Updated January 21, 2012 15:28:20

Video: Gillard announces pokies pre-commitment trial (ABC News)

Federal Cabinet has announced it is formally abandoning a deadline to introduce mandatory pre-commitment technology for poker machines.

Labor had a deal with independent MP Andrew Wilkie to form government, which involved changing poker machine laws by May 8.

At a press conference this afternoon, Prime Minister Julia Gillard and Community Services Minister Jenny Macklin announced they will begin a national trial of the technology from next year.

The Government will introduce legislation to require the mandatory pre-commitment technology be installed on every new poker machine manufactured from the start of 2013.

Ms Gillard says the technology will be in place by the end of the trial in 2016, with the new timeline supported by the Productivity Commission.

"The technology will be rolled out while the trial is underway," she said.

Poker machines will also be required to display electronic warnings, while ATMs at gaming venues will have a $250 daily withdrawal limit.

Ms Gillard says the original deal struck with Mr Wilkie would not have passed the current parliament.

"The circumstances of this parliament are clear ... there is not the support in the House of Representatives for the Andrew Wilkie plan," she said.

Mr Wilkie held a press conference after Ms Gillard announced her plans, and said he would withdraw his support from the Government.

He said the Government announced a plan too different from his original deal and he had "no option" but to end his support.

"I meet with the Prime Minister in Hobart on Sunday afternoon and she basically put in front of my what she's announced today. It was clearly unacceptable," he said.

But Mr Wilkie says he will not let his disappointment stop him from supporting the Government's poker machines changes.

Earlier today, Ms Macklin told Saturday AM the pokies discussions were in the early stages but financial support would be offered to clubs.

Yesterday, Federal independent MP Tony Windsor weighed into the poker machine debate, saying he believed the deal was dead.

The Member for New England has been a vocal opponent of Mr Wilkie's pre-commitment technology, but he admitted something did need to be done to address problem gambling.

"If there are other ways of addressing the issue, well let's have a look at them," he said.

He has backed Ms Gillard's assessment on the pokies plan being pushed through Parliament.

Mr Windsor has suggested Mr Wilkie take another look at his options and find another way to tackle the gambling addiction.

Cabinet ditches pokies reform deadline - ABC News (Australian Broadcasting Corporation)