There was a time in Spain when wealth flowed through public hands. The state owned a number of publicly traded companies that, more than two decades later, still stand among the country’s most important firms, with a presence in the Ibex-35. Endesa, Gas Natural, Red Eléctrica, Repsol, Iberia, Transmediterranea, Argentaria, Aceralia, and Indra were part of an economic powerhouse once managed by public administration and then gradually opened to private investment.
As Spain modernized its economy, joined the European Union, and adopted the euro, political leadership initiated broad reforms that liberalized the economy. While many assets were privatized, the state continued to own companies that had accumulated losses in recent years under the umbrella of the public utility complex, ensuring strategic control where it mattered most.
In 2021, Correos recorded a loss of 96 million euros; Renfe faced 350 million; Adif High Speed reported 460 million; the offshore construction firm Navantia showed 82 million; the EFE Agency posted 9 million; and the energy group Grupo Hunosa reported 8.5 million losses. Beyond these figures, the state retains ownership of a so-called goose that lays the golden eggs—State Lotteries and Gambling—a company known to every Spaniard, yet rarely making big headlines.
Christmas lottery: check your decimals
State Lotteries and Apuestas del Estado SME closed 2021 with revenue of 9,359 million euros and an operating profit of 1,944 million. These results echo those from 2019, after a near 20 percent revenue drop in 2020 due to the pandemic.
This income statement positions the entity among the country’s most important firms. In 2020 it ranked 13th in a broad national comparison, surpassing the turnover of Spanish subsidiaries of multinational giants such as Lidl, Orange, Acciona, BP, Peugeot-Citroën, Renault, and Mercedes-Benz.
Beyond the scale of its earnings, State Lotteries and Gambling form part of a monopoly-oligopoly in daily lotteries. There are few operators that run sweepstakes with high public visibility, including Red Cross and Gold Sweepstakes, Eleven and tickets, and Lotteries itself.
Roulette or bingo
In 2021, the Christmas Lottery distribution involved 172 million tenths, with each unit priced at more than 20 euros. The potential prize pool approached 3,440 million euros, yet distributions returned around 70 percent of ticket sales, about 2.408 billion euros. In such schemes, the total payout often remains dwarfed by the overall revenue, reflecting a public design where a portion funds public services while a larger share supports administrative costs and profits.
Analysts note that bets linked to charitable or nonprofit institutions typically carry lower margins than private games. The World Cup final margin for private bookmakers then serves as a benchmark: in some cases, private gaming margins approach a few percent, while public lotteries maintain a steadier, lower percentage of revenue allocated to prizes. The public setup thus balances public benefit with the need to sustain its operations.
Treasure always wins
When a sizable prize is won in the Christmas Lottery, it is often the state that benefits from the outcomes. In the early 2010s, the People’s Party government introduced a bonus tax on prize winnings above a certain threshold. Law No. 16/2012 established a 20 percent tax on prizes over 2,500 euros, a rule later adjusted to higher thresholds. The purpose was to allocate a portion of winnings to public coffers while maintaining fairness in tax treatment across the economy.
Tax authorities and analyses show that the state collects a meaningful share of prize distributions, with a portion allocated to the treasury and another to public programs. The implication remains clear: even when citizens win prizes, the public sector retains a stake through taxation and redistribution, reinforcing the notion that public institutions often play a central role in economic cycles.
The situation invites reflection: a citizen purchases a 20-euro ticket, hopes for a sizeable prize, and in many cases receives a portion of winnings back through tax contributions and public programs. It is a system where public administration frequently garners a steady return, supporting treasury needs and social initiatives in a way that blends ordinary life with broader public policy goals.