The DA believes that trade, industry & competition minister Parks Tau is on the verge of issuing a temporary lottery licence.
This follows Tau’s decision two weeks ago to postpone the award of a new national lottery licence to next year. In announcing the delay, Tau said he had identified several areas that required additional evaluation “to ensure the successful applicant meets all legal and ethical requirements” and to ensure the adjudication process is fair.
But the delay raises the question of who will run the lottery in the interim as the licence of the current operator, Ithuba, expires at the end of May and cannot be extended.
DA spokesperson on trade, industry & competition Toby Chance said in a statement on Wednesday that he had seen a letter sent by Tau and dated Monday in which the minister informed Lotto bidders that he would shortly issue a request for proposal (RFP) for the appointment of a temporary national lottery operator for the period June 1 to May 31 2026. The DA has also seen the RFP circulated to bidders.
Tau’s spokesperson Yamkela Fanisi strongly denied Chance’s claim, made in a meeting of parliament’s trade, industry & competition committee earlier in the day, that Tau had issued an RFP for a temporary licence.
Fanisi said if the minister took such a step it would be clearly communicated. The department’s acting COO, Nontombi Matomela, also told MPs she was not aware of any such RFPs having been issued.
Chance said in his statement that in terms of the Lotteries Act, the current Lotto licence held by Ithuba could not be extended further as it has already been extended for two years. Unless a new, permanent operator was appointed, lottery ticket sales would thus be terminated on the expiry of Ithuba’s licence until further notice.
Chance called on Tau to disclose on what provisions of the Lotteries Act he relied to issue a temporary licence, as the act could have been violated.
“For all practical purposes, it is impossible for a new operator to get its systems in place before June 1 2025,” Chance said. This usually takes about six months.
“The only outcome of the RFP could be a further extension of Ituba’s licence, or the nonawarding of a temporary licence and the cessation of Lotto ticket sales. Neither of these scenarios is acceptable and goes to show that the awarding of the new licence has been bungled from start to finish,” Chance said.
Grants
If the sale of Lotto tickets was terminated, the National Lottery Commission (NLC) could continue with its distribution of grants using its reserves, which NLC commissioner Jodi Scholtz said totalled R4.3bn at end-December.
The national lottery tender is worth about R180bn over eight years.
Shortlisted bidders include JSE-listed Hosken Consolidated Investments, Thebe Investment Holdings and Goldrush. Some of the bidders have links to the ANC. Bidders for the licence believe the delay in awarding the licence favours Ithuba and they are seeking legal advice.
Commission chair Barney Pityana told MPs the minister would in due course announce his decision on the way forward.
“The minister has been looking at several scenarios regarding what can be done. Our view, and the investigations that we have received from experts, is that it is possible to evaluate and adjudicate a temporary licence from June 1 to be valid and meaningful for at least 12 months. The information we have from experts is that this can be done.
“The minister is sitting with all the expert advice and will make an announcement in due course,” Pityana said.
A team from the commission led by Scholtz briefed the committee on its third-quarter performance.
The commission, through the National Distribution Trust Fund, allocates about R1.4bn annually in grants from the sale of lottery tickets to good causes, which amounts to about R7bn a year.
The commission has in the past been racked by corruption and mismanagement and the Special Investigating Unit (SIU) has been conducting ongoing investigations.
Scholtz said in the third quarter of the 2024/25 financial year that 17 cases were referred to the SIU for further action and 10 cases registered with the police.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.