ACT government to force clubs to surrender poker machine licences from next year
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ACT government to force clubs to surrender poker machine licences from next year

The territory government will start forcing Canberra's clubs to surrender their poker machine licences from April next year, as it reviews incentives for clubs to diversify their revenue streams.

Clubs have been largely in the dark for months about what the government's specific plans were for reaching its 2016 election pledge of cutting the number of pokies in Canberra to 4000.

The ACT government will start forcing Canberra clubs to surrender poker machine licences from April 2019.

The ACT government will start forcing Canberra clubs to surrender poker machine licences from April 2019.Credit:Peter Braig

Since 2015, the government has operated a transfer scheme for clubs to trade machine licences, but it has seen only 37 pokies actually forfeited, with 4985 authorisations still available and 4549 machines still operating on gaming floors.

The government released a discussion paper late last year, laying out a number of options to reach the planned cap, with the first tranche of surrenders originally planned to start this month.

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Instead, the government on Tuesday announced a review of clubs' diversification away from poker machine revenue, to help identify potential new incentives for clubs to diversify.

The review will be led by Neville Stevens AO, a former Commonwealth departmental secretary, who will complete a "club industry diversification analysis" and give Attorney-General Gordon Ramsay recommendations.

Those recommendations will centre on options to give clubs financial and non-financial incentives to diversify their revenue away from poker machines, and a framework for specific agreements on such moves with individual clubs.

Mr Stevens is expected to report his findings to Mr Ramsay by the end of May this year, but it is unclear if the government will actually release the full report, with Mr Ramsay's spokesman saying that would depend on the nature of the report.

But the terms of reference for Mr Stevens' review show the government now intends to start forcing clubs to surrender their licences from April next year.

"Compulsory surrender of authorisations will commence from 1 April 2019, and the maximum number of authorisations in the ACT will reach 4,000 by 1 May 2020," the document reads.

It remains unclear what the specific measures of the surrender program will be, or whether the government plans to compensate clubs for the machines they are forced to surrender, given the revenue they generate.

But a spokesman for Mr Ramsay said the process was "not about compensation", rather the diversification of clubs' revenue.

The discussion paper laid out plans for the surrender of clubs' machine authorisations of up to three years, with the target now to complete the entire scheme within 12 months.

While the terms of reference lay out a general timeframe, Mr Ramsay's spokesman said any specific decisions on plans for surrendering licences would be made contingent on the review.

Mr Ramsay's spokesman said the review would provide advice to government on "how best to achieve voluntary surrender of authorisations" to meet the election pledge of cutting pokie numbers in Canberra to 4000.

Clubs ACT chief executive Gwyn Rees backed the review and any help the government could provide to help diversify clubs' revenue, but said the sector still faced "challenges", including unlocking their land for redevelopment.

He said for some clubs, such redevelopment was key to "long term sustainability", while for others - particularly smaller ethnic, golf or bowls clubs - potential club mergers could be "key to their club's survival".

"Whatever decisions government makes over the coming months and the next two years will be key to the survival of many of Canberra's clubs and the assets they maintain," he said.

"Whilst the position of many of the ACTs clubs is stable, expecting they reduce gaming revenue whilst increasing taxes and contributions results in a zero sum game.

"The government must recognise the need for balance – independent analysis hopefully achieves this."

Mr Rees also said the boom in the capital's hospitality sector in the past five years had created more challenges for clubs to "keep up pace and diversify their income streams, particularly in the areas of food and beverage".

"Despite this a number of clubs continue to innovate and we have seen this in the recent launch of the Southern Cross Club Health and Wellness Centre Stellar and the redevelopment at Vikings Erindale," he said.

"Clubs who focus on reinvigorating their venues and staying relevant will be the clubs best equipped to navigate the changes ahead."

Daniel Burdon is a reporter for The Canberra Times

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