HC Deb 21 July 1997 vol 298 cc689-702 3.30 pm
The Secretary of State for Culture, Media and Sport (Mr. Chris Smith)

With permission, Madam Speaker, I should like to make a statement about reforming the national lottery. I am today publishing a White Paper, "The People's Lottery." It will be available in the Vote Office when I have finished speaking.

The Government's priorities are health and education. We said that we would reflect these in our plans for reforming the national lottery, and that is what we are doing today. The White Paper takes forward the plans outlined in our election manifesto and in the details that we published in "The People's Money" on 23 April. Both received the endorsement of the British people on 1 May.

I believe that the package of proposals that we are publishing today will mark a turning point in the fortunes of our national lottery. It will make it even more popular and even more relevant to people's daily lives.

It is less than three years since the first tickets were sold, yet in that short time the lottery has become a tremendous success. Nine out of 10 adults play at least occasionally. There have been 180 million winning tickets: 360 of them for more than £1 million.

The lottery has already raised more than £3.5 billion for good causes. By the time the current licence ends, we expect that it will have raised £10 billion. Thanks to the initiative and hard work of those who have been involved in developing projects, and the lottery distribution bodies, funds have already been committed to more than 24,000 projects throughout the United Kingdom. The large multi-million pound projects may attract most attention, but I suspect that the smaller proposals will make the most difference to many people's lives—such as the grant of some £2,000, featured in the White Paper, for a summer arts festival for children predominantly from low-income families in Norfolk.

I welcome that success. The proposals in the White Paper are about building on it. We shall introduce the legislation needed to give effect to aspects of these proposals later this year.

The proposals in the White Paper fall under four headings. The lottery is paid for by the people and, as it develops, we intend that it should better reflect the people's priorities. First, we will set up a new good cause—the New Opportunities Fund. It will support specific initiatives, additional to core programmes funded through taxation, to support our priorities of health, education and the environment.

Subject to Parliament, the fund will begin its work next year with three initiatives: two helping to raise standards in schools and one promoting better health. Other initiatives will follow—for the environment, as well as for health and education.

The new fund will come on stream in 1998 and, by 2001, the fund will be supporting programmes of activity outside the school day involving at least half of all secondary schools and a quarter of all primary schools. Activities will range from extra coaching in basic literacy and numeracy to new opportunities for creative and sporting education and structured play—fun as well as learning—helping parents who work, and raising school standards. By 2001, the fund will also have trained some half a million teachers and 10,000 public librarians to help children and adults learn throughout their lives using new technologies.

The new fund's health initiative will be a network of healthy living centres throughout the United Kingdom. They will provide a wide variety of facilities and services, in different ways and to help different groups, but all with the same fundamental aim of preventing illness and promoting good health. In designing the detail of those initiatives and delivering money to projects, the new fund will work closely with bodies expert in the relevant fields, in each part of the United Kingdom.

The financial success of the lottery will enable us to set up the new fund alongside the existing good causes. In 1994, the lottery was forecast to raise £9 billion for good causes in the period up to 2001. We now expect it to raise £1 billion on top of that. It is from that extra £1 billion that we will find initial support for the New Opportunities Fund.

We will continue to allocate the bulk of the proceeds of the lottery to the existing good causes. I pay tribute to the work that the distributing bodies have already done—some fine examples are included in the White Paper—and I want them to build on their success. That is the second main theme of the White Paper.

Excellent as the distributors' record has been, it has been limited by some aspects of the framework within which they have to operate. Those constraints are at the root of the concerns expressed about lottery distribution—the lack of a clear overall strategy, the uneven geographical allocation of grants, the failure of some activities to get enough help from the lottery, and the feeling that decisions are remote and unaccountable.

The Bill will contain measures to help us to work with the distributors to tackle the constraints. I want to encourage a debate, involving the distributors and everyone else with an interest in making a success of the lottery, about the way in which distribution will work within the new framework and the extent to which we can make progress in the same direction before the legislation comes into force. Among the main issues on which I am consulting are how the existing distributors can provide even more support for our priorities of health, education and the environment; the contribution that they can make to regeneration; how, through delegation and working together, they can meet needs better; and how they can bring decision making closer to the grass roots.

