Commemorating its anniversary, Foundation Welfare Care dispenses 50 million euros derived from the Bank in North Rhine-Westphalia to various social initiatives.
The 50th Anniversary of the Welfare Foundation in North Rhine-Westphalia sees a name change and a doubled budget. The foundation, now known as the Social Foundation NRW, has been dishing out financial aid to social initiatives since 1974, amassing a total of approximately 1 billion euros, as revealed by the Rheinische Post. Recipients of this benevolence include organizations like the AWO, the German Red Cross, and Caritas.
The annual funding for around 150 projects primarily comes from the surplus earnings of the five casinos in North Rhine-Westphalia, which are expected to contribute a combined 25 million euros annually to the foundation.
Merkur Takeover Doesn't Affect Financial Obligations
In 2021, the Gauselmann Group, now operating as Merkur Group, acquired four locations in North Rhine-Westphalia and opened another casino in Monheim the following year. Despite this ownership change, the casinos' obligation to contribute to the foundation remained intact. The Merkur Group agreed to this condition.
The foundation's board chairman, Marco Schmitz (CDU), explained that the increase in this year's budget to 50 million euros wasn't a gratuity from the Merkur Group, but rather, it was drawn from the existing funds of the Social Foundation NRW, which had experienced fewer expenditures than anticipated in recent years.
Gambling Revenue vs. Taxes
Similar to how car tax isn't exclusively used for road expansion, gambling tax revenue isn't earmarked. Even the so-called casino tax, despite its name, is actually a state-level tax that can be allocated to various projects.
However, the scheme in North Rhine-Westphalia includes an additional earmarked contribution aside from taxes, resembling the new system in the UK, where gambling companies are now compelled to make a mandatory contribution to the National Health Service (NHS).
The funds generated in this manner can be used more flexibly than tax revenue. Similarly, surpluses from the state lottery business must be utilized for culture, nature conservation, sport, or general welfare.
Future Contribution Adjustments on the Agenda?
Since the acquisition of the North Rhine-Westphalian casinos by the Merkur Group, plans for a new casino in Siegburg are underway, with an expected completion date of 2025. However, the level of contribution to the Social Foundation NRW does not seem to be contingent on the number of locations.
Regardless, Marco Schmitz has suggested that discourse about potential adjustments to the funding level may be necessary in the future:
At some point, it will likely be necessary to discuss whether adjustments to the funds are needed. That is a discussion that will take place in the political sphere. – Marco Schmitz (CDU), chairman of the foundation's board and member of the state parliament, source: Rheinische Post**
The foundation generally aims to accelerate its digitalization to improve the distribution of funding and support more projects.
The news of the 50 million euro increase in the foundation's budget has not been a generous gesture from the Merkur Group, but rather, a result of lower-than-expected expenditures by the Social Foundation NRW in recent years.
Despite the acquisition of North Rhine-Westphalian casinos by the Merkur Group, the responsibility to contribute financially to the Social Foundation NRW has remained unchanged for the casinos.
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