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REPOSITIONING THE NIGERIAN LOTTERY INDUSTRY FOR NATIONAL DEVELOPMENT, BY DR.

TAYO
ADULOJU, DIRECTOR, INSTITUTE OF WORKFORCE DEVELOPMENT
WORKFORCE GROUP

REPOSITIONING THE NIGERIAN


LOTTERY INDUSTRY FOR NATIONAL
DEVELOPMENT
The Distinguished Senators Present,
The Permanent Secretary, Federal Ministry of Special Duties and
Intergovernmental Affairs,
The Director General, National Lottery Regulatory Commission,
The Director General, Nigerian Information Technology Development
Agency,
The Executive-Vice Chairman Nigerian Communications Commission,
The Executive Chairman, Economic and Financial Crimes Commission
Distinguished Chief Executives and Captains of Industry,
Directors of the Federal Ministry of Special Duties and Intergovernmental
Affairs,
Directors of National Lottery Regulatory Commission,
LADIES AND GENTLEMEN,
1. It is an honour and privilege to join the Permanent Secretary, Special
Duties, the Director General, Management and Staff National Lottery
Regulatory Commission, and other Executives of State Lottery
Authorities and Captains of the Lottery Industry, at this 10th Year
Anniversary of the NLRC. The Workforce Group considers itself to be a
friend and partner of the NLRC and we celebrate you on this
anniversary celebration. Happy Anniversary!
2. Our gathering at this great conference offers the industry a unique
opportunity to assess the past, take critical stock of the present and
envisage the future of the industry.

3. WARNING: THE KIND OF FIGURES I WILL CALL IN THIS ROOM TODAY


WILL SOUND AS IF WE ARE OIL AND GAS. IT IS NOT A SCAM! THE FACT
IS THAT THE LOTTERY INDUSTRY IS ONE OF THE RETAIL GROUP INDUSTRIES
THAT HAS HUGE CAPACITY FOR UPTAKE 40 60 MILLION CONSUMERS
MARKET POTENTIAL ;
4. While our time here is limited to effectively do justice to the subject
that has been outlined in todays programme, these types of
gatherings allow us to achieve three things:
a. Generate the Critical Issues;
b. Mobilize the Stakeholders to engage on the Critical Issues; and
c. Set a Strategic Agenda Framework for dealing with the Critical
Issues going forward
5. The particular subject of my discourse this morning is REPOSITIONING
THE NIGERIAN LOTTERY INDUSTRY FOR NATIONAL DEVELOPMENT.
6. I would like to define what constitutes the lottery Industry from a
Stakeholder point of view:
a. Policy and Political Stakeholders;
b. The Lottery Regulator and Authorities;
c. The Lottery Operators; and
d. The Lottery Consumer.
To change the position of the Industry from where it is today to where
it can be, will require the cooperation of all the Industry Stakeholders.
7. Repositioning the Lottery Industry that drives National Development,
must be discussed in tangible terms: We must discuss Wealth Creation
through the Business of Lottery, Job Creation and Development, Skills
Market Development, Sports Development, Education Development
and Social Infrastructure
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a. Wealth Creation: The Core Lottery Value Chain in largely


unmapped because it is a sector that is interlinked with other
key sectors of the economy. In fact, some sectors of the
economy may not grow without given credence to the lottery
value chain activities. We might want to consider the business
revenue that accrues from the different types of Lottery and
Gaming activities specifically linked to a sector:
i. The USA and Asia lead the world in Entertainment Lottery
and Gaming;
ii. The USA leads the world in Immigration Lottery;
iii. South Africa leads the Continent in Combat Sports
Betting;
iv. USA leads the world in online lottery and gaming.
b. To grow we must support the Operators at five levels and
Captains of the Lottery Industry must take leadership in:
i. Investing in the Lottery Research and Development,
Technology Innovation and Capabilities there are still
several lottery formats and models that better serve our
demographics that are not being explored;
ii. World Class Lottery Operations
iii. Excellent Service Delivery and Consumer Experience
iv. Robust Lottery Downstream Experience Leveraging
Agency

