Parks Tau, the minister of trade, industry and competition, who has endeared himself to the business community for the way he has run the affairs of the department since taking office in June, has enhanced his reputation further by refusing to name a preferred bidder for the fourth licence to operate the national lottery.
The process of selecting a bidder has been highly tainted, marred by conflicts of interest.
In December Tau took a decision that he would not name a preferred bidder after he identified “matters that require further evaluation”, stating that the law requires him to ensure that no political party or political party office bearers has a financial interest in the applicants.
Business Day last year ran a series of stories bringing to the fore the proximity of the front runners in the bidding process to the ANC, the leading party in the government of national unity.
One of the shortlisted bidders is Thebe Investment Corporation, half owned by Batho Batho Trust, which according to declarations made to the Electoral Commission of SA (IEC) has donated R60m to the ANC since 2021.
Batho Batho Trust was founded by ANC leaders in 1992.
JSE-listed Hosken Consolidated Investments (HCI) has also thrown its hat into the ring to win the lucrative tender, said to be more than R80bn.
HCI is run by trade unionist turned-businessman Johnny Copelyn, who was one of the businesspeople who donated to President Cyril Ramaphosa’s CR17 campaign for the ANC presidency.
HCI is majority owned by the Southern African Clothing and Textile Workers’ Union (Sactwu), an affiliate of Cosatu, which is in alliance with the ANC.
Businessperson Sandile Zungu’s consortium Goldrush is also in the running to win the licence to operate the national lottery. Zungu in 2022 made a bid to chair the ANC’s biggest province, KwaZulu-Natal, eventually dropping out of the race.
The incumbent operator, Ithuba, is also looking to retain the eight year license, while Giya Games and the Umbulalelo Consortium, led by Afrirent Holdings are also candidates.
One of the concerns was that the lottery might be suspended as Tau tried to relook at the process the National Lottery Commission followed in evaluating the bid.
However, Tau in his statement said measures will be put in place to ensure the continuity of the national lottery whose proceeds benefit scores of non-governmental organisations across the country.
“I am awaiting advice on the best way to ensure the continuation of the national lottery in the interim and the development of a programme to finalise this process, which I have directed must be done after consultation with the National Treasury,” Tau said.
Mzwandile Masina, chair of parliament's portfolio committee on trade, industry & competition, welcomed Tau’s decision to further interrogate the bids without compromising the credibility of the licensing process.
“We implore the minister to consider various options if awarding the new lottery licence becomes impractical before the expiry of the third lottery licence on May 31 2025. Such options could include exploring Section 13B in the Lotteries Act that deals with issuing a temporary licence and/or considering the option of a ‘state led’ lottery in terms of Section 13A of the act among others,” Masina said.
“We have full confidence that the observations and input given during the portfolio committee’s meetings will also be taken into account without meddling in the process, especially as it relates to ‘conflict of interests’ as sharply raised on numerous occasions,” Masina said.
Tebogo Sithathu, founder and chair of United Civil Society in Action, said while not ideal, the decision by Tau was probably the best he could take under the circumstances.
“We appreciate the fact that minister Parks Tau found himself walking into a mess and crime scene that is not of his own making but which has been engineered by his predecessor former minister (Ebrahim) Patel who should still be held liable for our being where we are now including the delayed release of this current bidding RFP [request for proposal] process and marred it with shocking conflicts of interests.
“We encourage Tau to provide brave leadership instead of entangling himself any further by wanting to defend a predecessor “comrade” and a board that has left so much to be desired,” Sithathu said.
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