Parks Tau defends the awarding of the lotteries operator licence to Sizekhaya

TRADE, Industry and Commission Minister Parks Tau said on Tuesday he confidently discharged his responsibilities in awarding the fourth lotteries operator licence to Sizekhaya.

Briefing the portfolio committee, Tau said the process of appointing the national lotteries operator was designed to have multiple steps.

“This process ensures necessary checks and balances are in place for the appointment of the national lotteries operator,” he said.

Tau also said when he took over as the minister last year, he had inherited a process of awarding the fourth national lotteries operator, after the licence of Ithuba Holdings was extended for two years.

“The request for proposals for the fourth operator was issued and eight applications were received. The evaluation committee was still undertaking its work of evaluation.”

He noted that the bidding was highly competitive and involved well-resourced parties, and that the second and fourth operator licences were subjected to litigation.

“The fourth is proving to be the same,” he said.

“There is no doubt my every word here today is going to be scrutinised for some hook a party can base on for a legal challenge to the process.”

Tau further said as a minister entrusted with the responsibility of the National Lotteries Commission and by extension the licensing process, it was incumbent to his office to ensure the process ticked all boxes and there was fairness in the adjudication process.

 “I confidently discharged to the best of my abilities my responsibilities,” he said.

Tau said it was not an easy feat to award the licence operator and that he was criticised for delaying in making an announcement.

“I accept the delay was most unfortunate, however, we were confronted with a situation in which I could either rush the decision being confident it was correct and in accordance with the law or institute further investigation.

“I chose the latter so that I can confidently assure the county that I fulfilled my duty by applying my mind properly to arrive at what I believe is the best result. No doubt, others will disagree but I can confidently say I discharged my responsibility to the best of my abilities in my obligation to the Lotteries Act,” Tau said.

However, he said there was room for improvement despite the challenges.

“I am satisfied overall, the process was fair and where the problems were identified, they were addressed.”

Tau said the committee previously raised issues on conflict of interest and that they had taken into account the matters raised so that they applied their mind to the information that was not at their disposal in the consideration of awarding the lottery operator licence.

“I addressed some of the issues in the presentation and also in full in my answering affidavit in the review application.”

He noted that one of the applications has instituted a review decision in the matter and others have requested reasons for his decision.

“It will be filed in the high court within the next few weeks. I will ensure this committee receives a copy of these reasons,” said Tau, adding that he was advised not to compromise the legal process that was underway and that he did not want to be seen to obfuscate issue raised by the committee.

“It was hotly contested. The applications were thoroughly assessed and, indeed, it was a very close call,” he added.

Briefing the committee, National Lotteries Commission’s commissioner Jodi Scholtz took the MPs through the licensing process.

Scholtz said a request for proposals was issued in August 2023 and eight applications were received, double the number during the process for the third operator licence.

She said Tau could not make a decision after receiving the reports of the evaluation committee, the adjudication committee and quality assurance committee on the manner in which the evaluation and adjudication had taken place.

There had been lack of advice about disqualifying applicants that did not make the technical evaluation and whether there had been sufficient consideration of Broad-based Back Economic Empowerment matters, among others.

“These issues were investigated by the committee set up by the minister.”

Scholtz also said after allegations were made in 2024 that two evaluation committee members were conflicted, the National Lotteries Commission had investigated the matter and sought legal advice.

“The NLC concluded that there was no conflict of interest. This was reviewed by the quality assurance committee, which agreed with the NLC’s conclusion. This is one of the grounds of review in Lekalinga’s review application.”

She said there had been allegations that Sandile Zungu and Moses Tembe of Sizekhaya have close ties with the ANC and the MK Party.

“It has been determined that Mr Zungu and Mr Tembe do not qualify as office-bearers under the Lotteries Act. There is no evidence that the ANC or MK Party possess a ‘direct financial interest’ in Sizekhaya or any of its shareholders.”

Reiterating Tau’s sentiments, Sholtz said the full reasons for awarding the licence to Sizekhaya will be provided in the review application when the record is filed in July.

“However, I wish to point out it was a close race between Sizekhaya, Ithuba, Ringela, Wina Njalo and, to some extent, Bosele.”