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More bad news for Rehab: Charity loses lottery case against State

Justice Minister Frances Fitzgerald has welcomed today’s High Court ruling.

Angela Kerins (File photo)
Angela Kerins (File photo)
Image: Laura Hutton/Photocall Ireland

Updated: 21.45

THE REHAB GROUP has lost a judicial review it brought against the State for winding down the charitable lotteries scheme.

The group initiated proceedings in November 2012, after the then Justice Minister Alan Shatter decided to end the scheme. A hearing was held in the High Court in July 2013.

The Rehab Group and Rehab Lotteries Ltd received over €3.9 million under the scheme in 2012.

Justice Minister Frances Fitzgerald welcomed Justice Iseult O’Malley’s ruling, saying it “vindicated” Shatter’s decision.

“This decision was not arrived at lightly or quickly. It was taken because of the urgent need to make savings in government expenditure. Beneficiaries were advised in October 2012 that the scheme would be phased out on a gradual basis, over three years, with the first reduction only taking effect in late 2013.

It was done in this way in order to give affected organisations as much time as possible to adjust to the change. My hope is that the organisations involved will use this time to increase the funding they receive through other fundraising projects.

The Charitable Lotteries Scheme was established in 1997 by the then Finance Minister. It enables charitable lotteries who are in direct competition with the National Lottery to supplement their income with funding taken primarily from the National Lottery surplus, but with some drawn from the exchequer.

In a statement released this evening, the Rehab Group said it “fully recognises legitimate concerns that charity lotteries must generate real income to support their charitable work”.

However, it noted: “For as long as charity lotteries are unable to compete with the prizes offered by the National Lottery, their capacity to generate such income is severely restricted”.

The Rehab Group will now seek to engage in constructive consultation with the Department of Justice and Equality in relation to how charitable organisations can successfully operate lotteries in the future.

The statement added that Rehab used the funds it received from the scheme “for projects to support people with disabilities and others marginalised in society”.

Phased reduction in funding

Administration for the scheme was transferred from the Department of Public Expenditure and Reform to the Department of Justice and Equality in June 2011. The total funding available under the scheme was reduced from €8.6 million in 2010 to €6 million in 2011 and 2012.

As part of the phasing out plan, the money available in 2013 was €4 million. €2 million is available this year, with half this amount up for grabs in 2015. The scheme will end completely in 2016.

Rehab came under intense public scrutiny in recent months after it was revealed its CEO Angela Kerins earned a salary of €240,000.

The group made a €9,452 profit from almost €4 million worth of scratch card sales in 2010. During the same period, Rehab Bingo earned over €500,000. 

Kerins stepped down from her role in April, citing “the toll that public controversy has taken on the Rehab Group and my own family”.

Originally published: 17.45

Read: Angela Kerins quits her role as Rehab CEO

Realted: Rehab Group call on Justice Minister to withdraw €9k profit remarks

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Órla Ryan

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