Networks

to

create

sales

and

marketing

opportunities

c. Job Creation and Development: the current Unemployment


rate in the first quarter of 2015 is 23.9% increased from the 2014
fourth quarter figure of 24.2%. Increased National Lottery IGR
can

go

to

specifically

funding

employability

and

entrepreneurship development programmes. Other than the


jobs and employment opportunities that national agency
network of lottery operations creates. Lottery IGR has been
used on countries around the world to create entrepreneurship
opportunities. For example, some of the Asian Countries have
leveraged Lottery IGR to endow revolving Microfinance and
Micro-insurance funds that create and support small business,
which provides the resources to meet the promises of the
Presidents Administration to accelerate Job Creation;
d. Lottery Revenue can be directed to Skills Market Development:
lack of market responsive technical skills across the country is
another critical gap. National Lottery IGR has been used widely
in Europe for re-skilling and recertification of artisans to
upgrade their skills to respond to Global Market demands. This
is something that is desperately required in Nigeria, to
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significantly reduce Capital flight, thus, supporting the Agenda


of President Buharis Administration;

Lottery Revenue Can be directed to Sports Development: The United


States, the United Kingdom, China, Brazil, Russia and South Africa
National Lottery IGR have provide a viable source of funding of
National Sports Development that has been critical to these nations
performance at the Olympics and other Global Sporting events;

Lottery Revenue Can be directed to Education Development:


National Lottery has provided funding for free lunch for primary
school children and supporting free education and education
infrastructure development in many parts of Nigeria;

Social Infrastructure: Other than Education and Sports, National


Lottery IGR provides critical funding of other Social Infrastructure
imperatives in Health, Child Development, Women Development and
Cultural/Heritage Development.

THE CRITICAL IMPERATIVE FOR REPOSITIONING THE LOTTERY INDUSTRY


NLRC HAS SCRATCHED THE SURFACE OF ITS REAL POTENTIAL
8. Nigeria joined League of Nations with National Lottery Commissions in
2005, with the passage of the National Lottery Act 2005. However due
to the lack of a take off grant, strong political will and absence of a
strategic framework, the Institutions created by the Act did not build
Self-Accounting Institutions until the 2009.
9. Struggling with lack of investment in National Lottery Critical
Infrastructure, Systems, Capabilities and Capacities, the National
Lottery Regulatory Commission has not yet been able to fully optimise
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the opportunities for Revenue Generation Potential and the Impact


Potential of Reinvestment Revenues towards Good Causes in the
Socio-economic Development of the Nation.
10. We must congratulate and celebrate the DG and Management of
NLRC for what they have achieved with almost meagre resources
compared to their counterparts on the Continent and around the
world. We thank you for your Public Service.
THE POTENTIAL OF THE LOTTERY INDUSTRY AS A BUSINESS AND AS A KEY
ECONOMIC GROWTH CONTRIBUTION IS WELL ESTABLISHED
A

PROPERLY

POSITIONED

LOTTERY

INDUSTRY

SHOULD

CONTRIBUTE

SIGNIFICANTLY TO NATIONAL IGR


11. The Global Gaming and Lottery Industry has become a multi-billion
dollars (US) Industry contributing significantly to the Internationally
Generated Revenues of many countries around the world.
A PROPERLY POSITIONED NATIONAL LOTTERY INDUSTRY SHOULD CONTRIBUTE
SIGNIFICANTLY TO SOCIAL IMPACT
12. Furthermore, National Lotteries have become powerful and effective
vehicles of the setting up and endowment of the Lottery Trust Funds
that have been deployed for Good Cause.
13. Many

National

Administration,

Good

Causes

Education

have

included

Development,

Youth

State

Welfare

Development,

Women Development, Sports Development, etc. The effective


funding of these Good Causes across a vast range of National public
causes has made IGR from Gaming and Lottery a viable alternative
source of Federal and State Revenue. At a time when traditional
sources of Government Revenue are dwindling, a viable non-hostile
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stream of revenue that is viewed as fun, while inspiring citizens


