The financially clueless are told often enough: If a deal seems too good to be true, it probably is.

Yet the deal the Prime Minister seemed so pleased to have struck with SkyCity to build our supposedly "free" convention centre was painted as just that: a too-good-to-be-true, risk-free ride for ratepayers and taxpayers.

You can't blame John Key for doing what comes naturally. He is a dealer, and a damned good one. He didn't get to the exalted heights of the foreign exchange world, making millions along the way, by worrying overly about the morality of the market.

As a 2008 Sunday Star Times article revealed, though Key worked closely with a foreign exchange dealer who was famous for mounting "a brutal speculative attack on the Kiwi dollar", he didn't believe there was a moral issue "for the traders who make these speculative attacks on currencies, or for dealing rooms that carry out their orders. 'I don't really see it as a judgmental business. You're simply executing orders for people'."


A deal's a deal, after all, and what's not to love about this one? We get a flash $350 million convention centre and it won't cost us a cent! Genius.

As the story goes, Key's finely honed instincts kicked in when he heard SkyCity was planning to expand its convention facilities, just as the case was being made for a national convention centre in Auckland.

The casino had been lobbying for a change in the gambling law for some years to allow it to expand its business. (Read: make more money, something SkyCity already excels at, given the record profit it posted for the half-year to December 2011.)

So Key cut a deal. In return for SkyCity building the $350 million convention centre, the Government would change the law to allow it more gambling tables and (up to 500) extra poker machines. SkyCity would also get an early extension of its licence, due for renewal in 2021. Ka-ching.

It was a win-win for SkyCity and the business fraternity, who can't understand why a deal that's so good for New Zealand (and themselves, of course) is suddenly being questioned.

Sure, a few bleeding heart worry-warts might bang on about the negative impact on some poor saps who clearly can't control themselves, but Key must have gambled that most people would be sufficiently beguiled by the flashing lights of "economic growth", the promised millions for the local economy and hundreds of jobs (which, like big pokie wins, seem largely illusory).

Key's irritation at the ingratitude of some people has been palpable. "You either want economic growth or you don't," he told TV3's Patrick Gower from Singapore, where, incidentally, the nanny-ish Singaporean Government takes it upon itself to save its citizens from themselves by banning beneficiaries from the casino and making locals pay a $100 levy to enter.

Key doesn't believe in leading us not into temptation and delivering us from the evils of gambling. He has faith in SkyCity. He says the number of extra pokies in the new convention centre has been exaggerated, and that, anyway, the harm will be hardly any at all.


It would be nice to know what expert advice he's relying on, since there's been no attempt to seriously assess the social impact of the extra pokies.

Given the evidence indicting pokies and the particular harm they wreak, you'd think that might be relevant information. Experts say pokies are more addictive than Lotto and other forms of gambling, largely by design. They're also highly profitable. Goldman Sachs estimates, for example, that the extra 350 to 500 poker machines will net SkyCity $42 million a year once the convention centre is fully operational.

If there's a moral issue here, Key clearly doesn't see it. This is an economic decision, he asserts, and his Government has been transparent.

And yet there's been no attempt to consider the true cost of the convention centre. We've been given only the predicted benefits; for example, that New Zealand will benefit by (a rather precise) $85.4 million a year in additional tourism revenue. But as for the real cost of the deal, including the impact on the existing council-owned Aotea Centre, and any exploration of alternative, less harmful options, including the expansion of Aotea Centre: nothing.

The Problem Gambling Foundation estimates the extra pokies at SkyCity will result in 280 to 400 new problem gamblers. Recent research suggests an additional problem gambler for every poker machine in the community.

Given the Key Government's apparent willingness to change or at least subvert legislation aimed at minimising the known harm caused by casinos, it's clear the SkyCity deal comes with a hefty price tag. Is it one we're prepared to pay?