Federal Group

Last updated

Federal Group is a privately owned family company which operates tourism, hospitality, retail, and a national sensitive freight company but is primarily known for their casino and gaming assets in Tasmania which is described as "a licence to print money". [1] In the past the company has been known as both "Federal Hotels" [2] or "Federal Hotels and Resorts". [3]

Contents

The Federal Group is owned and operated by the Farrell family, consisting of Greg Farrell (managing director), John Farrell (director of business development), Julia Farrell (director of interior design), Deborah Lee (née Farrell; board member) and Jane Farrell (board member). [4]

History

Federal Coffee Palace

Federal is the oldest continually operating hotel group in Australia. Its origins can be traced to Melbourne in the 1880s.

In June 1885, a company named The Federal Coffee Palace Company Limited built an elegant temperance establishment (‘Coffee Palace’) to coincide with the 1888 Centennial Exhibition. [5] Seven stories high, it was the tallest building in Melbourne. It had 450 bedrooms and the largest dining room in Australia. [5]

During the Depression of the late 1880s and early 1890s, the Coffee Palace lost significant amounts of money. This prompted its directors to obtain a liquor licence in order to attract more profitable clientele. [5] The original coffee palace was renamed the Hotel Federal and it went on to become the cornerstone of what is now Federal Group. [5]

Over the next few decades Federal operated several hotels, including The Menzies, Savoy Plaza, The Windsor, Hotel Australia, Lennons Hotel in Brisbane and Hampton Court in Sydney. [5]

Australia's first casino

In 1956, Federal bought its first Tasmanian business – the Wrest Point Riviera Hotel in Sandy Bay, Hobart.

During the late 1960s Federal initiated discussions with the Tasmanian Government about granting the Wrest Point Riviera Hotel Australia's first casino licence. [5] The casino was initially conceived to address the seasonal nature of Tasmania’s tourism industry, designed to be an attraction that would entice visitors to the state all year round.

In a referendum held on 14 December 1968, Tasmanian voters were asked the following question: “Are you in favour of the granting of a casino licence to Wrest Point Hotel conditional on the proposed development of that hotel?”. In spite of having a referendum planned, the Government managed to obtain sufficient votes on the floor of the parliament. They therefore decided to ignore the referendum, and hold the vote prior to the referendum, and the bill was passed as law. This process was also mired in allegations of corruption and bribery, especially with regards to Kevin Lyons, who held the balance of power. [6] [7]

By a slim 6% majority, the establishment of a casino in Hobart was accepted and the Wrest Point Casino Licence and Development Act of 1968 was passed. [5]

On 10 February 1973 Australia’s first legal casino opened with great spectacle. The event featured the largest fireworks display ever seen in the country, and was televised through the Channel 7 network. [5] American entertainer Jerry Lewis was the main guest artist.

The initial response to the casino exceeded expectations. More than 2,000 people visited the casino on the first Sunday it opened. The hotel was booked out for the first 3 months.

However, the reality of the casino soon set in. While it was initially supposed to be an entertainment and convention centre with a small casino, the casino soon took over the building with many poker machines filling the complex. [8] The restrictions around the casino and the presence of poker machines in the community were gradually lifted, until they were widespread. The expected boon to tourism also disappeared as the vast majority of the significant losses at the machines were Tasmanian residents. [8]

Second casino licence

In 1979, Federal Group secured a second casino licence in Northern Tasmania. The Country Club Casino and Resort was opened in 1982 and the adjacent Country Club villas were acquired by the company some years later. [5]

Architects modelled the style and interior design of Country Club on the stately homes of America’s south. Former Chairman Greg Farrell senior had always admired the simple lines of the US Embassy building in Canberra and believed that the Georgian style would work well in the rural landscape of Launceston.

The casino is now surrounded by suburbs and local neighbourhoods.

