The operator of the UK National Lottery, Allwyn, is facing renewed pressure after the cost of a major technology transformation programme was revealed to be running hundreds of millions of pounds over budget.
According to The Telegraph, Allwyn is now expected to spend around £500m ($672m) on upgrading the National Lottery's core IT systems, roughly double the £250m originally allocated when it took over the 10-year licence. However, the operator has formally rejected this figure, stating that it has remained transparent about the amount spent on this latest transformation.
The overhaul forms a central part of Allwyn's commitments to modernise the lottery's infrastructure and increase returns to good causes.
The technology programme has faced repeated delays since Allwyn formally assumed control of the lottery in February 2024. The transition from previous operator Camelot was postponed following a High Court challenge brought by incumbent technology supplier International Game Technology, complicating the planned handover timeline.
In June, Gambling Commission scrutiny intensified after delays to the modernisation of the lottery's retail estate, which includes around 43,500 terminals nationwide.
During the summer, National Lottery services were taken offline for 34 hours to facilitate a major systems update, underscoring the scale and complexity of the work involved.
An Allwyn spokesperson provided commentary to Global Gaming Insider on this matter, stating: "We have invested significant sums in the transformation of The National Lottery that we inherited last year. Without this much needed investment, it would still be reliant on technology last upgraded in 2009, before the launch of Instagram, let alone Chat GPT.
“Our transformation of The National Lottery will gather momentum in 2026, enabling us to deliver on our plans to offer more engaging ways to play and to raise more money for good causes. We remain confident of our goal of doubling funding for good causes to £60m a week by the end of our licence period."
Allwyn has previously stated that the transformation is essential to meeting its funding commitments. In its original bid, the operator projected contributions to good causes of £38bn over the licence term. That figure was later revised, with Allwyn instead targeting a doubling of weekly returns from around £30m to £60m.
However, sales performance since the licence began has lagged initial projections. Based on current trends, National Lottery sales are forecast to reach approximately £84bn over the 10-year term, significantly below the £152bn implied by Allwyn's winning bid. This gap could also translate into lower tax receipts for the UK Treasury.
The licence award remains subject to legal challenge. Media entrepreneur Richard Desmond has filed a £1.3bn claim against the Gambling Commission, alleging flaws in the bidding process. A ruling is expected in early 2026.
Allwyn said the technology investment is necessary to replace systems last substantially upgraded in 2009 and reiterated its confidence in achieving higher funding levels for good causes once the transformation is complete.
The UK lottery challenges come amid broader group activity for Allwyn UK’s parent company – Allwyn International. In Q3 2025, the operator reported net revenue growth of 5% to €1.02bn, while profitability softened due to higher corporate costs and sports betting margin volatility.
During the period, Allwyn advanced its planned acquisition of PrizePicks and a proposed all-share combination with OPAP, positioning the group for expanded scale and technology access.
Allwyn has been rolling out its consumer brand across several European markets, including the Czech Republic and Greece, as part of a wider group integration strategy
