The Star’s involvement in fraud, money laundering and improper tax dealings hasn’t stopped the NSW government making planning and development decisions that facilitate the casino’s expansion. By Claire Connelly and Wendy Bacon.

Questions over Star's influence on planning

The Star casino in Sydney.
The Star casino in Sydney.
Credit: AAP Image / James Gourley

At the same time as executives from The Star casino were fronting a public inquiry into allegations the company was involved in fraud, money laundering, foreign interference and improper tax dealings, the New South Wales government was approving planning changes that suited The Star’s redevelopment plans. They included a controversial high-rise tower and entertainment precinct.

In July 2022, halfway through the inquiry into The Star, the NSW government used a state planning instrument to amend development controls for four “key” sites around the Pyrmont Peninsula precinct, one of which is The Star casino. 

These approved planning changes provide for a six-star hotel with a height of 105 metres, a new theatre, a rooftop dining and event space, and an increase in the height of the multi-use entertainment facility. In all, the project’s value will be significantly more than the “record” $100 million fine The Star was issued by the NSW Independent Casino Commission in October. Star’s recently appointed chief executive, Scott Wharton, welcomed the decision in August, saying it supported Star’s ambition to become “Australia’s leading tourism and entertainment destination”.

As part of the development, the NSW government acquired land owned by Star for a sum that is yet to be determined by the Valuer General of NSW, according to Sydney Metro. This land will be used to build a metro station that will bring commuters from Western Sydney to the Star complex. A 33-storey tower above it will include a mix of commercial, residential and retail uses, “to complement the station”, and the contract to build both the metro and building above it will be put out to competitive tender.

“The NSW government appears to be proposing substantial alterations to planning controls to favour Star, giving them an economic advantage that others don’t have,” says Geoffrey Watson, SC, previously counsel assisting the NSW Independent Commission Against Corruption and a director at the Centre for Public Integrity. “There is even a proposal relating to an expansion of public transport, which would mean the passengers would more or less pass through Star’s own facilities. And, oddly, the government seems to be willing to pay Star a large amount of money so that that can be secured. I don’t understand it.”

A spokesperson for the Department of Planning and Environment denies approving any development applications “for The Star” directly, claiming planning rules and development approvals are tied to a site rather than an owner. “We assess proposals on their merits, not based on who lodges an application or owns the land,” the spokesperson said.

However, while announcing the planning changes in August, Minister for Planning Anthony Roberts said the government was “giving industry and the community the certainty they need to bring to life incredible new assets, including … The Star’s planned six-star hotel which will be located next to a proposed new theatre, as well as new dining and retail spaces.”

At the same time as Star’s development was being approved, the minister for Infrastructure, Cities and Active Transport, Rob Stokes, recommended a new entity should play a special role in the management of public spaces. 

Modelled on similar business improvement districts in New York and Britain, the Sydney Western Harbour Business Improvement District (SWHBID) was set up as a three-year trial to create a new form of “tripartite governance” between the public and private sector. The NSW government announced plans to roll out many other districts across the state. The initiative is being monitored and evaluated by the Institute for Public Policy and Governance at the University of Technology Sydney, which is also a business member of the venture.

Star is a founding member of the SWHBID. A company search shows that Star’s former chief casino officer NSW, Greg Hawkins, is still listed as a board member. Hawkins resigned from Star this year after giving evidence of the casino’s involvement in money laundering, fraud and foreign interference. When contacted by The Saturday Paper, Hawkins said that he had also resigned from the SWHBID in May this year, but, as of October 23, documents lodged with ASIC still list him as a director.

SWHBID has received $450,000 in funding over three years from the NSW government, while the City of Sydney provided a $40,000 one-off payment to support the three-year trial.

This week, Deputy Lord Mayor Sylvie Ellsmore successfully moved a motion that committed the council to seek advice on its involvement in the SWHBID and its governance. Ellsmore describes the recent planning changes as a “gift to Star, worth hundreds of millions – if not billions – of dollars”.

