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John Armstrong is the Herald's chief political commentator

John Armstrong: Gamble pays off for SkyCity

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Minister Steven Joyce and SkyCity CEO Nigel Morrison. Photo / Greg Bowker
Minister Steven Joyce and SkyCity CEO Nigel Morrison. Photo / Greg Bowker

If SkyCity has not hit the jackpot - as Labour's David Shearer claims it has - the casino company has come pretty close with its deal hammered out with the Government to design, build and operate an international-standard convention centre in Auckland.

Perhaps the agreement is too good for the company's own good.

That is not because there will be argument between the Government and opponents of the convention centre over the number of extra pokies that SkyCity will be allowed or questioning of the adequacy of extra steps the company will have to take to identify problem gamblers. There would be bickering over those features whatever the two parties to the agreement had negotiated.

What has really stuck in Labour and Greens' craws is the 35-year extension of SkyCity's casino licence, including its existing site, plus a stipulation that SkyCity will be entitled to compensation if it is disadvantaged by changes to gaming laws during that period.

Neither the licence extension nor the compensation provision were mentioned by the Government prior to the recent resumption of negotiations.

This has prompted the Greens to threaten legislation to halt the project if and when they are in Government. That could be the case at the end of next year, just a few months after construction of the convention centre is expected to get under way. The Greens might stretch to repaying construction costs up to that point. But that would be a the limit.

The party views the heads of agreement as an attempt to bind future governments to stop them initiating further measures to tackle problem gambling. The Greens are seeking constitutional advice on governments breaking contracts with outside private interests. In New Zealand, however, Parliaments are elected for three-year terms and cannot be bound by the actions of their predecessors.

Fortunately for SkyCity, Labour is much more cautious with Shearer saying his party would have to see the fine print of the heads of agreement. Well, the fine print is already in the public domain.

There might be good reason for Shearer's caution, however. By the time that party and the Greens are sitting on the Government benches in Parliament, up to 1000 workers will be swarming over the construction site of the convention centre. Slinging them out of their jobs will not be an easy thing for a centre-left Government to do.

SkyCity can breathe easier.

- NZ Herald

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John Armstrong

John Armstrong is the Herald's chief political commentator

Herald political correspondent John Armstrong has been covering politics at a national level for nearly 30 years. Based in the Press Gallery at Parliament in Wellington, John has worked for the Herald since 1987. John was named Best Columnist at the 2013 Canon Media Awards and was a previous winner of Qantas media awards as best political columnist. Prior to joining the Herald, John worked at Parliament for the New Zealand Press Association. A graduate of Canterbury University's journalism school, John began his career in journalism in 1981 on the Christchurch Star. John has a Masters of Arts degree in political science from Canterbury.

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