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RUBY:

From Schwartz Media, I’m Ruby Jones. This is 7am.

The Premier of New South Wales, Dominic Perrottet, wore a Nazi uniform to his 21st birthday party.

Since it was made public, Jewish groups in New South Wales have told journalists that they have fielded calls, including from Holocaust survivors, who were in tears after hearing about the incident.

But why did Perrottet come out and admit the scandal? Does it have anything to do with the looming election? And who was circulating the rumours about the premier’s 21st birthday?

Today, national correspondent for The Saturday Paper, Mike Seccombe, on what’s behind the Perrottet scandal and how it might be connected to the gambling industry.

It’s Monday, January 23.

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RUBY:

Mike, not long ago we saw the New South Wales Premier, Dominic Perrottet, make this very unusual announcement. He called a press conference in which he told everyone that he had dressed in a Nazi uniform at his 21st birthday, and that he was very sorry about it. And this confession, it came completely out of the blue, didn't it?

MIKE:

It absolutely did. It absolutely did.

Archival tape – Dominic Perrottet

“When I was 21, at my 21st fancy dress party, I wore a Nazi uniform. I'm deeply ashamed of what I did.”

MIKE:

Essentially the only reason we know about the premier's past-Nazi impersonation is because he called this press conference to tell us about it.

Archival tape – Dominic Perrottet

“I was naive, I didn’t understand the significance of that decision, the hurt and the pain, of what that uniform represents.”

MIKE:

And the reason he did that was because he had learnt that someone, allegedly, has a photograph of it and there have been rumours circulating that this photograph could be dropped.

Archival tape – Dominic Perrottet

“And I'm truly sorry for the hurt and the pain that this will cause people right across our state, particularly members of the Jewish community, Holocaust survivors, veterans and their families.”

MIKE:

He made a succession of grovelling apologies, particularly to Jewish groups, for the “terrible, terrible mistake of his youth.” And actually, as I understand it, contacted some Jewish organisations to apologise.

And so after holding this guilty secret for all these years and prompted by fear of exposure, he finally owned up. As a number of people pointed out, it might have been better, of course, if he had done it of his own volition, you know, rather than having to be stampeded into it by the rumours of exposure. But nonetheless, he was clearly mortified and it was not a good look.

But other questions linger, of course, and the biggest of those being whose interests are served by the rumours that had forced the confession and by the diminishment of the New South Wales Premier.

RUBY:

Yeah, that's always an interesting question to ask, Mike. So, in this case, at this moment in time, whose interests are served by the premier having to admit to this?

MIKE:

Well, there could be a number of interests. We have an election coming up in a couple of months.

Archival tape – Dominic Perrottet

“I’m the premier, I’ve made my position very clear that change needs to happen, and that’s what I’m going to affect.”

MIKE:

Perrottet here has introduced a plan for mandatory cashless gaming in pubs and clubs.

Archival tape – Dominic Perrottet

“This is not a matter of if we do it, it’s a matter of how we do it.”

MIKE:

And so under his vision, by the end of 2024, punters will no longer be able to use cash. They will have a pre-loaded card instead. And the Liberal Government in Tasmania has recently done this and there they've capped expenditures by gamblers at $100 per day, $500 per month or $5000 a year.

Anyway, these cashless cards are, you know, really, frankly, not a problem for the average gambler. The people for whom they're a problem is those who benefit from the current arrangements. And that is, of course, the people who own the poker machines.

RUBY:

Okay, so you seem to be saying, Mike, that perhaps the person or people who prompted the premier to admit to this Nazi secret are somehow connected to the poker machine industry or lobby?

MIKE:

Look, all I can say is, maybe. All I can say is when I spoke to a lot of people around, you know, around the rumour mill of Macquarie Street, you know, in politics on both sides this week, they suggest that the gambling lobby is certainly a very strong suspect.

RUBY:

Okay, well, let's talk a bit more about the gambling lobby then because it's no secret that Australia loves the pokies. And we've recently seen some reports about just how embedded corruption is in casinos, in places like the Star Casino. So, talk to me a bit about the grip that gambling really has on us and the power that the lobby wields?

MIKE:

Well, the grip that it has on Australia is astonishing, really. Australia has about one third of 1% of the world's population, right, but we have 21% of the world's high intensity electronic gaming machines—colloquially called “pokies”. So, in total there's roughly 200,000 of these EGMS in the country. And New South Wales has by far the biggest share, it has like 86,000. So, what's that, 42–43% of the national total.

So, essentially what I'm saying here is that New South Wales has become the most pokie-addicted jurisdiction in the most pokie-addicted nation on earth. In 2021, the poker machine turnover, according to a recent investigation by the New South Wales Crime Commission, was $95 billion, which you know, is an astonishing number. And according to the Crime Commission, a great deal of that was dirty money—that was money from criminal elements being laundered through the pokies.

