A scathing report has found regulators of Australia's biggest poker machine network have failed harm minimisation efforts.
In what gambling reform advocates label "the worst kept secret", the NSW auditor-general found regulators were not reviewing licensing conditions once granted and did little to force venues to take meaningful actions when problem gambling was noticed.
Some 21 venues in NSW have more than 400 machines, but just two have had their licensing conditions reviewed since July 2019 - when applying for operations changes.
Four of the five most-profitable gaming venues were in high-risk gambling harm areas but have not had their risk or harm minimisation measures reviewed in at least a decade, the report said.
Premier Chris Minns campaigned on gambling reform at the 2023 election, but the number of poker machines has increased in NSW to 87,749.
Profits meanwhile hit all-time highs of $8.4 billion in the 2023/24 financial year.
That delivered $2.3 billion in tax revenue, a figure tipped to increase to $2.9 billion by 2027/28.
Alliance for Gambling Reform CEO Martin Thomas said the government was not concerned about reducing gambling harm, shown by the regulator "failing to do its job".
"NSW already has more poker machines than any other jurisdiction, more than almost any other part of the world," Mr Thomas told AAP.
"So it is appalling that the numbers of machines is still increasing despite the rhetoric about reducing the number of machines."
NSW had half of all Australian pokies in 2022/23 - with three times as many machines per capita than Victoria.
Defending Labor's record, Gaming Minister David Harris pointed to measures including reducing cash input limits, banning external gaming-related signage and introducing responsible gambling officers for venues with more than 20 pokies.
But the report found some of the measures, including gradually reducing the number of machines based on forfeiture rates, had not worked.
Greens MP Cate Faehrmann said the report, combined with the forecast growth in taxes from pokies losses, showed NSW was "addicted to poker machine revenue".
"Gambling harm reduction advocates have been warning for a long time that the gambling industry has been allowed to operate with virtually no government oversight," she said.
"And the report confirms this."
Venues in western Sydney, including in the Canterbury-Bankstown, Fairfield and Cumberland council areas, had the highest pokies losses, with those three combining to lose $1.9 billion in the year to June 2024.
That is almost a quarter (22 per cent) of the state's total losses, despite containing 10 per cent of the NSW population.
"In western Sydney, entire salaries are disappearing into poker machines," Opposition Leader Mark Speakman said.
An independent panel last year recommended statewide account-based systems by 2028 to prevent money laundering and reduce problem gambling.
The recommendation echoed a 2022 crime commission report that lifted the lid on the billions of dollars of dirty money being funnelled through pokies.
The former coalition government went to the 2023 state election promising mandatory cashless gaming.
