13 November 2012

Nigeria: Lottery Is Used for National Development - Igho


Dr. Peter Igho is the Director-General, National Lottery Regulatory Commission. In this Interview with Ademola Bakare, Erica Ordu and Tayo Bamidele, he speaks about the commission's drive to restore integrity to the sector. He also distinguishes between lottery and gambling, saying the former is used for good causes.

What precisely is the mandate of your Commission?

The National Lottery Regulatory Commission set up by an act of National Assembly in 2005 is to regulate the business of lottery in Nigeria. It is also to ensure transparency and integrity in the business of lottery. It is to ensure and protect the interest of stakeholders. Stakeholders in this respect means those who play the lottery, those who organize the lottery, and, of course, the Trust Fund, the body that disburses the fund for good causes. We also give permit and licences for lottery; meaning, you cannot operate the business of lottery without proper permit or licence. In regulating the business of lottery, we also ensure transparency and integrity and that those who failed to comply are made to do so. These are mainly the mandate of the Lottery Commission.

If you get to Lagos, you will see several kiosks for lottery game called 'Baba Ijebu'; are they regulated by your Commission?

Yes, they are. Baba Ijebu is actually Premier Lotto, one of our licencees. They operate mostly in Lagos. Incidentally, Premier Lottery is one of the biggest contributors towards the Trust Fund. Of course, there are other licencees operating in Lagos but we have, however, started to expand the business to make lottery go beyond Lagos. For the full potential of lottery business to be realized in this country, it has to be a nationwide issue and not a one-state affair. However, if you have a national licence, it is expected of you to operate nationwide but we are working towards that to ensure that the full potential of lottery is realized, and to achieve that is not by operating in one section of the country. We are also opening up the sector and this is the more reason we have opened office in about 14 states in the country. We have offices in Sokoto, Kano, Jos, Yola, Kaduna in the North. We have in Ilorin, Ibadan, Lagos, Benin, Warri, Abakaliki, Owerri and Yenagoa. We have opened up the entire country now to all operators in the country. It is also part of our operational requirement, because many of the lottery operators do their draws around the country and the cost of sending our staff to follow them around the country is becoming a huge cost. Therefore, if you want to do a draw in Yola, we have an office there; if it is Port Harcourt we have an office there; if it is in Yenagoa we have an office there. So that way we are able to ensure that at any stage of any lottery we are there to ensure transparency and integrity. At every point we are there to see what is going on and that the right things are being done.

There is this seeming confusion among Nigerians about what the difference is between promotion and lottery.

Many times we have had to discuss with those people running one promo or the other to come and when we ask them to come and regularize many of their products, what we get is that they are promos - promos to reward our customers. But, we always tell them that if you are doing that you are not in my territory. However, they go beyond that on many occasions. Let me give you an example: if you are the manufacturer of a detergent and you said buy one detergent and get one free, this what everybody uses in marketing. This is done worldwide as a marketing strategy to reward customers. But if you fail to reward anyone who buys one and he did not get one free and somebody complains, you go to Consumer Protection Council which has the constitutional right to protect that person and report that he has been cheated, because you promised to give him one free if he buys one, and he didn't get it.

However, if you now say, buy one detergent and you stand a chance of participating in a draw that may make you win a car or something else, it has then become a game of chance where not everyone who buys will win. Somebody must regularize it; somebody must ensure that there is integrity in the draw. Because what happens is that if a million people bought the detergent expecting to stand a chance of the prize when it comes to the draw, instead of putting the one million coupon in box to be drawn, they put only ten of their brothers and sisters and they will call a big man to come and pick the three star winning tickets, leaving all the other disenfranchised. That promise is not kept. Two, where everyone stands a chance of winning either a Mercedes Benz or Peugeot 404, and when it comes to the time of giving the prize, they will say no, what we wanted to give you was Keke NAPEP and bicycle. Somebody has to check do that and it is the Lottery Commission that has been set up to do that. So when your promo goes beyond rewarding your customers and veers into a game of chance where there is an element of chance and the winner would be determined by lot, you are now into lottery and must follow the rules to ensure that it is done properly. So, this is difference between promo and lottery or promo that has lottery component. I had actually expected you to ask of what is the difference between lottery and gambling?

What then is the difference?