As to where this love affair with pokies began. You can trace it back to 1956. The Cahill Labor government in New South Wales brought in pokies in clubs in the state and then of course they spread from there. And back then, of course, when Labor first introduced them in New South Wales, the party saw them actually as kind of a social good. They saw it as a way of raising money for community facilities, particularly in working class areas that otherwise lacked them. You know, that by putting them into community clubs that would give the clubs a source of revenue and they would reinvest it in their communities.

RUBY:

And when we talk about working class areas, we're talking about areas that are traditionally in Labor electorates, aren't we? Or at least they definitely were back at that time—back in the fifties.

MIKE:

Well, yes and most of them still are, frankly, you know—I mean, the electoral map has changed a bit, but not that much. But, yes, these things are heavily concentrated in lower income and Labor areas. And to be frank, back when they were first introduced, they didn't do nearly as much harm as they do today.

I mean, even Tim Costello, you know, the long time anti-gambling campaigner tells me that the pokies were not nearly as bad until we got to like the 1990s when pokies go electronic and suddenly you can lose an awful lot more money, an awful lot more quickly and they become vastly more addictive.

As it happens, around that time in 1997, another Labor government in New South Wales, the Carr Labor government, allowed pokies into pubs as well as clubs. The reason being that clubs were making so much money out of it, the pub industry was going into decline. And at that stage, Labor looked upon it as kind of an equity issue whereby the pubs should have the same access to this flood of money as the clubs did.

So, anyway, in a nutshell, I guess that's how New South Wales ended up the world capital of poker machines. This story is very much one of, I mean, it affects both sides of politics but this is very much a Labor story. The clubs sector gives money to Labor, clubs are a big donor to the Labor side of politics.

RUBY:

So, if damaging information is circulating about the New South Wales Premier at the same time that he's trying to introduce gambling reforms that the lobby doesn't like, and the Labor opposition and the gambling lobby are, I suppose, firm friends, then it would seem likely that you might find the source of this Nazi story in the Labor Party, Mike.

MIKE:

Well, you would, and let's face it, that's the normal assumption when a bucket is dropped on someone on one side of politics, the natural instinct is to look at someone on the other side of politics. And that's usually where it goes.

This time, among the people I've been talking to, the fingers are not actually pointing at the Labor Party. They're pointing at someone on the conservative side, someone in the pokies industry, or someone who fits into both those camps.

RUBY:

Right, and does anyone fit that bill?

MIKE:

Funny you should ask, because the person who told Perrottet that “someone was planning to use this alleged photograph against him” was one David Elliott—senior member of the government, transport minister, outgoing at the coming election, who just days before had to exclude himself from a meeting about gambling reform because of a conflict of interest.

And reportedly, and I haven't confirmed this because he's now on compassionate leave following the death of his mother, Elliott was angry at Perrottet for having leaked the fact that his son, Elliott's son, worked for the global poker machine manufacturer, Aristocrat.

RUBY:

We’ll be back in a moment.

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RUBY:

So, Mike, you're saying that there's a Liberal minister, David Elliott, who has this seemingly pretty big conflict of interests when it comes to pokies reform? His son actually works for a global poker machine manufacturer, and this same minister is the person who actually tells the New South Wales Premier, Dominic Perrottet, that there are rumours of a photo of him wearing a Nazi uniform. So, why does he do that? Why does David Elliott warn Dominic Perrottet? What's his motive here?

MIKE:

Well, good question. I mean, the two men obviously have not been getting on. We should say, at the top, to be fair, Perrottet, when he spoke about this, said it wasn't a threatening phone call. Okay, so we should be clear about that. And there are other people within the Liberal Party and the gambling lobby who might want to damage the premier.

But what we can say for sure, not only does his son work for a gambling machine maker, Elliott himself, before being Minister for Transport and Veterans and so on, was a former executive at the Hotels Association and a director of the Castle Hill RSL. We also know that he is quite hostile to Perrottet’s plans to reform poker machine laws. Only a couple of weeks before Perrottet’s apology, Elliott had attacked the planned reforms, saying they risked “demonising one form of gambling”, saying also that cashless gambling would cost jobs and would not help problem gamblers. That cracking down on pokies in pubs and clubs would simply see people move to other forms of gambling, which I might add, research has shown isn’t actually true.

Elliott did this riff on how, you know, well, if we won't let Nanna put 20 bucks through the pokies, she'll just stop at the newsagent on the way home and spend the same amount of money on lottery tickets. Well, that's not true. So, Elliott’s running very much the poker machine lobby's arguments here and they’re basically false.

But anyway, to go back to the circumstantial case around Elliott, we can't prove anything. But it seems very strange that an outgoing minister, having been pointedly unhelpful to the premier's bold election policy, should helpfully phone to warn him.

So, Perrottet was proposing a gambling policy that Labor was struggling with, they'd been on the back foot for the past few weeks, and then suddenly we have this revelation that blows other stories out of the water about the premier strutting about a Nazi uniform 20 years ago.