9/11 bottleshops

With the monopoly over the poker machines in the state and all the data of where the most profitable locations were, Federal Group then purchased the 9/11 chain of bottle shops in 2006 to attach to these locations. [9] In February 2024, Coles Liquor reached an agreement to acquire 20 out of 21 of Federal Group's 9/11 stores. [10]

Controversy

In a 2017, book entitled "Losing Streak", [11] the Tasmanian author James Boyce argues that the monopoly-licence granted to the Federal Hotels to operate poker machines in Tasmania has been at the expense of the best interests of the Tasmania public. The licence has meant that Federal Hotels have earned around $30 million for the past 30 years. [12]

A parliamentary enquiry called for a significant reduction of machines, and changing the deal with Federal Group. [13] It is estimated that clubs only take in 10-30% of all pokies losses, with the majority going to Federal Group, for which they pay a minimal amount to the government in taxes. [1]

2018 election and potential pokie ban

In August 2017, Federal Group agreed to give up their monopoly on the poker machines, if in return they would receive a reduction in their taxes (which are already the lowest gambling taxes in Australia). [14] The Liberal government also stated that they agree to the presence of the pokies but they will not necessarily grant those licences exclusively to Federal Group. [15]

In December 2017 the Labor Party opposition under its new leader, Rebecca White, announced that if elected they would phase out all poker machines from pubs and clubs by 2023. [16] The reasons cited were the health implications, and that Tasmanians could not afford to lose the more than $110 million it loses every year. [17]

In response Federal Group attacked the plan as dangerous and that it would lead to job losses, and said they would stop donating to the Labor Party. [18] [19] The Liberal Party mostly fell in line with Federal Group, even using Federal Group's own promotional material to attack Labor. [20] Over half of the Liberal Party's declared donations, over $400,000, for the election were given to them by gambling interests. [1]

There has been wide spread support for the Labor policy. The Greens have been calling for the pokies ban for many years, [21] and the Jacquie Lambie Network also coming out in support. [22] Others in support include David Walsh, the owner of the MONA gallery, and major opponent of the pokies. [23] Public opinion also strongly supports either a reduction or phasing out of pokies. [24]

Former interests

Tourist accommodation

See also

Related Research Articles

James Alexander Bacon, AC was an Australian politician who served as Premier of Tasmania from 1998 to 2004.

<span class="mw-page-title-main">Andrew Wilkie</span> Australian soldier, intelligence officer, environmental activist, politician

Andrew Damien Wilkie is an Australian politician and independent federal member for Clark. Before entering politics Wilkie was an infantry officer in the Australian Army.

<span class="mw-page-title-main">Wrest Point Hotel Casino</span> Building in Tasmania, Australia

The Wrest Point Hotel Casino is a casino in Tasmania. It was Australia's first legal casino, opening in the suburb of Sandy Bay in Hobart, on 10 February 1973.

<span class="mw-page-title-main">Casino Canberra</span>

Casino Canberra is a casino located in the Central Business District of Canberra, the capital city of Australia.

In 2017, Tatts Group combined with Tabcorp Holdings Limited under the Tabcorp brand.

<span class="mw-page-title-main">2006 Tasmanian state election</span>

An election for the House of Assembly was held in the Australian state of Tasmania on 18 March 2006, the same day as the South Australian elections. The Labor Party led by Premier Paul Lennon, won a third successive majority government term in office, despite predictions the election would result in a minority government. Although there was a small swing against Labor, they finished with 14 seats, and there were no changes in the party composition of the assembly. The Liberal Party led by Rene Hidding gained a small swing and finished with seven seats. The Tasmanian Greens led by Peg Putt suffered a small swing and finished with four seats; meaning no change in seat representation since the last election. Had the Greens lost one of their four seats, they would have lost their status as a major party and would lose financial resources, offices and support staff.

