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Home / Bay of Plenty Times

Pokie revenue see-saws: Plummet and record high through Covid-19

Luke Kirkness
By Luke Kirkness
Sport Planning Editor·Bay of Plenty Times·
29 Mar, 2021 05:00 PM4 mins to read

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The preliminary results of Retina Rimal's study show links between problem gambling and mental health issues. / Video by Dean Purcell

Tauranga pokie machine profits plummeted when New Zealand was placed into lockdown but the cash came pouring back at the end of the year.

A problem gambling expert said the increase was "staggering" and the problem was very real in the Bay of Plenty region.

In the final quarter of last year, a whopping $252 million was spent on pokie machines throughout the nation, the highest since records began in 2007.

The previous high was Q3 in 2019 when they generated $244.7m. Machines in Tauranga alone generated $10.1m.

However, in the next three quarters, revenue dropped by about 55 per cent to $4.5m and in Rotorua, revenue fell from $6.7m to $2.9m.

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The decreases mirrored the nationwide trend which fell about 53 per cent between Q3 2019 and Q2 2020, but the decline was short-lived.

There was a dramatic dip in pokie machine revenue over lockdown but revenue came roaring back. Photo / Christine Cornege
There was a dramatic dip in pokie machine revenue over lockdown but revenue came roaring back. Photo / Christine Cornege

The Covid-19 lockdown was helpful for many with harmful gambling addictions, Problem Gambling Foundation spokeswoman Andree Froude said.

"They couldn't gamble, they didn't gamble online, they managed to save some money and spend time with family, for a lot of them it was really positive," she said.

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However, Froude said machine use came back with a hiss and a roar towards the end of the year and problem gambling was a major problem in the region.

"The Bay of Plenty figures are quite staggering," she said.

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"In the year ending December 2018 to the year ending December 2019, spending increased by $5m across the Bay of Plenty, a 6.5 per cent increase.

"The amount of money lost in the Bay of Plenty in 2019 was $86m ... We've got areas that are losing significant amounts of money."

Across the Tauranga district alone last year, $32,618,008 of profits were raked in on gambling machines from 137 venues – an average of about $238,000 in profits for each location. The profit was $2.49m higher than in 2015.

Pokie machines outside casinos fall under Class 4 gambling, which is regulated by the Department of Internal Affairs.

The number of machines a venue can have varies, with those with a licence granted before October 2001 allowed up to 18, and those granted licences after that point allowed nine machines.

Corporate societies, also called non-club societies, own machines and distribute them to venues to operate, a Ministry spokesperson said.

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Societies must distribute at least 40 per cent of all gambling profits back to the community.

However, venues receive a commission of up to 1.28 per cent of their weekly turnover, capped at 16 per cent of their net annual machine profits.

With venues closed for alert level 4, there was a slump in pokie use over lockdown. Photo / George Novak
With venues closed for alert level 4, there was a slump in pokie use over lockdown. Photo / George Novak

Froude said one of the foundation's biggest concerns was having pokie machines in areas where communities were already struggling financially.

"If you look at Rotorua on its own, as at December 2020, they have 25 venues and of those, there are 19 in very high deprivation areas and four in medium-high," she said.

"Twenty-three of the 25 are in very high or medium-high deprivation areas. A lot of money is being lost by people who really cannot afford to be losing it."

In the months during and after lockdown, Tauranga Budget Advisory Services was only having about 40 general budgeting sessions per week, they are now delivering between 80 and 90.

"We were very quiet when we first returned to working face to face with clients. Many people just did not want to venture out," manager Shirley McCombe said.

Tauranga Budget Advisory Services manager Shirley McCombe. Photo / George Novak
Tauranga Budget Advisory Services manager Shirley McCombe. Photo / George Novak

Rotorua Budget Advisory Services also suffered a decline last year but it was thought stable incomes and only being able to spend on needs instead of wants was responsible, manager Pakanui Tuhura said.

"From October 2020 onwards we have seen a steady increase in people accessing our services, which has continued into 2021," he said.

Tuhura urged anyone with a gambling addiction or anyone with a loved one or friend with an addiction to seek help from anti-gambling professionals.

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