The Lotteries Commission spent more than $300,000 just over two years ago on a secret report which considered privatisation options and a valuation of the agency, Shadow Finance Minister Rob Lucas said today.
“Industry sources have confirmed to the Liberal Party that as recently as 2008-09 the Lotteries Commission had commissioned ABN Amro (now RBS Morgans) to undertake a scoping study of the national gambling market and options to respond to the increasing market risk,” Mr Lucas said.
“The ABN Amro report included a valuation of the Lotteries Commission which was significantly below the levels being currently speculated, and led to the Lotteries Commission Board deciding not to pursue and support privatisation options.
“The real intent and substance of the ABN Amro report was referred to briefly in deceptive terms in Lotteries Commission annual reports. The total costs were spread over two financial years (07/08 and 08/09) and referred to as an “independent strategic assessment”.
“Nowhere in the annual reports is the total cost referred to or the fact that privatisation options had been considered, including valuations of the Commission.
“Treasurer Jack Snelling confirmed in the Estimates Committee on 29 June 2011 that the Government had not received a formal recommendation to sell from the Board of the Lotteries Commission.
“All the Treasurer was able to say was the Chairman and CEO agreed the gambling market was volatile and the future value of the business was uncertain.
“Gail Gago, the Minister responsible for the Lotteries Commission, must now reveal what she knew and whether she was briefed on the secret report. It would seem hard to believe that an agency could spend more than $300,000 on a major report without the responsible Minister being briefed on its contents.
“Minister Gago’s response will be interesting as in February this year she assured the Parliament that no Lotteries Commission staff members had been involved in any discussions since the election about its potential sale. She also promised to check with the Commission to confirm her answer but of course she still hasn’t brought back an answer.
“The revelation of this secret privatisation report is a major embarrassment for the Labor Government as it was being conducted by an agency before the election at a time when the Premier was saying there would be no privatisations under his Government.
“It probably also explains why the Treasurer has had to confess that the board of the Commission had not recommended the sale of the Commission.
“Treasurer Snelling now needs to explain on what basis they have decided to proceed with the privatisation, particularly after such an expensive report obviously didn’t support the case for privatisation. Mr Snelling needs to confirm whether he commissioned any further report to justify the Government’s decision.”