support of good causes is the Gaming and Lottery Revenue Stream.
14. The fundamental Principle of National Lotteries is that every time
people play, the Nation must win. At the heart of the Operations of
National Lotteries Globally therefore, is the National Lottery Trust Fund,
where the IGR goes into.
15. To the degree the National Lottery Trust Funds are deployed for the
advancement of national and public common good causes, to that
same degree all citizens maybe mobilized to participate by spending
a small amount of their disposable income in the National Lottery,
triggering a formidable economic model for auxiliary revenue
sourcing for the country.
16. The most successful National Lotteries in the world is that of the United
States and United Kingdom.
a. In a decades date under review, the UK National Lottery
allowed the UK Government to save over 34 Million a week on
National Lottery Projects.
b. This culminated into a whopping 33 Billion spread across
450,000 projects, averaging 144 for every UK postcode district
(or we could say Local Government!).
c. As earlier noted the key to expanding National Lottery IGR is
the credible and effective use of the National Lottery Trust
Fund. The effectiveness by which government makes decision
on how and where lottery IGR is invested must show good
causes.
d. While Nigeria has far greater potential for Lottery Revenue, the
National Lottery Regulatory Commission has been inhibited by
the Lack of a Takeoff Grant and Sufficient Funding for National

Lottery

Regulatory

Administration

and

Operational

Effectiveness.
17. Between 2009 and 2014 the Lottery Industry brought in N4.6 Billion
and no significant re-investment has been made in the NLRC to
expand and grow its Capacity and Capabilities to deliver results.
STATE LOTTERIES
18. States in the U.S. operate some kind of lottery, generating an
astounding $29 Billion, according to one of the leading US Gaming
Almanac, Casino Citys North American Gaming Almanac. However
research has shown that these leading Lottery Boards in these States
have invested between $20 $70Million in Lottery Regulatory
Platforms, Technologies and Capabilities and many of the Boards
were set up with a Take Off Grant of between $25Million - $100Million.
19. THE FEDERAL AND STATE GOVERNMENTS MUST INVEST IN LOTTERY
REGULATORY INFRASTRUCTURE AND CAPABILITIES;
a. The Ghanaian National Lottery Authority was established under
Act 722 (2006) and its supportive Legislative Instrument LI 1948
(Lotto Regulations 2008) to Regulate, Supervise, Conduct,
Manage and provide assistance to issues related to National
Lotto in Ghana. Originally established as the Department of
National Lotteries in 1958 with a Mandate to organize raffles for
the public to have fun and win prizes. In 1960, the Lotto and
Betting Act 94 was passed into law to start lottery in Ghana with
the aim of raising revenue to support the development of the
country.
b. Modern Automated National Lottery Platform begun in 2006. In
2006, the NLA introduced the automation machines that
generate the lottery tickets upon purchase. The system works
via GPRS (online). The acceptance of the automation
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machines took a while for both the retailers and lotto stakers in
the first phase of implementation. The National Lottery Authority
received a significant Government investment Automation of
its Systems and Platform. Four years after the development of
the automation machines and platform, Ghana raked in the
highest revenue ever in its history as a result of the ongoing
Portable Automated Data Process Machine (PADPM) project
when the NLA sold up to GH5.5 million in a record week.
c. Such a significant IGR from National Lotteries is characteristic of
the global impact of Lottery IGRs. It is estimated that Global
National Lottery IGR may be as high as $250 Billion making (this
is discounting several Sub- national Lottery IGRs around the
world). This makes National Lottery IGR a formidable and
significant source of funding for several of the National Good
Causes and places imperatives for strategic review for a
country like the Federal Republic of Nigeria, considering the
fact that in 2014 Global FDI flows stood at $618.62bn.

20.

REPOSITIONING FOR GREATER REVENUE GENERATION


a. The current national economic crisis requires that the Federal
Government of Nigeria explores and leverages all the potential
and viable sources of IGR to boost National Revenue and the
National Lottery Regulation Commission is uniquely positioned
to lead the exponential grow of National Lottery IGR in Nigeria,
if backed by political will and significant restructuring of the
National

Lottery

Regulatory

and

Fund

Management

Framework. There are several aspects of the Nigerian State that


could significantly benefit from effective administration of an
increased, more transparent and effectively focused National
Lottery Trust Fund

