Canberra clubs hit the jackpot with poker machine cuts
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Canberra clubs hit the jackpot with poker machine cuts

Canberra's gaming behemoths have reaped millions of dollars in discounts on future redevelopments after cashing in on an ACT government scheme to cut the number of poker machine authorisations to 4000.

Clubs in Canberra had the choice to either voluntarily surrender their gaming machine licences for cash and planning offsets, or face having the government seize them if almost 1000 authorisations were not forfeited.

Clubs have surrendered 934 poker machines, at a cost of about $14 million.

Clubs have surrendered 934 poker machines, at a cost of about $14 million.Credit:Peter Braig

Roughly three in five of the 934 poker machine authorisations surrendered came from Canberra's five most dominant club groups, who control about 60 per cent of the city's poker machine licences.

Those groups will claim around $8 million in land and planning discounts, to be used over the next seven years.

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Vikings Group - the biggest player in the gaming machine space, owning 715 of the 4942 poker machine authorisations in Canberra - will receive a whopping $2.1 million in government offsets for forfeiting 140 licences.

Trading scheme statistics from November show Vikings had 621 machines on the floor across its four clubs, meaning only 46 machines would actually come off the floor.

The Southern Cross Club Group will surrender 126 of its 680 authorisations in order to receive $1.927 million in offsets. Similarly, the organisation has only 594 machines on the floor, meaning just 40 machines will have to be removed.

One of its four clubs - the Southern Cross Yacht Club - surrendered its total of 10 licences, making it eligible for a 25 per cent bonus on top. The actual poker machines were removed from the yacht club some time ago.

Southern Cross Club Group chief executive Ian Mackay said the group was looking to continue to diversify in the food and beverage and health and wellness sectors.

The group already operates five gyms under the Anytime Fitness brand, has the rights to one in Googong, and owns the Stellar Canberra health centre near the Woden town centre. Mr Mackay said the group saw "further opportunities to continue to expand".

It is also eyeing a refurbishment of the yacht club, likely to occur within the next 12 to 18 months.

"We think there's an opportunity for that location to be even better still for Canberrans to enjoy," Mr Mackay said.

The Labor Club Group will hand back 106 of its 542 authorisations, getting $1.59 million in offsets in return. It will only need to remove 53 machines off the floor.

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Raiders Group will surrender 93 of its 528 authorisations, receiving $1.396 million in planning discounts. With 484 machines on the floor, it will have to remove 49 to comply.

Ainslie Group will receive $1.2 million in exchange for 80 licences out of their total 423 authorisations. They operate 410 machines, so will take 67 off the floor.

Smaller clubs have also cashed in on the bonuses.

The Magpies Group forfeited 25 of its 143 authorisations in order to receive $625,000 in planning discounts, none of which will come from the floor.

The president of the Magpies board, Andrew Smith, said they negotiated the deal with the government late last year in order to transform their old Kippax club into a health centre run by Ochre Health. The new medical centre has just opened its doors after months of refurbishments.

He said closing the 40-year-old Kippax club last July was "not a decision made lightly" and it was a "very emotional time for members and board members".

However Mr Smith said he felt the club was in a "lot stronger" position to survive, given the challenges facing the clubs and general hospitality sectors.

"We actually thought diversifying away from gaming revenue was a wise move for the club long-term; rental income from a tenant is much more sustainable and manageable," Mr Smith said.

"The [Belconnen] golf club can be our social base for all our members and the community groups that we support but having the health centre provides the financial resources needed to support those groups."

Burns Club president and Canberra Community Clubs chair Athol Chalmers said the Burns Club planned on developing the block next door to the club into apartments.

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They'll receive $925,000 in discounts for surrendering 37 of their 143 authorisations, 26 of which will come from machines on the floor.

He said gaming revenue wouldn't change much as the machines they surrendered were underutilised, and the lease variation discount they'll receive will give them the ability to develop land they couldn't otherwise because they couldn't afford the charge.

"Our only option would have been to sell to a developer, who would have reaped the revenue in the longer term instead of us," Mr Chalmers said.

The 4000-poker-machine cap is part of Labor's parliamentary agreement with the Greens, and Greens leader Shane Rattenbury said he was pleased with the reduction.

However he foreshadowed a future push by his party to further regulate the clubs sector, off the back of a report from Dr Charles Livingstone last year which described the ACT's poker machine regulatory system as the nation's most lax.

Clubs ACT chief executive Gwyn Rees said the Greens were relying on "the research of an anti-gambling activist whose shortcomings as a gambling expert were highlighted in a recent federal court case".

Canberra Liberals gaming spokesman Mark Parton said most of the authorisations that were handed back "weren't on the floor anyway" and he did not believe the scheme would achieve much.

"Those problem gamblers, if the machines are there, will play them so the fact there might be 105 in a venue instead of 115 is not going to make a whole lot of difference," Mr Parton said.

However Mr Rattenbury said having fewer poker machines in suburban clubs would reduce gambling harm.

He said he'd rather see poker machines in the casino with "gold standard" harm-minimisation measures like bet limits than in "a family club in the suburbs".

Mr Rees said those comments ignored evidence that people travelled further, played longer and spent more money gambling in casinos, and did not take into account the "demonstrable" benefits that flowed from clubs to their communities.

Katie Burgess is a reporter for the Canberra Times, covering ACT politics.

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