Minister Tau breaks silence on lottery licence award

Minister of Trade and Industry Parks Tau has disclosed reasons for awarding the fourth lottery licence to Sizekhaya Holdings. Photo from government website

• Minister Parks Tau says he chose Sizekhaya Holdings for the fourth lottery licence as it had the highest projected contributions to good causes and impressive technology partners.
• Court challenges by rejected bidders Lekalinga and Ithuba Lottery compelled Tau to finally explain his decision after months of silence.
• Tau overruled his advisory panels by rejecting Ringeta, the initial favourite, due to its links to Batho Batho Trust, a major ANC donor.
• The minister glossed over concerns about Sizekhaya shareholders’ alleged connections to Deputy President Paul Mashatile.

Parks Tau, the trade and industry minister, has finally disclosed his reasons for awarding the fourth lottery licence to Sizekhaya Holdings, saying it was a “close race and a tight finish”.

The winning bidder Sizekhaya Holdings, which he announced at the end of May 2025, “pipped the others to the post”, Tau wrote in an affidavit filed in the Gauteng High Court in Pretoria.

This was because it had presented a well-balanced bid, had impressive technology partners, and its projected revenue was “suitably ambitious, yet credible”.

“Sizekhaya’s contributions to the National Lottery Distribution Trust Fund (NLDTF) are likely to be the highest,” he said.

However, the minister glossed over concerns of political involvement and connections of some of Sizekhaya’s shareholders, saying only that he had instructed the National Lotteries Commission (NLC) to investigate the alleged connections to Deputy President Paul Mashatile. He did not elaborate.

Compelled to explain

After months of silence regarding why he delayed the announcement of the successful bidder for the fourth licence, the minister was compelled, by law, to produce his reasons for this, and why he chose Sizekhaya, in two court challenges seeking to review the award.

These have been launched by Lekalinga and Ithuba Lottery (a sister company of Ithuba Holdings), which had the third licence and is still presently running the lottery in terms of a temporary licence issued by Tau under his special powers.

The aggrieved bidders specifically raised issues with Sizekhaya’s shareholders Moses Tembe and Sandile Zungu and the ANC, including reported links to Deputy President Paul Mashatile.

They also pointed to the fact that Tau had given Sizekhaya a year’s grace period in which to take over running the lottery, contrary to the Request for Proposals (RFP), which had stipulated that the winning bidder needed finance in place and the ability to take over the running the lottery in a “continuous and seamless” transition.

It has emerged in Tau’s reasons that Lekalinga was one of the lowest ranked bidders.

Ithuba Lottery was deemed the runner-up, who would possibly get the licence if negotiations with Sizekhaya failed.

Minister Tau also disclosed that he had overruled his own advisory panels, sidelining a bid by Ringeta, because of its links to the Batho Batho Trust, a known donor to the ANC.

Ringeta had been favoured by both the bid evaluation and adjudication committees before being flagged by a quality assurance committee (QAC) appointed by Tau.

Tau noted that Dr Sibongiseni Dhlomo, an ANC MP, was a trustee of the Batho Batho Trust, and was therefore “an office bearer”, which was outlawed by both the Lotteries Act and by the terms of the RFP, governing the licence award process.

He said the trust had regularly made donations of R15-million to the ANC, and that he had received legal advice that Dhlomo had a direct financial interest through the trust’s shareholding of 70% in Ringeta.

Beyond this, Tau said, its projected contributions to the distribution trust for good causes were much lower than those of Sizekhaya.

The quality assurance process, Tau said, only began after the NLC had already made its recommendations to him, with Ringeta ranked first.

“Quite why the NLC did not wait for the QAC to perform its functions is not clear to me. However, I was not prepared to forgo the QAC process. As it turned out, the QAC’s findings were important for me to make a decision,” he said.

Of particular concern was the interpretation given to sections of the Act which related to political party or political office bearers having financial interests in the bidders, and whether some of the games proposed by the bidders were not lottery or sports pool games but gambling games.

“My decision was delayed because I was not convinced that the processes and outcomes were correct. This prompted speculation and even accusations that I was trying to favour one or other applicants. Nothing could be further from the truth. I refused to simply rubber stamp recommendations,” he said.

He said he had not provided details of his concerns because he wanted to protect the process.

He said he had then set up a further “ministerial committee”, which comprised some members of the QAC, to re-assess the bids. The committee was assisted by three expert consultants.

That committee had finalised its report in April 2025 and recommended Sizekhaya as the preferred bidder and Ithuba Lottery as the reserve bidder.

He had then considered all the reports from all the committees.

The bids by Giya Games, Lekalinga and Umbelelo were all ranked the lowest.

The bids by Bosela, Ithuba Lottery, Ringeta, Sizekhaya and Wina Njalo were “neck and neck”, until he was advised by senior counsel that Dhlomo’s involvement was problematic.

The minister said Sizekhaya’s bid was the most well-balanced. There had been criticism of its low marketing spend on new games “however its broader marketing plans and spend were commended, including its plans to rejuvenate the suite of current lottery games”.

Its contribution to the NLDTF was the highest.

Regarding his choice of the “reserve”, Ithuba Lottery, he said its technology partner was local and it also held a higher empowerment rating.

“While Ithuba Lottery proposed a relatively modest contribution percentage to the NLDTF, the feasibility and sustainability of these contributions were the key strength and an important consideration,” he said.

The review before the court will not be resolved speedily. The aggrieved bidders are expected to file further affidavits based on the minister’s reasons and likely to again raise the “political connections” in Sizekhaya’s shareholding structure.

The minister and other respondents will then have to file answering affidavits before trial dates are set.

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