€4m Rehab scratch card sales yielded just €9,452 profit in 2010

IvaBigWun · 22-01-2014 09:46AM #1

http://www.rte.ie/news/2014/0121/499312-rehab-scratch-card-sales/

It would seem that charity CEOs are the new corrupt politicians

Rehab lottery scratch card sales of almost €4m in 2010 yielded profits of only €9,452, according to Minister for Justice Alan Shatter.

He gave details in the Dáil regarding his decision to phase out the Charitable Lottery Scheme.

Mr Shatter said when he assumed responsibility for the operation of the scheme, he undertook a review of payments being made.

He said that Rehab lottery scratch card sales of €3.969m yielded profits of only €9,452 in 2010.

Prizes of €2.6m were given out, while the costs associated with the scratch cards were €1.348m, according to the minister's statement.

Rehab Bingo sales of €3.19m during this period yielded profits of €548,000.

Mr Shatter said his decision to phase out the scheme was based on four reasons - that the scheme encourages inefficient fundraising practices and high administration costs; that it creates an incentive to run a charitable lottery at a low profit margin or at a loss and that it results in low proportions of profits reaching designated charities.

He also said it was unfair to the donors that a low proportion of monies donated was being used for charitable purposes and that the scheme had “essentially evolved into a mechanism to obtain taxpayers and National Lottery surplus funds”

drunkmonkey · 22-01-2014 09:55AM

They did nothing illegal, hell the government even subsidised them to do it.

Sir Arthur Daley · 22-01-2014 10:04AM

I was never an honours maths student but those figures do not add up anyway.

Rabies · 22-01-2014 10:10AM

WikiHow wrote: »

I was never an honours maths student but those figures do not add up anyway.

You forgot to carry the one...

in a brown envelope

kneemos · 22-01-2014 10:12AM

Lottery cards by definition make less for charity because of the prizes,but that is pointless.

homerjay2005 · 22-01-2014 10:17AM

drunkmonkey wrote: »

They did nothing illegal, hell the government even subsidised them to do it.

illegal no, incompetent yes. to make only 9k on a 4million turnover is just the definition of bad business practice.

DeanAustin · 22-01-2014 10:25AM

homerjay2005 wrote: »

illegal no, incompetent yes. to make only 9k on a 4million turnover is just the definition of bad business practice.

At first I thought so too but I heard on the radio today that the size of the government's subsidy was based on sales rather than profit. Therefore, Rehab were better off selling €4 million and making only €10k rather than selling €2 million and making €500k.

If that's true then I don't blame Rehab at all. They were incentivised to not make a profit. The government, or whoever approved that, deserve a kick in the hole though.

drunkmonkey · 22-01-2014 10:26AM

homerjay2005 wrote: »

illegal no, incompetent yes. to make only 9k on a 4million turnover is just the definition of bad business practice.

That depends on your point of view, if you were Angela "I won't tell you may salary" Kerins you'd be pretty happy. The business made loads of money for its owners and that's what matters to them.

everdead.ie · 22-01-2014 10:29AM

doesn't the guy in the bib get an extraordinary share of whatever he sells?

The Backwards Man · 22-01-2014 10:31AM

Never seen a Rehab scratchcard in my
life.

drunkmonkey · 22-01-2014 10:33AM

everdead.ie wrote: »

doesn't the guy in the bib get an extraordinary share of whatever he sells?

He gets the full 1st years donations.

IvaBigWun · 22-01-2014 10:49AM

everdead.ie wrote: »

doesn't the guy in the bib get an extraordinary share of whatever he sells?

BLB?

Murt10 · 22-01-2014 11:04AM

Brilliant this from Morning Ireland on RTE 1 on 6 Jan 2014. CEO Angela Kerins of Rehab refused to divulge her salary, bullsh****ing that Rehab was operating in a commercial environment.

Skip the first part, which is what she came on to be interviewed about, to 3.10 mins. She was rightly ambushed and full of bluster. RTE even deferred going over to the 8.30 am news, so that they could question her

http://www.rte.ie/news/player/2014/0106/20499542-rehab-group-signs-contract-to-develop-employment-programmes-for-people-with-disabilities-in-saudi-arabia/

Hats off to RTE for the interview and also to the current edition of the Pheonix for highlighting it again

Menas · 22-01-2014 11:15AM

It really is an odd situation. Governement seem to match sales of these ticekts rather than profits. So no incentive to make them profitable.
4Million in sales. 1.3 million in admin costs. 2.7 million in prizes if I remember correctly (rehab 2010 figures).

So the government, having audited Rehab, decide to get rid of the charitable lottery act. And Rehab take them to court.

Sound like now that FF are out of power Angela is discovering that the corridors of power are less welcoming and is going to battle the governemnt all the way.

Sadly, like the CRC your average punter will see this as another charity wasting money and may hold back on future donations.

As said on another thread. Registered charities should be compelled to publish their accounts and in particular to show what % of donations/income goes to 'admin' and what goes to the true cause. Then people can decide for themselves if it is worthy of their money.

micosoft · 22-01-2014 11:48AM

Trigger Happy wrote: »

It really is an odd situation. Governement seem to match sales of these ticekts rather than profits. So no incentive to make them profitable.
4Million in sales. 1.3 million in admin costs. 2.7 million in prizes if I remember correctly (rehab 2010 figures).

So the government, having audited Rehab, decide to get rid of the charitable lottery act. And Rehab take them to court.

Sound like now that FF are out of power Angela is discovering that the corridors of power are less welcoming and is going to battle the governemnt all the way.

Sadly, like the CRC your average punter will see this as another charity wasting money and may hold back on future donations.

As said on another thread. Registered charities should be compelled to publish their accounts and in particular to show what % of donations/income goes to 'admin' and what goes to the true cause. Then people can decide for themselves if it is worthy of their money.

