Increase in Pokies Spend in New Zealand. The Reasons Why.

The Kiwis seem to be indulging in online pokies nowadays.

It’s a well-known fact that pokies are very popular in New Zealand. It actually rivals Australia in terms of pokies spend according to a report from Gisborne’s Department of Internal Affairs. The only difference would be Aussies frequently play land-based pokies while Kiwis are now big fans of mobile pokie games.

New Zealanders have an increasing penchant for online pokies. The Department of Internal Affairs (DIA) has found out the Gisborne residents have been drained of $100 million. The residents have wagered $2.4 million on pokies in the last 3 months. This has resulted to a $7.4 annual loss in Q3.

The DIA estimates that pokie-related losses will reach around $10 million this year. This is simply a rough estimate, but it could represent a $700,000 increase compared to last year. It’s not an alarming rate just yet, but what seems to be the factor increases the pokies spend?

Online Pokies Contributes to Pokies Spend

mobile pokies new zealand

Pokies gaming spend have increased in the national level. New Zealanders have wagered around $218.9 million on digital pokie games compare to its previous $213.5 million of the same period last year. The astounding figures would be that it is now $848.9 million or 3% more than the $823.8 in the previous year. Industry analysts say that New Zealanders have found another venue to play pokies which is in the form of mobile pokie games.

The Department of Internal Affairs (DIA) recently released new data showing that there has been another increase in spending on pokies in New Zealand for the last quarter, and questions have been raised around why this is happening despite a decrease in pokie machine numbers.

Pokies and the Gambling Act

Pokie expenditure in New Zealand saw a sharp rise in the late 90s and early 2000s, side-by-side with the expansion of machines around the nation. Expenditure peaked in 2004 and 2005, when over a billion dollars each year was lost to the machines in exchange for nothing more than lights and sounds.

After 2004, when the Gambling Act was in full effect, the amount of money spent on pokies started to decline, and has been trending downwards ever since. Every quarter, the DIA releases updated data that shows that quarter’s expenditure and the current number of venues and pokie machines. Usually they will report how the expenditure has changed compared to the same quarter of the previous year. And sometimes this shows an increase in expenditure. However, a short-term increase is very different to a long-term decreasing trend.

Looking at pokie trends

It’s often not very helpful to look at changes from quarter to quarter. In the report of DIA the quarterly national expenditure looks like a mountain range trending up and down. The changes tend to be seasonal – during the summer the expenditure falls, then steadily rises again through the cooler months.

Looking at reports from year to year gives you a better picture of the rise and fall of annual expenditure. For the past two years, it has been rising – 2015 was higher than 2014, and 2016 higher still. However, those are only two data points in what is a generally downward trend.

The machine numbers in New Zealand have seen a steady decrease since the introduction of the Gambling Act. There are almost 4,000 fewer pokies in operation now than there were in 2007. Both the numbers of machines and the expenditure are following the same downward trend, and that’s not likely to be a coincidence. But the machine numbers don’t always follow the same short-term rise and falls as the expenditure because not all machines are used equally.

people with gambling problems generate a disproportionate amount of pokie expenditure – Australian research estimates it could be as much as 60%. The recent National Gambling Study found that people who use pokies more often have longer play sessions. The more often you play, and the longer your play, the more money you will lose to the machines and the more likely you are to have or develop a gambling problem.

So if a small number of people are playing a small number of machines but are generating a larger portion of expenditure, you can’t guarantee the numbers of pokie machines and the expenditure spent on pokie machines will change at the same rate.

That isn’t to say that reducing the machine numbers doesn’t help. Research shows that having easy access to pokies is a key factor in developing and maintaining a problem with pokie gambling. This is why the Problem Gambling Foundation supports a “sinking lid” gambling policy, which are in approximately 17 districts across New Zealand. A ‘sinking lid’ policy means no new licenses for pokie machines can be issued, and pokie machines cannot be transferred to a new pub or owner if the venue closes. Reducing availability is also one way that can help reduce gambling harm.

Will New Zealand Turn into Australia?

The Australian gambling industry has recently been tumultuous. Anti-gambling lobbyists and gambling operators are initiating discussions. These are caused by the increasing concerns of problem gambling. One prime example is the recent Pokie-Leaks campaign that is headed by a team of senators. The campaign advocates a more rigid and moderated gambling industry.

It’s been proposed to impose a $1 betting limit across pokie machines in Australia. The legislation is only a proposal for now. It can all change as Australian elections are underway in 2018. A major revelation of the socio-political issue of gambling could happen before amendments are implemented.

The question would be – will the New Zealand government impose right yet appropriate online gambling regulations before it becomes a clone of Australia’s gambling industry?