Tau’s temporary lottery talks with Ithuba-linked company raise eyebrows
Ithuba is ineligible by law to apply for the temporary licence.
South Africa.- The Minister of Trade, Industry and Commerce, Parks Tau, and Ithuba Holdings are embroiled in a fresh controversy regarding the awarding of a temporary licence for the National Lottery.
Tau has reportedly entered into negotiations with a company linked to Ithuba Holdings to grant a 12-month provisional licence that would see the latter run the lottery until June 1, 2026.
The development follows months of uncertainty and delays in determining the future operator of the lottery.
The licence of the current lottery operator, Ithuba Holdings, is set to expire at the end of the month, and the company is ineligible by law to apply for a temporary licence.
Ithuba has operated the South African national lottery since 2015. Its licence expired in 2023 but was extended for two years, ending on May 30, 2025.
Under the Lotteries Act, the minister can only extend a licence once and for a maximum of two years. Now, the company that Tau is in talks with for the temporary licence is Ithuba Lottery, which shares six directors and the same website as Ithuba Holdings.
The temporary licence will allow its holder to operate the lottery from June 1, 2025, to May 31, 2026. Following this period, a new operator will run the lottery for eight years.
The Sizekhaya Consortium, led by Gold Rush, is believed to be the winner of the permanent lottery bid. This news has generated strong reactions, with several stakeholders, such as political parties BOSA and EFF, alleging that the decision process was flawed and biased.
If Sizekhaya meets all the requirements and contracts are signed, its licence will commence on June 1, 2026. This would provide it with a 12-month transition window to replace the temporary licence holder, set up its infrastructure, manufacture ticket sales equipment for retail stores and recruit staff.
However, the selection of Ithuba Lottery as the temporary operator may raise concerns about potential conflicts of interest and favouritism and further fuel criticism of the bidding process.
In March, one of the lottery bidders, Wina Njalo, sued Tau for allegedly delaying the awarding of the fourth licence to favour Ithuba. Njalo contended in court that Tau’s short-notice temporary licence RFP process was designed to benefit Ithuba, as only the company had the existing infrastructure and technology to meet the requirements.
In his court response, Tau said the temporary licence was necessary to bridge the gap until the new operator, whose identity would be announced by May 28, could assume control.
Without Ithuba as the interim operator, lottery ticket sales may have to be suspended until the new licence holder becomes operational.
