On 22 March 1946 His Excellency the Governor-General appointed a Royal Commission to inquire into and report on the existing law relating to gaming, the present administration and control of practices relating to racing, and, generally, all other matters connected with gaming and racing. The Royal Commission conducted sittings during 1946 and 1947 and presented its report in December 1947.
Its major recommendation was that provision should be made for the legalisation of off-course totalisator betting; it also recommended that a scheme submitted by the New Zealand Racing and Trotting Conferences should be adopted.
Because of the controversial nature of this recommendation, the Government decided to refer the issue to the people by way of a referendum and, on 20 January 1949, His Excellency authorised the holding, on 9 March 1949, of a special poll under the Gaming Poll Act of 1948. The proposal contained in the voting paper was “that provision be made for off-course betting on horse races, through the totalisator, by means to be provided by the New Zealand Racing Conference and the New Zealand Trotting Conference”. A total of 623,625 votes was recorded (approximately 56 per cent of the electoral roll), 424,219 in favour of the proposal and 199,406 against.
The authority for the establishment, constitution, and operation of the Totalisator Agency Board to develop an approved scheme was then given by the Gaming Amendment Act of 1949. The scheme itself was approved by the Minister of Internal Affairs on 20 September 1950.