Culture Secretary Tessa Jowell was accused in the High Court of treating existing gaming establishments with „blatant unfairness“ as she pushed ahead with plans for 17 new casinos, including in Solihull and Wolverhampton.

Lost profits could be as much as GBP 120 million a year and old, established operators forced out of business, a judge was told. The accusations came as the British Casino Association (BCA), which represents the interests of more than 90 per cent of existing British casinos, challenged the legality of the Government’s new gaming policy.

Ministers are backing plans for a „large“ casino, with up to 150 fruit machines offering jackpots of GBP 4,000 in Solihull. And they are also supporting Wolverhampton’s plans for a smaller casino, including up to 80 slot machines.

The proposals have already been cast into doubt after the House of Lords rejected the scheme, because of concern over proposals for a „supercasino“ in Manchester.

Peers voted in March to block the proposals unless the Government agreed to a review into the decision to reject Blackpool’s bid for the supercasino.

The High Court hearing could mean Solihull and Wolverhampton face further delays before they can press ahead with their plans, which have already been approved by the independent Casino Advisory Panel.

Michael Beloff QC, appearing for BCA and four of its member companies, said the policy „has created a disparity which is potentially seriously damaging to our legitimate commercial interests“.

He said Ms Jowell had previously pledged that she would ensure „fair competition between old and new“.

He added: „Whether she deliberately abandoned that policy or not, she has created a situation in which existing casinos are condemned to second-class status.“

The BCA is seeking a judicial review at a three-day hearing at London’s High Court before Mr Justice Langstaff.

The association is challenging the legality of the transitional order made under the 2005 Gambling Act which paved the way for the controversial new wave of casinos.

Lawyers for the Culture Secretary argue that the challenge „is without merit and should be dismissed“. But Mr Beloff said that unless the court intervened, the 17 new casinos were likely to become „a privileged class“ that would put existing facilities out of business.

He said: „The additional entitlements given to the 17 new casinos will seriously threaten many long-established businesses and jobs.“

Originally the Government proposed that all existing casinos would be treated at least as small casinos under the 2005 Act, ensuring fair competition.

But that policy had now „unnecessarily and unfairly“ been abandoned, said Mr Beloff. Existing casinos were restricted, in effect, to a maximum of 20 gaming machines.

In contrast, a small new casino would be able to offer 80 gaming machines, a large casino up to 150 machines and the regional casino up to 1,250 machines, with possibly unlimited stakes and prizes.

The new casinos would also be able to offer other forms of gambling, such as bingo or betting, while existing casinos would enjoy no such rights, he added.