Lifestyle

Fight for lottery millions: the odds are you’ll lose

Mike Macbeth October 23 1978
Lifestyle

Fight for lottery millions: the odds are you’ll lose

Mike Macbeth October 23 1978

Fight for lottery millions: the odds are you’ll lose

Lifestyle

During the past week, as every week, Canadians dug into their wallets for a deflated dollar bill, a five or a 10, until they had plunged $20 million on lottery tickets. Four out of five Canadians buy regularly, though few quite so regularly as Toronto office manager Richard Quesnell, who after cutting back the habit from $200 per month, is buying $50 worth —confidently waiting for the big million. By now most lottery gamblers must know that for every major winner there are half a million losers, but eager citizens still put out a billion dollars a year for such slim chances at fortune.

Aided and abetted by government. So heated has the rivalry grown between Ottawa and the provinces that they have been spending $33.5 million a year advertising eight competing lotteries— before a five-year treaty was finally hammered out at a secret “Camp Reuben summit” three weeks ago. Minister of State, Fitness and Amateur Sport Iona Campagnolo took FederalProvincial Relations Minister Marc Lalonde with her for backup support to the closed-door meeting in the Bloor St. suite of Ontario Minister of Culture and Recreation Reuben Baetz, attended by key representatives from East and West. But it required another 10 days of anxious phone calls among the provinces before release of the four-point agreement:

• Campagnolo will abandon her grand game plan (and $23-million worth of new computer terminals) to wire the nation for Loto Select—an electronic draw in which the buyer bets $1 on a number of his own choosing, punched up on a machine in his corner milk store. (Ontario and Quebec will run one instead.)

• The provinces will concede to Ottawa Loto Canada’s exclusive rights to create new millionaires every month by selling tickets at $10 and up, if Ottawa will leave the cut-rate $9.00-and-under field to them.

• All lotteries will return 50 per cent of gross revenues to ticket buyers in prize money.

• No lottery will spend more than four per cent of revenues on advertising and promotion.

The provinces want further discussions of how Ottawa intends to spend its share of the gambling take—they’re suspicious of Campagnolo showering

communities with sports palaces that they will have to service and maintain. And it begins to sound like a fresh round of constitution talks when Reuben Baetz advises that “it’s a question of federal or provincial jurisdiction over leisure.” But the great lottery debate is really about money—millions and millions of lovely dollars with which rival governments can fatten their tax coffers. And it is difficult to distinguish between the greedy dreams of the would-be lottery millionaires and the avaricious schemes of the lottery operators who cream 40 per cent off the top. And who, of course, always win.

Ten years ago, one could have been arrested for selling lottery tickets. The only legal gambling in Canada was at the race track, the fall fair or the bingo game in the church basement. Seldom has there been such a turnaround in the perceived public morality as in the matter of getting something for nothing. Although millions were already being wagered at the track, gambling was still actively denounced from Protestant pulpits (it was only the Catholics who ran bingo games) and no sane politician would advocate making it legal. Until it slowly dawned on governments that, as with “liquor control,” there was big money in it.

Montreal’s Mayor Jean Drapeau broke the ice with his cleverly camouflaged “voluntary $2-tax” for Expo in 1967. Three years later Ottawa

amended the Criminal Code to legalize lotteries: Drapeau’s draw immediately became Loto Québec and Manitoba launched its own $2.50-a-shot sweepstake for a top prize of $70,000, which spread through four provinces as the Western Express. In 1974 Ottawa introduced the Olympic Lottery (only to bail out the Games, they said), with a fat $10 entry fee and the first (wow) milliondollar prizes. Soon there was also Wintario, then the Atlantic Loto—and then came The Provincial at $5 a shot, under the joint sponsorship of all second-tier governments except Nova Scotia.

When Ottawa announced in 1976 that the Olympic Lottery was to become Loto Canada “until Dec. 31, 1979,” the provinces cheerfully assumed the feds would vacate the field on that date. They were wrong. What Ottawa meant was that the profit-sharing deal—82.5 per cent for Olympic and Commonwealth Games debt retirement, 12.5 to the provinces and five to federal amateur sports programs—would run until then. With sales for the year ending March, 1978, reaching $225 million for the national lottery—double the previous year—and the profit fattening out at $74 million, Iona Campagnolo meant to have 100 per cent for national sport and fitness as of 1980. And that’s when the in-fighting for lottery millions got dirty:

• Loto Canada’s advertising budget reached $25 million—five times that of both Wintario and The Provincial—and the provinces cried foul. “We had to shout to be heard,” says Marshall Pollock, managing director of the Ontario Lottery Corporation. “And at media rates today, shouting is expensive.”

• In late May, Ontario and Quebec jointly called for tenders for electronic equipment to operate a new computercontrolled, write-your-own-ticket lottery. Three weeks later Campagnolo awarded, without tender, a $23-million contract to U.S.-owned General Instrument of Canada Ltd. Toronto, for computer terminals to run an identical game nationwide, called Loto Select. Frustrated rivals accused her of scrambling for a bargaining tool to keep the provinces from invading the $10-ticket game. “She’s leapfrogging the orderly market-development cycle,”fumed Pollock. As it turned out, Campagnolo’s ploy worked.

With gambling having totally changed its image from closet vice to accredited source of income, and with lottery sales headed ever upward (an expected increase of $600 million next year) federal-provincial conferences on lotteries may become as regular as the other kinds. After all, the potential is tremendous. Canadians spend only $40 per capita per year on taking chances— peanuts compared with Italy’s $220 and Japan’s $285.

Mike Macbeth