RUBY:

Okay and can you tell me a bit more about where the Labor opposition stands in all of this? Because it sounds like the party has historically been tied to the industry. So, how is it responding to these reforms that Perrottet is proposing?

MIKE:

Well, you're right. Labor found itself in a very awkward position.

Archival tape – Chris Minns

“Both sides of politics are inheriting a situation where there’s 100,000 gaming machines in New South Wales and an industry that’s grown up around that number of gaming machines.”

MIKE:

They initially opposed the reforms, but then allies of Labor, like Unions New South Wales, came out in favour saying the gambling industry was responsible for taking money from working class people, which is true. And this put the party in a really tricky position.

Archival tape – Chris Minns

“Gaming in particular is a complicated area and if there were easy answers they would’ve been done by now.”

MIKE:

So, last week Labor released its own policy on pokie reform.

Archival tape – Chris Minns

“What we're doing today is taking to the people of New South Wales a comprehensive, evidence-based plan that is unanimously supported by the New South Wales shadow cabinet.”

MIKE:

There were some pretty strong things in there, to be frank. The most positive being that they proposed to ban political donations from clubs that run poker machines, which would have cost Labor money, because overwhelmingly club donations go to Labor. And the Labor leader, Chris Minns, also said that, you know, he'd already instructed the party to refuse donations. He did say, however, that they wouldn't retrospectively return donations they had received because they'd already spent them.

They're also calling for the removal of external advertising from pubs and clubs. You know those signs you see up, you know, with a VIP lounge, and a gradual reduction in the overall number of poker machines and also the imposition of feed-in limits—that is, not limits on the gamblers per se, but limits on the amount the machines will accept—of $500 an hour. And currently the limit is $5,000, and as I understand it, there are some machines that will take $10,000 an hour. So, these are positive things.

But in the view of almost everyone I spoke to, it's nowhere near enough. The New South Wales Crime Commission report last year found that billions, they couldn't quantify exactly how many billions because the reporting isn't good enough, but they found that billions of dollars each year of money from criminal enterprises, particularly drugs, were laundered through the poker machines. And their number one recommendation was that there should be a cashless gaming card instituted so that we could at least get some idea of how much money was flowing from crime into the machines, and also do something about controlling it. Of course, the other thing that experts say the cashless card would do, is that it would limit the amount that problem gamblers could spend. It wouldn't necessarily affect people who didn't have a gambling problem particularly at all. So, that's the big central thing that everyone's saying should be done—cashless card. And all Minns will commit themselves to, commit Labor to, at this stage, is a trial with 500 machines. Which, you know, frankly seems like a bit of a cop out.

RUBY:

Okay and I suppose at this point we don't yet know whether these reforms are going to happen, if we're going to see a cashless card put in place beyond a trial because we don't know what's going to happen in the election, which is in two months time. And I suppose part of that is we don't yet know how damaging this story about Perrottet’s Nazi costume is going to turn out to be, but it would be probably a lot more damaging if there is a photo of him dressed as a Nazi and that photo was to be made public. So, do you think that it does exist?

MIKE:

I have no idea. All I can say is the rumours are swirling, I've spoken to people who claim to have spoken to people who claim to have seen the photograph. Right, so I wouldn't be surprised if it existed and I wouldn't be surprised if it dropped before the election. On the other hand, I wouldn't be surprised if Perrottet had kind of been stampeded here into making an admission on the basis of evidence that doesn't exist, right, because politics is a very nasty business. As to how much damage has been done to Perrottet, I would say a couple of things. His contrition, his mortification, I mean, he was fighting back tears when he confessed. I mean, it was real. Even Chris Minns admitted it was real. It was stupid. He's sorry.

But, you know, obviously, if the picture appears, it's not good. As to the substantive issue here, pokie reform, I actually remain quite hopeful. I mean, public opinion has clearly swung on this issue and we haven't seen all the details yet of Perrottet’s proposal, but, you know, presumably there will be limits.

I understand he is also proposing to stop donations to political parties, which would be a very good thing. The thing that gives me greatest hope is that public opinion has clearly swung on this issue and it is the nature of politics that, when it's a choice between the right thing and the popular thing, they usually choose to do the popular thing. In this case, it's both the right thing and the popular thing. So, all I can say is let's keep our fingers crossed.

RUBY:

Mmm. Well, Mike, thank you so much for your time.

MIKE:

My pleasure.

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RUBY:

Also in the news today…

Over the weekend, Google announced 12,000 staff around the world would lose their jobs.

This adds to other major staff cuts across the global technology sector, with Microsoft cutting 10,000 jobs and Amazon cutting 18,000.

And the historic site of Machu Picchu and the Incan trail in Peru have been closed by the government, as protests spread around the country.

The protests, supported by many poor and Indigenous Peruvians, have been in support of former leftist President, Pedro Castillo, who attempted to dissolve the country’s congress in December only to be deposed himself.

I’m Ruby Jones, this is 7am, see you tomorrow.

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