Cr Banerji has suggested the Federal Government induce state governments to significantly slash poker machine numbers by offering compensation for the loss of gaming tax revenue.

For the first six months of 2007-08, Monash poker machines collected more than $66 million, the most of any Victorian municipality.

Cr Banerji said problem gambling needed to be addressed decisively like other social problems such as high death rates among male P-plate drivers, smokers and heavy drinkers.

"These sort of things need some action, but it seems to take time and a lot of suffering in the meantime before things happen.

"The question is: are we doing enough? I don't think so."

Bruce federal MP Alan Griffin said Mr Rudd sought a "co-operative policy approach" with states and territories to identify the social impact of gaming.

He said a small proportion of gamblers developed a serious problem, but for most gamblers it was a legitimate form of entertainment.

"It is important that the environment in which people gamble is one which encourages responsible gaming and minimises chances of harm."

Clubs Victoria chief executive Margaret Kearney dismissed Cr Banerji's idea as "hare-brained".

"The reality is a lot of people who play gaming machines enjoy it.

"How does she compensate the people whose fun will be taken away?

"How will she compensate the clubs? Who's going to compensate those who lose their jobs?"

ALH Group director Ross Blair-Holt, whose company owns Chadstone pokies venue Matthew Flinders Taverner, gave the idea short shrift.

"The Feds are not going to hand out $5 billion-odd every year to the states in exchange for no gaming."

He said his venue, which was fighting a cap that reduced the number of poker machines from 105 to 59, could not survive without these machines.

A spokeswoman for Gaming Minister Tony Robinson was unable to comment before deadline.