Rehab to sue State in €1bn lottery case

One of the country’s largest charities is expected to begin a €1bn legal challenge to the operation of the soon-to-be sold National Lottery later today.

Rehab has already notified the Government about its intention to take a case challenging uncompetitive aspects of the Lotto.

It is understood papers may be filed with the High Court this morning and, if successful, Rehab’s case threatens to undermine the ongoing process of selling the National Lottery.

Last night, it emerged that An Post, in partnership with the operator of the British lottery, Camelot, had been selected as the preferred bidder for the State asset.

Together, they had tabled a €405m bid for a 20-year licence to run the lottery. The money is earmarked to help fund the new national children’s hospital. This news came in spite of Rehab’s imminent challenge.

The charity has told the Government it believes the way the National Lottery was set up in 1986 contravened European competition law and it deserves compensation.

Prior to its introduction, Rehab had a 25% share of the lotteries’ market. It now has a 1% share.

Rehab is one of 22 groups licensed to run charity lotteries since 1997, subject to a prize cap of €20,000. However, Justice Minister Alan Shatter is to phase out funding for these schemes by 2016. In a warning letter to the Government earlier this year, Rehab said it had lost €600m because the 1997 act had capped the prize money.