LINKS between the Government and the company running the Millennium Dome came under fresh scrutiny yesterday after it emerged that building work has already begun on a supercasino even though a gambling licence has not been granted.

Anschutz Entertainment Group (AEG) admitted that it had already built the “shell” of a supercasino inside the Dome, even though no decision has yet been taken on where the first and only one in Britain will be. The Casino Advisory Panel is expected to announce the winning area in December.

This prompted the Conservatives to claim that the Government must have given AEG private assurances that it would win the licence.

Philip Anschutz, who owns AEG, was at the centre of a row this summer after The Times revealed that John Prescott had enjoyed a two-night stay on the tycoon’s Colorado ranch. AEG’s close ties to the Government came under even greater scrutiny after it emerged that Mr Prescott had met Mr Anschutz on seven separate occasions.

AEG said it would be too costly to wait until December to start work because building was already under way on the whole development. Should it win the licence, it would want to open the casino in 18 months. A spokeswoman said that it had planning permission to construct the shell, and was waiting for the outcome of the panel, like the other bidders, but AEG issued a stark warning to the Casino Advisory Panel that it will scale back its investment in the Dome considerably if the licence for Britain’s first regional casino goes to one of the five rivals.

It revealed that it would drop proposals to build two luxury hotels, an 1,800-seat theatre capable of housing large-scale shows and an exhibition area if it were not given the go-ahead for the casino. It estimates that 3,354 jobs and £320 milllion of projected investment will be at risk if it does not get its way.

“AEG is contractually obliged to develop the arena on the site but has no obligation whatsoever to develop other elements,” said a document submitted to the Casino Advisory Panel by Greenwich council, which made the application on AEG’s behalf. Next Wednesday the application will be scrutinised in public by the panel, with council officials and representatives of the company invited to contribute.

Hugo Swire, Shadow Culture Secretary, said that once again it appeared that the casino selection process had been compromised, saying: “It now appears that all the estimates of jobs from the sale of the Dome trotted out by the Government and AEG are all based on building a supercasino.

“Many people are now asking why would AEG take such a financial risk and actually begin construction of the casino unless they had received assurances that they would be successful in the bidding process. This raises yet more questions about the Government’s relationship with those wanting a casino at the Dome.”

Other documents revealed how the Casino Advisory Panel was evaluating the six different regional casino bids.

They demonstrated that the panel had concerns that Blackpool’s casino would be next to some of the area’s most deprived wards, and next to the station. In its reply, Blackpool council said that the area faced a bleak future if it was not given a supercasino.

“Incremental change will not reposition Blackpool in the marketplace and will not therefore halt the process of decline,” it said. “There is, as a consequence, no Plan B for regeneration of the resort role.”

In Wembley, the panel expressed concern that many of the people who lived near the site were particularly vulnerable to gambling addiction.

The council said that while just under half of the local council’s population were potential casino users — four times the national average — the proportion of vulnerable gamblers is 14 per cent, in line with the average for Greater London.

The panel also asked Sheffield City Council, which is on the shortlist for a supercasino, whether it was wise to situate a casino in an area with a high-density Muslim population.

“How do you defend the suggestions that job opportunities will not be available in these areas due to the restrictions of their faith?” it asked.

The council said that local Muslim groups were satisfied broadly with the proposals.

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