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The Baird government vowed on Thursday to legislate the NSW greyhound racing industry out of existence after a report found it participated in and condoned the mass slaughter of thousands of healthy dogs each year and appeared incapable of reform.
The government's announcement followed the report of a Special Commission of Inquiry by former High Court Justice Michael McHugh, which conservatively put the number of greyhounds killed in NSW over the past 12 years at up to 68,000, or between 50 and 70 per cent of all dogs bred for racing.
"There is no other alternative," said Mr Baird when announcing a phased ban to take effect next July.
"Justice McHugh has shone a light on an industry that has overseen the slaughter of tens of thousands of healthy dogs whose only crime was not being fast enough."
The inquiry was presented with evidence that industry officials were aware that the illegal practice of savaging smaller animals such as possums as live bait for racing dogs was ongoing. Up to one-fifth of NSW greyhound trainers may have used the condemned practice.
The government's response will close an industry and sport that had been central to working class culture in NSW and which continues to attract wagers of about $1 billion a year and employ about 1000 people.
The sport's official body, Greyhound Racing NSW, said it was "devastated" by the measure and had reformed the sport in the past year, and announced it was suspending racing for the next seven days.
Races will continue under heavy government supervision for one more year, the government says, a delay designed to help industry employees find new work and prevent further losses among the between 6000-10,000 dogs trained to race in NSW.
"No government wants to close down an industry and there are many, many people who have done nothing wrong," said Deputy Premier Troy Grant.
Mr Grant said assistance packages for industry workers were still being finalised. Legislation will be introduced when Parliament convenes next month.
"Around our state, there are many thousands of responsible participants who treat their greyhounds like family," Greyhound Racing NSW said.
The RSPCA and other animal rights organisations hailed the measure as an historic step for animal welfare in Australia. The ACT said it would mirror the NSW ban. Queensland and Victoria said they do not plan to do so.
The inquiry followed an episode of the 4 Corners program which showed graphic footage of animals used as bait being savaged by racing dogs.
The state government will deny itself about $30 million in revenue from associated gambling taxes from the reform, while the state's economy will lose a total economic benefit of about $90 million, according to government estimates.
Labor frontbencher Michael Daley spoke out against the haste with which the government announced the ban.
"You don't wipe an industry out on a whim," he said. "And you don't do it without going to Parliament first."
The NSW Shooters, Fishers and Farmers Party said the government had failed to tackle the task of reforming greyhound racing and called on the Premier to rule out future bans on horse racing.
The government and the RSPCA are now campaigning for members of the public to adopt the between 6000-10,000 dogs who race in NSW or are being trained to do so. But the organisation said it was doubtful if all dogs could be rehomed.
Mr Baird paid tribute to his late colleague, Greens MLC John Kaye, who had also earlier helped bring to light the mass extermination of dogs at an inquiry in the NSW upper house.
Justice McHugh found senior officials at the industry's governing body, Greyhound Racing NSW, believed the practice of live-baiting was ongoing and prepared briefing papers for its board to that effect.
The report further alleges the industry tried to fight growing public concerns about animal welfare and the sport by "sanitising" the extent of injuries suffered by dogs and their treatment by cheap and painful non-veterinary methods.
Justice McHugh concluded that notwithstanding recent reform efforts within Greyhound Racing NSW, the endemic nature of animal welfare violations in the industry and their apparent cover up left the sport with little prospect of reform.
Shares in Tabcorp were down about 4.3 per cent at the close of trading but the company said dog racing represented only a small share of its revenue and would be replaced.
Cabinet met at the first opportunity on Thursday to approve the measures, which will be introduced when Parliament reconvenes next month.
Mr Baird said existing greyhound infrastructure would be repurposed for use by local communities.
