The political influence of clubs in New South Wales will be curtailed under proposed laws banning donations from venues with poker machines that are being introduced to the state parliament on Thursday.
If passed, the electoral funding act would be changed to outlaw political donations from registered clubs that have poker machines or are involved in any other wagering, betting or other gambling activities.
By doing so, clubs with poker machines will be regarded as “prohibited donors”, similar to property developers, tobacco businesses and liquor or gambling industry companies.
Labor had vowed to ban such donations in the lead up to the March election, amid a campaign by the state’s powerful clubs lobby opposing proposed reforms to poker machine gambling, including the Coalition’s pledge to introduce mandatory cashless gaming.
The premier, Chris Minns, said the bill would bring clubs in line with other gambling bodies.
“Our bill closes a political loophole,” he said.
“This bill is an important integrity measure to strengthening the political donation system in our state.”
He hoped the “overdue reform” would enjoy support across the parliament.
The state was on the verge of major gaming reform when the Coalition government of Dominic Perrottet was voted out of power in March. He had joined forces with members of the crossbench, including the independent Sydney MP, Alex Greenwich, vowing to introduce cashless gambling systems to reduce problem gambling and criminal activity with the clubs.
The crossbench has since expanded and will seek to use Labor’s minority status in both houses to push for greater action on problem gambling and money laundering after the government’s policy was criticised of being too soft at the election.
Data recently released by Liquor and Gaming NSW revealed $4.3bn was lost to poker machines in the second half of last year – $820m more than the total losses recorded in a similar period before the pandemic.
Total gaming machine net profits jumped 11% to $4.26bn – 24% higher than the $3.44bn reached in the last six months of 2019.
The new government has set a mid-year deadline to set up an independent panel of experts to oversee its planned expanded 12-month trial of cashless gaming before committing to an expanded rollout.
The special minister of state, John Graham, said the bill would bring other parties in line with Labor’s internal policy change enacted in January not to accept donations from clubs with gaming machines.
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“This bill will ban political parties from accepting financial donations from clubs with gaming machines – it is another election commitment we are seeing through,” he said.
“From January 16 this year, NSW Labor took action to not accept donations from clubs with gaming machines. This bill will extend that ban to every state political party.”
But Greenwich said the profits from poker machines outlined in the latest data laid bare the need for change.
“These super profits for clubs and pubs has come at a very cruel cost to families across NSW, and we also know has been fuelled by the proceeds of crime and money laundering,” he told Guardian Australia.
“It’s time to act and I’m committed to work with the new government to curb the scourge of gambling harm in NSW.”
The government has also pledged to reduce the feed-in limit for new machines to $500, ban external signage promoting gaming including “VIP lounge” signage, and reduce the number of machines overall across the state.
The push for poker machine reform came off the back of a damning NSW crime commission report last year that found money was being laundered through machines across the state. The commission recommended a cashless system.