I now come to our third main proposal. It is a major part of our vision of a lottery for the people. We will use part of the £1 billion of extra lottery money to establish the National Endowment for Science, Technology and the Arts. NESTA will help to ensure that the fruits of the outstanding talents with which our nation is blessed benefit our own country rather than others. It will encourage the development of an environment that fosters creative talent and innovation, and allows them to flourish for the benefit of the country, its economy and its people. In doing so, it will support my central objective of promoting the creative industries.

NESTA will have three simple objectives: to help talented individuals to develop their full potential in the creative activities and industries and in science and technology; to help to turn creativity and ideas into products or services that are effectively exploited with rights protected; and to contribute to the advancement of public education about—and awareness and appreciation of—the areas with which NESTA is concerned. Those objectives will be set out in the forthcoming Bill, but, once established as a trust independent of Government, NESTA will determine for itself its priorities and activities. Its first task will be to map what support and provision already exists, so that its own activities complement existing publicly and privately funded programmes.

Finally, the White Paper outlines our proposals to make the lottery itself a more efficient and transparent operation. As we have made clear, we will seek an efficient not-for-profit operator. In the White Paper, we invite proposals to meet the twin objectives of maximising the return to good causes and removing unnecessary profit. Within the framework that we set, the licence will go to the bidder who will deliver the greatest return, while running the lottery efficiently, transparently and with propriety. So that the selection of a new operator is seen to be independent and objective, we will appoint a panel to assist the director general in his choice, including people with expertise in business, lottery distribution and the views of consumers.

We want to ensure that the director general has the full range of powers necessary to ensure that the operator complies with its licence. The Bill will, therefore, contain provision for him to fine the operator where serious licence breaches occur.

I look forward to the widest possible consultation on our proposals, with contributions from right hon. and hon. Members, and everyone else with an interest in building on the lottery's success, in the consultation period that is now beginning. To help everyone to participate, a summary of the proposals is available in a leaflet that will be distributed widely throughout the country in the coming weeks.

A new good cause for health, education and the environment; a reform of lottery distribution; NESTA to unlock people's potential; and better operation and regulation—this White Paper sets out to enable the national lottery to become even more successful and to become truly a people's Lottery.

Mr. Francis Maude (Horsham)

First, I congratulate the right hon. Member on a substantial change in his tune from what we have heard from him and from other Labour spokesmen previously. The White Paper contains the most remarkable, and justified, paean of praise to the success of the national lottery. On page 27, it says: Our lottery"— my hon. Friends will note that it has now become "our" lottery— has, in a short time, become one of the most successful in the world. Compared to other lotteries around the world, it gives most to good causes and Government and"—be it noted— least to the operator; independent research showed that the UK Lottery's annual ticket sales were the largest of all world lotteries and that it returned the highest amount and percentage to the good causes and Government. That is what we have been saying for some time and it is nice that the right hon. Gentleman has been persuaded of the rightness of what we have been saying. It would also have been nice if, during his remarks, he had had a word of praise for those of his predecessors whose vision it was to set up the lottery and to achieve the remarkable success, which he has justly praised.

I sympathise with the Secretary of State because he has been rolled over by No. 10 and forced effectively to abandon the manifesto pledge that the next lottery contract should be on a not-for-profit basis. Does he now accept that it was a dogmatic and destructive pledge, that what he now proposes in the White Paper goes a long way from it, and that the formulation in his statement sounds to most of us like a restatement of the formulation that currently exists? The pledge was at odds with Labour's vaunted conversion to free enterprise and the profit motive. We welcome the effective abandonment of that commitment.

Does the Secretary of State agree with the Prime Minister, who apparently said in a letter to the right, hon. Gentleman's office that the policy must maintain the incentives for the operator to work efficiently"? Does that not amount to the profit motive that currently operates? Does not the word "maintain" give the game away—that these incentives currently operate and have contributed to the current success? It would be good to hear the Secretary of State accept that overtly.

