Concerns raised about lottery funds as 98% of unclaimed prizes spent on marketing

Considerations have been raised in regards to the Nationwide Lottery after it was revealed that 98%, or some €120m, of unclaimed prizes goes into advertising and marketing.

Profitable lottery gamers failed to assert greater than €124m between 2015 and 2021, an investigation by Comptroller and Auditor Basic Seamus McCarthy into the lottery operator accounts confirmed.

The Oireachtas Public Accounts Committee (PAC), a watchdog for State spending, heard that underneath its contract, lottery operator Premier Lotteries Eire DAC should use unclaimed prize cash inside a 12 months to advertise the lottery however that should embrace funding extra prizes.

Whereas a few of this cash is permitted for use for advertising and marketing, Mr McCarthy discovered that by the tip of 2021, some 98% of unclaimed funds had been used on this method, with simply 2% allotted for extra prizes.

Mr McCarthy’s report really useful that the Lotto regulator “take into account together with extra info within the Nationwide Lottery Fund accounts to allow customers of these accounts to see extra clearly that the important thing provisions of the licence are being complied with, specifically across the quantities allotted to the Exchequer yearly”.

PAC chairperson, Sinn Féin TD Brian Stanley, raised considerations concerning the outstanding promoting of the lottery and requested whether or not it wanted tighter regulation within the context of playing habit.

He known as for stricter regulation and controls of the Nationwide Lottery to make sure that good causes obtain a share of unclaimed prize cash.

We have to see stronger enforcement by the regulator and stricter controls inside the licence and the committee might be proposing these modifications in our report back to the minister.

The lottery fund’s revenue in 2021 totalled €682m, with €287m paid into the prize fund in 2021. The operator’s entitlement for the 12 months was €103m. Virtually €290m was transferred to the Exchequer.

Annual gross sales for Nationwide Lottery video games elevated by 64% between 2015 and 2021, rising from €670m to round €1.1bn.

Carol Boate, regulator of the Nationwide Lottery, stated that the compound annual development price of gross sales is roughly 8%.

“This equates to general development in gross sales of 57% from 2015 to 2021 and development in good-causes earnings of 61% in the identical interval,” she stated.

“The affect on good causes earnings has been a rise from €188m in 2015 to €304m in 2021.” 

She stated that the returns to good causes and prizes received remained comparatively constant as a proportion of gross sales over the seven years, at 27.6% and 28.85%.

This was unsurprising given the licence settlement, which aligns the operator’s industrial pursuits with the returns to the State.

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