One of Australia’s biggest poker machine venues has shifted more than $26m in gambling profits over eight years to its parent company – an NRL club – while claiming the payments as a community benefit for a tax cut.
In New South Wales, clubs that donate a percentage of gambling profits to community causes receive a tax concession under a scheme called ClubsGrants, which is under review by the state government after years of sustained criticism.
The scheme allows clubs to secure a tax break by using poker machine profits to pay off their operating costs or those of an associated entity. This has led to claims the scheme is a “shameless rort” that must be immediately scrapped.
Since 2014-15, the Canterbury leagues club in western Sydney – which had 634 poker machines as of 31 May – has paid $26.4m to its holding entity, the Canterbury-Bankstown Bulldogs. These payments, which are legal and within the rules, were categorised as “community development and support initiatives”.
The amount of money transferred to the NRL club was significantly larger than what was spent on non-affiliated local community groups under the scheme, according to the league club’s financial statements.
Last year, the Canterbury-Bankstown Bulldogs reported a consolidated entity profit of $10m after tax. A year earlier it was $4.5m and in 2020 it was $4.4m.
ClubGrants was, according to official guidelines, “designed to ensure that larger registered clubs in NSW contribute to the provision of frontline services to their local communities; and to ensure that the disadvantaged in the community are better positioned to benefit from the substantial contributions made by those clubs”.
The NSW Council for Social Service, which abandoned its 25-year association with the ClubGrants program last year after its own review identified alleged conflicts of interest, believed the scheme no longer reflects community expectations.
“The ClubGrants scheme does not reflect 21st-century standards and expectations for a taxpayer funded grants program – it is a broken model and has been from the beginning,” said the Ncoss chief executive, Joanna Quilty.
Wesley Mission’s chief executive, the Rev Stu Cameron, who is part of the NSW government’s expert panel on gambling reform, said the payments were legal but “illustrate what is fundamentally wrong with the ClubGrants scheme”.
“Rather than throwing the cashed-up Bulldogs several multimillion-dollar bones over the last few years for ‘running expenses’, these funds could have done so much to help people in the community with the cost-of-living crisis,” Cameron said.
Cameron noted the Canterbury Leagues Club had donated to many local initiatives that improved the living standards of “low income and disadvantaged people”, but said “the amounts allocated seem scandalously disproportionate to the financial support granted to a prosperous NRL club”.
The Canterbury-Bankstown Bulldogs and Canterbury leagues club were contacted for comment.
The state Greens MP Cate Faehrmann, the party’s spokesperson on gambling issues, said the scheme needed to be urgently scrapped or overhauled.
“The larger clubs like to talk up a big game when it comes to giving back to their local community, yet the vast majority of grants are going straight to their own wealthy sporting clubs,” Faehrmann said.
A spokesperson for the minister for gaming, David Harris, said ClubGrants review would “help determine whether the scheme continues to represent value for money to the people of NSW”.
• In Australia, Gambling Help Online is available on 1800 858 858. The National Debt Helpline is at 1800 007 007. In the UK, support for problem gambling can be found via the NHS National Problem Gambling Clinic on 020 7381 7722, or GamCare on 0808 8020 133. In the US, call the National Council on Problem Gambling at 800-GAMBLER or text 800GAM.
