The Department of Internal Affairs

The Department of Internal Affairs

Te Tari Taiwhenua

Building a safe, prosperous and respected nation

 

Gambling spending drops in 2004/05 year


25/1/2006

Statistics for 2004/05 suggest that the amount New Zealanders spend on gambling may have peaked, for the time being at least.


    Releasing the annual gambling expenditure figures today, the Department of Internal Affairs’ Gaming Policy Manager, John Markland, said that spending on the main forms of gambling fell by 0.6 per cent, from a record high of $2.039 billion in 2003/04, to $2.027 billion in 2004/05.

    “While the reduction is less than one per cent, it is only the second time in at least 25 years that total spending has fallen from one year to the next,” Mr Markland said. “More significantly, it is the first time that either non-casino gaming machine spending or casino spending has dropped. This is important because we know that gaming machines, including casino gaming machines, are the most harmful form of gambling.”

    Overall spending in 2004/05 on gambling was made up of:

    Gambling product
    2004/05 Spending (Player Losses)
    Increase / Decrease from 2003/04
    Racing and sports betting
    $247m
    + 3.3%
    Lotteries Commission products
    $280m
    - 0.7%
    Non-casino gaming machines
    $1.027 billion
    - 0.8%
    Casinos
    $472m
    - 2.5%
    Total spending
    $2.027 billion
    - 0.6%

    Mr Markland said that 2004/05 seems to have been a year of two halves, as a result of the new regulatory environment introduced by the Gambling Act 2003 and its associated regulations being complemented by the smoke-free legislation that came into force on 10 December 2004.

    “There are indications that spending on non-casino gaming machine and casino gambling increased a little in the first half of 2004/05, before falling below the equivalent 2003/04 figures in the second half of the year. This reverses the usual pattern,” Mr Markland said. “Spending now appears to have settled at a level a little below the record 2003/04 year.

    “This suggests that non-casino gaming machine spending in 2005/06 (the current year) might be just below $1 billion, rather than just above it. Even so, that would be considerably more than double the amount players spent on pub and club machines in the year 2000 ($450 million).”

    Mr Markland said that the detail, accuracy and timeliness of the non-casino gaming machine expenditure statistics would be greatly enhanced from the end of March 2007, when all machines will be connected to a new electronic monitoring system.

    “In the meantime, though, trends in all the gambling statistics, including the expenditure statistics and gaming machine numbers, look positive in terms of the objectives of the Gambling Act 2003, which include controlling the growth of gambling,” Mr Markland said.

    Background

    Further details on gambling expenditure are available in the table Gambling Statistics 1981-2005 and the explanatory notes that accompany this media release.

    The Gambling Act 2003 was passed on 18 September 2003, with lead-in periods for most of its provisions. The Act came fully into force on 1 July 2004. It accepts that gambling is a harmless entertainment for many, and a source of community funding. It also recognises that gambling causes harm to some gamblers and to those around them.

    Key objectives of the Act are to: control the growth of gambling, prevent and limit the harm that can be caused by gambling, limit opportunities for crime and dishonesty, and ensure that money from gambling benefits the community.

    The “revenue” of a gambling operator is the same as gamblers’ “spending” or “expenditure”. It is the difference between the total amount wagered and the total amount paid back or credited to gamblers in prizes.

    Non-casino gaming machines raise more money for community purposes than any other form of gambling. The amount paid to community purposes depends not only on the revenue of gaming machine operators, but also on the costs taken out of, and any misappropriation from, that revenue.

    Gaming machines are also the most harmful form of gambling in New Zealand:
    • In 2004, over 80 per cent of people who received help from problem gambling intervention services for the first time, said that their main problem was non-casino gaming machines.
    • Another eight per cent said that their main problem was casino gaming machines.
    • About one in five regular gaming machine players has a gambling problem.
    • More than 20 per cent of gaming machine revenue comes from people with gambling problems.
    • Most gaming machines are located in the poorest areas.

    The number of non-casino gaming machines declined from 25,221 as at 30 June 2003, to 21,846 as at 30 June 2005. The number of non-casino gaming machine venues declined from 2,122 to 1,801 over the same period.

    Media contact:

    John Markland
    Manager, Gaming, Racing and Censorship Policy Phone 04 495 9354, Cellular 0274 406 624

    Trevor Henry
    Communications Advisor Phone 04 495 7211, Cellular 021 843 679