Lottery and gambling are both games of chance. Not everybody that participates will win, because it is a game of luck and the winner is drawn by lot. Lottery did not start today. If you check your Bible, when land was to be divided, the winner was cast by lot. But, beyond that, gambling is a game of chance and the beneficiaries are only those who organize the game and those who participated in it. It has no other benefit to the society. The organizer who runs the roulette or casino, the person who runs the casino and who comes to play 'I win my money, I lose my money' - that is gambling. But when everybody that likes to take a chance to better his lot, but rather than take to the negative element of gambling, that is self destructive, why don't you use the same game of chance to do something for charity, to raise money for charity. Where the essence of lottery is to raise money for good causes, to better people's life or raise infrastructure; that is lottery. It a game of chance used for charity or to raise money for good causes. For too long, people have confused it with gambling. In the United Kingdom, for example, the there are two different commissions: there are the gambling and the lottery regulators.

That is why we don't regulate casinos. We do not go into those ones because they are gambling. We want to stay with what would raise money for good causes. And this is why the Act is very clear. Any lottery scheme you run, 50% of it must go to those who play it. The essence of lottery is to empower people; it is poverty alleviation tool. By the same lottery Act 20% of the revenue you make, must go to the Trust Fund which will be used for good causes. This is what makes lottery acceptable. If you run the scheme, pay your prizes and keep the rest is no lottery. This is because the essence of lottery is to raise money to better the life of the people. This makes lottery not to have any problem with either religion or social. It is gambling that everybody quarrels with. It is because some people have attempted to mix it with lottery that makes some people to say my religion is against, my tribe is against it and so on. Yes, everybody's religion is against gambling but not lottery. For example, if you go to Niger Republic, the first thing they did when lottery was introduced was to ban all gambling activities. In fact, lottery has become synonymous with their national identity card. Whatever you want to do and you show your lottery ticket, you will be allowed to do a few things. It is almost like their identity card. But, most importantly and for the number of years that lottery has been run in Niger Republic, they have been able to raise a lot of money to fight desert encroachment, to provide boreholes and every year many of those who win go to Mecca for the Holy pilgrimage funded by the lottery.

A lot of people are not playing lottery because of moral question...

It's misconception; they are confusing it. That is why you in the media have to help in educating the people. This game of chance has been used for good causes, which is the big difference and the reason why the entire world plays lottery.

What are these good causes you have been talking, particularly here where NLRC is operating?

I told you that the law says 50% of every revenue must go back as prizes to those who played it. Let me go back a little before I come back to your question. Government also sees that as a tool for empowering people, reduction of poverty, etc. Before we came on board in 2009, the commission ran a lottery of which they made close to about N10 billion. They ought to have given 50% of that as prizes to the winners, which is about N5 billion. If they had done that you probably would have known somebody or somebody who knows those that have won prizes. N5 billion would have gone a long way, but instead of N5 billion, they paid only N25million. If government had followed that 50% rule, a lot of Nigerians would have been empowered. Many would have been rich enough to start their own businesses and train their children in school. In the United Kingdom, for the 14 years that lottery has run, it has raised over £22 billion for good causes. Many of us watched the last Olympics, 80% of the fund came from lottery to help the government fund the preparation of the athletes.

This is the kind of good things that the lottery does. I told you of the good causes Niger Republic use its own for. In Atlanta, in America once your child gets of age and meets certain academic criteria, the child automatically qualifies for scholarship funded from the lottery. In New York, it is education; in other parts it is sports, some of it is support for widows. In fact, different parts of the world have what they use their good causes for. Now, in Nigeria, the Act that sets up the National Lottery Regulatory Commission also set up what is called National Lottery Trust Fund. The essence of it is that 20% that comes from any lottery operation goes to the Trust Fund to be used for good causes. As you know, this is like we have just started. Before, and until 2009, there was actually nothing on the ground until we came on board, and since then we have started this education to let people know that lottery is a good thing. That lottery is good if it is done the proper way. When it is done in the proper way, the country benefits each time you play. As we speak, the Trust Fund has its own Board of Directors and they are now the people to sit down and decide what the good causes the fund should be used for. And that is what is going on right now. They are to design what in Nigeria would be our good causes. Would it be to support our sports, should it be to support education, or to provide infrastructure like in other places.

