Bay of Plenty community groups will be hit in the pocket under a proposal to increase pokie machine fees.

The Department of Internal Affairs is consulting with the gambling sector on proposals to increase monitoring and licensing fees on pub gambling machines - with an increase of close to 54 per cent on the cards.

As of December last year, 702 pokie machines were operating at 52 venues in Tauranga and Western Bay of Plenty. The machines made more than $8 million from October to December last year.

New Zealand Community Trust chief executive Mike Knell said the trust would lose half a million a year in funding for community groups and sports clubs nationally if the proposal went ahead.


The trust operated at 158 venues nationwide, including City Sports Bar, Cobb & Co, Flannagan's Irish Pub, Judea Tavern, Marble Bar, Mount Turf and TAB, Settlers Tavern in Tauranga, and Lava East in Omokoroa.

More than 90 per cent of the bars' funds went back into local community groups and sports clubs, Mr Knell said.

"It's outrageous to have a 53 per cent increase," he said. "There used to be 81 societies running machines and now there's 41, and there's a reduction in machines so there's far less monitoring to be done.

"Obviously we're concerned about any loss to the community."

Mr Knell said they were pleased Internal Affairs was consulting as there needed to be more transparency about what the costs were.

Vicki Semple, tournament director for Sport Bay of Plenty NZCT Aims Games said she was surprised the Government would be interested in taking money away from community organisations but said the increased costs should have a limited effect on the funds available.

"The NZCT Aims Games International Sporting Championships very much appreciates the tremendous support that we get from the NZ Community Trust as their vision is consistent with ours.

"We strive to unite communities through active participation in sport and making healthy life style choices.


"Any additional costs, such as increased licensing fees, would be absorbed by societies, which will mean they will need to look to reduce costs within the organisation and operate a lot more efficiently than what they may [have] been doing so in the past.

"In other words the increased costs should have limited effect on the funds available to the community."

New Zealanders' gambling spend had not fallen significantly, but the department's revenue from operators had, as it was tied to the number of machines.

Internal Affairs Minister Peter Dunne said the higher fees would cover the costs of the gambling law enforcement by the department, which has been financially stretched by investigations into increased non-compliance by pokie operators.

Nationally, the number of pub and club gaming machines dropped from 20,120 in 2007 to 16,717 at the end of last year.

The Community Gaming Association said the hike would impact community grants generated by gaming machines.

But the Problem Gambling Foundation said it would lead to increased compliance of a sector which, according to chief executive Graeme Ramsey, has been "a story of poor customer care". A "mystery shop" by Internal Affairs had found the vast majority of pokie operators were in breach of the Gambling Act, he said.