Gambling with state
The state lottery “Nevskoye Lotto” – a project of St Petersburg Administration – will start work in May. The lottery operator was chosen in an open competition in January this year. It is the “Nevskie Lotteries” company, close to “Conti Group”, a leader in Petersburg gaming market.
Under the agreement made between the city and the “Nevskie Lotteries” for five years, the company will invest over $11.5mn in the development of lottery tickets sales system. And tickets will be sold neither in kiosks nor from hawkers` trays next to underground stations, which is the common practice of the majority of the city private lotteries, but via specialized electronic terminals. All in all, promises Dmitri Nevelski, the general director of “Conti Group”, about a thousand terminals will be installed in the city. The first 500 of them will appear in St Petersburg shops by City Day – May 27th, and the first drawing will take place on the same day. A ticket will cost 20 rubles; drawings will be broadcasted weekly on a local channel.
The Smolny is planning to collect 150mn rubles selling lottery tickets, and by 2011 the amount of revenues is estimated to reach 1.5bn rubles a year. Nevelski says that half of the money will constitute the prize fund, at least 10$% will go to the city budget, the remaining 40% will cover the operator`s expenses. Meanwhile the city administration emphasizes that the project is social. “Funds gained from the lottery will be spent on construction and reconstruction of socially significant properties – kindergartens, school, hospitals”, says Lidiya Mamon, the head of Gambling and Entertainment Department of Economic Development, Industrial Policy and Trade Committee.
State lotteries are a standard tool of budget replenishment for many megapolises (i.e. the city lottery of Helsinki brought about ˆ30mn to the budget last year). Launching “Nevskoye Lotto” the city is apparently trying to partly compensate for financial losses to be caused by the coming disappearance of slot machine market which used to bring to the budget about 2.5bn rubles of tax revenues annually. “People had better gamble with the state”, claims Governor Valentina Matvienko. “Conti Group” will also hold its own (three large city casinos belonging to it will have to close by 2009). Nevelsky is sure that, becoming the state lottery operator, the group will make up for its losses when the profitable projects terminate.
“Expert Severo-Zapad”