Govt needs more than luck with new lottery plan

Govt needs more than luck with new lottery plan

A vendor sells government lottery tickets in Khon Kaen. (Photo by Patipat Janthong)
A vendor sells government lottery tickets in Khon Kaen. (Photo by Patipat Janthong)

The idea of having the Government Lottery Office (GLO) run a two- and three-digit lottery scheme is taking shape once again.

Previously, the Thaksin Shinawatra government did this between 2003 and 2006, based on the idea that that if the government could not crack down on the "underground" two- and three-digit lotto, it should just run a legal scheme to compete with it.

This week, the GLO revealed that it has appointed a panel to study suitable lottery variations that could be introduced, including two- and three-digit tickets.

Underground lottery draws have mushroomed in value to about 500 billion baht -- up from 100 billion baht just 10 years ago, according to Thanawat Polvichai, a GLO member.

Prior to going ahead with the new lottery scheme, the government must ensure that it has the answers to these questions: How will the state tackle the underground lottery business? How can it ensure that people will not get addicted to this form of gambling? How will the revenue generated from the scheme be used?

When it ran the two- and three-digit lottery, the Thaksin government failed to eliminate underground lottery draws. But it did help expose the large scale and value of illegal lottery operations. The government scheme at that time generated about 123 billion baht in revenue. That must mean that the overall value of the entire underground business is much higher.

Today, the underground lottery remains a thriving business. The huge revenue that it generates implies that it is not an industry that can be easily eliminated, partly because government officials, especially police officers, benefit from it.

Without clear directives from the government, tackling this underground business will never be possible.

Therefore, the GLO's new proposal needs to set clear objectives -- whether it aims to compete for market share in order to reduce the volume of the underground lottery, or whether it targets to mainly generate more revenue for the GLO. At present, the law governing the GLO gives it flexibility in designing new lottery variations including two- and three-digit tickets.

Whatever the goal is, running the state lottery scheme will not help tackle the underground industry which has been gaining in popularity with authorities turning a blind eye to it.

For one thing, the government scheme's lottery prizes will not be as handsome as those offered by the underground business because the latter sets no ceiling on the purchase amount of each person.

Even though the GLO's scheme will be more reliable because winners will be guaranteed that they will definitely receive the payouts, it will likely set the limit for wining prizes based on the percentage of its total ticket sale value.

The GLO experienced a bitter lesson during its implementation of the two- and three-digit lottery scheme under the Thaksin government. During that time, GLO executives had to pray for help from holy spirits not to let the numbers picked most by buyers become the winning ones, otherwise the GLO could have ended up bankrupt.

Moreover, the GLO will have to set clear directions on how revenue generated from the new scheme will be used and for what purposes.

There is a lesson to be learnt from the previous scheme. On June 6, the Supreme Court's Criminal Division for Holders of Political Positions ruled that Thaksin was guilty of launching the scheme which was found to have violated relevant laws. He was given a two-year jail term for dereliction of duty under Section 157 of the Criminal Code. The court found him guilty of not complying with the GLO's objectives and not amending the law prior to coming up with the project. Additionally, the court ruled that a hundred billion baht generated by the scheme was not transferred to state coffers, while there was no evidence as to how it had been spent by the government.

Therefore, if the Prayut Chan-o-cha government wants to run a new scheme, it must set clear directives on the state's revenue expenditure and how to monitor and evaluate the spending. The government should explicitly state the purpose for each line of expenditure in order to facilitate the monitoring and evaluation process. Additionally, reports must be produced and made available to the public about the use of the revenues.

By launching a new lottery scheme, it will be hard for the state to contain people's gambling habits. This is because gambling is common in Thai society. Many forms of it can be found at social occasions including funerals.

Therefore, if the government cannot stop people from getting deeply involved in gambling, it must find ways to encourage them to moderate their behaviour. For example, it should discourage advertisements or news reports that promote public interest in two- and three-digit lottery buying. There have been many media reports about "lucky numbers" drawn from unnatural happenings or even from the number plate of a prime minister's car. The state must play hardball against those who lure people into believing that it can provide lucky numbers because it is not true.

It has been proved that the chances of winning the lottery are slim -- at 1% to win the government's two-digit lottery and 0.0001% to win the first prize.

The government must come up with answers for those questions prior to going ahead with a new two- and three-digit lottery scheme. This is because most of the money generated will come from low-income people who always hope that one day they will win a prize, but their lucky day never arrives.

Wichit Chantanusornsiri is a senior economics reporter, Bangkok Post.

Wichit Chantanusornsiri

Senior economics reporter

Wichit Chantanusornsiri is a senior economics reporter, Bangkok Post.

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