Has Crown found a way, finally, to offend even the politicians it has spent so much money purchasing the acquiescence of in recent years?
Crown has traversed a path familiar to watchers of industries where user-friendly, pro-corporate regulation bought by political influence and large donations has resulted in abuses so extraordinary that politicians have been forced to reregulate them.
The big banks, energy companies and the aged care sector have ended up facing royal commissions or dramatic reregulation after their systematic abuses of lax regulatory frameworks came back to bite them. Then it was Crown’s turn as it faced a major inquiry in NSW — the one state where it had failed to butter up politicians with donations — followed by a Victorian royal commission.
Far from being the superfluous sequel to the NSW show many of us expected, the Victorian royal commission has unearthed a scandal worthy of displaying along with the money laundering, organised crime links, poor governance and failure of Chinese staff that have already been paraded by the NSW inquiry and Austrac.
The company may have underpaid the Victorian government by more than a quarter of a billion dollars by adding in the costs of freebies to gamblers to its gambling losses — without checking that the gambling regulator was happy with the formula. That attitude is unsurprising given that Victorian governments of both flavours have ensured that Crown faced minimal threat from the entirely toothless Victorian Commission for Gambling and Liquor Regulation.
But traditionally the abuses perpetrated by large, well-connected and generous corporate donors to political parties have been reserved for ordinary Australians: customers ripped off by banks; dead clients charged fees by super funds; households overcharged for power; seniors abused and neglected in aged care facilities.
When it comes to handing tax to governments, if anything, the big banks and energy companies tend to pay full freight compared with other large corporations, given their main assets and customer base are in Australia and they function more like utilities.
Crown is the first to extend its abuse of its power to governments — and where it hurts.
Crown also differs from the big banks, energy companies and aged care providers in that it is not a pseudo-utility. Finance, energy and care for seniors who are no longer independent are all essential services in a modern economy. Part of the power wielded by companies in those sectors springs from the fact that either they are too big to fail or the consequences of their failure would be disruptive and embarrassing — particularly in regional areas where there is less competition and the closure of, say, an aged care facility would mean locals had nowhere to turn.
Crown, on the other hand — well who would miss it vanishing, apart from gambling addicts and the few high rollers who might be able to fly into Australia?
Well, as The Australian’s John Durie notes, in fact about 11,600 people would — namely those employed by the company in Melbourne. Durie suggests there’s no way the Victorian government — which not merely enjoys a lucrative flow of tax revenue from Crown, albeit lower than it should, but which is politically joined at the hip with the company — will allow Crown to shut its doors in Melbourne.
There’s hope for Crown under chair Helen Coonan, however. Since the NSW inquiry humiliated most of the board and forced the departure of a slew of executives and directors, the company has been working hard to look like it has turned over a new leaf on corporate governance and compliance with regulation.
That’s what the big banks did after being exposed and humiliated by the banking royal commission. And look at them now. A couple of years on, and the government is furiously reversing its post-royal commission regulation of the sector. The Hayne era was only brief before business as usual resumed. NAB even started making political donations again as the banks resumed their role as the biggest donors to political parties.
If Coonan and Crown can just hang on, things may be different indeed a couple of years down the track.
What do you think about Crown? Let us know by writing to letters@crikey.com.au. Don’t forget to include your full name if you’d like to considered for publication.
Crown is a cancer on the state of Victoria, while the state government is the biggest gambling addict of them all.
Be a strange place if all businesses had to prove their utility to society and their lack of any adverse effects.Be a good idea however.
It’s not called a liberal capitalistic democracy for nothin’..’-)
The only question is the price.
Perhaps it would be enough if they just had to show that, unlike a casino/dirty money laundry, they were not entirely harmful without a single redeeming feature.
Thank you, Sir.
Ever the voice of moderation.
Now burn down the rest!
I’d vote for that.
Just don’t talk about it…….. right ?
Same in NSW. The purpose of a casino is twofold.
Not sure about that nsw registered clubs steal more money from more people. Governments addicted to gambling taxes are not only in Victoria
Or the Government could make an example of Crown to other casino operators. Take back the license and auction it off to Crown’s competitors. Who would admittedly then have to buy the Temple of Mammon by the Yarra from Crown who could extract a hefty price, but it would make future operators wary of such egregious conduct in the future
Or the VicGov could turn it into social housing.
I think their conscience cleansing is already along similar lines .
I dunno, the last lines of Tobacco Row have much to recommend.
If you are wanting high rollers you are facilitating money laundering…….and the government doesn’t want this mentioned THANK YOU VERY MUCH !
By default, the general public is complicit in the resulting revenue benefits !
Do politicians like receiving money from big business? You betcha! I cannot believe that the hand providing the largess will receive anything more than a perfunctory finger tap and a hint to those with their fingers in the collective money pit to be more clandestine in future business activities. People can be bought and it is less trouble and cheaper for a business to arrange and implement than a comprehensive and competitive marketing plan. Less trouble all around and mutually beneficial to both parties – what a winner.
As rulers from antiquity have found, it is cheaper to bribe people than bully them.
Not as much fun, for some, but that’s the trade-off – bread & circuses.
It’s the cost of gladiators these days, they expect pension plans.
It is indeed. The former Soeharto government in Indonesia was regarded as a dictatorship. It actually had few political prisoners and people felt pretty free to say what they liked although criticism would not get published in the media. Outspoken opponents of the government tended to be approached by the government, praised for their concern, and invited to work to establish their ideas from the inside. I knew someone who accepted such an invitation and I’m sure he believed that he could do some good that way.
It is curious that Coonan has survived and even prospered on the Crown board given that she was a part of the dysfunctional operations of the Crown board for years while their misdeeds were carried out.
Contacts, Able, contacts.