Does the Secretary of State accept that, on page 28 of the White Paper, the formulation he uses attempts to justify the continued existence of that manifesto pledge, clinging desperately to life by its fingernails: A private operator which had no check on the profits it could make might damage public confidence in the Lottery—people might even stop playing"? Does he not accept that that is precisely what he has been arguing is the case now— that there is no check on the profits and that that will destroy confidence? It has not: public confidence in the lottery has not been damaged. It has increased and, as the Secretary of State said in his statement, the lottery proceeds are now greater than were originally projected. Therefore, he has already defeated his own argument.

What does the Secretary of State mean by the suggestion that yet another quango should be set up to monitor the Office of the National Lottery's handing out of the new contract? Is not that yet another case of new Labour, new quangos? The Minister proposes that the operator should be liable to financial penalties if it does not meet the terms of its licence. If the lottery is to be genuinely operated on a not-for-profit basis, does he accept that those financial penalties will, effectively, come out of the money for good causes?

Finally, does the Secretary of State accept that the creation at this stage of further good causes amounts to a breach of the principle of additionality to which the Labour party attached such importance when the legislation was going through the House? For example, does he recollect the amendment that was moved in Committee by the official Opposition spokesman and which stated that the amount raised by the National Lottery after the deduction of taxes and operating expenses shall be distributed solely and only to causes where it can be demonstrated that they would not otherwise be funded out of taxation or other national or local government revenues."—[Official Report, Standing Committee A, 16 February 1993; c.142.] The Labour party was even tougher on additionality than the Conservative Government proposed to be. Today's proposals amount to a significant volte face.

Does the Secretary of State accept that the contention occasionally made by the Government that the midweek draw is somehow a bonus which entitles them to raid proceeds in this way bears no examination? The right hon. Gentleman knows that the sums for good causes, projected over the period of the lottery, always included an uplift for scratch cards and/or the midweek draw. That has always been part of what was anticipated. Fudge it how he will, the harsh message is that hundreds of charities and groups the length and breadth of the country will be told that the Government have grabbed the money for themselves.

Did not the Prime Minister give the game away in the letter that his office sent to the Secretary of State which stated that a key question will be finding ways of re-orientating the lottery to provide more support for projects that reflect the Government's policy objectives, such as health, education and the environment How will the Secretary of State explain to the Deputy Prime Minister that the Aqua science museum in Hull is now under threat? How will the Minister of Agriculture, Fisheries and Food take the news that the facelift for Whitehaven, to be funded by the Millennium Commission is now under threat? Is not the reality the fact that the only Cabinet Minister who is smiling as a result of this turnaround will be the Chancellor of the Exchequer? Of course, that is an unusual event and perhaps we should celebrate it on its own.

Labour has a black hole in its public finances of its own making, and it has been created by excessive public spending commitments beyond what the public finances can afford. The Government have got themselves into a mess and, as so often, they try to extricate themselves by going on the grab. The Secretary of State has been rolled over by No.10 and the Treasury. The people's lottery is becoming the Government's lottery, and that illustrates what we have always contended—that Labour cannot keep its hands off other people's money.

Mr. Smith

Oh dear, Madam Speaker. I had expected somewhat better than that.

The right hon. Gentleman says that there has been a substantial change of tune. There has not. We are today publishing proposals to put in place precisely what we told the electorate during the election we would do. When the original lottery legislation was passed by the House, it was supported by hon. Members on both sides of the House and was not simply the province of the then Government.

The right hon. Member said that the Government have somehow abandoned our not-for-profit objective. Although I gave him several hours to read the White Paper before I made the statement, clearly he has not read page 28, which precisely states that we maintain that objective. The goal must be to maximise the return to good causes. The current lottery operator, by the end of the term of its franchise, will have made upwards of £500 million profit. Our determination is to achieve a better deal for good causes when the franchise is renewed than is provided by the current lottery operation.

