Timmy Dooley (Clare, Fianna Fail) | Oireachtas source

I welcome the opportunity to contribute to this important debate. Like others, I have seen the tremendous success national lottery funding has been in this country on a number of fronts. It has provided a level of gambling, gaming and entertainment in a very controlled and regulated way for those who play it. Irish society has a penchant for gaming and gambling whether at the dogs, horses or bingo. Some would suggest, perhaps rightly, that it is State-sponsored gambling and another tax on the poor. When such a system is put in place, one must be exceptionally careful to recognise that within its ambit one has something which, if it goes out of control, can have dramatic and disastrous consequences for those who participate and play.

It has been so successful in Ireland since its inception in 1986 because of how the current licence holder has succeeded in managing the growth of the product and the introduction of new products in a careful way which looks to the potential dangers and ramifications of being overly avaricious in terms of trying to target new players or trying to target the average revenue per user. It has been a tremendous success because the State and An Post have been able to demonstrate to the players and citizens at large where their tax euro goes. Our communities are very well aware of the very positive benefits associated with the spoils of the national lottery.

Others have spoken about projects developed in their constituencies and it is the same in mine, in areas with which I am mightily familiar. I am minded of the support a former Minister with responsibility for health gave to a cystic fibrosis unit attached to the Mid-Western Regional Hospital in Limerick, involving a voluntary organisation developing facilities for cystic fibrosis sufferers. It received approximately €300,000 over two years which allowed it to garner other funds from philanthropic organisations. Now it is working towards a state-of-the-art facility. This has significant benefits which might not have been provided or might not be on the development list now were it not for these funds being available. It will have a meaningful impact on the lives of many young people. It is easy for some who might say this should be provided by the State, but the State can only levy taxes to a certain extent, and it is necessary to allow this discretionary spend and having another stream of revenue which again can be distributed from State coffers.

The national lottery has worked well in terms of the support it has given to sporting organisations locally and nationally and has allowed for very significant investment at grass roots level. We are well aware of the much improved facilities which virtually every club in Ireland has with regard to playing surfaces, changing areas, gyms and facilities not only for those who play but all those who participate by coming to observe.

From the outset the package has been developed well and it has developed in a very controlled way. The national lottery through An Post has advertised that one could be that millionaire, driving that Ferrari or lying on that beach. At times I was concerned about the notion of the dream being very much part of this advertising. I have a problem with this because it pulls the strings of a certain vulnerable cohort in the community but sometimes it was so overstated it was almost laughable and therefore not as infectious as some advertising campaigns might be, such as those by drinks companies in the past or by cigarette companies which had a very specific methodology for hooking new participants for their products.

I am against the Bill because I am concerned that too much responsibility will be handed over to the new licence holder. The State is seeking an upfront payment which will be a significant boost to the State and will allow it to do certain noble things. My concern is that the new operator will try to increase the overall take from the national lottery spend, which can be done in two ways: either through giving less back to good causes or increasing sales which Deputy Regina Doherty indicated could be done through an extension into online gaming. It is my recollection there is no prohibition on online gaming. The former director of the national lottery, Ray Bates, was a former Department of Finance official. I thought he understood lotteries and the importance of where a national lottery could go wrong and the negative impact it could have on society. He crafted and developed the organisation in a way that ensured it did not boil over and become overly avaricious.

I am concerned if the national lottery goes outside State control and we end up with an international player driving to get a return on the investment made upfront. We may see new games, including online games which by themselves require one to spend more in a less controlled environment. I am also conscious that other countries have a game known as keno which involves multiple draws every ten or 15 minutes and is usually located in pubs or clubs. Such games would move the national lottery into hard gambling. We must accept it is gambling, but I would argue it is soft gambling, no more than horses, dogs and bingo. This is where the line would be breached between entertainment and soft gambling and we would end up with an absolute tax on the poor, with games developed and created to target this audience which will spend more than it should because the return seems possible. Recurring draws every ten or 15 minutes are quite addictive. There are people who spend too much on the national lottery but they will spend it today and then must wait until Wednesday or Saturday. This is controllable, but a multiplicity of games which turn over every few minutes has the real potential to move people into an area associated with slot machines and casino-led gaming. We must be exceptionally careful. This is my biggest concern with regard to the legislation.

I note the real success achieved by the national lottery and I ask the Minister of State to take on board the views and concerns I have raised. These views have also been expressed by others associated with addiction to gambling organisations. They are concerned about anything which might tip the balance. The national lottery is well maintained and well structured and it has been very well managed. I appreciate the Minister of State can stand up and say there will be a regulator.

I am conscious we cannot hardwire into the legislation that the licence will be given to An Post and I am not here to make the case for An Post. I accept under various competition directives from Europe it is not possible for the State to issue a licence to a sub-division of the State and this puts the Government in a very difficult position. If it could hand it over to An Post there would be at least a level of control at arms length. I do not advocate this as it would be nonsensical. For this reason I am deeply concerned that outside players are being brought in.

I have some knowledge of the lottery industry as well as having a general interest in the area. I am not casting aspersions on lottery service providers or lotteries in other countries, but there are different cultures which treat this differently. I have seen the low end of lottery participation and I do not see much difference between this sector of the market and slot machines in a casino. I have grave concerns about this. We need to be very careful about whether the legislation will be prescriptive about the extent to which control of the games will be a factor or feature of it, or whether State supervision or acceptance will be required before these games are introduced.

