Queensland charities have been lobbying the state government to impose restrictions on private companies they say are undermining their fundraising efforts by running prize draws for profit.
Under state laws, companies can run prize draws to promote their goods and services and reward customers for their loyalty. However, some companies appear to have been established largely for that purpose: rather than sell tickets, they sell memberships – in a car club, for example – which grant free entry into the draw.
Charities including the Endeavour Foundation and yourtown raise funds by running art unions for homes, cars and holidays. They argue the companies that advertise prize draws online are subject to less regulation and may be confused for genuine charities.
Charities are concerned their lottery fundraisers now have to compete with private companies running so-called trade promotions.Credit: Aresna Villanueva
A charity lotteries alliance was in talks with the Queensland government before it went into the caretaker period ahead of the October 26 election.
“These non-charitable entities are a direct threat to Queensland consumers and the capacity of Queensland’s charitable sector to deliver services to some of our state’s most vulnerable,” said alliance spokesman Andrew Thomas, chief executive of the Mater Foundation, which also runs art unions.
“[Alliance] members estimate a loss of some $61.6 million as a direct result of for-profit trade promotion businesses.”
In a statement, the Justice Department confirmed it was an unresolved issue.
“The department is investigating options to address concerns around certain private businesses potentially disguising pay-to-enter games as trade promotions, to the detriment of genuine charities,” it said.
While the ongoing value of club memberships may be questionable, the government last year investigated companies operating out of Queensland and found their activities were “consistent with promotional game requirements under the Act”.
