the government take to protect these registered clubs from financial collapse?"
It was evident soon after the opening in Sydney the new casino was killing clubs.
AQUIS, the new Canberra Casino operator, has stated it will invest $330 million in re-developing the current venue, but the investment is contingent upon the casino operating pokies. The Hong-Kong based investor stated if the ACT government grants it pokies, it will deliver an "…unprecedented boost to inbound tourism by Chinese visitors". AQUIS claims it will attract 750,000 visitors a year to Canberra, including high-end Chinese gamblers, using their 500 poker machines as a crucial component to generate the $330 million return they need.
The concept of attracting 750,000 additional tourists to Canberra every year – more than double the entire population of the capital – for the sole purpose of gambling in the casino is grossly misplaced and misinformed optimism. Attracting even a small portion of this number would mean convincing tourists to bypass Melbourne, Brisbane and Sydney, which will soon include the new Barangaroo Casino. .
If AQUIS is serious about delivering on this unlikely scenario, the Canberra public deserves to see the strategy that backs up its claim.
And Canberra is not the first town to receive this promise.
AQUIS is also investing in Cairns, where an $8.5 billion dollar development has been proposed, on the same assumption it will attract the Chinese middle and upper class.
Writing of AQUIS' claims up north, Francis Markham and Martin Young, researchers for the Southern Cross and Australian National Universities, note;
"Those with long memories or a familiarity with the history of casino development in Australia have heard this story before. From Hobart to Darwin, casinos have been justified with hopes of attracting lucrative international tourists and gamblers, particularly from Asia."
As these independent researchers very accurately point out, we keep being sold this same vision without any proof of the delivery.
The far more likely scenario is that financial success for AQUIS will depend on drawing people from Canberra's not-for profit clubs and the city's surrounding regional centres.
Markham and Young explain this best: "Australian casinos sooner or later become dependent on the 'local' pokies market.
"Chinese gamblers rarely play the pokies. The 'market cultivation' efforts by operators in Macau to create demand for poker machines have thus far been a dismal failure. According to the latest figures, poker machine gambling accounted for just 4 per cent of gambling expenditure in Macau's casinos.
"Casino operators in Macau actually reduced the number of pokies they offer by over 20 per cent between 2012 and 2014. The pokies in the AQUIS casino will overwhelmingly be used by locals."
So what does this mean for Canberra's clubs? The simple answer is that many will close.
History again puts this in perspective. In 1995 the Minister for Gaming and Racing responding to Fred Nile's questions by explaining that clubs located within a 10-kilometre radius of the Sydney Harbour Casino would be able to apply for a tax exemption.
But for clubs in the inner Sydney region it was all too late, and the tax break had little effect. In the years following the opening of Star City's permanent home, 48 clubs closed in the inner Sydney region.
In a local context, 35 of the 50 ACT clubs are within this same 10km radius of Canberra Casino.
What would happen to the enormous community contribution ACT clubs make – the $125 million in donations over the past decade to more 1100 community organisations, the 2300 employees of clubs, many of whom are non-tertiary educated, or the 80 per cent of suppliers used by clubs which are local to the capital?
And these community impacts are only half of the story. A wealth of independent research demonstrates casino venues higher gambling participation rates, aggressive marketing tactics and larger catchment areas which create the perfect storm for "at risk" problem gamblers.
The purpose that drives the operation of your local club is in stark contrast to a casino – one is entirely for the community, the other is only for profit – and in this case, profits which will flow offshore.
And are we willing to gamble such an essential part of Canberra's social, cultural and economic fabric in exchange for a few extra flashing lights, when history so clearly demonstrates what the outcome will be?
Canberra loses if the casino wins.
Gwyn Rees is chief executive of ClubsACT