I want to acknowledge the role the lottery has played since its inception in funding various groups and organisations in the State. An awful lot of development at county level would not have taken place had it not been for lottery grants. There was much economic activity around those lottery grants, as well as socio-economic improvements for sports, health projects and others.

In the context of this legislation, I also acknowledge that the new national children's hospital might be partially funded through the national lottery. My subsequent comments are in no way meant to take from the positive work achieved over the years by the lottery in its current format. However, I do have a number of concerns surrounding the Bill's proposals. First, I think the legislation does not contain sufficient detail to govern the offering of this licence in the market. Lessons will have to be taken from the many mistakes that were made in selling off either enterprises or State assets without the best interests of the taxpayer in mind.

One has only to look at the current reports on toll roads, for example, to understand that the State will have to continue funding those very profitable companies simply because they have not reached the numbers. The detail of the contract concerning this licence is very important. In many cases, however, the State does not look at the detail sufficiently and, as a result, the State is short-changed so the taxpayer had to stump up considerable sums to support the transaction that has taken place.

The legislation needs to be more robust and detailed in terms of the transaction involved. There is an opportunity for the Minister to use the appropriate Oireachtas committee to set out the detail of the transaction and the licence, thus giving greater clarity concerning the agents' 6% and their profitability. The uncertainty needs to be removed.

We also need to examine the regulatory framework being put in place. Various regulators have already been put in place and are being paid in the region of €180,000 a year. In some cases, there is a second or third person on exactly the same level of salary. Within the same organisations, a significant number of employees are earning over €100,000 per annum. The body of staff grows over the years because bureaucracy simply encourages the regulator's staff to grow and prosper at the expense of the State.

One would have to question the type of regulation we have seen. In most cases when an application is made for an increase in ESB, gas or Eircom charges, they look at the cost of the regulator's administration. They also look at the other cost items concerning the company. They almost always grant the increase, so one must ask if the structure itself, in terms of its cost in salaries and bureaucracy, actually serves the citizen it is supposed to protect. It does not seem to do so. It actually serves the corporate entity that it is supposed to regulate. That is what I have seen from the three or four regulators who are currently there.

In opposition, the Government said it would remove a lot of quangos, yet it is now doing exactly the opposite. I would like to see the Government sticking to its guns and having a different corporate structure in place to oversee the lottery, with far less cost and far more accountability to the State. In this instance, one could reduce the 6% on agents' tickets. The sum of €6 in €100 is nothing. What will happen to the agency structure when this licence is given out and it becomes a new entity? What about all the other agents? What is the criterion for establishing an agency? What criteria will be used by the new entity to give out agencies across the country? What will their performance expectations be? They are serving local communities and it is important to a local business. The Minister of State needs to reflect on that because at the moment I am hearing numerous complaints about the lottery being taken from individual businesses and thus affecting their viability. This is in spite of the fact that the turnover figures would stand up.

RGDATA - of which I was once a member - and the Convenience Stores and Newsagents' Association have made submissions on the agents' figure as to whether there is a commitment to hold it at 6% or to increase it. There is much more to it than the 6% figure. There are also performance issues and the appointment of agents, particularly new ones.

I also have issues over the new licence. The Bill states that any terms that are considered necessary or expedient will be included, and that there will be a code of practice contained within the licence. What does that mean? Surely as legislators we should know what that means. We should know the background to the licence and the detail concerning the appointment of agents. In addition, we should know what is being committed to in terms of agents' fees and profitability, but we do not. Yet we are expected to pass the legislation without knowing that. We should also know the detail of the regulator's office and what the potential is for staff numbers. What will they be related to and are they being taken from the Civil Service or being recruited externally? What will be their terms and conditions?

What will be the audit arrangement concerning the Comptroller and Auditor General? I note the legislation proposes an arrangement whereby the Comptroller and Auditor General would examine the accounts. What is the extent of that audit, however, and what is the extent of the role of the Committee of Public Accounts? The Bill mentions another committee regarding oversight but not the Committee of Public Accounts. I would like to see that stitched into this legislation.

Another issue is the period of the licence. The proposal is for a period of 20 or 25 years, but are we going down the same road we went with the road tolls? Will we find after five years that we have sold the taxpayer short, and that we could have got much more for the licence? What are the performance criteria relative to this licence that the Minister will insist upon when the new licence holder is the operator? We need to know that. Twenty years is far too long. What if we have a bad operator? We know what that means - it will just go into litigation with all sorts of crossfire between Departments, the Oireachtas and the operator. Unsatisfactory arrangements can lead to protracted legal arguments, so one may be stuck with the operator for 20 years. Surely there should be five-year reviews with an analysis of all this after that period. The legislation needs to be far more detailed on that matter, so that there is no wriggle room for any licence-holder or sharp operator the State may find itself with. I am not saying it will, but it could.

Every single eventuality should be covered in the legislation. The Bill is short on detail and requires much more analysis on whether we really want to create another regulator absorbing so much cost to the State. Where does the citizen fit into this and how can taxpayers' money be protected?

The committee system in the House should be used to a greater extent to expose the detail which is not included in this Bill but which should be.

See this speech in context