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Country analysis > South Africa Last update: 2020-10-26  

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The National Lottery and the non-profit sector

The National Lottery Act (57 of 1997) makes provision for the operation of a countrywide lottery. The National Lottery was founded in 1999. The Lotto, its flagship, was launched on March 2 the following year. On October 23, 2000, scratch cards were launched. The purpose of this report is to overview some of the key issues relating to the operation of the Lottery, particularly the distribution of money to good causes, and to highlight areas of particular concern to the non-profit sector.

At the outset, it must be stated that the report is intended to highlight a broad array of issues, raised primarily by non-profit organizations themselves. Clearly, the sector includes a variety of different organisations with different organising styles, bureaucratic and administrative concerns, and fundraising capacities. Expectations of the National Lottery differ widely, particularly between the larger, non-governmental organisations, and smaller, often unregistered, community-based organisations. Many non-profit organisations were beneficiaries of earlier scratch card gaming operations, and the sudden loss of this source of revenue means that their perceptions of the National Lottery are motivated by quite different concerns to those expressed by organisations applying for lottery funding for the first time.

The report can do no more than highlight the variety of perceptions, without making judgements as to the most appropriate strategies for reform or mobilisation around the Lottery. That is the task of the non-profit sector.

Two time-periods should be born in mind. Uthingo Management Company Pty (Ltd) has been granted a licence to operate the Lottery for seven years, starting in 2000. During this period, incremental reforms rather than dramatic change are possible, particularly with regards to the structure and operation of the Distribution Agencies. After this period has ended, however, new regulations will have to be drafted, and a new tender process will be embarked upon. In anticipation of this, the non-profit sector should seek to make maximum input into the debate as to the most appropriate terms and conditions for the second licence period.

In Part One, some background to the National Lottery is offered. This includes the establishment of the Lottery, as well as the functions, responsibilities, and performance of the main players: Uthingo, the Lotteries Board, the Distribution Agencies, etc. A very brief overview of the Lotto and scratch card operations is also provided.

Whilst Part One is largely descriptive, Part Two considers some of the criticism that has been levelled against the National Lottery, as well as the perceptions of three categories of role-players: the loosely defined non-profit sector; parliament/government; and the Lotteries Board itself.

It must be emphasised that, to adopt the phrase used by one informant, some of the criticism offered is valid, some is based on misinformation, and some of it is simply sour grapes. It is hoped that this report might contribute in some small way towards sifting out the valid criticism and using this in a constructive way to contribute to the development of the National Lottery.

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