The right hon. Member said, "new Labour, new quango." I am astonished that he does not think that it is sensible that the lottery regulator should have advice from the business world, lottery distributors and consumers in reaching the important decision on who should run the lottery in future.

The right hon. Member drew attention to the matter of the midweek lottery draw. I draw his attention to page 8 of the White Paper, which specifically spells out how the money that is additional to the overall lottery—which is available because of the midweek draw—will enable us to keep our commitments to the current distributors and to add the new good cause that we are proposing today.

The right hon. Gentleman said that, somehow, there is a black hole in the public finances. I should draw his attention to the fact that my right hon. Friend the Chancellor of the Exchequer, managed to find in the Budget that he announced only a few weeks ago £3.6 billion of extra resources for health and education.

The right hon. Gentleman said also that no other Cabinet Members are smiling. Perhaps that is why, in the press packs that we will issue later today, there are supportive press releases from my right hon. Friends the President of the Board of Trade and the Secretary of State for Education and Employment.

The right hon. Gentleman made two points that have some importance. The first was the importance of holding fast to the additionality principle. The amendment tabled by my hon. Friends in Committee provided a very good definition of additionality—for which the right hon. Member for Cities of London and Westminster (Mr. Brooke) was asking in today's Question Time. The important aspect is that the lottery is providing support for those projects that are not the province of the Exchequer and the taxpayer—a principle which is enshrined in everything that we propose in the White Paper.

Finally, the right hon. Gentleman said that the Government are taking money off good causes. We are not taking money off good causes. In our proposals for health, education and the environment, we will make additional money—which is available because of the midweek draw—available to equally good, if not better, causes.

Helen Jones (Warrington, North)

May I welcome the Secretary of State's announcement that more money will go to health and education projects, and tell him that that will be particularly welcome to people in the Orford ward of my constituency—who applied to the national lottery for money to establish a one-stop shop, including health projects, and were turned down despite being in one of the borough's most needy areas? In the light of that example, will he provide more details of how such projects will be able to apply for such grants?

Mr. Smith

I am grateful to my hon. Friend for her remarks, and I can tell her that an application from that particular area would be extremely welcome to the New Opportunities Fund, as and when it is established in our proposed legislation.

Mr. Robert Maclennan (Caithness, Sutherland and Easter Ross)

In his remarks, the Secretary of State drew attention to what he described as the lack of a clear overall strategy. Does he not accept, however, that his White Paper—far from providing a clear overall strategy—is endorsing the thinking of Tom Lehrer that, "You can get away with it by sprinkling a little bit over each part of the banana split"? It seems remarkable for him to say it is not the province of the Treasury and the taxpayer to deal with medical matters that will be covered by the proposals in his White Paper. Is it not strange that he boasts that preventive medicine is to be one of the new beneficiaries of his proposals, and that the new methods of teaching and encouraging teacher training are regarded as not suitable to be paid for by taxpayers and the Treasury? What limit will he put on the erosion of the national lottery by his Cabinet colleagues, who no doubt all have other good causes for which they cannot find taxpayers' money?

Will the Secretary of State confirm that he still regards himself as the custodian of culture, the media and sport, because the White Paper certainly contains no awareness of the fact that the lottery's problem has been the lack of take-up by existing good causes, with less than a quarter of the money held for them being distributed to them? Surely, the money held should be turned to good account and be used, not just spread ever more thinly.

Mr. Smith

The lack of take-up is exactly one of the problems we seek to address in chapter 2 of the White Paper on reforming the existing distribution of lottery funds. It is precisely the lack of a clear overall strategy and the absence of power for lottery distributors to be proactive—at the moment, they have to sit and wait for applications to come in—that have led to the uneven geographical distribution and, in many cases, to the lack of ability to tackle real problems in deprived areas as we would wish.

The point about the health and education projects is precisely that they are not part of the core health and education services which, rightly, have to be a continuing part of the responsibility that we all bear as taxpayers.

