Lottery industry hardsells raffle funding of health plan

The lottery industry is hopeful of a favourable response from NITI Aayog, the government’s think tank, to its pitch that the Centre comes out with lotteries to fund Ayushman Bharat, the universal healthcare scheme.

It is common in many countries for governments to run lotteries and use the proceeds to fund social welfare or sports development programmes. The All India Federation of Lottery Trade & Allied Industries (AIFLTAI) has tried to sell just this idea to NITI Aayog.

NITI Aayog has assured the Federation it would consider the suggestion, but it is not clear whether the think tank has made up its mind one way or the other, as a mail to its CEO, Amitabh Kant, did not elicit a response.

But the lottery industry is satisfied that it has made a strong case.

Globally, lottery is a thriving business. According to the World Lottery Association’s Global Compendium, 2017, total sales recorded by the business in that year was $293.4 billion. Fifty-one per cent of the money was given back to players as prize and another 29 per cent went to fund social causes.

Industry players believe that lottery has a stigma attached to it, unfairly. “People still look at lotteries with ‘Mahabharata eyes’,” says Sugalchand Jain, Chairman-emeritus of Sugal & Damani, one of the leading marketers of state-run lottery tickets in the country.

A chat with Sugal Jain is always peppered with instances of how lotteries have long been used to fund good causes. Harvard, Columbia and Yale universities, he says, were funded in part by revenues raised through lotteries. Sri Lanka launched the Sarana National Lottery in January 2005 to raise funds for rehabilitating tsunami victims. The UK has used proceeds from its National Lottery to support sports. The list is long.

In a monograph that he wrote a few years back, Sugal Jain notes that ‘chance games’ such as quizzes in which participants are asked to SMS an extremely simple question for a lucky-winner prize, is also a form of lottery, albeit one through which the government gains nothing.

Lottery in India

In India, the Constitution says only the Central and State governments can run lotteries — not a private entity. Private lottery companies operate on behalf of the governments — marketing tickets or organising draws. In 1998, the government came up with a Lotteries (Regulations) Act, which banned some forms of lotteries such as scratch cards and lotteries that assured prizes for the correct last one, two or three digits on the ticket.

Then came the Lotteries (Regulations) Rules, 2010, which regulated certain aspects of the trade such as appointing distributors and selling one State’s tickets in another. Now, only nine States run lotteries. They raked in ₹5,800 crore. Kerala and West Bengal accounted for over 80 per cent of it, with revenues of ₹2,599 crore and ₹2,182 crore, respectively. Maharashtra’s lotteries fetched it ₹814 crore. Punjab, Sikkim, Arunachal Pradesh, Assam, Mizoram and Goa took the rest.

The Federation wants the Centre to come up with lotteries to fund, say, Ayushman Bharat and other social welfare schemes.

It wants State governments to follow suit. Gambling is a natural instinct, so why not use it to channel resources for public causes, is the industry’s refrain.

If alcohol and horse racing can be allowed, why not lotteries, which can be easily regulated, is its argument. Its pitch includes the employment potential of the industry. When Tamil Nadu banned lotteries (in 2003), six lakh families lost a means of livelihood, says Sugal Jain.

In Australia, State governments get several hundred millions of dollars in revenue through lotteries, but governments have their own gaming and licensing departments which closely monitor the business, says Raj Selvendra, who runs Here’s Luck Lottery Centre, the biggest lottery operator in Western Australia.

There is no reported fraud, and there is much public trust in the system. India should adopt the Australian model, Selvendra says.

With technology, it is also possible to limit the number of ticket purchases by a person, by linking the purchases to his Aadhaar card, say industry sources.

COMMENT NOW