Retailing group call on minister to publish Lottery Bill

Minister for Public Expenditure and Reform Brendan Howlin
Minister for Public Expenditure and Reform Brendan Howlin

RGDATA say retailers need assurances that their margins are protected under new licence

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22 May 2013

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Retailers’ group RGDATA has called on the Minister for Public Expenditure and Reform, Brendan Howlin, to publish the proposed licence to the National Lottery. Retailers are concerned that their margin on ticket sales may be eroded under the new terms. Minister Howlin’s department have said that details of the new licence would only be available to parties that have expressed an interest in the upcoming bidding process, and who pay €100,000 to enter its virtual data room.

RGDATA’s Tara Buckley says it’s anxious to ensure that the existing 6% margin paid to retailers who sell lottery products would be preserved in the planned sale process. "Retailers, who are already operating in a very challenging environment are deeply concerned that any new operator of the licence will erode the existing margin of 6% in an attempt to recover the hundreds of millions that they are likely to pay to acquire the licence. At a time of unprecedented pressure for retailers, any cut to the National Lottery margin, could be the difference between success and failure for retailers. There are also concerns that the new licence could allow a new operator to cull the existing agency network and cherry pick or offer preferential terms to particular retailers."

In an address to the Seanad last year, Minister Howlin pledged to maintain the 6% margin on sales lottery currently enjoyed by retailers. Under the terms of a new 20-year licence, lottery beneficiaries will now receive an unspecified percentage of gross gaming revenues, which is calculated by subtracting prize payouts from sales, as opposed to a proportion of overall revenue. The move is designed to give the next licensee greater flexibility to operate online where margins for certain game products are substantially smaller.

 

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