Mr. Dennis Skinner (Bolsover)

On the question of Camelot making about £2 million a week profit, will my right hon. Friend give us an assurance that the proposal for a non-profit scheme will hold fast? However, may I enter a caveat? I keep hearing Branson's name—Mr. Goody Two Shoes. There is something about that fellow that I just cannot cling to. He seems to have his finger in every pie, and I would not trust him with the lottery, either—he would be making some money for himself if he got hold of it.

Mr. Smith

I refer my hon. Friend to page 28 of the White Paper where we set out precisely what we propose and invite public comment on such issues. Richard Branson, Camelot or anyone else would be very welcome to apply post-2001 to run the lottery, provided they do so in accordance with the framework that we will put in place in the legislation later this year.

Mr. Robert Key (Salisbury)

Of course the Secretary of State is right to review the way the lottery works—that was part of the original Act—but is he aware that not one of the Labour warriors who fought the Bill in Standing Committee is present today? Those who fought on the principle of additionality day after day in Standing Committee are not here—they are no doubt ashamed to see that the Government have been rolled over by the Treasury. The right hon. Gentleman speaks fondly of people's aspirations for the lottery, but is he aware—if he is, he has not mentioned it—that their aspiration is to win? That is what the national lottery, and its success, is about, but his proposals will mean that people are less likely to win and that the lottery will no longer be the most successful national lottery in the world.

Finally, does the Secretary of State agree that, apart from the Treasury, the only winners will be Vernons, Zetters and Littlewoods? Good luck to them, but it is back to those days.

Mr. Smith

The winners will be the British people. They said to us during the election campaign and afterwards that they want part of the money that they spend on their lottery tickets to go to good causes in health, education and the environment. That is what the White Paper proposes.

Dr. Tony Wright (Cannock Chase)

I congratulate my right hon. Friend on his excellent document. The essential element of the lottery is randomness. Would it not be sensible to introduce a random element into the way in which the money is paid out, as well as the way in which it is paid in? I speak for an area that has had a lousy distribution of lottery proceeds. When the qualifying criteria are met, the bids are in and the priorities are determined, we could have a lottery to decide on the winners and losers. Instead of getting infusions of largesse from anonymous distribution committees, local communities would see the intervention of Lady Luck and would get as much excitement from the moment of distribution as from the moment of paying in.

Mr. Smith

Normally, I agree with my hon. Friend, but I do not follow him entirely in his argument today. One of the problems with lottery money distribution at the moment is that it tends to be random, in response to the applications that happen to have been submitted. We believe that a more strategic view can and should be taken by the distributing bodies. That is why we have proposed changes.

Mr. Richard Page (South-West Hertfordshire)

The Secretary of State will be aware that the lower the operator's percentage, the more money there is for good causes. Camelot, which is based in my constituency, has proved that by securing hundreds of millions of pounds more for good causes than there would have been if another licensee had been selected, particularly one that was not for profit. The right hon. Gentleman says that he wants a not-for-profit operator. What will he do if, when the licence is up for renewal, a for-profit operator offers the lowest operating percentage? What would win—Labour dogma or good causes?

Mr. Smith

The key principle has to be to maximise the fund for the good causes. That is why we set out in the White Paper how we believe that the present arrangements can be improved on.

Ms Gisela Stuart (Birmingham, Edgbaston)

I am delighted that NESTA funds will be available for talented young people. Will young creative artists in my constituency, particularly dancers, who have been unable to get further education funds so far, benefit from the proposals?

Mr. Smith

A scheme was put in place by the previous Government to give some assistance to dance and drama students, using lottery funds. We supported that scheme when it was launched. It is now bedding in and we want to see how it progresses before we make any changes. The development of NESTA will enable talented youngsters in many fields to develop their talents and turn their skills into careers.