That is not my responsibility; mine is to create the environment, regulate the business and that the money being raised goes to them. A different body does that. But, I can assure you that, that body right now with government's full support is looking and ensuring that, that fund is used as we begin to grow. But as of now, it is still coming in trickles. But when it begins to build up, Nigerians and any part of the world can now point their finger to say this is what good causes money has done. And all over the world you see them. I spoke about America, where churches and schools have been built as far back 100BC when the Barbarians were attacking the China, they didn't have enough resources to run their government but they ran the lottery and fro the proceeds they built their defenses including the great wall of China, which is one of the wonders of the world. If you go to France, the Academy was built with the lottery money. So, all over the world like the British museum was built with resources from lottery. So, tomorrow we want to see in Nigeria what the lottery money has done, and it is in my interest to make sure that it is done, else my business has failed. I have an interest to ensure that while we are doing the business and growing it, my sister organization should also ensure that the money is used with integrity and transparency. I am pushing integrity and transparency in the market and when the money comes to us, we too must ensure that the money is spent with integrity and transparency, and I can assure you that the government will ensure that it is done.

Your Commission raises the money but another body manages and disburses it; is this not difficult to understand?

No. it is not difficult to understand. We create the business, run the business and we ensure that the business is done properly; that the people, who play, get their money and the government's Trust Fund gets what it supposed to get. It is a big business and running that Trust Fund is a big responsibility.

Two separate bodies?

Yes, ours is running the business of lottery; theirs is managing the fund generated. When we came in, one of the things we did to attract licencees was to do a study of the market and a modest estimate of the lottery potential in Nigeria, which is over N260 billion per annum. If that kind of money is coming in from the business, you need an organization that will truly develop it, to run that business. And the power that set up these two organizations did that with sincerity of purpose, so that one does not interfere with the other, nor obstruct the other.

Until you came on board in 2009, nobody was aware of NLRC, what magic touch did you bring to bear on the Commission?

Well, there is no magic. It is all about perseverance and passion. I do any assignment I am given with all my heart. When we came on board, like Late Chief Abiola used to say - that you cannot clap with one hand, you must do it with both hands - I cannot claim to have done it alone, but I have got a wonderful team of staff, and the government has been very supportive. Hitherto, the Commission was operating from a two-room office with no budget in spite of the existence of the Commission since 2005, but the moment the government began to realize the potential of lottery when the present crop of staff came on board, things began to change. In fact, the Commission received its first budget in 2010, and that was a year after we came in and it is from then we started pushing to let everyone understand that lottery is a good thing. And again, because of my media background, the first thing I did was to start educating Nigerians, even the government, on the importance of lottery, letting the people know that lottery is a good thing and it has done well for other parts of the world, and Nigeria cannot be an exception.

Also, many of the lottery operators are giving lottery a bad name and that is why many people termed lottery 419 or gambling, because nobody was gaining anything from it and people who played were being ripped off. So we need to address that by educating Nigerians on the goodness of lottery, educate many of the operators themselves that they can be more successful if they are honest and transparent; because if 10,000 Nigerians participated and won in a lottery scheme and you keep your promise to them, all of them will go round to tell people that these people are honest, and the next time you run a lottery, millions of Nigerians will rush to participate. So, we have started to educate many of the operators that you cannot run a lottery without permit or licence and you must obey the rules setting up the Act. This is what we started since 2009 and I have used all my links with my family in the media to support, by joining me to do this. And in fact, the media have really tried. They were asking questions and even said that they were ignorant that all we said were possible. I have visited all the major media houses in Lagos, Kaduna and many others including television and radio stations. The education really helped. Even the government was surprised when we told them about the potential, and that it could make a difference. And that was when we were put in the budget for the first time in 2010. Before now lottery licence was N10 million and nobody was interested, but when we went after those who were operating illegally and coming hard on them, showing integrity and standing by those who complied, sanity came into the business. With the lottery potential study I told you we carried out, a lot of foreign investors are now coming to Nigeria. In the last six months we have received visitors from the biggest operator of lottery in Russia, Netherlands, Israel and South Africa. Everybody wants to come, and what is driving them is one: lottery is a game of numbers and the population of Nigeria is big. United Kingdom that is just over 70million has about 75% of the population play lottery.

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