Many New Zealanders think having a new international convention centre is desirable. Few of them think paying for it via problem gambling is a good idea.
This Government is pushing a bad deal onto New Zealanders.
Steven Joyce’s own department estimates that 8000 more Aucklanders will be affected by the fallout from problem gambling. Another report suggests the net benefit of the deal to the economy will be just 18 more jobs.
The Government originally tried to sell this deal as an economic development initiative, but because the economic benefits of the casino deal to New Zealand are marginal, the debate has shifted to the problem gambling that is paying for it.
Why is the deal so bad? Simply put: it is because the Government *put itself* over a barrel in the negotiations. A transparent process would have seen competitive bidders. Instead SkyCity were able to name their price from a Government already commited to saving political face through getting this deal done.
The Auditor General certainly pulled no punches in describing the process for what it was: “we do not consider that the evaluation process was transparent or even handed”.
Treasury has made it clear that they are not convinced by the cost benefit analysis presented to Ministers. Treasury expressed “strong concerns that private benefits to SkyCity will exceed public benefits to New Zealanders.”
The deal buys SkyCity an extra 230 pokie machines and an extension on its licence until 2048 in return for building the New Zealand International Convention Centre. Even if you put the horrors of problem gambling to one side, comparison with overseas valuation of gambling rights shows taxpayers have been short-changed.
Sudhir Kale, a professor of marketing at Bond University in Queensland, and a friend of SkyCity CE Morrison has worked as a consultant at casinos on five continents. He says the deal was a clear win for SkyCity. “He’s a friend, but if you want to quote me you can say: ‘Morrison did an excellent job negotiating with authorities’.” Kale calls the 27 year license extension ‘icing on the cake’.
The Treasury were spot-on when they said that public costs will flow to private gain once the centre is paid off.
And there may be worse to come. The final negotiations on spend for the convention centre are set to happen during election year. The Government has reserved itself the right to hand more taxpayer cash over to SkyCity to get the negotiation done.
The fact that gambling issues are treated as conscience issues in Parliament presents an opportunity to MPs; we are explicitly invited to exercise our consciences.
You may not have heard of the National MP Peseta Sam Lotu-Iiga but he holds the deciding vote that could stop the extra pokies. Sam comes from a part of the country where pokies do more harm than almost anywhere else. Signing the online petition to encourage him to change his mind is a practical step you can take to push for change.