<span class="mw-page-title-main">Adelaide Casino</span> Casino in Adelaide, Australia

Adelaide Casino, known commercially as SkyCity Adelaide, is a large casino and recreational venue on the north edge of the Adelaide city centre. Located in the heritage-listed Adelaide railway station building on North Terrace, Adelaide, the casino has 90 gaming tables and 950 gaming machines, as well as several bars, function areas and restaurants. Operated as part of the SkyCity Entertainment Group, it is the sole licensed casino in South Australia, regulated by the Independent Gambling Authority and the Liquor and Gambling Commissioner under the Casino Act 1997.

<span class="mw-page-title-main">Will Hodgman</span> 45th Premier of Tasmania, Australia

William Edward Felix Hodgman is an Australian diplomat and former politician who has been the High Commissioner of Australia to Singapore since February 2021. He was the 45th Premier of Tasmania and a member for the Division of Franklin in the Tasmanian House of Assembly from the 2002 state election until his resignation in January 2020. He became premier following the 2014 state election, having been Leader of the Opposition since 2006. He was re-elected to a second term in government following victory in the 2018 state election.

<span class="mw-page-title-main">Nick Xenophon</span> Australian politician (born 1959)

Nick Xenophon is an Australian politician and lawyer who was a Senator for South Australia from 2008 to 2017. He was the leader of two political parties: Nick Xenophon Team federally, and Nick Xenophon's SA-BEST in South Australia.

<span class="mw-page-title-main">Kevin Lyons</span> Australian politician

Kevin Orchard Lyons was an Australian politician and member of the Tasmanian House of Assembly representing the seat of Darwin.

The Tasmanian casino referendum was a one-question referendum held on 14 December 1968, which concerned the granting of Australia's first casino licence to the Federal Group to operate the Wrest Point Hotel Casino in Sandy Bay.

<span class="mw-page-title-main">Country Club Casino</span> Casino in Launceston, Tasmania

Country Club Tasmania is a casino in Launceston, Tasmania, owned by Federal Hotels. It is Tasmania's second casino. It is also used for a variety of local events and is home to an 18-hole golf course. Targa Tasmania uses the casino as a starting point for the race.

<span class="mw-page-title-main">Gambling in Australia</span>

Gambling is an activity undertaken by many Australians. In 2022, 72.8% of Australian adults gambled within the previous 12 months and 38% of Australian adults gambled at least once per week. In 2017, Australians were estimated to lead the world with the highest gambling losses on a per-capita basis.

<span class="mw-page-title-main">Rebecca White</span> Australian politician

Rebecca Peta White is an Australian politician. She has been the Leader of the Opposition in Tasmania and Leader of the Parliamentary Labor Party in Tasmania since July 2021, having previously served in that role from March 2017 until May 2021. She has been a member of the Tasmanian House of Assembly in the electorate of Lyons since the 2010 state election. Previously, White served as Shadow Minister for Health and Human Services, and Opposition Spokesperson for Children.

<span class="mw-page-title-main">2018 Tasmanian state election</span>

The 2018 Tasmanian state election was held on 3 March 2018 to elect all 25 members of the Tasmanian House of Assembly.

<span class="mw-page-title-main">Madeleine Ogilvie</span> Australian lawyer and politician

Madeleine Ruth Ogilvie is an Australian lawyer and politician. She is a Liberal Party member of the Tasmanian House of Assembly representing the Division of Clark and is the Minister for Small Business, Advanced Manufacturing and Defence Industries, Science and Technology, Racing and Heritage in the Rockliff ministry. She was previously the Minister for Hospitality, Racing, Small Business, Women and Disability Services in the Second Gutwein Ministry for six weeks.

<span class="mw-page-title-main">2021 Tasmanian state election</span>

The 2021 Tasmanian state election was held on 1 May 2021 to elect all 25 members to the Tasmanian House of Assembly.

Tasmania has been notable in the history of gambling in Australia.

James Boyce is an Australian author and historian based in Tasmania. He has written four major books on Australian history and the history of Western thought.

Endeavour Group Ltd (EG) is an Australian alcoholic drinks retailer, hotel operator, and poker machine operator that was spun off from Woolworths Group in 2021.

