First-ever release of Victorian cabinet documents reveals pokies warning

Ministers were also warned of the risk of a bank run due to the financial situation being made public. The bank was eventually sold to the Commonwealth Bank amid much controversy.

As the cabinet sought to salvage its own finances and the state’s economy, Kirner oversaw the introduction of poker machines, an idea floated by Cain’s team in 1982. but he was strongly against it.

Then attorney general Jim Kennan chaired the Gambling Review Committee, which pushed for a $100 maximum betting limit as well as the machine limit.

But a proposal from the Prime Minister and Cabinet opposed this, saying there should be no limits and the number of machines should be determined by the open market.

“If part of the government’s strategy is to improve community facilities in clubs and possibly pubs, that activity will not be funded by 30 machines alone,” he says.

“This restriction will be strongly opposed by all major clubs, pubs, TAB and racing interests.”

Kirner’s cabinet was also warned that the lack of maximum machine limits would not risk concentrating slots in just a few places, pushing them towards a “consensus number” large enough to justify spending money on the machines.

The machines were proposed to have a $2 limit if placed in “unlimited entry” locations with no age limits or dress code restrictions; This was a policy that was adopted and continued until years later when the machines were restricted to adult-only areas.

Kennan advised the cabinet that these policies would appeal to gamblers looking for a casual “flutter”.

“Betting limits at ‘uncontrolled’ venues will prevent ‘flutter’ from becoming heavy gambling unless the person concerned makes such a conscious decision,” he wrote.

The cabinet was also advised to introduce legislation that would ensure that at least 88 percent of the turnover from the machines goes back to the players, with 7 percent going to the government, 2 percent to the operator and 3 percent to licensed clubs.

The law, which was eventually passed by parliament, stipulated that the staff turnover rate would be 87 percent. This rate was reduced to at least 85 percent in 2014.

Reforms introduced under Kirner have led to the installation of 10,000 machines across Victoria. The Kennett government allowed further expansion of slots until 1999, when the 30,000 machine limit was introduced due to growing community concern.

Since then, governments have routinely attempted to undo the impact of these decisions with trading hour restrictions, maximum bet reductions and the still-pending introduction of card gaming.

Kirner, who died in 2015 He expressed his regret at the launch of Age in 2004 and supported a review of “the decisions of Jeffrey’s government and my government.”

“Restricting them to just the casino is an extremely good idea,” he said at the time.

“It’s time for tighter controls, but that’s a matter for the government.”

Cabinet documents from 1982 to 1992 also reveal that one of the biggest problems dogging the Cain and Kirner years was the province’s increasingly precarious financial situation.

Interest rates as high as 17.5 per cent contributed to the collapse of the commercial bank Tricontinental and with it the State Bank of Victoria.

Tricontinental was allowed to run into hundreds of millions of dollars of bad debt, leaving the state bank and Victorian taxpayers on the hook.

Cabinet papers reveal that Roper wrote a “letter of comfort” to the state bank in July 1990, promising to protect the government’s finances.

The documents show that this means going further than the $795 million in bad debts they were already expecting from the Tricontinental saga.

The debts of both banks had increased so significantly between February and July that the cabinet was told they had to cover about $2.3 billion in debt and interest costs. This was expected to cost the state budget $120 million in 1990 alone; this figure was expected to rise to $340 million per year in 1994.

The alternative presented to Kabul’s cabinet was to do nothing until the state bank’s financial figures were finalized. But they warned that any rumors or leaks in the market in this scenario could lead to the collapse of the bank and require a federal bailout.

“A significant incursion into the State Bank would be beyond the financial resources of the state and would depend on the Central Bank for treatment,” they said.

On August 10 of that year, Cain was replaced by Kirner as prime minister, and records from 10 days later show that the government resorted to massive asset sales to salvage its own finances.

As part of the debt management strategy, the cabinet has been asked to consider selling the state bank, the Loy Yang B power plant, softwood plantations, the State Insurance Office, the Rural Finance Corporation and half of the Gas and Fuel Corporation.

The State Bank of Victoria was sold for $2 billion and the State Insurance Office was sold for $227 million in 1992.

A 51 percent stake in Loy Yang B was sold in 1992, but it was not fully privatized until 1995, along with most of the State Electricity Commission’s assets.

The Gas and Fuel Company was split into three entities and privatized by the Kennett government in 1997.

