Grant money buying Lotto tickets – survey shows how the poor are lured in

The latest findings, based on a survey conducted from November 2018 to February 2019, follow earlier research commissioned by the NLC eight years ago into participation in the lottery and attitudes of players, found that more than two-thirds of the people who played the lottery were poor.

The percentage of poor people playing the lottery has dropped since GroundUp reported last year on the research conducted for the NLC in 2011. That research found that more than 70% of lottery players earned R5,000 or less a month and, of those, about a third (33%) earned R1,000 or less.

The latest countrywide research, conducted by UNISA’s Bureau of Market Research, used a randomised and representative sample of more than 3,000 people. It found that 42% of lottery players have household incomes of R5,000 or less a month and, of those, 6.5% have household incomes of R1,000 or less – a decrease from the earlier findings but still a significant number of people. Also, inflation over the eight-year period means that the results are not strictly comparable. But even taking inflation into account, the number of low-income earners as a percentage of lottery players has declined. Nevertheless, more than 60% of lottery players have household incomes less than R10,000 per month.

Nearly 28% of the people who play the lottery are unemployed. About 29% receive social grants, the survey found.

What this means is that, in many instances, players are using money they cannot afford for a near-impossible chance at winning big. The report’s researchers even went so far as to say that poorer households “displace the bulk of their lottery expenditure from household necessities”.

After the number of balls used in the draw was increased from 49 to 52, the odds of winning the big prize rose to over 20 million to 1. The odds of winning one of the smaller prizes are much better, but of course nearly everyone who plays the lottery spends more than they win.

Asked about creating alternative ways to enhance the probability of winning, one participant surveyed suggested that the number of balls should be cut from 52 to 40, “so at least when they reduce the numbers, the odds will become better”, which would drop the odds to a bit less than 1 in 4 million.

That’s not going to happen, but even with the 49 balls that the Lotto formerly used, the odds of winning were only 1 in nearly 14 million. By comparison, the odds of a plane you’re on crashing are considerably higher: 1 in 5.3 million.

Many people who play the lottery are chasing the dream of a better life, with 74% of survey participants citing the “need for money” as their reason for playing.

The most common reasons people surveyed gave for playing the lottery are to win money that will help “improve their standard of living” and to “alleviate high levels of unemployment experienced”.

The report says: “Lottery games are seen to be an easy route for many people to get quick cash to get rich.”

The research also found that more than 25% of lottery players said they spent more on playing the lottery than they had anticipated or budgeted for and “could not resist the urge to play again”. Over 30% of the players described their behaviour as “impulsive” when it came to buying lottery tickets.

One in every five people admitted to experiencing disapproval from friends and family for spending too much on playing the lottery.

Close to 24% of participants spend between R21 and R50 each month, while nearly a third spend between R51 and R150.

The average amount spent on tickets goes up by 1.7 times or more from R109 to R185 when big jackpots (defined as R10 million or more) are at stake.

The report looked at what people spend their winnings on. The majority of unemployed (72%), low-income earners (75%) and grant recipients (74%) spent their winnings on household necessities, followed by repurchasing lottery tickets (47%) and giving money to family (29%). Only about 1 in 20 players win prizes, small or large.

The findings of the NLC’s research are largely in line with most countries, where poor people, hoping for a life-changing win, are major supporters of lotteries.

Put another way, the lottery can be categorised as a regressive tax on the poor.

Republished from GroundUp

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