Oireachtas Joint and Select Committees

Thursday, 27 February 2014

Public Accounts Committee

Payments to Section 39 Companies: Discussion

12:20 pm

Mr. John McGuire:

That is not quite correct. As an overview, every year Rehab makes in excess of €2.5 million on its lottery activities, including the income from Care Trust Limited.

To go back to what the Deputy was hinting at, last year Care Trust Limited contributed approximately €1.7 million or €1.8 million to both shareholders. It is a very different lottery from the national lottery and our other lotteries. Tickets are sold through a different distribution mechanism, through subscription, and because of this it is a very efficient lottery, on which the return last year was 54%. Therefore, the proceeds were 54%. I am relating this to indicate that we do run and are involved in some very effective and high profit lotteries. For reference, the national lottery provides a return of 31%, based on a massive turnover and volume of €730 million last year. Separately, Rehab has another subscription lottery which has a net profit of approximately 36%.

Coming to the two lotteries to which the Deputy probably wants to refer, these are the two lotteries that directly face the national lottery. We sell through retail outlets our radio bingo and scratch cards. They contributed in the year referenced in the Dáil by the Minister, Deputy Alan Shatter, €560,000. Members of the committee may think this is a small amount of money, but it is very important to us in the context of the services we provide in the way they have been explained to the committee. In percentage terms, the amount is small and we would dearly love it to be greater. The only reason it is so low is the unfair cap on lottery prizes in that sector in which we are competing head-on with the national lottery. Our response to the Government is that if there is a genuine interest in having highly profitable authority lotteries, with returns comparable to those for the national lottery, the unfair cap on lottery prizes must be removed to enable us to compete on a fair basis.

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