The horse trading between the Baird government and the Reverend Fred Nile is under way just weeks after the state election delivered him the balance of power, with gambling policy first up for grabs.

The government has officially declined to support poker machine reforms recommended by an inquiry chaired by Mr Nile, including consideration of maximum bets and limits on jackpots.

Fred Nile holds the balance of power following the NSW state election. Credit:Darren Pateman

But it has privately told him it remains open to further discussions.

The Christian Democratic Party MP, whose vote is crucial to the passage of the government's electricity privatisation legislation, says Deputy Premier Troy Grant contacted him to discuss the response before it was made public.