References

  1. 1 2 3 "Wager war on pokie reign". www.theaustralian.com.au. 2 December 2019. Retrieved 7 December 2019.
  2. ↑ Tasmania. Parliament. Standing Committee of Public Accounts (2003), Inquiry into the Federal Hotels agreement, The Committee], retrieved 20 October 2021
  3. ↑ Way, Nicholas (18 May 2006), "A sure bet.(Federal Hotels and Resorts)", Business Review Weekly, BRW Media, 28 (19): 98(3), ISSN   0727-758X
  4. ↑ "Farrell family fortune doubles", Australasian Business Intelligence, COMTEX News Network, Inc, 18 May 2005, ISSN   1320-6680
  5. 1 2 3 4 5 6 7 8 9 Sutton, Keith Blueprint for the Casino industry : Federal Hotels and Wrest Point Canberra: K. Sutton, c1992
  6. ↑ The politics of poker machines in Australia's poorest state, Australian Broadcasting Corporation, 15 September 2017, retrieved 18 January 2018
  7. ↑ Newman, Terry Referendums (p. 304) in Alexander, Alison The Companion to Tasmanian History 2005 ISBN   1-86295-223-X
  8. 1 2 "Tasmania got gamed". The Monthly. 1 March 2017. Retrieved 18 January 2018.
  9. ↑ Lawrence, John (18 September 2017). "Federal Group's 20 year haul". Tasmanian Times. Archived from the original on 19 January 2018. Retrieved 18 January 2018.
  10. ↑ Profaca, Cody (5 February 2024). "Coles Group Acquires Tasmania's 9/11 Bottle Shop Chain". Drinks Trade. Retrieved 8 February 2024.
  11. ↑ Boyce, J (2017), Losing streak: how Tasmania was gamed by the gambling industry, Redback, retrieved 20 October 2021
  12. ↑ Markham, Francis; Kinder, Barbara; Young, Martin (5 April 2017). "How Federal Hotels monopolised pokies in Tasmania". ABC News.
  13. ↑ "Gaming report urges reduction in pokies, reassessment of Federal Group deal". ABC News. 28 September 2017. Retrieved 18 January 2018.
  14. ↑ "Federal Group Offers To End Tasmania Slots Monopoly | GamblingCompliance". gamblingcompliance.com. Retrieved 18 January 2018.
  15. ↑ "Tasmanian Liberals commit to pokies but not Federal Group". Financial Review. 9 January 2018. Retrieved 18 January 2018.
  16. ↑ "Pokies out of Tasmanian pubs, clubs by 2023 under Labor promise". ABC News. 13 December 2017. Retrieved 18 January 2018.
  17. ↑ "Rebecca White defends claims that pokies ban is a health issue". www.tasmaniatalks.com.au. Retrieved 18 January 2018.
  18. ↑ "Federal Group to launch pro-pokies campaign at Country Club". The Advocate. 19 January 2018. Retrieved 18 January 2018.
  19. ↑ Maloney, Matt (15 December 2017). "Federal Group boss Greg Farrell speaks out on Labor's pokies plan". The Examiner. Retrieved 18 January 2018.
  20. ↑ "Labor's pokies plan 'threatens our way of life', Deputy Premier says". ABC News. 25 December 2017. Retrieved 18 January 2018.
  21. ↑ "Labor's poker face on gambling policy set to be tested". ABC News. 16 October 2017. Retrieved 18 January 2018.
  22. ↑ "Game on: Federal Group blasts Labor's 'attack on gaming', jobs". ABC News. 15 December 2017. Retrieved 18 January 2018.
  23. ↑ "Tasmanian Labor's gamble on pokie policy could win big, or break the bank". ABC News. 13 December 2017. Retrieved 18 January 2018.
  24. ↑ "Could Tasmania become the first state to ban pokies from pubs and clubs?". ABC News. 26 September 2017. Retrieved 18 January 2018.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.