Charities Challenge Phasing Out of State Funding of Nonprofit Lotteries

The decision to phase out and eventually abolish the State funding of private charities has been challenged in the High Court.

Launching the challenge, the Rehab Group and Rehab Lotteries Ltd said that Justice Minister Alan Shatter's recent decision to phase out funding under the Charitable Lotteries Scheme will severely damage their ability to provide services to those with disabilities.
 
Mr Shatter has said that the decision to phase out - and eventually abolish - the funding scheme by 2016 is due to the ongoing economic crisis affecting the country.

More than 20 charities receive funding under the Charitable Lotteries Scheme

 
The Charitable Lotteries Scheme was originally established in the 1990's to compensate Irish charities for the advantage that the National Lottery held over them.
 
Rehab, which is the largest single beneficiary of the scheme, has warned that it will suffer the "greatest adverse impact" from the abolition of the scheme.
 
Rehab received €4.4m in 2011 under the scheme, with a further €1.6m being alloted to other charities for the running of nonprofit lotteries.
 
The action taken by Rehab is seeking a number of orders from the Court, including one preventing the implementation of the Minister's decision, along with declarations including that the Minister failed to take into account relevant considerations before announcing his decision.
 
In particular, Rehab has accused the Minister of denying it an opportunity to make a submission about the proposal prior to it being decided upon.
 
Representing Rehab, Paul Gardiner SC said that the €20,000 cap on the amount of prize money that charity lotteries were permitted to pay out meant that they were consistently at a disadvantage when competing with the National Lottery, which has no such caps on prize money.
 
Counsel further pointed out the Rehab share of the lotteries was 25% prior to the commencement of the National Lottery in 1987, but that this share has since been reduced to just 1% nationally (as compared to the National Lottery 98% market share).
 
Counsel also said that the money paid under the scheme to Rehab and other charities came not from government funds, but rather from the proceeds of the National Lottery.
 
In an affidavit, Rehab said that over 20 Irish charities, including the ISPCC, Asthma Society of Ireland, Irish Cancer Society and Irish Wheelchair Association, receive funding under the Charitable Lotteries Scheme along with Rehab.
 
The affidavit also stated that the abolition of the scheme will have a "significant and damaging impact on the continued development and enhancement of services to people with disabilities and those who are disadvantaged".
 
Responding to the challenge, the court has put the matter back until January.