New rules cut pubs' share of pokie payout

Reduced limits on how much pubs can be paid to have "pokie" gaming machines have been set by the Internal Affairs Department.

The department's gaming and censorship regulation group director, Keith Manch, said that some gambling operators strongly opposed limits on venue expenses, claiming that if they could not pay pubs as much as they wanted, pubs would no longer host machines.

"At the same time, some community groups were extremely concerned that many millions of dollars raised for the community were, instead, going to pub owners."

The new system is the result of submissions from the industry and the community and an independent accounting report commissioned on the industry's operating costs.

"It recognises that pubs incur costs for hosting gaming machines, will ensure that pubs will get fair payment for their work, and allows them to make some profit," Mr Manch said.

"But the total payment will be lower than before, and the proportion of gaming machine profits going to pubs will be reduced from about 20 per cent to no more than 16 per cent."

Hospitality Association chief executive Bruce Robertson says the cap on venue expenses will result in less money for the community and the Government.

"High turnover venues will not be reimbursed sufficiently to encourage venue operators to maintain current operating hours and turnover," he said.


Mr Robertson said the formula did not cover the increased cost of compliance imposed by the new Gambling Act - which replaces the Gaming and Lotteries Act - nor did it reflect true operating costs.

"For instance, it is ludicrous that a share of costs such as car parking and toilets cannot be apportioned against gambling revenue. It defies common sense to suggest that gaming machine patrons don't drive cars or use the toilets."

The new system has allows different venues to be paid different amounts to reflect their costs and includes four parts:

* Hourly operating costs of up to 60c a machine.

* Weekly operating costs of up to $75 a machine.

* Venue operating costs of up to $800 a week

* A cap of 16 per cent on the amount that each gaming machine society can pay in expenses to its venues.

Mr Manch said the 16 per cent cap was the most significant change from the previous system, which had no total limit.

Based on estimates of this year's gaming machine profits, the 16 per cent limit would reduce what pubs were paid to host the country's 22,000 gaming machines to no more than $130 million.

The limits on hourly, weekly and venue costs come into force on December 1. The 16 per cent limit on payments to pubs will operate from December 1 next year.

Gambling operators' gross profits from machines in pubs and clubs have climbed in the past three years.

In the year to June 30, 2002, the amount was $777 million. Last year, it was $941 million, and this year is is expected to be more than $1 billion.

- NZPA