Letter: Profits and lotteries

Sir: Peter Kilfoyle's letter (16 February) about Richard Branson's bid returning the profit element from the National Lottery to the good causes overlooks the fundamental flaws of Oflot's decisions. There is no need for Mr Branson, or any other consortium, to make large profits. The most efficient and successful lotteries in the world pay off their start-up costs immediately, so that they need neither long-term loans from banks nor equity capital.

Profit motivation to increase sales comes when the agents receive more funds by selling more tickets. Only one other person needs such a motive - the director of operations, of whom several outstanding examples are already in this country. In Sweden, he receives pounds 75,000 a year. In Hessen, Germany, the perks which the director has received beyond his pounds 106,000 salary have caused such a scandal that his bosses have been replaced. So pounds 200,000, with a bonus for extra sales, ought to be more than sufficient for the director of operations here, by international standards.

The administration costs of the commercial lottery in Victoria, Australia, are only 4 per cent of the turnover, not the 15 per cent envisaged in Britain. Moreover, Oflot's duty under the Act to maximise the funds to the good causes cannot be achieved here while rollovers are limited to three times, or while unclaimed prizes are not returned to the prize pool.

It is high time the Government revised its plans to create the best lottery in the world in a more thoroughly informed way.

DENIS VAUGHAN

Director, Lottery Promotion

Company Limited

London, WC2