Mr. Vincent Jennings:

I thank the Chairman and other members for their invitation to appear before the joint committee.

The Convenience Stores and Newsagents' Association, CSNA, welcomes the opportunity to address the committee on the review of operations and functioning of the national lottery under the new licence holder. The CSNA represents over 1,200 individuals in 1,500 stores throughout the Republic of Ireland. The vast majority of these stores are agents of the national lottery.

When the Government announced its intention to offer the operation to license the national lottery for a 20-year period, we engaged the services of Mr. Anthony Foley of DCU's economics department to prepare a submission for the association to assist us in our attempts to ensure that the existing commissions earned by our members were maintained at the levels enjoyed under the licences held by An Post – The National Lottery, levels that were not fixed in the original legislation setting up the national lottery. Both Mr. Foley and the association attended meetings with the team that the Minister for Public Expenditure and Reform, Deputy Howlin, had assembled to oversee the process. We were pleased to secure the commitment of the Minister that the retailers' commission would be safeguarded and maintained at the existing 6% level.

The association met with the national lottery and Camelot on a number of occasions to discuss matters of vital importance to our members in advance of the tender process. While we were prepared to deal with any of the prospective owners, we made it clear to the Department of Finance and the Department of Public Expenditure and Reform that our working relationship with the management of An Post - The National Lottery was very strong and we would be best pleased to continue working with them after the new owners took over.

Our relationship with the national lottery is over 27 years old. We have taken part in assisting new applicants to familiarise themselves with the licensing process and the day-to-day accounting requirements to prevent, or minimise, internal and external fraud. We were responsible for promoting the idea of a lottery agents' council to Malachy Moynihan and Ray Bates, taking a leaf from Crowning the Customer, the book by Senator Feargal Quinn who is a strong advocate of listening to the customer.

The agents' council has been responsible for many years for teasing out various initiatives that have been to the benefit of the playing public. We can say with certainty that each of the CSNA representatives on the agents' council has been diligent in informing the association on the deliberations and decisions being considered. My colleague, Joe Tierney, is a member of the CSNA national executive and is on the national lottery agents' council. He will be able to address any questions regarding the present level of communication and actions that both the CSNA and the Lottery have engaged in over the past six months in the lead-in to, and during, the transition.

As chief executive, I had five high-level meetings with senior management in the lottery to discuss various commercial options that needed to be considered when the financial aspects of the licence moved from the Department of Finance into that of a private company. These included the migration of direct debits, the standing of existing securities or guarantees, the transitional periods' accounting processes, and the extinguishing of liabilities due to the old company.

We were at all times briefed by the national lottery on the transitional roll-out, both directly and via the agents' council representatives, and provided updated information to all our members through our weekly e-zine. The date for the changeover was in doubt up until the final few days, as the lottery was awaiting final checks from its software providers that the system was good to go. We had discussions with the lottery on the merits and detractions in deferring the roll-out until after Christmas and told them that if the roll-out was deferred, they would need to reconvene the training sessions that had previously been held, as the time-lag would be too great for retailers and their staff to retain information given to them at a distance of more than two months. We had no reason to believe that there were any problems beneath the surface.

The roll-out was the largest single logistical operation in our FMCG sector since the advent of the euro. Every detail had been considered and checked. Those areas affecting retailers were advised to the council and they expressed themselves to be satisfied with the process as planned. Planning and attention to detail was not the problem.

The teams assembled by the national lottery worked diligently and methodically to achieve a seamless transition of the product from the old to the new. It may have been considered that the advent of a new operator would wish to change the logo or signage in our stores, but such was the level of belief in the brand that there was no determination to change.

It is our belief that there are two central criticisms that need to be addressed. The first is the decision to move from a primarily broadband-connected service to one that relies upon wireless free. The second criticism is the lack of communication with the public both on the transition and the difficulties being experienced in accessing products and services that the public had become accustomed to using. Retailers are agents of the national lottery but were not given timely information on difficulties being experienced. Nor were they the recipients of any posters or leaflets for display until CSNA demanded that they be printed and forwarded explaining that certain delays and faults were at lottery-level and not the fault of any individual retailer.

Only the national lottery can answer why it moved from broadband and whether the decision to install a certain type of terminal was the correct option, or the least expensive one. There are concerns within our industry that such choices may not have been made if the old An Post - The National Lottery company was making that decision. We represent members that rely significantly upon the direct and indirect income derived from the sale of national lottery products. We do not wish to drag either PLI or any of their shareholders or staff into areas that would injure the brand, given the importance that we attach to selling a unique and hitherto blemish-free product.

We acknowledge the desire of the committee to consider what, if any, systemic problems may be present in the current set-up. We respectfully suggest, however, that it does nothing that would further damage the level of trust the public has with a product designed to promote good causes, and which brings a little joy into all of our lives.

The national executive of CSNA endorses the unanimous affirmation given by the agents' council to continue to work with the lottery to resolve all outstanding issues.