Mrs. Virginia Bottomley (South-West Surrey)

The right hon. Gentleman is right to pay tribute to all those in the distributing bodies and elsewhere who have made such a success of the lottery. Is he aware, however, that almost every lottery in other countries is the responsibility of the Finance Department? Earlier today, the right hon. Gentleman talked about the importance of resisting good advice from the Treasury on, for example, the privatisation of Channel 4. Today, he has not resisted the Treasury's advice. The additionality principle is breached, the jackpot winners are the Treasury and the successful lottery that we have known will be seriously damaged by the White Paper.

Mr. Smith

The additionality principle has not been breached.

Mr. Harry Barnes (North-East Derbyshire)

I hope that the moves on health, education and the environment mean that there will be a fairer distribution of lottery funds, because those elements are important throughout society and need to be responded to. Under the current arrangements, not a single one of the 41 grants from lottery funds for sport that have been provided so far in Derbyshire has been given to north-east Derbyshire or Chesterfield. That is an unfair arrangement. I am pleased that measures are proposed in the White Paper that will begin to tackle that problem.

Will my right hon. Friend look at the scam that is being perpetrated on punters in the lottery by many organisations? Systems are being sold that are supposed to increase people's chances of winning the lottery. That is not on. People are having the wool pulled over their eyes and something should be done to stop it.

Mr. Smith

I agree entirely with my hon. Friend about those who try to convince people that they have a system for giving a better chance of winning the lottery. Self-evidently, that cannot be the case and it is unacceptable for people to make that claim.

There are three changes in lottery distribution that will achieve the objectives that my hon. Friend seeks: first, the emphasis on health, education and the environment; secondly, the ability, through the changes to distribution, to ensure that regional imbalances in lottery distribution are addressed; thirdly, the ability of different lottery distributors to come together in order to target assistance in the arts, sport, heritage, charities, health and education at areas of particular deprivation. That will be of considerable benefit to many parts of the country.

Mr. Peter Brooke (Cities of London and Westminster)

If, as was demonstrated earlier this afternoon, one of the Secretary of State's junior Ministers patently does not know what his current definition of additionality is, why should the rest of us have any confidence in it?

Mr. Smith

The principle of additionality is very clear. It is that the lottery should not be used for expenditure on matters that are properly the province of the Treasury and the Exchequer. That principle is enshrined in every paragraph and page of the White Paper.

Mr. Vernon Coaker (Gedling)

How will the leaflets that explain the White Paper be made available to the public? I believe that once the public become aware of what the Government propose, far from decrying it, as Conservative Members would have us believe, they will welcome it when they see the money that will be made available for a variety of projects. Will my right hon. Friend ensure that the leaflets are available in places where people can easily get them, such as supermarkets, doctors' surgeries and health centres, because it is the Government's wish to consult widely with people? If we are to do that, we must make the leaflets easily available.

Mr. Smith

I thank my hon. Friend for his question. We are printing 2 million leaflets which will be available widely across the country at every lottery distribution point and in public libraries. I am sure that my hon. Friend is right to say that the public will warmly welcome our proposals. When we proposed precisely these measures during the election campaign, they produced an enthusiastic response from the public. I am afraid that Conservative Members seem to have forgotten that an election took place on 1 May and that the people gave their verdict.

Mr. Peter Viggers (Gosport)

Another day in the life of this Government and another media illusion. I congratulate the right hon. Gentleman on the presentation of a mean, tricky and nasty little statement. First, yet again, he trashed those responsible for the enormous success in financial terms of the lottery. Secondly, he has announced a plan to steal part of the proceeds to pay for part of the Government's proper expenditure plans. Is not it true—my right hon. Friend the Member for Horsham (Mr. Maude) put his finger on the issue—that, after today, it will be significantly less the people's lottery and much more the Government's lottery?

Mr. Smith


Fiona Mactaggart (Slough)

I welcome my right hon. Friend's commitment to extending lottery funds to innovation in health and education, but may I ask him whether he has he spoken to the Ministers in charge of those Departments about what happens when a project is no longer innovatory—when it has proved its worth and value? That is one of the difficulties that private charities have to face, and it will be a challenge to the Government, to which I have not yet seen an answer.

