The motion was supported by a majority of councillors, 5-3, at last Tuesday's council meeting.

Those who supported the Highlands Hotel application said they believed a place to "socialise" was needed in Craigieburn because of the continuing delay of the Craigieburn Town Centre project.

Cr Drew Jessop "reluctantly" supported the proposal, saying: "The fundamental issue is the community needs places to socialise."

He said that while it would have a negative impact, the development would generate 65 jobs and the venue provide a one-off community contribution of $100,000.

"The lack of movement on the town centre makes this more important ... there are no facilities.

"I hope this will be the first of many developments for the retail area," Cr Jessop said. The council is awaiting a development proposal from Lend Lease on plans for a Craigieburn town centre.

Cr Ros Spence supported Cr Jessop's stance, saying: "The benefits and negatives are on balance, I believe. Craigieburn is a growing community with sinking facilities."

Speaking against the motion, Cr Adem Atmaca said the results of a community survey showed that 55per cent of respondents would prefer the tavern without the pokies.

When told there would be no tavern without the gaming machines, 54per cent said they'd support it.

"The worst part about this is the gambling component. I have nothing against the tavern," Cr Atmaca said. "Exposing a young community to this - I don't think I could sleep with that."

Cr Helen Patsikatheodorou agreed.

"I know Craigieburn needs facilities and services, but I believe telling people you get this or nothing is holding someone to ransom."