The government put the scheme in when the National Lottery was created to make up for the lost income some charities who ran existing lotteries might have. That was a long time ago and it appears Rehab figured out how to game the system - they get plenty of grant aid to make their lottery worthwhile even if the lottery itself makes no money.
It's about time this was addressed but the reaction of Rehab was to sue the state for (and yes, this is the figure) €1.5 billion.
It takes some staggering amount of neck to do this for a state owned entity. The extraordinary statement yesterday that a Minister is not entitled to observe some pretty basic facts around the situation is also shocking along with the intemperate language. Finally the last annual report is from 2011, 2012 is still not out.
For a state owned organisation this is a level of hubris that I suspect will come back to bite them.

kneemos · 22-01-2014 11:56AM

micosoft wrote: »

The government put the scheme in when the National Lottery was created to make up for the lost income some charities who ran existing lotteries might have. That was a long time ago and it appears Rehab figured out how to game the system - they get plenty of grant aid to make their lottery worthwhile even if the lottery itself makes no money.
It's about time this was addressed but the reaction of Rehab was to sue the state for (and yes, this is the figure) €1.5 billion.
It takes some staggering amount of neck to do this for a state owned entity. The extraordinary statement yesterday that a Minister is not entitled to observe some pretty basic facts around the situation is also shocking along with the intemperate language. Finally the last annual report is from 2011, 2012 is still not out.
For a state owned organisation this is a level of hubris that I suspect will come back to bite them.

Presumably their grant aid will be protected so you have to wonder why they are eager to protect a lottery that doesn't make a profit.

Menas · 22-01-2014 12:01PM

kneemos wrote: »

Presumably their grant aid will be protected so you have to wonder why they are eager to protect a lottery that doesn't make a profit.

They are eager because the 'profit' comes from the state matching their sales.
So they sell €4M of tickets and it costs them €4M to sell/administer.
The current arragement is that the government will then grant them €4M.
But if they sell 0 then they get 0 from the charitable lottery act.

Ridiculous right? No incentive for them to make any profit on the original sales.

I presume they get other government funding - but dont know for sure.

flutered · 22-01-2014 12:08PM

too me the charity gigs are like the goverment and their financiers, the guys a the top get a large whack, while the guy at the bottom get little.

golfball37 · 22-01-2014 12:15PM

They can't blame this one on FF either as the Rehab board is stuffed full of FG cronies.

Great country.

c_man · 22-01-2014 12:15PM

The Backwards Man wrote: »

Never seen a Rehab scratchcard in my
life.

You're not missing much in fairness.

ThisRegard · 22-01-2014 12:16PM

golfball37 wrote: »

They can't blame this one on FF either as the Rehab board is stuffed full of FG cronies.

Great country.

Now even SF are saying that it's the prior government that have questions to answer on this.

Manach · 22-01-2014 12:17PM

The irony is that the Gov is highlighting these selected figures as an example of a poor return of money for services provided. Pot/Kettle/Black.

Johnny Jukebox · 22-01-2014 12:19PM

If an organisation takes 1c of public money, then said organisation must be fully transparent to the public.

delthedriver · 22-01-2014 12:23PM

Unbelieveable ! Fair play to Minister Shatter for bringing this into the open.

No doubt many individuals contributed or bought ticket to support the worthy cause.

Sadly it looks like all they were supporting were the lifestyles of a small group of individuals.

What next?

suicide_circus · 22-01-2014 12:24PM

Johnny Jukebox wrote: »

If an organisation takes 1c of public money, then said organisation must be fully transparent to the public.

that's the dream! but they will fight thIs tooth and nail claiming their salary information is somehow commercially sensitive as they know the money they are milking is totally unjustifiably and indeed probably immoral.

EyeSight · 22-01-2014 12:30PM

golfball37 wrote: »

They can't blame this one on FF either as the Rehab board is stuffed full of FG cronies.

Great country.

Why is every aspect of Ireland now just a group of cronies? I'm so sick of it. I've come to expect it of the government and other state bodies but now charities too?
Can we not just remove everything and start all over?

flutered · 22-01-2014 12:35PM

a few weeks ago the crew looking into the crc wanted to interview a guy from the board, it was not possible, why, he was on a fundraising gig to burma, enough said methinks.

suicide_circus · 22-01-2014 12:36PM

EyeSight wrote: »

Why is every aspect of Ireland now just a group of cronies? I'm so sick of it. I've come to expect it of the government and other state bodies but now charities too?
Can we not just remove everything and start all over?

pretty much any institution or venture which involves public money in any way in this country is knee deep in inefficiency, cronyism, waste and borderline corruption. Every week there is a new revelation and every week nothing changes.

golfball37 · 22-01-2014 12:41PM

We all have the power to change it by never voting for the 3 parties that endorse this behaviour but alas nothing changes.

delthedriver · 22-01-2014 12:44PM

EyeSight wrote: »

Why is every aspect of Ireland now just a group of cronies? I'm so sick of it. I've come to expect it of the government and other state bodies but now charities too?
Can we not just remove everything and start all over?

Agreed, back to basics.!

Shocking stuff. It looks like every Institution , Financial, Political , Charitable has something nasty going on.

Sadly all these issues don't help outside Investor's to consider Ireland as a good place to invest.

The sooner these issues are dealt with the better. Perhaps then we can draw a line in the sand and start again from scratch.

delthedriver · 22-01-2014 12:50PM

golfball37 wrote: »

We all have the power to change it by never voting for the 3 parties that endorse this behaviour but alas nothing changes.

Very true! We get what we vote for!
Having said that I am not aware of any credible Political Party who could be seen as a genuine alternative!

€4m Rehab scratch card sales yielded just €9,452 profit in 2010

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