Rural Australia rocked by jailing of 'Country Woman of the Year'

She was, by all accounts, a dab hand at home-made scones, but Margaret Magnay, a leading member of Australia's equivalent of the Women's Institute, had a dark secret.

Magnay, a matronly-looking 58-year-old, was addicted to fruit machines, and in order to feed her addiction, she stole from her local branch of the Country Women's Association (CWA). A branch and divisonal treasurer, she managed to pocket $30,000 (£14,000) over five years, before anyone noticed.

The CWA, a venerable institution founded in 1922 and known for its charitable works, is in shock at the revelations. Magnay, jailed for 18 months by a Queensland court, was a mentor to young women and girls who belonged to the organisation's "Younger Sets".

Marion Mudra, a CWA regional vice-president, said yesterday: "This is a cruel lesson to the young girls who trusted her, and they have had the rug pulled from their feet because all the time she was stealing from them. I've had mothers and young girls in tears, and I've been in tears myself."

Last year Magnay was named Country Woman of the Year for her division in south Queensland. She was treasurer of the Kumbia branch, on the outskirts of the town of Kingaroy, and carried out the thefts by manipulating audits. She was also in charge of funds for the regional division.

Ms Mudra told the Brisbane-based Courier-Mail newspaper: "When I asked her, 'How could you?', Margaret said she had only taken a little and intended to pay it back, and then she started playing the pokies [poker machines] to pay the money back, and was waiting for the big drop to pay it all back."

Australians are the world's biggest per capita gamblers, with three-quarters of the money wagered swallowed up by poker machines. Pokies, which have colonised pubs and clubs, are an importance source of revenue for state governments. Not surprisingly, Australia has a high rate of problem gambling, which is blamed for a raft of social problems, including crime, debt, poverty, job losses, homelessness, suicide and family breakdown.

In Magnay's case, she was able to siphon off cash destined for charitable causes. The president of CWA Queensland, Heather Wieland, told the Australian Broadcasting Corporation that a fellow member eventually raised the alarm after becoming suspicious. Police were then called in.

Ms Wieland described Magnay as "very highly respected and trusted". "She'd been a member for some time in our organisation," she said. "The sad thing is that we are always very meticulous in having our books audited. We're trusting, but we do have accountability in our organisation, and that type of thing shouldn't happen."

The Queensland state government has replaced the money stolen by Magnay, in order that charities to which funds had been pledged – including the Royal Flying Doctor Service – would not go short.

The CWA, which has 25,000 members, works to help women and families, particularly in remote and rural areas. It offers assistance to people affected by problems such as drought.

In Queensland, an estimated 1 per cent of the population has a gambling problem. Magnay's defence lawyer, Keith Murdoch, told the court that she was very sorry, and the offences had just "spiralled out of control". Kingaroy magistrates' court also heard that she had two previous convictions for stealing, in 1976 and 1981.

Ms Mudra said: "It's shocking, but we've also got a lot of good, dedicated members, and we're not going to throw the barrel out because of one bad apple."