I propose to take Questions Nos. 22 and 53 together.
Under the next National Lottery licence, annual contributions for Good Causes will be set at 65% of Gross Gaming Revenues. Gross Gaming Revenues are defined as the level of sales less the amount deducted for prizes. The current licence does not have a specific formula in place for Good Causes - the level of contribution is the amount which remains when prizes and costs are deducted from the value of total sales.
An Post National Lottery Company recently published its Annual Report and Accounts for 2012. Total sales recorded by the Company in 2012 amounted to approximately 735m euro while the funds allocated to prizes amounted to 406m euro. Gross Gaming Revenues would therefore be equal to approximately 329m euro and 65% of that figure is around 214m euro. The actual contribution to Good Causes in 2012 was 225m euro.
However, I must stress that using this type of comparison as a guide to anticipating future revenues for Good Causes would be somewhat misleading. For example, under existing arrangements National Lottery sales have fallen and there is less money available for Good Causes. Under the next licence, a competition for which is currently taking place, the National Lottery operator will be better placed to reverse this trend and boost the level of sales of National Lottery tickets. This increase will be facilitated by the terms of both the next licence and the National Lottery Act 2013 which will offer the holder of the next licence greater flexibility for the growth and development of lottery games and distribution channels, including interactive channels. However, it is important to emphasise that this will be achieved in a responsible manner which protects the interests of National Lottery players and ensures that the long term sustainability of the National Lottery is safeguarded.
I am very confident that under the new arrangements, the level of annual returns for good causes, which include sport, culture, health of the community and the natural environment, will grow significantly from the 2012 amount of 225 million euro. More worthwhile projects being funded in more places across the country will be the outcome.
I should also point out that the successful bidder for the next licence will make an upfront payment to the State in return for a 20 year licence to operate the National Lottery. Part of this upfront payment will be used to fund the construction of the new National Children’s Hospital. In addition, some moneys which will accrue from the payment in respect of the National Lottery licence are being allocated to help fund Exchequer capital projects in 2013 and 2014.