Gov’t revenue loss in STL: P48B a year
The government is losing at least P4 billion a month — or P48 billion a year — to gambling lords operating state-sanctioned Small Town Lottery (STL) outlets in Luzon, according to Sen. Panfilo Lacson.
Lacson, chair of the Senate committee on games and amusement, disclosed the foregone revenue from STL on Wednesday at a hearing on his bill seeking to create a Philippine Charity Office and to strengthen the charter of the Philippine Charity Sweepstakes Office (PCSO).
Lacson told the PCSO that STL may be prohibited altogether under the new Philippine Charity Office if the agency could not control and contain STL operations, which are supposedly part of government efforts to stamp out “jueteng,” an illegal numbers racket in the country.
STL and jueteng involve betting on two-number combinations—from 1 to 40 for the former and from 1 to 37 for the latter.
Citing intelligence information, Lacson said monthly gross collections from STL operations in at least eight Luzon regions averaged P6.05 billion, higher than the PCSO’s current monthly collection of P1.7 billion from authorized agent corporations (AACs).
According to the senator, Metro Manila has a daily gross collection of P30-P34 million; Cordillera Administrative Region, P8.4 million; Ilocos, P20-P22 million; Cagayan Valley, P14-P15 million; Central Luzon, P40-P45 million; Calabarzon, P50 million; Mimaropa, P7-P7.5 million; and Bicol, P19 million.
Launched in 1987
“If you total this monthly, this is easily P6.05 billion compared with the P1.7 billion that you are actually receiving now from your AACs. So, imagine if you’re losing P4 billion a month in gross,” Lacson told the PCSO General Manager, Alexander Balutan.
Lacson pointed out that the PCSO was getting not even half of what it could potentially collect from its more than 90 AACs. “You are losing too much,” he said.
STL was launched in 1987 by the administration of President Corazon Aquino in the hopes that it would kill jueteng. It failed to eradicate the illegal numbers racket.
Gambling lords instead used STL as a front for jueteng as the two games have similar mechanics.
STL draws are done locally unlike the PCSO-run lotto, where draws are televised nationwide.
A House inquiry following the government’s move to stop STL operations in 1990 found that franchises for STL had been awarded to the same people behind jueteng.
The Arroyo administration revived STL in 2005. In February 2006, the PCSO launched STL on test-run mode in several areas in Luzon and the Visayas.
At the Senate hearing, Lacson asked if the case of Evenchance Gaming Corp., an authorized STL operator in Camarines Sur, was representative of what was happening in other areas where STL was being operated.
Camarines Sur Rep. Luis Raymund Villafuerte told the panel that Evenchance was a jueteng front that continued to operate despite violations of the PCSO’s implementing rules and regulations (IRR) for STL operations.
The violations include accepting bets from minors, collecting bets outside the premises of its STL stations, not complying with the use of PCSO-recommended uniforms and IDs, and issuing tickets and receipts without barcodes, according to Villafuerte.
Lacson also questioned Balutan why Evenchance was given the leeway to submit a presumptive monthly retail receipt (PMRR) of only P61 million when total gross collections in Camarines Sur was P5 million a day, or P150 million, a month. The amounts were confirmed by the provincial director, Senior Supt. Jerry Bearis.
Currently, the PMRR, which STL operators are expected to remit to the PCSO monthly, is computed by getting 30 percent of the voting population and multiplying it by the P2.50 average bet, by three draws a day and by 30 days.
“We’re losing P80 to P90 million easily in revenues and we’re talking of gross collection,” Lacson pointed out.
“If we are to incorporate in the bill the operation of STL, we must plug all the loopholes but if you cannot address all these concerns, we might as well not allow the operation of the STL,” he said.
In an interview with reporters, Lacson said something was “very wrong” with STL that gambling lords were “lording it over.”
“The government do not capture a good 50 percent [of the collections]. So, effectively, the losers here are the beneficiaries of charity,” he said.
Balutan admitted at the hearing that an investigation by the PCSO board was needed to look into the true collections of the AACs.
He also told the Senate panel that the agency had listed down a number of STL operators for disqualification because they did not fulfill their PMRRs and violated the IRR.
Gov’t takeover of STL
A suspected gambling lord and gaming consultant, Charlie “Atong” Ang, said at the hearing that the PCSO could easily earn P60 billion a year from STL if government took over its operations.
“My suggestion is the government operate it so there will be no gambling lords. It’s that simple and I guarantee, P60 billion a year,” Ang said.
Lacson later told reporters that Ang’s recommendation was a “good proposition,” but how the government would operate STL should be carefully studied.
In a hearing on the bill last August, the senator had urged the PCSO to adjust the rate for the PMRR so it could get its full share from its operators and limit the elbow room for so-called “guerrilla operations.”
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