The 10-year contract for the operation of the prize bonds scheme has been awarded to the Prize Bond Company, the joint venture between An Post and Fexco.
The National Treasury Management Agency (NTMA) announced yesterday that the award for the contract, advertised last March, had been made following the evaluation of three tenders.
The Prize Bond Company has operated the scheme for the past 10 years, since it was set up to tender for the contract from the Department of Finance in 1989. Prior to that the scheme was administered by Bank of Ireland since its inception in 1957. The scheme's administration is carried out from Fexco's headquarters in Killorglin, Co Kerry, by about 30 employees.
Prize bonds are Government securities which, instead of paying interest, entitle holders to participate in weekly draws for cash prizes. About 39.5 million bonds are held by investors, representing £198 million (#251 million). The new contract will come into effect from November 1st. Last year, £5.6 million was distributed to 33,000 winners. Net sales amounted to £25 million last year, compared to £9.4 million in 1997. Although the NTMA did not state how much the contract was worth, a spokesman said that fees and expenses for the scheme amounted to £2.86 million in 1998.
