Reviewing a Class 4 Venue Policy
Is your Council’s class 4 gambling venue policy due for review?
Councils perform a critical regulatory function in relation to the operation and location of electronic gaming machines throughout New Zealand.
Under section 102(5) of the Gambling Act, within three years of adopting a class 4 venue policy, a Council (or TA) must complete a review and decide whether changes are required to your policy.
If a TA decides that changes to the policy are required, then it must undertake the review in accordance with the special consultative process under the Local Government Act.
This guidance provides information specific to class 4 gambling arranged in line with the local government policy process and is designed to assist territorial authorities (TAs) to meet their legal responsibilities when reviewing their class 4 gambling venue policies.
This guidance is for general information only and is not a substitute for independent legal advice.
- Gambling regulation in New Zealand
- What is Class 4 gambling?
- Roles of different agencies
- The Policy Review Process
The role of territorial authorities or councils
Councils perform a critical regulatory function in relation to class 4 gaming are set out under Sections 95 -102 of the Gambling Act.
Their responsibilities include: developing and reviewing their class 4 venue policy and assessing applications for territorial consent under their policy. Territorial authorities must consider applications for:
- A new class 4 venue licence
- A change to an existing class 4 licence, including a relocation application
- A new TAB venue.
Guidance for councils and how to apply their class 4 venue policies is in development [future link].
Reviewing your class 4 venue policy
The responsibilities of councils when developing their class 4 venue policies are set out under sections 101 and 102 of the Gambling Act.
These sections contain provisions which councils must and/or may include in their policy. These options are a tool to enable councils to control the opportunities for, and limit the impact of, gambling in their community.
Under section 101 the Gambling Act 2003, territorial authorities were required to adopt a policy on class 4 gambling within six months of the Act passing into law. The purpose of this requirement is to ensure community input into decisions about the provision of class 4 gambling, one of the purposes of the Gambling Act.
All councils now have a class 4 venue in place. Under section 102(5) of the Gambling Act, a territorial authority (TA) must complete a review of its policy three years after the policy was adopted and then each three years subsequently. A policy does not cease to have effect because it is due for review or it is under review (Section 102(6)).Under section 102(2) of the Gambling Act, where the policy is going to be changed or replaced, a special consultative procedure in section 83 of the LGA will be necessary.
What about TAB venue policies?
Under the Racing Act 2003, every council must adopt an Agency (also referred to as a Board or TAB) venue policy, in relation to their race and sports betting services. For the purposes of this guidance we will refer to these as TAB venue polices.
TAB venue policies cover whether or not new TAB venues may be established in the area, and if so, where. In developing their TAB venue policy, councils must also have regard to the social impact of gambling within their district.
Sections 65D and 65E of the Racing Act sets out some of the key requirements under that Act.
Note: Some TAB venues also operate class 4 machines in their venues. A council’s class 4 gambling policy also applies to these machines. The Department is responsible for the regulation of class 4 gambling in these venues.
Gambling regulation in New Zealand
The Act requires central and local government to work together to achieve the purposes of minimising harm and maximising benefits of gambling. Councils can determine the number and location of electronic gambling machines in their area.
New Zealand’s gambling system includes government departments, territorial authorities, casinos, clubs and gaming societies. The New Zealand Lotteries Commission provides gambling products under the “Lotto NZ ” brand, while the Racing Industry Transition Agency (RITA) regulates horse racing and sports betting, under the Racing Act.
What is class 4 gambling?
Class 4 gambling is gambling that involves electronic gaming machines (EGMs), also called pokies or poker machines. These pokie machines can only legally be owned by corporate societies but are hosted in pubs, clubs, and hotels around New Zealand, referred to as venues. Under the Gambling Act, class 4 gambling excludes the pokie machines in casinos, but includes gambling on pokie machines owned and operated in TABs. A TAB venue is any premises owned or leased by the Racing Industry Transitional Authority (RITA) where the main business is racing or sports betting services.
Class 4 gambling is operated on a not-for-profit basis to generate money to return to communities via grants. Under the Gambling Act, gaming societies must return at least 40% of the net proceeds from gaming to the community in accordance with its authorised purposes statement in the form of grants. Class 4 gambling returns around $300 -$350 million annually to the community. Local Government has a role in balancing the harms and benefits of Class 4 and TAB gambling in their communities.
Roles of different agencies
The role of the Department of Internal Affairs (the Department)
The Department is the primary regulator of gambling in New Zealand. It undertakes gambling licensing, compliance and enforcement functions in order to achieve the purposes of the Gambling Act. There is potential for conflict between some of these purposes, therefore the Department’s decision-making must balance the need to minimise harm from gambling against community benefit from gambling proceeds.
The purpose of the Gambling Act 2003 (the Gambling Act) is to:
- control the growth of gambling;
- prevent and minimise harm from gambling, including problem gambling;
- authorise some gambling and prohibit the rest;
- facilitate responsible gambling;
- ensure the integrity and fairness of games;
- limit opportunities for crime or dishonesty associated with gambling and the conduct of gambling;
- ensure that money from gambling benefits the community; and
- facilitate community involvement in decisions about the provision of gambling.
For more information on Gambling in New Zealand, and the Department’s role visit: Gambling.
The role of the Ministry of Health
Under section 317 of the Gambling Act, the Government has allocated the responsibility for developing an integrated problem gambling strategy to the Ministry of Health. The Ministry must refresh and consult on the strategy every three years. The strategy covers:
- measures to promote public health by preventing and minimising the harm from gambling
- services to treat and assist problem gamblers and their families and whanau
- independent scientific research associated with gambling, including (for example) longitudinal research on the social and economic impacts of gambling, particularly the impacts on different cultural groups
- evaluation.
The Ministry receives funding from the Gambling Levy (a levy on class 4 and other classes of gambling) to develop and implement the strategy. The Crown is reimbursed the cost of the strategy via a levy on gambling profits charged against RITA, the Lotteries Commission, casinos and pokie operators.
To see the latest strategy and more information about the role of the Ministry of Health, visit their website.
Information about the research activities undertaken and funding opportunities available can also be found on the Ministry of Health website.
The role of the Gambling Commission
The Gambling Commission is an independent statutory decision-making body established under the Gambling Act. It hears complaints and appeals against the decisions made by the Department of Internal Affairs in relation to class 4 gambling. The Commission also hears and determines casino licensing applications and issues licences to casinos. The Gambling Commission has the powers of a Commission of Inquiry. For more, see the Gambling Commission website.
