He said the major parties were conflicted by the donations they received from the gambling industry.
Several government and opposition MPs have privately shared concern about gambling advertising,especially during sport.
"So many parents have approached all of us to say they are appalled that their kids are talking about … the odds of the game,rather than the game itself,"Senator Xenophon said.
A code of practice is in place for TV networks and gambling,including a ban on betting ads during play for football,but all three men said the industry had lost the right to self-regulate. The Australian Wagering Council said it had told the government it wanted advertising regulation in place.
If the Labor and Liberal parties won't stand up to the gambling industry,the crossbench will
"Advertising isn't all bad:in a globally competitive market,it informs consumers of the identity of licensed Australian-based wagering service providers where they can participate in wagering in a well-regulated environment avoiding the significant dangers which exist from wagering with illegal offshore operators,"chief executive Ian Fletcher said.
Senator Xenophon and Mr Wilkie are also reigniting a federal crackdown on pokie machines and want to establish a committee to investigate gambling.
Both want the 2010 Productivity Commission's recommendation for a $1 maximum bet rolled out on each machine - this is the maximum bet a punter can make every time they push the button,with limits varying from state to state,in Victoria it is $5,in NSW it is $10.
"The case is compelling,and it is very,very sad that up until now,parliamentarians have not seemed to care enough about the hurt caused by problem gambling;that parliamentarians have been happy to be completely out of step with the vast majority of the members of the community who want strong reform,"Mr Wilkie said.
They also want the commission's report revisited and updated to include the impact of the exploding online gambling industry.
Clubs Australia,who spearheaded the campaign against the Wilkie-Gillard reforms,said the policy would cost more than $1.5 billion and not help a single problem gambler access counselling or treatment.
"The economic,social and employment costs of this policy thought-bubble from Xenophon and Wilkie are even more astounding when you consider that the majority of problem gamblers bet less than $1 per spin,"executive director Anthony Ball said.
In 2012,Mr Wilkie withdrew his support for Ms Gillard's minority Labor government after he accused her of breaching an agreement signed after the 2010 election for action on problem gambling that would have seen all punters forced to preset a loss limit on the pokies.
Ms Gillard faced a revolt from Labor MPs over a deal on poker machines as the powerful pokies and clubs lobby pressured marginal seat MPs in NSW and Queensland.
Before the July 2 election,the Greens pledged tooutlaw all gambling advertising in a similar manner to bans on tobacco promotion.
Greens Leader Richard Di Natale backed reform and said a critical key was to reform Australia's political donation laws that allowed money to flow from vested gambling interests.
"Until we end that we are not going to get the reform we need,"Senator Di Natale said.
Labor frontbencher Brendan O'Connor said the opposition would wait to see the proposals before responding.
Human Services Minister Alan Tudge said the Coalition's focus was on online gambling,following a review led by former NSW premier Barry O'Farrell.
He said the government would work constructively with MPs to deliver the package,including a self-exclusion register and voluntary pre-commitment scheme.