Labor inches closer to goal

CLOSER: Julia Gillard is one step closer to forming a minority government in Australia.

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Australian Prime Minister Julia Gillard has committed to tighter regulation of the country's $10 billion slot-machine industry, if she succeeds in her bid to form a minority government after inconclusive elections last month.

Gillard became favourite to retain power on Thursday after Tasmanian Independent Andrew Wilkie said he would support her Labour party on condition she would launch gambling reform.

``I have judged that it is in fact (Labour) that best meets my criteria that the next government must be stable, must be competent and must be ethical,'' said Wilkie, who has blamed slot machines for causing addiction and misery for families.

Under the agreement with Wilkie, Gillard has promised to push for the gambling industry to adopt new technology that would allow gamblers to pre-set limits on how much they were prepared to wager on slot machines. The measure is aimed at people who are addicted to gambling and cannot stop themselves.

Canberra would pressure state governments to adopt such reforms. The states are responsible for regulating gambling and rely heavily on the industry's taxation revenues.

Listed Australian firms that rely on slot-machine revenues include gaming and wagering groups Tabcorp Holdings , Tatts  and Crown  as well as Aristocrat Leisure , the world's second-largest maker of slot machines.  

Analysts said the reforms were mildly negative for the industry overall but saw a limited impact on Tatts and Tabcorp.

``I don't think it will affect those two at all because they are not going to be in gaming after fiscal 2012 anyway. It's a non-core business of theirs now because they have lost the licence. They're just running the business down really,'' said David Spry, research manager at F W Holst.

``It's a bit of kite-flying stuff. It would be a couple of years down the track anyway if it happened at all. I would think it would have a pretty small impact,'' he said.

``There's no growth in it, it hasn't gone forward. It will grow no more than the growth in household disposable incomes really, which is about 3 percent,'' he said.

Slot machines are prevalent in pubs, not just casinos. Australians gambled $A10.5 billion on slot machines in pubs and clubs in the year to June 2009, and another $A1.4 billion on machines in casinos, according to government data.

Tabcorp  shares rose 0.5 percent to A$6.50 while Tatts Group  rose 0.9 percent to $A2.32 on Thursday in an overall market up 0.8 percent.

- © Fairfax NZ News