James Packer’s deployment of Jeff Kennett in his controversial bid to gain a monopoly over high-roller gambling in Australia really does have it all. The angles are endless, as can be seen from the huge coverage with eight different stories (and my lead letter) in today’s Australian Financial Review.
It is a fascinating study in political and corporate power, media connections, corporate governance, social issues, relationships, codes of conduct, tourism, development, planning, tendering and problem gambling.
Take the media connections for a start. The Herald Sun was not given the drop on the story yesterday, even though Kennett, its highly-paid columnist, appeared in a double-page spread slagging the Gillard government on the same day.
Seeing as we have a proudly Victorian premier taking the cash of a Sydney billionaire to try and strengthen the Emerald Sydney’s competitive threat against Crown’s Asian high roller business, this would normally be an issue that Australia’s biggest-selling tabloid would be all over. Alas, all we got today was one measly business story buried on page 50 which was partly supplied by AAP. You’d think it was the News Ltd journalists that were on strike.
One can only assume the Herald Sun’s long-time support for both Jeff Kennett and Crown, the world’s biggest casino, will continue unabated, even though both Rupert and Dame Elisabeth Murdoch profess to have a problem with casino gambling.
The Herald Sun and 3AW were Kennett’s media power base during his seven years as premier and he now has regular paid gigs with both of them.
After declining all interviews yesterday, Kennett gave his old 3AW mate Neil Mitchell an exclusive this morning, but it was typically friendly.
An obvious question would be to ask Kennett if he thought Echo Entertainment Group — which was put together by the very gambling business (Tabcorp) that Kennett floated in August 1994 — was unethical and in breach of its code of conduct. After all, that is what Packer continues to allege.
In between hosting a function in Hong Kong yesterday for the Deutsche Bank team which put together his controversial derivative play on Echo, James found the time, yet again, to speak to Damon Kitney from The Australian. This is what he said:
“For a month, Echo publicly denied being involved in the serious matter of leaking of the company’s emails and texts. The Furness inquiry forced Echo to admit the truth, that it was involved. Shareholders were misled by their own company. They are entitled to know who was responsible for the leak, and was it authorised or ratified by the board? These are the question for John Story to answer.”
Indeed, James. But there are many questions you and Kennett need to answer, not that Mitchell will step up and do the asking.
The first is the claim that Kennett is being nominated by Crown but is somehow “independent” of Crown. The obvious way to answer that is to examine whether Packer interests have made any payments to Kennett interests over the years.
For instance, Kennett will no doubt have already invested many hours in this endeavour and will be subjected to excruciating probity tests in NSW and Queensland.
Is Packer paying Kennett for his legal bills and time, especially if the attempt to land a modest six-figure gig on the Echo board fails, as it almost certainly will first time around?
The most remarkable element of Packer’s full-page ads in The AFR and The Australian today read as follows:
“Competent management of regulatory risk and relationships with relevant government authorities is critical in a casino business, and the Chairman has a pivotal role to play. The recent fiasco at The Star Casino has clearly harmed Echo’s business, and as Chairman Mr Story must take responsibility. This is not an isolated incident — the surprise increase of casino taxes in Queensland under the Bligh government and the loss of Tabcorp’s duopoly gaming machine licence in Victoria have cost hundreds of millions in shareholder value.”
Packer is essentially saying: “I’m a rich and powerful billionaire with strong media and political connections so no government will push me around.”
Which might explain why Paul Howes, Wayne Swan, Julia Gillard and company have completely left Packer out of the class war. Are they scared? They certainly sided with him ahead of problem gamblers when it came to poker machine reform. Mark Latham had no problems loading up against Kerry Packer’s gambling splurges and aggressive tax planning, but the current crop of Labor leaders are in a different league.
Maybe that’s just the effect the Packers have when they pay fat salaries to the likes of Graham Richardson and Karl Bitar and show a preparedness to get into bed with the aggressive pubs and clubs to do whatever it takes to retain Australia’s status as the biggest gambling nation on earth.