Clubs Australia has declared "open warfare" on the Gillard government, preparing a $20 million media campaign to try to stop laws to limit how much punters can spend on poker machines.

Last year Tasmanian independent MP Andrew Wilkie backed Labor to form a minority government in return for a clampdown on the use of poker machines.

Now, the lobby that represents clubs and pubs is fighting back, with a media blitz targeting Mr Wilkie and Prime Minister Julie Gillard.

Along with billboards and a website, they have prepared beer coasters for distribution to clubs and pubs across the country.

The campaign has already been criticised as misleading for claiming punters will need a licence to gamble.

But Clubs Australia executive director Anthony Ball rejects that.

"What we do know is that everyone who plays a poker machine will need to register and obtain a card, and then insert it into a poker machine and set a binding limit," he told ABC TV's Lateline.

"There needs to be player tracking, because how else does the machine know what the player is doing?

"It will have your private details and your gambling history on it. Now if that's not a licence, I don't know what is."

Under Mr Wilkie's plan, gamblers would have to nominate a dollar figure for how much they are prepared to lose before they start gambling, a scheme known as "mandatory pre-commitment".

Mr Wilkie wants the law in place by 2014 and he has the backing of South Australian independent Senator Nick Xenophon.

Senator Xenophon describes the Clubs Australia campaign as a "joke".

"This industry is willing to spend $20 million of tax-break money that they get from community clubs - effectively taxpayers' monies, indirectly - to peddle lies in terms of a campaign where they haven't even seen what the final report will say," he told Lateline.

"Whether it's $20 million or $200 million, this mob can spend as much as they like, but they can't spin that they are causing enormous damage out in the community.

"There are 300,000 Australians who either have a severe gambling problem because of poker machines, or are already showing the signs of one."

Jobs at risk?

Clubs say the changes will cost jobs. They want it to be a voluntary scheme and have rejected a government request to hold off on the ad war.

"It will cost jobs, for the simple reason that asking Australians to sign on to this licence to gamble will mean they'll do something else," Mr Ball said.

"They'll go and gamble online where none of these controls exist, or they they'll go to the TAB - they won't do it at the club.

"Even the proponent of this, Andrew Wilkie, is saying that this will cost up to 40 per cent of revenue."

The argument is about to heat up in Parliament.

Liberal Steve Ciobo sits on the joint committee on gambling reform, which has been hearing arguments for and against a mandatory pre-commitment scheme.

"The committee was charged by the Labor party with the responsibility to look at a roll-out of pre-commitment," he said.

"But Coalition members will be putting in a dissenting report because the evidence is clear that it's going to cost jobs, it's going to cost investment, and I'm concerned based on the evidence that it will make problem gambling potentially worse."

The committee is due to report in the next few weeks.

The states and territories have until the end of May to decide if they will agree to the Wilkie-led reforms.

If they refuse, the Commonwealth believes it has the power to introduce overriding legislation to impose a national scheme.

The pokie industry has vowed to fight that all the way to the next election.