South Africa’s Trade and Industry Minister, Parks Tau, stands by his statement regarding the National Lottery contract, but some MPs are still not convinced.
Tau made the decision to award the next eight-year contract for the South African National Lottery to Sizekhaya, a consortium which counts Goldrush Gaming Ltd and Bellamount Gaming Ltd as stakeholders.
Sizekhaya will begin operating the lottery next year, with current operator Ithuba managing it until then under a temporary one year contract. Concerns have been raised, however, that Sizekhaya has too close links to the government.
In a recent filing to the Gauteng High Court in Pretoria, Minister Tau asserted that the lottery licence contest had been a “close race and a tight finish”, but that in his view “Sizekhaya pipped the others to the post. It presented a well-balanced bid”.
He also remained adamant that Sizekhaya is best positioned to deliver the best contributions possible to the National Lottery Distribution Trust Fund (NLDTF), the organisation that distributes South African lottery funds to charities across the country.
“It has satisfied the requirements in Section 13 of the Lotteries Act. It has an impressive technology partner,” he said. “Its financial plans and models are sound. Its projected revenue is suitably ambitious, yet credible. Based on its projected revenue and percentage contribution to the NLDTF, Sizekhaya’s contributions to the NDLTF are likely to be the highest.”
Democratic Alliance cites inconsistencies
This has not deterred political critics from taking aim at the aforementioned alleged links between the new lottery consortium and the government. In particular, the fact that Khumo Bogatsu, a Director in Bellamount Gaming, is sister-in-law to Deputy President, Paul Mashatile, has raised a few eyebrows.
Goldrush Gaming has acknowledged Khumo Bogatsu’s role and small shareholding in the Sizekhaya consortium, while also noting that other individuals involved in the consortium are familiar with South African gaming and lotteries regulators as a result of their professional careers.
Another development which has prompted concern, however, is that Tau allegedly dismissed a bid from one group due to its links to the governing African National Congress (ANC) party potentially constituting a conflict of interest. This has been criticised by the Democratic Alliance (DA), the second largest party in the National Assembly.
Toby Chance MP, the DA’s Spokesperson on Trade, Industry and Competition, said: “Minister Parks Tau’s decision to sideline one ANC-linked bid for the lotto licence due to conflict-of-interest concerns, only to award it to another bid linked to the Deputy President’s family, raises far more questions than answers.
“The DA will continue to seek answers on this clearly flawed process through our PAIA application and by ensuring the Minister accounts to Parliament. It is extremely concerning that the National Lotteries Commission’s (NLC) evaluation and adjudication committees both failed to flag the glaring conflict of interest of their top candidate for the award of the lotto licence, Ringeta.
“The conflict of interest in awarding one of the state’s largest tenders to a bidder part-owned by an ANC funding vehicle with a sitting ANC MP on its board of trustees is patently obvious.”
It is clear that despite the licence content being long finished, allegations of corruption at worst and negligence at best are going to be hounding South Africa’s NLC and its political overseers for some time.