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7 April 2016

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Minister Dunne announces next steps for gambling review and decision on minimum rate of return

Internal Affairs Minister Peter Dunne has announced today the Government’s decision to progress the review of the Class 4 sector and cancel scheduled increases to the minimum rate of return.

Read the Minister’s media release.

The sector review was launched in October 2015.  Since then work has found that the sustainability of the sector and community funding from Class 4 gambling remains uncertain. This is because of the nature of Class 4 gambling and the complexity and costs associated with the regulatory framework. The uncertainty exists despite the fact that since 2010/11 a decline in spending on gaming machines has stabilised.

The Department will develop a discussion document containing options for the future of Class 4 gambling and submit it to Cabinet for approval by the end of May 2016. Prior to this the Department will talk to key sector groups involved in Class 4 gambling about the terms of reference for the review, and ideas for what should be included in the discussion document.

Groups consulted will include societies, clubs and Class 4 venues, problem gambling service providers, and representatives of groups which receive grants funding.

Public consultation will take place later in 2016, and all options will be discussed with the gambling sector before any final recommendations for change are made.

Questions or comments regarding the sector review may be emailed to gamblingreview@dia.govt.nz from Monday 11 April 2016.

Read the Cabinet paper for the decision to undertake a review.

The decision to cancel increases and retain the minimum rate of return at 40 per cent recognises the increased costs faced by societies, including the recent increase in fees.

“While scheduled increases would mean a higher percentage of gaming machine proceeds going to the community, the combination of cost pressures could actually lead to the total dollar amount going to communities decreasing, as there are fewer venues generating funds,’ said Minister Dunne.

Read the Cabinet paper and Regulatory Impact Statement for the decision to cancel further increases to the rate of return.