The Department of Internal Affairs

The Department of Internal Affairs

Te Tari Taiwhenua

Building a safe, prosperous and respected nation

 

New gambling fees: most community groups will no longer pay fees


3/6/2004
The new Gambling Act means that most schools, churches, clubs and other community groups wanting to use gambling for fund raising will not have to pay licensing and compliance fees from
July 1.

Community groups will not have to get licences, and will not pay fees, unless total prizes in their housie, raffle or other non-gaming machine gambling activity exceed $5,000. The current law requires a licence if prizes exceed $500. This change means that 89% of such gambling will no longer need licences and the operators will not have to pay fees.

The Director of the Department of Internal Affairs Gaming and Censorship Regulation Group, Keith Manch, said that many other community groups might be able to reorganise their gambling activities so they too could meet the new criteria and not have to pay fees.

Many clubs that operate gaming machines are likely to pay slightly less in total for licensing and compliance fees and the problem gambling levy. These are clubs with a moderate number of gaming machines and whose machines have moderate turnovers.

The total fees and problem gambling levy for the remaining clubs, most casinos, and gambling operators with gaming machines in pubs will increase.

Overall, as the result of the rapid growth in gaming machines in recent years and tighter controls imposed under the Gambling Act, there is an increase in licensing and compliance fees of $1.9 million.

Casino and gaming machine gambling have grown by between 18% and 23% a year over each of the last five years, with gross profits (or gamblers’ losses) reaching $1.4 billion in the last financial year.

The costs for the Department to regulate the sector effectively will continue to be less than 1% of the sector’s profit. They will go up from $13.6 million to $15.5 million, which includes the implementation costs of the new Act. In following years the costs will be less than $15.5 million, and the amount collected in fees will be reduced accordingly.

“These fees are an excellent investment for the community,” Mr Manch said.

“Gaming machines in pubs and clubs are licensed as a form of community fund-raising only and the Department is the only organisation that audits them to ensure that the money they raise goes to community organisations as it must do.

“The Department is the primary regulator ensuring that crime is kept out of casinos, and New Zealand continues to be free of the money laundering and organised crime problems some overseas casinos have suffered.

“These fees pay for the direct surveillance of a sector that turns over more than $9 billion in cash every year. Effective regulation of gambling benefits gamblers and the community.”

Gambling Commission

The new Act creates an independent Gambling Commission. The Commission will replace the Casino Control Authority (CCA) and will also have functions in the gaming machine sector.

The Commission will potentially help lower gambling operators’ compliance costs by hearing complaints and appeals against the Department’s decisions more quickly and at lower cost than courts can. Gambling operators who disagree with Commission decisions will still have the right to seek a judicial review from the courts.

Community organisations and members of the public will also have the right to appeal to the Commission if they disagree with how the Department deals with their complaints about gaming machines in pubs and clubs.

The Commission’s costs, $900,000 annually, will be spread across casinos and gaming machine operators. The CCA’s costs ($1.6 million this year) were met by casinos.

Problem Gambling Levy

The Ministry of Health has consulted on the proposed new problem gambling levy. It will be making a recommendation to the Gambling Commission, which will recommend a problem gambling levy to Ministers. The exact amounts are not yet finalised.

Under the new Act, each gambling operator will pay a levy based on player losses and the numbers of people requiring problem gambling services because of those forms of gambling.

Gaming machines in pubs, clubs and casinos are the highest cause of problem gambling in New Zealand.

Background statistics

  • In a year, the Department issues about 1,500 licences for lotteries, housie and other gambling by community groups.
  • At 31 December 2003, 559 clubs were licensed to operate 4,815 gaming machines.
  • At 31 December 2003, 113 “societies” were licensed to operate 17,919 gaming machines in pubs.
  • There are six casinos in New Zealand, located in Auckland, Hamilton, Christchurch Queenstown (2) and Dunedin.
  • In the year ended 30 June 2003 gamblers losses (or operators gross profits) on gaming machines in pubs and clubs were $941 million (up 21%)
  • In the year ended 30 June 2003 gamblers losses (or operators gross profits) in casinos were $457 million (up 11%)
  • Total Department costs to increase from $13.6 million to $15.5 million next financial year and then to reduce in future years
  • Gambling Commission costs to decrease in comparison to the CCCA, from $1.6 million for the CCA this year to $900,000 for the Commission.

    Schedule of gambling licensing and compliance fees
    Matter in respect of which fee is payable
    Previous Charges
    $ (GST incl.)
    New Fee
    $ (GST incl.)
    Lotteries and housie (prizes not exceeding $5,000)
    85
    Nil
    Class 3 operator’s licence applications
    New or renewal (prizes not exceeding $50,000 in value)
    (Lottery) 85
    100
    New or renewal (prizes exceeding $50,000 in value and housie)
    (New Housie Part 1) 424
    (Lottery) 85
    707
    Amendment
    (Housie Part 1) 293
    344
    Class 4 operator’s licence applications
    New (Category A)
    1,677
    973
    (Category B)
    1,677
    1,295
    Renewal (Category A)
    393
    887
    (Category B)
    393
    1,123
    Amendment
    517
    344
    Class 4 operator’s annual fee
    Category B applications only
    -
    3,566
    Class 4 venue licence applications
    New (Category A)
    -
    543
    (Category B)
    -
    608
    Amendment
    -
    258
    Renewal (Category A)
    -
    372
    (Category B)
    -
    469
    Class 4 venue annual fee
    Annual per gaming machine fee
    250
    373
    Licensed promoter licence applications
    New or renewal
    300
    1,375
    Temporary Authority
    100
    100
    Certificate of approval applications
    506
    270
    Casino operator’s licence applications
    New
    340,000
    340,000
    Amendment
    1,000
    1,000
    Temporary Authority
    -
    23,000
    Casino venue agreement approval applications
    New
    23,000
    23,000
    Amendment
    1,000
    1,000
    Associated person approval applications
    -
    330
    Casino Operator’s annual fee
    Sky City Auckland Casino
    2,276,368
    2,218,207
    Sky City Hamilton Casino
    559,592
    548,184
    Christchurch Casino
    889,264
    925,431
    Dunedin Casino
    438,436
    477,394
    Sky City Queenstown Casino
    233,867
    237,501
    Wharf Casino (Queenstown)
    203,533
    216,259
    Gambling Commission Appeal Fees
    Appeal filing
    -
    120
    First day of hearing
    -
    450
    Half day and part half day hearing (after first day)
    -
    450
    Category A applications are made by the New Zealand Racing Board, a racing club and a club that operating at a non-commercial venue that it owns or leases and is mainly for the used of club members.

    Category B application means an application that is not Category A.

    Media contact:

    Keith Manch
    Director
    Phone 04 495 9449, Cellular 027 445 6420

    Vincent Cholewa
    Communications Advisor
    Phone 04 495 9350, Cellular 027 272 4270