A state's 40-year lottery licence deal will go under the microscope after secretive discussions caught the eye of the auditor-general.
The Lottery Corporation struck the public lottery licence extension with the Victorian government in an agreement revealed to the Australian Securities Exchange on May 5, the same day the state budget was delivered.
Victoria's current 10-year deal with the company, which runs brands such as The Lott and Keno, was due to expire in 2028.
When announcing the extension, the company said it followed "exclusive, bilateral negotiations" and included an upfront "premium payment" of $1.145 billion.
The deal came under fire from the state opposition and Alliance for Gambling Reform chief advocate Tim Costello, who described the lack of transparency as "devious".
The Victorian Auditor-General's Office has confirmed it will examine whether the extension "optimised value" for the state.
"It is important that the process adopted by the government was supported by robust analysis and advice, and that a credible threat of competition was maintained during negotiations to help optimise value," the independent body said.
The review is expected to be released early next financial year.
In May 2025, the Victorian government passed laws through parliament to allow backroom negotiations on the lottery licence between the relevant minister and an "invited" applicant.
Opposition Leader Jess Wilson pointed out the contradiction between the company's statement and Premier Jacinta Allan's suggestion the deal went through a tender process.
"This is a deal that smells rotten from every single perspective," she told reporters on Tuesday.
Attorney-General Sonya Kilkenny said the process was overseen by an independent review panel and its report to Casino, Gaming and Liquor Regulation Minister Enver Erdogan would be tabled in parliament "very shortly".
The Lottery Corporation has 40-year lottery deals with NSW, South Australia and the NT, and a 65-year deal with Queensland until 2072.
Its licence with the ACT is indefinite and a five-year contract with Tasmania will expire in 2030.
In a statement, the Lottery Corporation did not address the auditor-general's review but said the extension would allow it to continue generating significant revenue to fund state and community services.
Treasurer Jaclyn Symes has previously denied the upfront payment propped up Victoria's projected operating surplus of $1.05 billion next financial year.
