The ill conceived and poorly executed legislation banning betting exchanges in Western Australia is looking even worse today with the revelation that the State's own TAB wrote to the government last year concerned that "it could inhibit the development and operation of a Betting Exchange by RWWA if required at a future date."

Ray Bennett, the CEO of Racing & Wagering WA (RWWA) wrote to Barry Sargeant, Director General of the WA Department of Racing Gaming and Liquor in March last year when the legislation was still in the drafting stage.

Bennett asked that the government consider amendments to the legislation :-

"We would seek some commitment that the Department of Racing Gaming & Liquor would support amendments to this legislation so they could be enacted in a timely manner if in the future RWWA is required to meet competitive pressures and establish a Betting Exchange operation either independently or in a pooling arrangement."

Despite this correspondence, Mark McGowan the then Minister responsible for introducing the legislation, denied in Parliament that RWWA had ever considered setting up a betting exchange.

On the 22nd of August, McGowan responded to a Parliamentary question by saying :-

"The member for Murdoch asked about the TAB setting up its own betting exchange. No, the TAB has not been considering that."

The WA government's only defence to the High Court constitutional challenge launched by Betfair against the legislation is to invoke so called "social policy" considerations.

The news that its own TAB wanted the freedom to set up an exchange in the future suggests that the purported purpose of the legislation which is to protect the WA public from the corruption allegedly caused by exchanges is a hollow sham to conceal its true purpose.

This is of course to protect RWWA from the rigours of competition - a purpose very much at odds with the free trade between the states envisaged by Section 92 of the Australian Constitution.

With Constitutional law experts seemingly united in opinion that the WA legislation will be struck down, this latest revelation will do the government's case no good whatsoever.

The natural outcome of the WA law being struck down will be to invalidate all similar provisions in other States' legislation prohibiting things like interstate advertising by wagering firms or the display of odds.

The writing is on the wall for wholesale demolition of the web of legislation which has protected the TAB's from competition.

RWWA had better dust off its plans to set up its own exchange, although ironically if the WA legislation is struck down it will only be the bits dealing with interstate trade.

Setting up a WA based exchange will still be illegal.