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National Executives of LMCs disassociate from Ashanti Region Press Conference

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Written by  Published in politics Thursday, 07 September 2017 11:12

The National Executives of the Association of Lotto Marketing Companies (LMCs) on Monday disassociated its self from the press conference held in Kumasi in the Ashanti Region by a group of disgruntled individuals who purported to be members of Association.

 

“We want to state on very clear and equivocal terms that the contents of the press statement of the group aforementioned on the 31st day of August, 2017 are baseless, unfounded and above all unwarranted.

“We condemn not only their action but the contents of their purported press statement.”

At a press conference in Accra, Mr. Kofi Frimpong, General Secretary of the LMCs said there was no doubt whatsoever that the National Lottery Authority (NLA) was generating revenue for national development through its operations.

This he said is evidenced by the contributions the NLA was making to the Consolidated Fund over the years and maintaining direct and indirect workforce of over ten thousand Ghanaians.

Mr Frimpong said, it was instructive to mention that a sizeable share of about 60-70 per cent of the lotto market have been taken over by the private lotto operators known as Banker-to-Banker who ply their trade outside the legal framework of the National Lotto Act, (Act 722).

He said the substantive Director-General of the NLA, Mr Kofi Osei-Ameyaw who was appointed by the President Nana Addo Dankwa Akufo - Addo, in March, 2017 articulated his vision and shared same with Stakeholder in the lotto industry.

“He laid bare his strategic initiatives to expand the revenue base of the lottery and most importantly to create jobs and from March 2017 to date, the NLA has made a sale of GHC 205,047,991.65 and made an amount of GHc41,009,598.33 representing 20 per cent of the total sales to retailers as commissions.”

Mr. Frimpong said prior to the appointment of Mr. Osei-Ameyaw, the Authority had serious challenges in paying Retailers Commission even though the LMCs had these monies paid up-front.

“LMCs are entitled to 20 per cent of sales made and the Authority had to finance the payment of Retailes Commissions through bank overdraft which attracted high interest rates.”

He said the Authority paid about GHC 66,000 per month by way of interest on Bank over draft which translates to GHc792,000 per annum.

The General Secretary said through prudent financial engineering, the new Administration has liquidated all banks overdrafts and interests thereof and has saved the Authority from paying GHc396,000 it would have paid over six months.

“It is intriguing to note that all LMCs Retailers Commissions which was paid between 20–30 days in arrears by the previous administration is now paid in a fashionable time by the 2nd or 3rd day after the month in which it is due and this is unprecedented.

 “We the LMCs are very happy and grateful to the Director General for this new arrangement.”

He said the Director–General’s initiative to roll out about 30,000 e-kiosks and Point of Sales Terminal (POST) throughout the country to enable LMCs to perform additional value added services on the POST was amazing.

“The e-kiosk will be fitted with solar panels and will be compatible with other businesses such as bank transactions, collection of electricity and water tariffs, mobile money transfer for both local and international, payment of university academic user fees and collection of property rates for the Metropolitan, Municipal, District Assemblies.”

This, he said is aimed at rebranding the sale outlet and will benefit the LMCs since they would realize additional income from the new portfolio.

“It is unfortunate that, certain individuals or group of individuals who are bent on pursuing their narrow parochial interest at the expense of the NLA are engaging in an unorthodox method to thwart this laudable mission are using just a few of our uniformed members to outrageously destroy the good intentions of the NLA spearheaded by Mr. Osei-Ameyaw.

Mr. Frimpong said, for some time, the NLA was periodically recording lotto prize wins in excess of sales made by the Authority as high as 100 to about 400 per cent in certain instances, a situation which was unacceptable and in a Fixed Odds Game such as the 5/90 Games.

This, he said the Director–General in June 2017 pursued a policy to secure (both hard and electronic) copies of all Lotto Sales Data from the Technical Service Providers before the Lotto Draw for the day was effected to reverse the trend and this has brought lotto prize winning ratio to the internationally acceptable standard rates between 40-50 per cent.

He said the implementation of these initiatives by the NLA present administration has obviously incurred the displeasure of certain individuals or group of persons who feel threatened.

     Mr. Frimpong said the Retail Lotto Commission Rates payable to LMCs in 2010 was 25 and reduce to 20 per cent by the then NLA board to the disappointment of the LMCs and the explanation was that some entities was contracted to provide an online lottery application to enhance the LMCs business, hence the need to share cost.

     He said this issue has been a bone of contention between LMCs and management to date for which the current administration was taking steps to reverse the trend by restoring back 25 per cent.

     “The NDC government in 2015 increased the withholding tax on lotto commission from 5 to 7.5 per cent and also slapped a 5 per cent tax on lotto winners that were above GHC20, 000.”

     The General Secretary added that this policy adversely affected the NLA business as some LMCs resorted to the selling of Banker-to-Banker for higher Retailer Commission Rate of 30-35 per cent whose prize winning were not subject to tax.

     He said: “players of the game break bulk and buy products in smaller denominations as tax avoidance scheme thereby defeating the import of the tax.”

     “The situation in which the NLA finds itself has led to a seeming boycott of its products by the lotto players and people who are doing illegal business by pirating the NLA are allowed to thrive on the NLA’S goodwill and popularity with impunity, and also using it as a parasitic paradise, whilst LMCs and the operations of the NLA is being seriously undermined by a state policy.”

     Mr. Frimpong said the policy was clearly undermining the operation of the NLA and ought to be reversed, adding that, “the Director–General has assured LMCs at different meetings that he is in discussions with the Ministry of Finance to have the present tax regime reversed”.

     He said Banker-to–Banker has been an albatross hanging on the neck of the NLA and that several attempts made by the past managements of the Authority including police raids to eliminate operators have not been successful.

     “In our view, the only option worth considering now is to find a way to control Banker-to-Banker operators which is to bring them on board, register, license regularize their operations to pay taxes.

     “We fully endorse the decision of the NLA to license Banker-to-Banker operators and all private lotto operators who are operating outside the legal framework of ACT 722.”

     Mr. Frimpong said “the good intentions of the Director-General and his management team have been misconstrued by a few group of individuals and believe that those of our members who held a press conference on Thursday 31st August 2017 in the Ashanti Region without recourse to the National Executives of our Association were clearly misinformed and are being used by a group of people to prosecute their parochial agenda”.

     “We want to place on record that the Director General and his management team has the full and unadulterated support of National Executive Committee of LMCs and majority members of the Association in its pursuits.”

     He urged the NLA to secure its own platform which is independent of the services provided by LOTs and SIMNET and called on government to investigate the circumstances surrounding the payment of Lotto Retailers Commissions with Bank Overdraft and interest and the supply of Thermal Paper Rolls by the then NLA board

 

 

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