NLA’s financial woes began long before KGL deal — Dr. Razak Opoku clarifies

Former Public Relations Manager of the National Lottery Authority (NLA), Dr. Razak Kojo Opoku, has dismissed suggestions that the partnership between the NLA and KGL Technology Limited was responsible for the Authority’s financial challenges, insisting that the NLA’s debts predated the signing of the provisional license with KGL in November 2019.

In a statement issued today October 16, Dr. Opoku clarified that the NLA’s losses began long before KGL entered into the picture. He disclosed that as of 2019, before the NLA-KGL deal was signed, the Authority had already accumulated debts amounting to GHS 233,121,889.28. These debts, he said, covered unpaid lotto prizes, contractor arrears, outstanding withholding taxes to the Ghana Revenue Authority (GRA), Social Security and National Insurance Trust (SSNIT) contributions, and fees owed to Technical Service Providers and Lotto Marketing Companies.

He noted that under existing revenue-sharing arrangements, Technical Service Providers were receiving six percent of gross revenue generated through Point of Sale terminals, while Lotto Marketing Companies were taking 2.25 percent as commission, a situation that heavily strained NLA’s finances. Dr. Opoku also cited other challenges such as illegal lottery operations, high win ratios, and the absence of spending limits for lottery staking.

Responding to media reports linking KGL to the NLA’s inability to remit funds to the Consolidated Fund, Dr. Opoku stressed that KGL had no role in such administrative decisions. “The responsibility of KGL is to pay its fees to the NLA in accordance with its license terms. What NLA does with the money is not KGL’s business, just as KGL cannot dictate to the Ghana Revenue Authority how to use taxes it pays to the state,” he said.

He further explained that Section 32(4) of the National Lotto Act, 2006 (Act 722), which requires the NLA to transfer net balances from the Lotto Account to the Consolidated Fund, could only be implemented after satisfying Section 32(3) of the same Act. The latter mandates the Authority to first pay prize monies, commissions, and operational expenses. “If there is no net balance left after these payments, then the transfer to the Consolidated Fund cannot occur,” he stated.

To illustrate the NLA’s long-standing financial imbalance, Dr. Opoku cited several instances between 2012 and 2020 where the Authority transferred millions of cedis to the Consolidated Fund despite being indebted to winners, marketing companies, and contractors. In 2012, he said, the NLA transferred GHS 20 million while still owing GHS 16.7 million. Similar patterns followed in subsequent years, with the Authority consistently transferring funds despite outstanding debts.

Between 2012 and 2020, the NLA transferred a total of GHS 209,409,495.24 to the Consolidated Fund while its total indebtedness over the same period stood at GHS 233,121,889.28. “This clearly shows that the NLA had to breach Section 32(3) of Act 722 in order to comply with Section 32(4),” he said, arguing that political pressures often compelled the Authority to prioritize transfers over legitimate payments.

Dr. Opoku therefore described as baseless the claims that the KGL partnership had hindered the NLA’s ability to meet its obligations. On the contrary, he said, KGL has been a vital contributor to national development, reinvesting 50 to 70 percent of its profits in corporate social responsibility initiatives.

He highlighted some of KGL’s interventions, including the construction of a modern mental health facility in Kumasi in collaboration with Otumfuo Osei Tutu II, support for the Accra Psychiatric Hospital, donations to the Akropong School for the Blind, relief aid to flood victims in Keta, sponsorship of the Democracy Cup by Parliament, and support for national football teams.

KGL contributes GHS 2 million annually to the NLA Good Causes Foundation and GHS 3 million to the NLA-KGL Stabilization Fund. The company has also refurbished the NLA’s draw studio and continues to finance live draw programs.

Dr. Opoku concluded that the evidence clearly exonerates KGL from blame, emphasizing that the NLA’s financial troubles were deeply rooted long before the 2019 licensing agreement.