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Government estimates the lottery, in its current form and later supplemented by a scratch card game, will raise R50bn over seven years. Of that, half will be spent on prize money, 30% will go to good causes and 20% to overheads and profit.

In the profit stakes, lottery operator Uthingo Management (Pty) Ltd is half-held by private shareholders, 30% ``industry shareholders'' (such as Tattersalls) and 20% by the State.

Given the exclusiveness of the business thanks to legislation, and regulatory powers granted to Trade & Industry Minister Alec Erwin through the Lotteries Act, its position is secure from competition.

This will be detrimental to competitors (such as scratch card operators outside of the Uthingo charmed circle), consumer choice, worthy causes that rely on competitions to raise funds and the marketing industry.

Uthingo's local shareholders hold 80% of its board seats. In the logic of ``empowerment'', the lucky ones are the:

Black Management Forum;

Disability Employment Concerns Trust;

Motswedi Technology Group;

Nafcoc Investment Holdings;

Numsa Investment Holdings; and

A women's entrepreneurship group.

Uthingo intends to apply a strong affirmative action policy within the organisation and in choosing suppliers -- who will have to achieve ``employment equity within a reasonable period'' to keep the business.

Expatriates working on the lottery will have to train their local replacements and then leave. Uthingo will also ``identify opportunities for State organisations'' to provide services. It says it aims to ``do well while doing good''. So much for the winners.

The obvious losers are:

Gaming establishments closed to give Uthingo its monopoly;

Provincial lotteries (such as the now closed Lotto KZN);

Charities that rely on gaming for income (Child Welfare loses R1, 3m it received from Ithuba and Viva! cards); and

Others who use competitions to promote either causes or products.

Thus the Direct Marketing Association and the Association of Marketers have protested against regulatory power that will allow the ending of marketing competitions by ministerial fiat.

To protect Uthingo, things like in-store promotions and customer loyalty programmes fall into legal limbo. Raffles may not charge more than R10 for participation, nor offer prizes above R2000. No company may offer a prize exceeding R100000 in a year, getting rid of things like competitions for some motor cars.

The US Congress has established a National Gambling Impact Study to look at the regulation and social effects of lotteries. But Washington's Cato Institute argues that they shouldn't fall under State regulation. Cato says the study ``should fully expose gambling to the rigours of the market, beginning with the lotteries. It is time for states to relinquish their monopolies''.

Then there is the little matter of who wins the lottery's largesse. Uthingo has, to date, not identified the beneficiaries among non-profit organisations, though these must fall within the nebulous ambits of the RDP, charities, sport and arts, and national heritage categories. And then there is a ``miscellaneous'' category.

There is clearly a danger that, without stricter definition, political favouritism could play a role in deciding who benefit. Even fashion could sway things -- thus Britain's Camelot lottery spent £ 4700 to train a lesbian circus act and gave £2bn to an organisation commemorating the millennium.

Here, says the DP's Nigel Bruce, ``there are dangers of cronyism and corruption, with only charities that are ANC favourites benefiting''.

Government said this week that one reason for not yet identifying beneficiaries was that directors-general of various State departments had not had the chance to meet and discuss the matter.

-- Paul Pereira