Chief Minister Andrew Barr says the ACT government will look to divert a portion of the compulsory "community contributions" from clubs into his new charitable fund.
Clubs in the ACT are legally required to give 8 per cent of poker machine profits to community groups, but the scheme has been criticised as "deeply flawed" in the wake of a 2017 report by leading gambling researcher Dr Charles Livingstone.
Then, in April, ACT auditor-general Maxine Cooper said clubs were not providing enough information for the government to assess whether some expenses were eligible to be considered community contributions.
According to Dr Livingstone's research, about 70 per cent of all community contributions went to sport.
Mr Barr said his new charitable fund aimed to support "a wider range of activities".
"Too much of the charitable work, or community contribution funds, that come out of the gaming sector's legal requirements are very narrowly focused," he said at a press conference on Monday.
"We want to see that broadened and [the chief minister's charitable fund] presents an opportunity to support a much wider range of activities in the community."
Mr Barr announced on Monday that independent community foundation Hands Across Canberra would administer the chief minister's charitable fund "at arm's length" from the government, which is providing $5 million in seed funding.
Mr Barr said clubs' community contributions were an "obvious area" from which money for the charitable fund could be sourced.
"For example, with the Canberra Casino... to take up their entitlement to operate up to 200 gaming machines, their community contributions that would be required under that arrangement would go into this fund," Mr Barr said.
“Equally, we will look at opportunities with the existing poker machines in the city at the moment, to direct some of the community contributions from those into this fund."
Asked what proportion of community contributions the government hoped to divert into the charitable fund, a spokesman for Mr Barr said that was yet to be determined.
"It's part of a broader plan to look at the community contributions scheme," the spokesman said.
"We need to consult with the clubs as well."
ACT Greens leader Shane Rattenbury, who called three years ago for a share of clubs' community contributions to be distributed by a community fund, welcomed the move.
"This is exactly the kind of governance that the Greens have wanted to apply to community contributions for some time," Mr Rattenbury said.
"Administering a portion of money from gambling revenue through this independent community fund will ensure community support is delivered in a practical and more transparent way."
Clubs ACT chief executive Gwyn Rees rejected Mr Barr's suggestion that contributions were narrowly focused. The claim was "simply wrong", with more than 1000 groups funded by clubs, he said.
"This type of proposal, if it proceeds, will strike at the very heart of the club movement and the reason for why they exist," he said.
He would invite ACT Attorney-General Gordon Ramsay on Wednesday to meet the clubs board, he said.
Canberra Community Clubs chairman Athol Chalmers said he was aware the community contributions scheme was to be reviewed, but said he hadn't yet had any discussions with the government.
"It's not an issue we've looked at yet," said Mr Chalmers, who is also president of the Burns Club.
Clubs control 4723 poker machines in Canberra. In 2016-17, they made $168 million from the machines and gave $11.9 million in community contributions.