An Post wins a lottery extension

The Government has extended An Post's licence to run the National Lottery to allow time for the tendering process to be finalised. The Department of Finance has named the three applicants for the licence in a move to expedite the process which has been criticised for its slowness.

The Government made the decision in July to advertise and seek expressions of interest.

However, that did not allow enough time for the process to be completed by March 2000. As a result, it announced yesterday it was extending An Post's licence for a year.

The process was put out for tender in order to introduce competition and an open tender process was seen as the best method of doing this.

The Government also wanted to see what the contract to run the lottery was worth on the open market.

The applicants are: Autotote Worldwide of Ballymahon, Co Longford; Sisal and its subsidiary Rockdean, of Athlone, Co Westmeath; and the An Post National Lottery Company.

The Department of Finance owns 20 per cent of the An Post company. That allows it to withdraw money from the lottery funds held on account at the Central Bank and to make payments to the various spending departments.

The current licence expires on March 31st, 2000, and to allow an "adequate transitional and lead-in period", the Department of Finance said An Post's licence had been extended for a year.

It is estimated that it could take almost that long to develop and implement a system if one of the new companies wins the licence.

In 1998, An Post was paid a management fee, after costs, of £2.36 million (€3 million) for running the lottery.

However, in the advertisement for the tender, the Department of Finance stipulated that this amount would be less under the new contract.

An Post has held the licence since 1986. Originally the contract was scheduled to run for 10 years but this was extended in 1992.

The Department of Finance refused to comment on speculation that it was concerned that the two applicants other than the incumbent could mount a legal challenge if they lost out in the process for the new licence on the grounds that the system was set up in An Post's favour.