b. Between 2009 and 2014, the Nigerian Government generated N4.6


Billion in National Lottery IGR. Indicating that the Lottery Industry in
Nigeria has a potential of at least half a Trillion Naira in 5 years. This figure
however, does not reflect the true size of National Lottery IGR of the
Federal Republic of Nigeria.
c. The 2015 Mckinsey & Co. Report, Nigerias Renewal: Delivering Inclusive
Growth in Africas Largest Economy, on the rebasing of the Nigerian
economy indicates that not only are we the largest economy in Africa
with GDP Size of $510 Billion, almost 40 Million Nigerians are in consumingclass households (that is households with income of more than $7500).
d. These indicators provide National Lottery IGR a unique opportunity if
effectively leveraged based on Global National Lottery Best Practices.
The IGR Imperative of the National Lottery Regulatory Commission for the
Future will demand on leveraging the National Lottery IGR (hereinafter
called NLIGR) from the 40 Million Nigerians living in consumer-class
households and channel that IGR Volume to National Good Causes that
has the potential over the next 30 years to move 120 Million Nigerians
above the Empowerment Line and move 70 Million out of poverty! This
new imperative is a task that can and must be done.
e. We estimate that if NLRC drives a National Lottery that leverages up to
40 Million Nigerians weekly, at just N200 per week. The National Lottery
Sector will generate an estimated N38.4 Trillion per annum.

21. THE LOTTERY INDUSTRY IN NIGERIA MUST LEAPFROG INTO THE DIGITAL
AGE
a. The

Convergence

of

Media,

Information

Technology,

Telecommunications and Entertainment has created a New


Digital World Order with huge implications for Lottery and
Gaming Industry;
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b. In the next decade 90% of all Lottery and Gaming will be


Digital. The entire lottery industry will be terra-formed by
Digitization;
c. A repositioned Lottery Industry is expected to experience
significant

investment

in

digital

infrastructure,

stronger

partnerships between lottery and gaming companies and the


telecommunication operators;
d. Digitization

will

Opportunities,

expand

which

will

Universal
challenge

Access
the

to

Lottery

monitoring

of

boundaries of regulation and compliance, including cross


boarder and international lotteries and gaming campaigns not
within the current mapped areas of oversight ;
e. We anticipate increasing complexity in the revenue stream
mixtures between the lottery industry and ICT, media and
entertainment;
f. We anticipate the potential for greater lottery and gaming
cyber crimes and the need for a more strategic cooperation
framework between key sector regulators, NLRC and lottery
boards
22. I WOULD LIKE TO THEREFORE CALL ON OUR STAKEHOLDERS TO
CONSIDER THE IMPLICATIONS OF THE ECONOMIC OPPORTUNITY
BEFORE US AND DO ALL THAT IS WITHIN OUR POWER TO UNLEASH THE
LOTTERY INDUSTRYS POTENTIAL
a. To our Policy and Political Stakeholders
a. We ask for greater funding of the regulators and
authorities;

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b. Support the passage of legal instruments to ensure


greater industry compliance and synergy between
Federal and State authorities;
c. Fund

the

development

of

Robust

lottery

industry

monitoring capabilities;
d. Provide the political will, support and leadership in the
transparent and accountable monitoring of trust funds
impact in terms of good causes;
b. To the Lottery Regulator and Authorities;
a. Institutional Reforms to make the regulator and board for
business like is essential (lottery is a business);
b. Deepen the Core Competencies and Technological
Capabilities

required for Lottery Industry regulation,

compliance monitoring and enforcement;


c. Authorities need to see themselves as Industry and
Market Developers:
i. Improving the Operating Environment;
ii. Improvement

of

the

Corporate

Governance

Framework of Operators;
iii. Improvement of Enterprise Risk Framework of
Operators;
iv. Creating Regulations that expand access;
v. Creating opportunities through institutional and
industry linkages.
c. The Lottery Operators:
i. Create Sustainable Business Structures and Models;
ii. Improving

Consumer

Experience

through

Innovative Products and Services;


iii. Improve

Corporate

Governance,

Business

Transparency and Accountability;


iv. Develop the Capacity of the core Lottery Business
and the Agency Networks;
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d. The Lottery Consumer


i. Credible, Transparent and Fair Lotteries
ii. Consumer Rights Protection
iii. Consumer Rights Abuse Redress and Remediation.
As you match forward to reposition the Nigerian Lottery Industry, we
assure you of our support and commitment to continue to add
tangible value in building enduring institutions and businesses of
excellence.
ONCE AGAIN HAPPY TENTH ANNIVERSARY TO NATIONAL LOTTERY
REGULATORY COMMISSION AND WE WISH YOU ANOTHER DECADE OF
INDUSTRY GROWTH, SOCIAL IMPACT AND SIGNIFICANT CONTRIBUTION
TO THE FEDERAL REPUBLIC OF NIGERIA.
Thank you ladies and gentlemen.
DR TAYO ADULOJU

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