Prime Minister John Key yesterday claimed public support for his pokies-for-national convention centre deal as the Opposition reacted angrily to a 35-year compensation clause which protects the casino against future law changes.
The Government yesterday signed an initial agreement under which SkyCity will build and entirely fund a $402 million 3500-place international convention centre. In return, the casino company is allowed 230 new pokie machines and other concessions that are worth up to $527 million over the life of the deal.
Crucially, SkyCity gets its licence extended to 2048 and until then, if any future Government changes gambling laws and affects the profits the company gets from its new concessions, the taxpayer will have to pay compensation.
Again, National introduces an exciting new tactic into New Zealand politics that left-wing parties could have a field day with. How about stringent pro-worker labour laws where trade unions get paid massive compensations if a subsequent government changes them? Or environmental policies with multi-billion dollar pay-outs to Greenpeace if a future National government wants to open new coal mines or offshore oil platforms?
This part of the Sky arrangement seems pretty daft to me. National really needed to look like they negotiated hard and hammered out a tough deal with Sky, and this blows that perception out of the water. A thirty five year compensation clause? It makes them look like they rolled over for yet another multi-national, while a future government can just legislate the clause away at no political cost.