New Zealand is now out of recession and Napier Health's in-person overnight care will continue following backlash over proposed cuts. Video / NZ Herald, Getty
The Government is auctioning 15 online casino licences, regulating online gambling for the first time.
There are fears community and sports funding may decrease as online operators won’t be required to make community returns.
Minister Brooke van Velden says community groups should not be dependent on online gambling proceeds for their funding.
Paying to play community and club sports in Hawke’s Bay appears set to become more expensive thanks to a Government shake-up of the gambling market.
The Government is auctioning off 15 online casino licences, as it regulates online gambling for the first time.
Internal Affairs Minister Brooke van Velden saidNew Zealanders could already gamble on thousands of unregulated offshore websites.
Internal Affairs Minister Brooke van Velden. Photo / Mark Mitchell
“We want to bring those users into a regulated market with harm minimisation standards and vetted operators and to do that, there needs to be a sufficient variety of sites to choose from. Allowing operators to compete for up to 15 licences ensures there is enough choice in the market while balancing regulatory complexity.”
The online operators will not be required to make community returns in the form of grants to sporting clubs or other community groups, as has been the case for pokie machine revenue.
They will pay GST, gaming duty, and into the Problem Gambling Levy which funds community services to treat gambling harm.
“Encouraging community groups to be dependent on online gambling proceeds for their funding can create a perverse incentive to increase gambling,” van Velden said.
“I would expect local operators to advocate for their interests, but the Government’s decisions are based on what is best for New Zealand.”
Chief executive of Sports Hawke’s Bay Ryan Hambleton said money generated from the returns of gambling was required to fuel the sports system.
“Around 9% of funding to our sector comes from the proceeds of gambling and we know close to 30,000 successful grants are approved to community-related initiatives across the motu. Any change to this is a concern for our sector.
“If we lose this funding, sports organisations and clubs will need to look at different ways to be financially sustainable — this could result in higher costs to participate.”
Central Football chief executive Darren Mason said his federation was concerned about offshore gambling companies reducing the funding available for sporting organisations.
“That funding is incredibly important as it keeps the cost of participation affordable and accessible.
“Reductions in access to community funding for sport has ramifications not only for fitness and health but also for those, young and old, that use sport as social connection, or as a development mechanism or aspirational pathway.
“The minister’s comments about reliance on such funding being a concern shows a complete lack of understanding.
“Her assertion that having the profits generated by the proposed offshore gambling companies be moved out of New Zealand be a better outcome is impossible to reconcile.”
Martin Cheer is the managing director of Pub Charity, which has about 1700 pokie machines (known as Class 4 gambling) earning revenue of $125 million, close to 13% of the $1 billion pokie industry.
In February, Pub Charity gave away over $3.5m in grants to 288 sports, charity, and community groups.
Cheer did not see any positives from the proposal, and said the Government’s move accelerates the loss of revenue.
“That translates to less grant money for the community, less tax for the Government, loss of payments to local businesses, and a net loss overall.
“All it’s going to do is basically take profits that would’ve gone to the community in dividends and grants and basically ship it offshore to the shareholders of these big international companies.”
Cheer also says online casinos introduce a new cohort of people to a type of gambling that is 24 hours a day, seven days a week with no limit on bet sizes.
“The games themselves have none of the limits that are imposed upon us,” he said.
“[If] you walk into a pub that has got gaming machines ... there are limits on the actual potential for gambling experiences.
“None of those apply to those online casinos, so there are going to be a lot of loss leaders.”
Residents of Napier, Hastings, and Wairoa lost over a combined $12.3 million in Class 4 gambling from September to December 2024, according to data from the Department of Internal Affairs.
Gaming machines in pubs and clubs outside a casino represent “Class 4” gambling, which the Gambling Act 2003 classifies as high-risk, high-turnover gambling.
Cath Healey, general manager for Te Rangihaeata Oranga Trust (HB Problem Gambling Services). Photo / Warren Buckland
Cath Healy, general manager at Te Rangihaeata Oranga Gambling Recovery Service Hawke’s Bay believed that number would rise, and gambling-related harm would increase in the region if 15 online casino licences were auctioned off.
“What will happen is that it will normalise gambling online for our rangatahi.
“I think the increased exposure through advertising is definitely going to create an increase in people either trying gambling online or unfortunately possibly getting into a bit of worry with the way they might gamble.”
Jack Riddell is a multimedia journalist with Hawke’s Bay Today and spent the last 15 years working in radio and media in Auckland, London, Berlin, and Napier. He reports on all stories relevant to residents of the region.
