Star dealt all the aces in Queensland casino pact

The Queensland government signed an extraordinary contract with Star Entertainment in 2016 promising to compensate the casino giant if it hiked taxes or cut pokies numbers without consent.

Queensland Premier Annastacia Palaszczuk. Picture: Adam Head

The Queensland government signed an extraordinary contract with Star Entertainment in 2016 promising to compensate the ­casino giant if it hiked taxes or cut pokies numbers without corporate consent, or if the company’s gaming earnings dropped by $5m.

Embattled former attorney-general and casino regulator ­Yvette D’Ath negotiated the agreement with Star for its $3bn Queen’s Wharf Brisbane casino development, a year before Star hosted and paid for a Labor election fundraiser for her at its Treasury casino in the state’s capital.

A recent probe by retired judge Robert Gotterson KC into Star’s “egregious” behaviour uncovered the terms of the secretive deal, which Mr Gotterson said hamstrung the ways the state could regulate the mega-project, due to open next year.

The Queen’s Wharf Brisbane Financial and Commitment Agreement bans the state from taking certain regulatory steps without the written consent of Star, including introducing or increasing any “taxes, levies, licence fees” or other gaming-related fees and cutting the number of pokies or table games at the establishment. Star would also be compensated if its gaming earnings fell $5m or more in a certain period, the agreement states.

The decision to award the cas­ino licence to the Star-led consortium was made by Premier Annastacia Palaszczuk and her cabinet in 2015, in one of the first major announcements of the newly elected Labor government.

Attorney-General Shannon Fentiman on Thursday afternoon introduced into parliament urgent amendments to the state’s Casino Control Act in the wake of Mr Gotterson’s review, including a move to remove the regulatory restrictions and compensation triggers in the Queen’s Wharf agreement. “The proper regulation of casinos demands the state be unfettered (to regulate ­casinos) … the state must be able to adjust those controls as circumstances demand and in order to protect the public interest,” Ms Fentiman said.

Queensland Attorney-General Shannon Fentiman. Picture: NCA NewsWire / Dan Peled

Similar provisions in NSW for Crown casino – which would have compensated the company for the cancellation of the casino licence, albeit not on disciplinary grounds – were abolished this year.

The updated Queensland bill also increases from $50m to $100m the fines the government can hit a casino operator with, and gives the government the power to install a “special manager” to run a casino to remediate its bad behaviour.

Last week, Star was deemed unsuitable to hold licences for its Brisbane and Gold Coast casinos, after the release of the Gotterson report.

Ms Fentiman said the government would issue Star with a show-cause notice, on the back of similar action against the company in NSW.

Opposition justice spokesman Tim Nicholls accused Ms Fentiman of failing to expand the terms of reference of Mr Gotterson’s inquiry to fully probe allegations of closeness between the government, the casino giant, Labor lobbyists and unions.

“Management of casinos and gaming in this state is a farce,” he told parliament.

Ms Fentiman said the inquiry had the power to look at anything that could improve probity and regulation of casinos in the state.

Queensland Health Minister Yvette D’Ath. Picture: Adam Head

At a press conference last week, Mr Gotterson said the issue of the government’s close relationship with Star was not relevant to the “forward-looking” inquiry he was running.

“I didn’t venture there, it didn’t arise in the terms of reference,” he said.

In 2015, the Palaszczuk government awarded Star the right to develop the Queen’s Wharf Brisbane site in Brisbane’s riverfront CBD, in a joint venture with Hong Kong-based partners Chow Tai Fook and Far East ­Consortium.

As part of the agreement – which secures the company a 99-year casino licence – Star promised it would pay the government $272m by the time Queen’s Wharf opened, with “minimum guaranteed state gaming tax payments” of $880m in total over the first decade of its operation.

The Australian revealed in 2019 that Star hosted and covered the costs of a Labor fundraiser at the Treasury casino hotel for Ms D’Ath in the lead-up to the 2017 state election.

At the time, Ms D’Ath was the gaming regulator and considering approval for Star’s “masterplan” for its Gold Coast operations. Star was also lobbying the government not to proceed with its plans for a rival second casino on the coast.

Labor declined to disclose whether Star hosted other fund­raisers for the party before it was banned from making political donations as a property developer.

Ms D’Ath defended the fundraiser when it was reported. “Most licensed venues in Queensland are also gaming and wagering outlets so it would be ridiculous to argue (that) the ­attorney-general is doing anything wrong by holding a fundraiser in a hotel, pub or club,” she said.

Star also employed lobbyist Evan Moorhead – the former head of strategy for Ms Palaszczuk’s government and former state secretary of Labor – as a consultant, as the government resisted calling an independent inquiry into the casino operator.