Cash-starved govt to start online lottery

Facing a major resource crunch and lacking the will to take the much-needed bold steps, the Shiromani Akali Dal-Bharatiya Janata Party government on Tuesday decided to start an online lottery to generate “additional revenue”.

Facing a major resource crunch and lacking the will to take the much-needed bold steps, the Shiromani Akali Dal-Bharatiya Janata Party government on Tuesday decided to start an online lottery to generate “additional revenue”.

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The cabinet, which met here on Tuesday, gave formal approval to providing “clean and transparent” lottery to people and curbing illegal activities like satta or matka. From this move, if implemented without glitches, the government expects to mop up nearly `200 crore as additional revenue per annum.

During the current tenure of the Parkash Singh Badal government, revenue growth from the lottery has been sluggish in the absence of online lottery. When the Akali-BJP combine formed the government in 2007 after dethroning the Congress, “gross profit” from lottery in 2007-08 was `162 crore and reached Rs 170 crore in the 2009-10 fiscal.

But, in the financial year 2010-11, the profit from lottery was just `6 crore as the online lottery had to be stopped after the Centre banned certain categories of the online lottery. The profit from the lottery during the last fiscal was `33 crore, according to official figures.

“The cabinet (on Tuesday) gave approval to commencing online lottery to mop up additional revenue in the state,” a government spokesperson said.

The online lottery system will be operated through public private partnership (PPP). Lottery games will be offered through a network of computer terminals across the state. The government will select a private sector partner who will act as distributor and, inter alia, design, operate and maintain this system on build, operate and own (BOO) basis.

A senior government official said the private sector partner who will be selected and appointed through competitive bidding will be entitled to hold maximum of 24 draws per day during the duration of the contract.

A tender and monitoring committee will be headed by the chief secretary with principal secretary (industries and commerce) and principal secretary (finance) as members.

Earlier, numerous moves by the Punjab government to launch online lottery system did not take off as the lottery companies had stayed away from the bidding process on the grounds that the government had imposed “tough” conditions.

The lottery operators had been demanding relaxation in conditions pertaining to licence fee and bid-processing charges.

It is learnt that the government is likely to charge `5 lakh (as non-refundable) for procuring the biding document, while a bidder could be asked to deposit `5 crore as earnest money or “the bid security”. Earlier, this amount was much higher, it is learnt.

Sources say the licence fee will be less than what it was earlier, which was `200 crore in the first year and `550 crore in the fifth year of the contract.