Electronic gambling machines (pokies) venues tend to be overly represented in lower income communities and town centres. Māori and Pasifika populations are effectively being disproportionately targeted and often severely harmed by them. The harm generated by pokies in terms of poverty, relationship break-up, depression, domestic violence, crime, neglected children, and the greatest losses by gamblers from pokie machines tend also to be drawn disproportionately from Māori, Pasifika, and lower income communities and families.

This Bill seeks to overcome these inequities of harm in the location and excessive numbers of pokies by enabling local authorities, in consultation with their communities, to reduce the number of, or even eliminate, pokies from those suburbs and towns where they are particularly concentrated or doing particular harm. It also changes the responsibility for distributing pokie funds to provide an informed and democratically accountable distribution method, and to end the inefficiencies, lack of transparency, risks of unethical behaviour, and failure to appreciate and respond to the greatest needs of particular geographical and ethnic communities in the distribution of the "community benefit" funds from pokies. It also proposes to give gamblers more ability to limit and control their own gambling behaviour through player tracking and pre-commit cards. The Bill proposes to do so in 5 ways.

First, this Bill responds to the public sentiment and evidence that there are already too many pokies and venues in some locations and districts by adding public sentiment and evidence of harm to the major criteria to be applied in developing a territorial authority's gambling venue policy. It empowers local authorities, after consulting the community and affected operators, to eliminate or reduce the number of pokie machines and venues in particular suburbs or towns where public sentiment or evidence of harm justifies this. There is a specific new power to phase out venues that were in operation at the time the Gambling Act 2003 (the principal Act) came into force or have since commenced operation, while permitting operators who have not otherwise breached any licence conditions, the opportunity to phase out their pokies over a 1 year period. There is an explicit new power that this is an option to be decided on through the triennial reviews of that local authority's Gambling Venue Policy which would also be applied by all licences being for 3 year renewable periods only.

Second, it cuts out racing and racing-stake money as an authorised "charitable" purpose that is inconsistent with the community benefit tenor of the rest of the principal Act. Special consideration to this industry alone should not continue when community and iwi organisations are desperately short of funding.

Third, it requires the distribution of proceeds to be carried out primarily for the benefit of community, sporting, and social-service organisations operating within and for the benefit of the geographic community in which the venue is located. It specifically requires all pokie machine trusts, corporate societies and other distributors of the proceeds of gambling machines to return at least 80% of these funds generated by gamblers' losses on local pokie machines back into the charitable organisations that are meeting priority needs in the same local authority area as the venue and within the same local authority ward, local board subdivision, or community board area where such subdivisions exist. Currently pokie machine trusts and corporate societies are obliged to make grants for authorised purposes as defined in the principal Act from the net proceeds from their gambling machines. However only a small proportion of the pokie gamblers' losses are distributed in grants for community benefit back into the same communities that generated them. This is because the majority of the gamblers' losses go to pay machine site rentals, machine maintenance, trustee fees for pokie trust members, and other administrative costs. Gambling losses are occasionally siphoned off into corrupt purposes and other rorts; go into paying taxes; and into grants made to organisations based in other local authorities altogether, sometimes even in the other Island, or to national bodies.

Fourth, this Bill also phases out the "pokie trusts" or corporate societies as the distributors of community benefit money from pokie machines, and within a year's time passes over responsibility for these distributions to special committees of local authorities with a majority of representation from community organisations, modelled on the Creative New Zealand creative communities fund committees and the former Hillary Commission local committees. The creative communities fund committees in particular already make full use of the provisions of clause 31(3) of Schedule 7 of the Local Government Act 2002 which permit councils to appoint members to council committees and subcommittees who are not members of the council. Every local authority in New Zealand is granted money from Creative New Zealand on a per head of population basis and distributes it through a council committee which has one or more councillors on it but a majority of whose members are drawn from knowledgeable people from arts and cultural groups in that district. This Bill would set up a parallel system to grant money to community, social-service, iwi, and sporting groups in their district on a fair, informed, transparent, and accountable basis.

Fifth, gamblers who are having problems with their behaviour when using pokie machines frequently have their problems exacerbated by losing track of the amount of their losses or of the passage of time. Gamblers could more often be able to manage their gambling if pokie machine venue operators were obliged to keep track of each gambler's overall losses and time spent gambling through using common technological devices like player tracking systems. If, in addition, gamblers were equipped with pre-commit cards in which the gambler pre-set, away from the gambling venue, limits on the amount of losses and time spent gambling on pokie machines then they could restore control over their own behaviour and greatly reduce the problems they could face from pokie gambling. The Bill proposes making such player tracking devices and pre-commit cards a required condition of a pokie machine venue operator's licence as issued by the Secretary of Internal Affairs.

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