Every time the media or social networks raise the issue about the public service efficiency, the main conversations usually happen around officials’ salaries and whether they should be given up altogether. And only sometimes the State is mentioned to be, primarily, a public service provider.
Most public institutions are divided into those established to provide free services to citizens and businesses and those to perform regulatory functions in various areas of economic activity and therefore able to provide paid services, generating revenues for the state budget and funds to finance organizations providing the first type of free public services, that is, education, health care, public safety, etc.
That is why we should evaluate the effectiveness of these two types of public organizations by different criteria. As for the first-type institutions, the main criteria are the quality, accessibility, and reach of the target audience, namely, service users. As for the second-type institutions, the main efficiency criterion is the ratio of the cost of operating the organization itself to the funds received by the State thanks to it.
The Commission for Regulation of Gambling and Lotteries (CRGL) belongs to second-type institutions and works with clients of the gambling business. May I remind you that the legal Ukrainian gambling market is only two years old. The Law of Ukraine “On State Regulation of Activities in the Organization and Conduct of Gambling” was adopted in July and entered into force in August 2020. The first licenses began to be issued in early 2021. And since then, the total license fees (from January 2021 to October 2022) amounted to UAH 2.436 billion.
The state budget received all these funds thanks to CRGL, the maintenance of which cost 12(!) times less over the same period. For instance, the budget of the national regulator in 2021 amounted to UAH 124.55 million, and during the ten months of 2022, UAH 79.67 million of state budget funds was spent on CRGL. So far, there is no institution so efficient as CRGL, where for one budget hryvnia there are 12 hryvnias received by the State.
In addition, from the very beginning of the full-scale invasion of Ukraine by russia, CRGL has been supporting the country’s economic front and carrying out its activities under martial law. In particular, it:
· ensures compliance with the rules of gambling that are the same for all players;
· ensures responsible gaming principles;
· ensures compliance with the principles of transparency, stability, openness, equality, fairness, and objectivity in the conduct of gambling;
· makes an external influence on the game results impossible;
· fights against gambling addiction (ludopathy), etc.
Thanks to the national regulator, the legal domestic gambling market is gradually recovering and providing revenues to the budget in the form of license fees and taxes.