$350m SkyCity casino deal to be signed off

Government sources were last night tight-lipped on details including how many additional poker machines the casino company will be allowed. Photo / Supplied

Conceived over dinner almost four years ago, the Government's $350 million pokies-for-a-national convention centre deal with SkyCity is to be signed over breakfast this morning.

Sources close to the negotiations between the Government and SkyCity yesterday said Economic Development Minister Steven Joyce and SkyCity chief executive Nigel Morrison would today sign a heads of agreement for the deal.

Mr Joyce's office later said an announcement would be made at the casino at 8am.

Under the deal, SkyCity will design, build and operate an international scale convention centre in return for "regulatory reform" of rules covering casino operations.

That will allow SkyCity to operate more poker machines and give it other concessions.

Prime Minister John Key has said the convention centre will create 1000 new jobs while it is being built and 800 permanent new jobs when it is up and running. But the Opposition disputes those figures and says the deal amounts to the Government putting the law "up for sale".

Investment bank Goldman Sachs estimated the new pokies and other concessions could add $42 million a year to SkyCity's profits.

But opponents say up to 500 extra gaming machines could create as many as 400 new problem gamblers a year and claim the casino has a patchy record on host responsibility.

It is understood the agreement includes "harm minimisation" measures including dealing with problem gamblers at an early stage.

Government sources were last night tight-lipped on details including how many additional poker machines the casino company will be allowed under changes to the Gambling Act.

But the casino has said it wants 300 more pokies, extra table games and an early extension to its exclusive licence.

The deal has angered the anti-gambling lobby, which says it will increase problem gambling at a time when the number of pokies in Auckland should be falling under the city council's "sinking lid" policy.

Three months ago, an Auditor-General's investigation into the deal, instigated by the Green Party, cleared Mr Key of any improper involvement in early stages of negotiation.

Mr Key has acknowledged that changes to the Gambling Act in return for SkyCity building the convention centre were first raised when he had dinner with the company's board in November 2009.

But the Auditor-General's report found the Government's subsequent dealings with SkyCity over the matter "fell short of good practice in a number of respects".

These included the fact the casino operator was given information and access to ministers and officials that other bidders to build the centre did not receive.

The casino had the advantage in knowing the Government didn't plan on putting any money into the project, enabling it to shape its offer.

Labour Leader David Shearer last night said his party objected to the deal on two ground.

The first was that it was "a shonky process".

"Obviously there was a backroom deal done between John Key and and his mates at SkyCity," he said.

"There were clearly other participants that didn't get the same information that clearly SkyCity did."

"Secondly, I personally find it objectionable to build a convention centre effectively on the backs of problem gamblers."

The Government's announcement almost certainly indicates United Future Leader Peter Dunne has agreed to support the deal, as the Maori Party has indicated it won't vote in favour of the necessary legislation.

Mr Dunne was unwilling to comment last night, but recently told the Herald he was keen for Auckland to have a world-class convention centre, but was opposed to an increase in pokie numbers.