Lotto still hobbling along despite ticket and legal issues

CAPE TOWN — Despite a legal battle for control of the national lottery, the Lotto was still operational, National Lotteries Board chairman Alfred Nevhutanda told Parliament’s trade and industry committee on Friday.

However, reports show that the transition from outgoing operator Gidani to new operator Ithuba has not been without problems and users have complained about being unable to buy tickets, have them checked or redeem winnings.

Gidani, which previously operated the national lottery, has mounted a court review of the decision to award the operating licence to Ithuba. Gidani’s predecessor, Uthingo, also challenged the ascendency of its successor about eight years ago, bringing the lottery to a standstill for nearly six months.

Prof Nevhutanda told the committee that “the Lotto is going on even as the two parties prepared to go to court”. Draws were being made, but “the transition from Gidani to Ithuba has not been seamless”, he said.

Ithuba admitted last week that there had been teething problems in the transition, which took place on June 1.

CEO Charmaine Mabuza appealed to the public and retailers to be patient while the problems were ironed out.

The process of establishing a new operator stretches back to 2013 when the board designated Gidani as the preferred bidder to continue running the lottery.

This was overturned by Trade and Industry Minister Rob Davies, who named Ithuba the preferred bidder. Last year, the High Court in Pretoria dismissed an urgent application to reverse Mr Davies’s decision and Gidani is now pursuing a judicial review of the decision.

Briefing the committee on the distribution of funds to worthy causes by the National Lotteries Distribution Agencies, Prof Nevhutanda told MPs that the national lottery celebrated 16 years of existence in March and that during that time, it had distributed more than R18bn to worthy causes.

He and the heads of distribution agencies told the committee that 47% of the available funds went to charities, 28% to sports projects, 23% to arts and 2% to other applicants. A sum of R1.5bn was budgeted for allocation in 2015-16 — R724.3m would go to charities, R431.5m to sports, R354.4m to the arts with R30.8m assigned for miscellaneous applicants.

A change contained in the Lotteries Amendment Act would differentiate between small and large beneficiaries.

In the past, the application procedure was the same for large and small grants, but Prof Nevhutanda said fewer documents would now be needed for smaller grants.

The Lotto is going on even as the two parties prepared to go to court … the transition has not been seamless