Although Kirner’s asset sales did not go as far as Kennett would later go, he attracted significant criticism from within the Labor Party.

Newly released documents show that during its first week in office, the cabinet received a submission from the ALP calling for the number of MPs in the lower house to be reduced from 88 to 85 and the number of seats in the upper house to 17 to show the government was sympathetic to the challenges of the time.

“Accepting this proposal will allow the Prime Minister to announce to Victorians on budget night that the serious cuts they are being asked to make are shared by MPs,” the presentation said.

“The headlines ‘Budget of fear: welfare recipients hit hard’ could be changed to ‘MPs cut: Government shares the pain’.”

These were the first cracks in the Labor factional coalition built after decades in the political desert.

By March 1991, further signs of tension emerged at the same cabinet meeting when two ministers were reprimanded in their official presentations.

Agriculture minister Ian Baker has been accused of failing to consult colleagues before telling the NSW and Commonwealth governments that the state did not support releasing treated wastewater into the Murray River.

The Prime Minister’s department did not recommend supporting Baker’s presentation on the issue and recommended that they ask him to consult other ministers before briefing cabinet presentations.

“Mr Baker chose to convey the Victorian Government’s view without consulting all relevant ministers,” the documents say.

At the same meeting, a briefing note from the prime minister’s office criticized finance minister Tony Sheehan for submitting a bid to support a housing development in Footscray known as Quay West.

“You should be aware that, although the submission indicates that the Department of Prime Minister and Cabinet has been consulted, we have not been informed by either the Department of Finance or the Treasury that a submission is in preparation and we do not support the minister’s recommendations,” they said.

Baker was later criticized for public comments he made about the cabinet’s decision-making abilities, saying: taken out of context.

Sheehan was appointed treasurer from January 1992 until Labor lost the election in October. He blamed Kirner after the defeat Moving away from plans to balance the budget by 1994.

Despite the scandals and infighting that consumed its third term in office, the Labor government carried out significant reforms.

Monash University emeritus professor of politics Paul Strangio said it could be argued that Cain was the most transformative Victorian premier of the last 50 years, modernizing government processes and leading Labor from nine consecutive election defeats to become the regular party of government in the state.

The vote was reformed to enshrine the principle of “one person, one vote” and an independent electoral commission was created, a policy the federal Hawke government emulated.

“Cain himself has led legal or electoral reforms underpinned by the principles of transparency, accountability and freedom from political interference,” he said.

“The government was leading the way in creating a Director of Public Prosecutions and introducing Freedom of Information laws in Australia. Later in his life Cain would call me regularly to condemn what was happening to Freedom of Information.”

The WorkCare and Transport Accident Commission, the forerunner of WorkSafe, was established together with VicHealth and it was recently announced that this commission will be incorporated into the Department of Health next year. After decades of independence as part of the current state government’s budget cuts.

Strangio said Cain also oversaw the legalization of brothels, liberalizing liquor license laws, tightening firearms controls, overhauling rental laws and extending store hours.

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The night lighting at the MCG and the decision to make Melbourne Park the home of the Australian Open were significant contributions to Victoria’s sporting scene.

As education minister, Kirner oversaw the creation of the Victorian Certificate of Education as we know it today, and as conservation minister, he brought farmers and communities together to form the LandCare movement.

In its final term, the government was wracked by factional conflict, financial disasters and public sector labor disputes.

Strangio said it was the end of the government when Kirner took over from a “broken” Kabul.

“His two years in office largely involved crisis management as he tried to stabilize Victoria’s struggling economy, hold together a restive party and fend off the union movement,” he said.

“His main legacy as prime minister was to sell the debt-laden State Bank of Victoria to the Commonwealth Bank after negotiations with federal treasurer Paul Keating.”

Strangio said there was also a “glass cliff” element for Kirner, where a female leader took over under impossible circumstances.

He said it was a tragedy that Cain’s government’s reputation had been tarnished in its final years, given that the prime minister was a stickler for integrity who paid his own postage, returned gifts and refused first-class flights.

“The end of his term as prime minister echoed what happened to his father [former premier John Cain snr]a government swallowed up by itself,” Strangio said.

“But in my view, despite its unhappy end, there is no doubt that the Kabul government has changed Victoria overwhelmingly for the better, and has done so with the seriousness of purpose, clarity of principle and civility that are the hallmarks of its premier.”

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