Clubs in Canberra would lose control over where their community contributions go, under a proposal to radically overhaul the scheme.
The ACT government's liquor, racing and gaming arm has proposed creating a central pool for community contributions, where gambling venues would pour a proportion of their total poker machine revenue.
The proposal is separate to an announcement made by Chief Minister Andrew Barr last week that some community contributions would be diverted to his new Chief Minister's Charitable Fund.
Under the current scheme, clubs must pay 8 per cent of their net revenue as community contributions, in categories that include charitable and social welfare, problem gambling, sport and recreation, non-profit activity and community infrastructure.
But under the options for reform revealed by the Justice and Community Safety Directorate on Tuesday, venues could instead be forced to surrender a proportion of their gross gaming revenue to a central fund.
Funding could then be doled out via an independent committee or charity through grants.
About $12 million in community contributions was made under the current scheme in 2015-16.
While a PWC report found the current scheme provided up to $33.2 million of extra value on top of this, clubs have been criticised in the past for claiming expenses like payments to coaches and elite sports players, and payments for physiotherapy and massage, as community contributions.
Clubs have also come under fire for claiming in-kind contributions like room hire as part of the scheme.
Approximately one-quarter of contributions made in 2016-17 were in-kind contributions. One in five in-kind contributions were room hire.
If the community contributions were pooled into a central fund, it would remove concerns about items claimed under the current scheme, the directorate said.
It would also give the government more firepower to target specific problems, the directorate said.
For example, just $54,232 in community contributions were made in the problem gambling category in 2016-17. The Problem Gambling Assistance Fund, a separate 0.75 per cent levy on gross gaming revenue introduced in 2010, brought in more than $1 million.
"A contribution of 3.5 per cent of gross revenue [to a central pool] would have seen $5.89 million of contributions received in 2016-17," the paper reads
"This would be less than the total amount of community contributions currently made, and also less than the current amount of monetary contributions. However, it would allow clubs to continue to fund other activities consistent with their objectives and which currently count towards community contributions."
However, the directorate also said a direct contribution scheme and a centrally administered fund were not mutually exclusive.
"A hybrid scheme would allow a set level of funding to continue to be distributed by the club industry, with a set percentage or dollar value directed towards a grants fund, independently administered," it said.
"However, while such a combined approach may address the concerns over the distribution of community contributions, it would not by itself address the inefficiencies associated with the direct contribution model."
ClubsACT was already railing against the announcement by Mr Barr that a proportion of pokies revenue would be diverted into his new Chief Minister's Charitable Fund.
Its chief executive Gwyn Rees said while it was aware of the review into the community contributions scheme, it had been blind-sided by Mr Barr's announcement.
"Eight clubs closed in the ACT between 2011 and 2015 and this cost Canberra nearly 600 jobs," Mr Rees said.
“This a cash grab pure and simple and will hurt clubs who are already trying to do more with less. It will also take away financial support our community and sporting organisations rely on.”
Canberra Community Clubs chairman Athol Chalmers said while clubs had to be able to look after core business, he could support a hybrid model.
"We've got no intention of going to war with the government. The government has made it clear [it's] not going to undermine the reasons clubs exist," Mr Chalmers said.
"My club, the Burns Club, was set up to support the Scottish community and we still want to retain the ability to do that and I don't want to take away from that. We need to ensure clubs are able to support what they're established for, but still need to contribute to other community causes."
However a spokeswoman for the government clarified that Mr Barr did not mean all community contributions would be taken away from the clubs.
"The government recognises that some clubs were established to support certain sporting teams and cultural groups, and this will be considered as part of the review," she said.
An earlier version of this article incorrectly said only clubs with a gross revenue of more than $200,000 had to pay the minimum 8 per cent community contributions.