Thursday, 7 December 1995
Seanad Éireann Debate
Mr. Sherlock: Thank you for letting me raise this very important matter, a Chathaoirligh. I also thank the Minister for coming to take this debate. In raising this matter on the Adjournment, I am asking the Minister for Justice to consider whether or not the criteria are adequate for the granting of a licence under the Gaming and Lotteries Act, 1956, in view of disclosures made at Mallow District Court on Wednesday, 29 November 1995, when North Cork Community Radio was granted a renewal licence to run a weekly radio lottery on the application of Mr. Jack O'Rourke.
This licence was granted despite the objections of Superintendant Frank McDermot who told the court that, contrary to legal requirements, North Cork Community Radio had consistently failed to submit required reports to him under previous licences. The Superintendent told the court that Monsignor Denis O'Callaghan had given an undertaking in the early 1990s at a special sitting of Kanturk District Court that all necessary returns would be made to the Garda.
Mr. Sherlock: Tá go maith. Despite this, no returns had been made. It was further contended in court that North Cork Community Radio had also breached the terms of its licence by paying an undisclosed sum of money to a private company, County Sound Radio Ltd., and that this had continued up to two months prior to the application for the renewal of the licence.
The applicant told the court that up to the previous evening he had not realised that North Cork Community Radio had not been complying with certain requirements of the licence over the pevious four years. He confirmed that NCCR were obliged to pay a sum to Radio County Sound Ltd. It later emerged that the amount involved had been as high as £7,000 per month, although I understand and have good reason to believe that charities which were supposed to benefit from the lottery got something in the region of £100 per month. Mallow General Hospital was used widely in literature promoting an NCCR draw two years ago, yet to my knowedge, no contribution of any significance was made to the hospital. Judge John Clifford, who granted the licence despite the objections of the Garda, said “That is the way the law is — returns can be fudged”.
At the annual general meeting of NCCR, held recently, a shareholder told the meeting that he had received correspondence alleging that two people in west Cork had received £98,000 for running the lottery draw. The chairman said NCCR had made great money from the draw and that it was a good business decision to run it. NCCR currently holds a 9.7 per cent shareholding in Radio County Sound, Ltd., which has a licence to broadcast in north Cork, west Cork and Cork city. There is currently a proposal for a management buy-out at County Sound.
This case raises a number of important issues which need to be addressed by the Minister. Is she satisfied that lottery draws are being genuinely used for charitable purposes and not as some sort of a hidden subsidy for  private business? Most people subscribing to these lotteries believe that they are assisting deserving causes and would be angry if they knew their money was being largely used to benefit private businesses.
In view of the disclosures in court, is the Minister satisfied that there are adequate arrangements for ensuring that recipients of licences comply with the law? What levels of supervision are in place? Have the Garda adequate powers? It seems extraordinary that legal requirements could be ignored in the way indicated in the court and that the applicant could simply say that he was unaware of legal obligations. Is the Minister satisfied that a District Judge can overrule the objections of the Garda and renew a licence, particularly where gardaí have given evidence that legal requirements had been totally ignored? On the basis of what emerged in Mallow District Court in this case there is a strong argument for a complete review of procedures by the Minister.
Minister of State at the Department of Health (Mr. O'Shea): I thank Senator Sherlock for giving me an opportunity to speak to the House and to inform it about the situation relating to the criteria for the granting of lottery licences. I am replying on behalf of the Minister for Justice, Deputy Owen, who apologises that she could not be here today as she is attending to other urgent business.
The Minister is aware of the case which has led the Senator to raise this issue. She has obtained a report from the Garda about this particular case and I know the matter is being looked at closely. I acknowledge that this is a matter of concern to Senator Sherlock, particularly as the case in question occurred in his home town.
Let me say at the outset that the role of the Minister for Justice is in relation to the regulation of the particular type of lotteries which have been operated for many years. The Minister has no role in regard to the national lottery and the Adjournment Matter debated here  today is not concerned in any way with the selling of tickets for the national lottery or national lottery scratch cards. The primary legislation governing local lotteries is contained in the Gaming and Lotteries Act, 1956. Under section 28 of that Act, the District Court is the authority empowered to grant a licence for the promotion of a periodical lottery. A periodical lottery is one which is conducted over a continuing period, generally at intervals of one week. The procedural requirements are set out in the Periodical Lottery Regulations, 1961.
In the particular case referred to by the Senator, the District Court granted a licence on condition that all of the existing regulations will be adhered to in future and it is understood that the applicant has given a commitment that this will happen.
In making a decision on any case, the courts are subject only to the Constitution and the law and they are, therefore, independent in the exercise of their functions. It is not open to the Minister to comment or to intervene in any way in the conduct or outcome of any particular court case, whether it is a criminal case or any one of the various types of licensing applications which come before the courts.
However, the Minister is aware that during the court hearing concerning this case, various factors were commented on and the District Court judge, having taken all the factors of the case into account, decided to grant the application for the periodical lottery licence. The Senator will appreciate that the granting of lottery licences in individual cases is solely a matter for the court and the Minister for Justice is not empowered by the legislation to interfere in any way.
In raising this topic, Senator Sherlock asked if the Minister is satisfied with the criteria that apply to the granting of lottery licences. The House will be aware there is a commitment in the Government policy agreement to reform the law relating to the administration and regulation of charities along the lines of  the report of the committee on fund raising activities for charitable and other purposes. The report, known as the Costello report, includes recommendations relating to the law on lottery licences.
The committee, under the chairmanship of His Honour, Judge Declan Costello, concluded that more efficient controls are required over lotteries and made recommendations. Occasional lotteries should be better regulated by requiring greater details at the time of application for a permit, controlling the maximum level of expenses, regulating sales, requiring returns and accounts to be submitted and ensuring the public are able to ascertain the outcome of the lottery. A periodical lottery licence should operate only in the District Court district in which it was granted and, in addition, there should be provision for nationwide periodical lotteries by means of a scheme, approved by a central body which would set out details surrounding the conduct of such a lottery.
More efficient controls are required over periodic lotteries and these should include: notice of intention to apply for a licence to be published in a newspaper; controlling the level of permitted expenses; only certain types of bodies could apply for such licences and the licence holder would prepare professionally audited accounts. Organisations required to submit accounts following the promotion of a lottery should make them available at their local registered office for public inspection. The House will appreciate that the report also contained a wide range of recommendations about other aspects of charities legislation.
In June of this year the Minister of State at the Department of Justice, Deputy Burton, chaired a seminar which was attended by a wide range of interested bodies as part of the process of examining what legislative changes are needed in this area. The Department is now examining written submissions which were received following the seminar, and consultations with representatives  of fund raising and charitable groups are continuing.
I can inform the House that the Department of Justice is working to reform the law relating to the administration of charities along the lines of the report of the committee on fund raising activities for charitable and other purposes and it is the Minister's intention that proposals for amending legislation on these issues will be brought before Government as soon as possible. In this context, I assure the House that I will arrange that the points made by Senator Sherlock will be brought to the attention of the Minister for Justice and taken into account as part of the process of bringing forward legislative proposals in this area.
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