I am speaking in support of the counter motion
“That Seanad Éireann
Welcomes the decision of the Government to hold a competition for the next licence to operate the National Lottery for the period 2013-2033, in accordance with EU legal requirements;
Recognises the major achievements to date of the National Lottery and the widespread support of the Irish public for the Lottery;
Recognises the need for the State in the current economic situation to pursue opportunities to generate additional revenues that do not impact on taxpayers;
Welcomes the fact that the terms of the next licence will continue to involve an ongoing return to the State through the provision of a fixed percentage of 30.5% of annual National Lottery turnover for good causes;
Welcomes the fact that the new licence will also involve an upfront payment to the State, with some of the payment being used to help fund the building of the proposed new National Children’s Hospital.”
Opening
I welcome the opportunity this evening to outline to the Seanad the most up to date position on the future of the National Lottery.
The National Lottery since its establishment
Firstly, I would like to pay tribute to the very substantial achievements of the National Lottery since its establishment in the mid 1980s. The Lottery was set up under the terms of the National Lottery Act 1986 and has been operated under a licence since its inception by An Post National Lottery Company. 80% of the shares of the National Lottery Company are held by An Post while the remaining 20% are held by me as Minister for Public Expenditure and Reform.
During the past quarter of a century, the National Lottery Company has come to be regarded as a very innovative and successful national lottery. Since 1987, it has raised a total €3.9 billion for good causes. Throughout this time, the National Lottery has maintained the support of the general public, which is crucial to the success of a State lottery. Very few, if any, concerns have ever been raised in relation to the integrity, probity or ethos of the Lottery. This achievement is something which should not be taken for granted.
The National Lottery was established at a time of economic difficulty for Ireland in the 1980s. At the present time, we are again seeking to address very serious economic challenges. Like so many other businesses in Ireland, the National Lottery has been affected by the economic climate of recent years. Both overall Lottery sales and the level of funding raised for good causes have declined since 2009. Nevertheless, the Lottery continues to generate a very significant surplus that is used to fund a range of good causes across the State. For example, in 2011 just under €232 million was raised for good causes by the Lottery.
Future of the National Lottery
The current National Lottery licence was issued to An Post National Lottery Company in late 2001 following a competition for the licence held between 1999 and 2001. This current licence is due to expire at the end of June 2013.
I do not need to remind Senators of the difficult economic situation in our country. Given the present budgetary situation, the Government needs to be innovative and creative where opportunities arise to generate additional resources for the State. Failure to think creatively about how we might find additional resources has a cost and that cost will be reflected in an inability to provide vital elements of social infrastructure for our population. Therefore, the Government has decided to take advantage of the opportunity presented by the expiry of the current licence in June 2013 to provide for new arrangements for the Lottery. The terms of the next licence will involve a large upfront payment to the State but will still retain significant annual revenues for good causes.
Recent Government decision
On 4th April 2012, I announced that the Government has agreed in principle to the arrangements that will apply to the next National Lottery licence. Under these arrangements:
· There will be a competitive process for the award of the licence which will be for a period of 20 years;
· The terms of the next licence will include an upfront payment to the State – the intention is that part of this upfront payment will be used to help fund the building of the proposed new National Children’s Hospital;
· The next licence will involve the ongoing provision of a fixed percentage of 30.5% of annual Lottery turnover for good causes – (30.5% was the percentage of Lottery sales which was allocated for good causes in 2011).
Proposed legislative changes
It is envisaged that the competition for the next licence will take place later in 2012 and in early 2013. The necessary preparatory work is being carried out by my Department as a priority. This preparatory work will include legislative change to deal with future regulation and address issues around Lottery sales online. Globally, lotteries are doing more business online and in the context of a 20 year licence we need to provide for this. However, this will be done in a manner that has sufficient safeguards in areas such as player protection. Therefore, it is envisaged that a Bill providing for changes to the National Lottery Act 1986 will be published later in the summer.
International context and bidder interest
Recent years have seen a number of States and regions around the globe make new arrangements for their lotteries. For example, two Australian States, Queensland and New South Wales, have in recent years successfully put arrangements in place that involved upfront payments to those States. Already the Government’s announcement has created considerable interest and my Department has already met with a number of potential bidders. The competition process will be overseen by my Department. I recently published a protocol on my Department’s website which sets out the procedures to be followed regarding contact with potential bidders.�
Stakeholders
I am very conscious that the National Lottery has a number of significant stakeholders whose concerns need to be taken into consideration as part of this process. Apart from the Government, these stakeholders include:
· players of the lottery
· the general public and its view on the role of the lottery
· employees of the lottery
· beneficiaries through money raised for Good Causes
· retailers who played their part in building the national lottery brand
The Government will, of course, respect the statutory employment position of existing National Lottery staff. I am also conscious of the vital role which retailers have played in the success of the Lottery since its establishment and my officials have engaged with retailer representative bodies in recent weeks.
Conclusion
The National Lottery has been one of Ireland’s success stories since its establishment 25 years ago. The Government is committed to pursuing the opportunities provided by the issuing of a new Lottery licence to raise a significant upfront payment for the State, which is sorely needed at this time. It is equally committed to safeguarding the National Lottery and to securing the continued provision of ongoing funding for good causes. I commend this amendment to the House.