Victorian Premier Daniel Andrews has released the terms of reference of a review into the operation, allocation and number of pokie machines in the state.

The state government’s Review of Gaming Machine Arrangements, which began last month, will help dictate the future number, terms and allocation of gaming machines in Victoria and examine whether existing regulations need to be altered or not.

Under current arrangements, gaming venues must have an entitlement for each pokie it operates. Electronic gaming machine entitlements last ten years and will expire in 2022.

The review will look at:

1. Whether to keep the gaming venue operator model and if it has met its objectives
2. Whether the regulatory settings for the venue operator model should be retained, e.g. the 27,372 cap on the number of entitlements, 105 machine venue level cap, the 35 per cent ownership restriction, the requirement that 20 per cent of entitlements are used in non-metropolitan municipalities and that entitlements are divided equally between clubs and hotels.
3. Whether revenue from gaming is fairly distributed (the structure of gaming machine taxes and the tax differential between clubs and hotels, including how clubs demonstrate their community benefit)
4. The appropriateness of the current 10-year term or whether entitlements should be issued for a longer fixed term or in perpetuity
5. How any new entitlements should be allocated
6. How the price of any new entitlements should be determined
7. How and when entitlements should be paid for and taxed
8. How the entitlement transfer market should operate

The peak body for Victoria’s local councils, the Municipal Association of Victoria (MAV), is concerned that Victorians’ gambling debts are spiralling and that something needs to be done to staunch the losses and the terrible human cost they represent.

MAV believes that council and community input into the review is a chance to make some changes that could help, for example, lower betting limits and fewer machines.

The MAV President Bill Arthur said Victorians loss nearly $70 million (Victorian Commission for Gambling and Liquor Regulation figures) more last year than they did in 2013-2014, the first time there has been an increase since 2008.

“We believe this review is an opportunity to reduce the number of machines in this state and refrain from providing any entitlement in perpetuity,” Mr Arthur said.

“It seems the harm minimisation approaches currently in place are no longer effective and more needs to be done to minimise the impact this industry is having on families and communities.

“Councils and the MAV have been advocating for better protection for vulnerable communities from inappropriate placement of poker machines through the Enough Pokies campaign. This data adds to concerns the losses are in communities that can least afford it,” he said.

Minister for Consumer Affairs, Gaming and Liquor Regulation Jane Garrett said the review would give the community and industry more certainty around the future arrangements for gaming machines.

“The review will examine the existing regulatory framework and help inform any future allocation of gaming machine entitlements,” Ms Garrett said.

“The review will look at whether the current entitlement model has met its objectives and will consider how venues own and operate gaming machines, the distribution of machines between hotels and clubs, and the length of entitlements.”

The review, which will be conducted by Victoria’s Department of Justice and Regulation, will incorporate consultation with industry and the community and report to the Government by July next year.

The state government has said it will separately examine how effective and appropriate existing harm minimisation measures are.