“When Star’s development plans were rejected by an independent planning panel in 2019, the NSW government quickly intervened with an offer to rewrite the planning rules,” she said.

“Is the NSW planning system so broken that it would allow the state government to pay the Star for land – so it can build a Metro stop right in front of their complex – and then sell it back to them again, all for undisclosed amounts of public money?”

The website of SWHBID has no address or contact number but it is registered at Business Sydney, formerly the Sydney Business Chamber, which has been a strong supporter of Star’s development plans in recent years. 

In its support of the BID model, Business Sydney has described it as “more than just a consultative committee”, saying it would be a “properly constituted delivery and co-ordinating agency” where “businesses have a seat at the main table”. Alongside Star, the board has members representing Lendlease, Mirvac and Markham, as well as the Sydney Fish Markets and the University of Technology Sydney.

Many of the board’s founding directors have strong connections either with conservative think tanks and consultancies or the NSW Liberal Party. This includes Bay Warburton, who was chief of staff to former NSW premier Mike Baird and continues to work with him as general manager of home care at HammondCare, of which Baird is CEO, and Katherine O’Regan, who was a NSW government staffer, Liberal councillor, and former deputy mayor of Woollahra.

This year the SWHBID began operating under a new business name, the New Sydney Waterfront Company, although it is not a company, which in addition to The Star also promotes Crown casino as a founding partner on its website, although it is not represented on the board. 

While SWHBID claims to operate as a “collaborative voice” for all stakeholders in the Pyrmont area, according to its constitution only business members have any decision-making power. There are no publicly available annual reports or any financial statements. 

The Saturday Paper spoke briefly to Jace Tyrrell, the new chief executive of the New Sydney Waterfront Company (BIDCo), at a community meeting in Pyrmont last weekend. An enthusiastic and fast-talking man, Tyrrell says he is working closely with Sydney Business and “virtually” with board chair Geoff Parmenter and that the BIDCo is non-profit but could offer services such as a “free ferry”. 

Questions were also sent to Geoff Parmenter, who chairs both the board and steering committee of SWHBID, and who was an executive at Star from 2013-18. He told The Saturday Paper that “Star has not been represented at BIDCo board or other meetings” since May. He said that the company’s first-year accounts were independently audited by BDO international accounting firm and tabled and approved at its first annual general meeting in May, which was attended by company directors as well as representatives of the NSW government, the City of Sydney and local community and small business groups. 

“Our FY2022 accounts are currently being audited and will be similarly shared at this year’s AGM,” he said. “We will be happy to publish them on our website.”

The New Sydney Waterfront Company has been enthusiastically promoted by both NSW Premier Dominic Perrottet and Cities Minister Stokes. On its website, Perrottet is quoted as saying, “Sydney’s Western Harbour will be the one-stop-shopfront for Sydney’s attraction effort – whether that is about investment, talent, business headquarters, visitors or new experiences.”

Perrottet, Stokes and Roberts did not respond to questions about their support for a company in which Star is promoted as a key member. 

Geoffrey Watson says Star is able to continue operating because the NSW government fears the damage in loss of tax revenue and jobs if it were to have its licence revoked.

“In a sense, Star is too big to be allowed to fail,” he says. “Why then would you increase its size and thus increase its economic and political power? All that would succeed in doing is make it even more difficult for the government – or the regulators – to control or discipline Star. It’s moving in the wrong direction.”

Watson says the NSW government is approaching Star’s expansion as a planning issue, failing to see the larger context.

“It’s not a planning issue. It’s a major policy issue, in respect of larger social issues, including organised crime,” he says.

“The real issue here is what we decide is our long-term strategy in respect of casinos. We’ve just had two inquiries which have exposed our casinos facilitating the most serious kind of organised crime. We’ve got to work out how to stop that and prevent it occurring again. The one thing we don’t want to do is expand it.

“There’s the old saying: when you’re digging yourself into a hole, it’d be a good idea to stop digging.”

This article was first published in the print edition of The Saturday Paper on November 5, 2022 as "Star attraction".

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