Mr. Smith

My hon. Friend, unlike many Conservative Members, puts her finger on a serious and pertinent point. Yes, the aim of the New Opportunities Fund is to support innovation in health and education. That is the whole answer to the point about additionality raised by Conservative Members. Of course, once innovation has bedded in, it becomes accepted and part of normal life. Our aim in everything that we are doing is that the initial funding should be just that, and that the healthy living centres and after-school clubs should become self-funding in due course, after the initial tranche of money has gone in.

Mr. Tony Baldry (Banbury)

The Secretary of State will be surprised that Conservative Members are amazed that he should think that public health and teacher training are not legitimate matters for the public expense and for the Treasury. Is not the concern about all of this that there will be a blurring of the legitimate boundaries of what should come out of public funding and departmental expenditure?

There will be little rejoicing in Oxfordshire that there is to be more money for teacher training at a time when, as a consequence of the capping of Oxfordshire, the number of classes of more than 30 will go up considerably, and little rejoicing that there is to be more money for public health, when centres such as the Rivermead rehabilitation centre and Ritchie Russell house are threatened with closure because of the lack of funding to Oxfordshire health authority.

Mr. Smith

The hon. Gentleman has clearly completely missed the work that my right hon. Friend the Secretary of State for Education and Employment is doing in reducing class sizes throughout the country. On the other point that he makes, a one-off exercise in teacher training for information technology, and the development of out-of-school clubs, is not, in any reasonable person's book, core Exchequer expenditure on education services.

Mrs. Linda Gilroy (Plymouth, Sutton)

I welcome my right hon. Friend's statement. My constituents in Plymouth, Sutton—which, on the index of local conditions, includes the poorest ward in England—will greatly welcome his commitment to health projects, education projects and regeneration. Will he say a little more about how he intends to ensure that the distribution agencies deliver and reach all parts of the country, but especially areas such as my constituency where there is such a need for regeneration?

Mr. Smith

One of the ways in which we seek to improve the distribution mechanisms not just of the New Opportunities Fund that will be established, but of the existing lottery distribution bodies, is to ensure that they take into account the regenerative possibilities that come from investment in the arts, sport, heritage and charitable and voluntary endeavour in an area, as well as the health and education projects that we propose.

Ms Roseanna Cunningham (Perth)

Given that one of the main criticisms—to which the Secretary of State did not refer—of the national lottery at present is the allocation of extremely large sums to what are seen as white elephants or to projects that apparently benefit only a few individuals, where in his statement is there any indication that he will look again at the basis on which awards are made?

Mr. Smith

I draw the hon. Lady's attention to chapter 2 of the White Paper, where we set out precisely how we intend to go about doing that. We stress the importance of decision making nearer to the grass roots, the importance of small-scale rather than large-scale projects, and the importance of lottery money being able to support people and activities, rather than just buildings.

Mr. Barry Jones (Alyn and Deeside)

I welcome my right hon. Friend's statement—yet another election promise kept. Does he guarantee that there will be more local, small-scale and after-school projects in Wales? Does he know of my astonishment that the recent application by the Sea Cadets of Connah's Quay on the River Dee in my constituency was thrown out? All they were asking for was the renewal of the tumbledown, damp and disgraceful building, in which they carry out their excellent operations. How will that rejection help my constituents, the Sea Cadets?

Mr. Smith

I regret that I cannot give my hon. Friend a specific answer on the question of the Sea Cadets' project. I can tell him that, throughout the country, including Wales, more local, out-of-school clubs and projects will become available to the people through the changes that we propose in the White Paper. I find it somewhat astonishing that the Conservative party should find it remarkable that a party should seek to keep the promises that it gave to the electorate during an election.

Mr. John Greenway (Ryedale)

Will the Secretary of State be a little more forthcoming than he was in his reply to the hon. Member for Birmingham, Edgbaston (Ms Stuart) about finding more money to support dance, drama, horticulture and agriculture students? In a week in which it is widely predicted that the Government will announce the end of maintenance grants and the charging of fees for students in universities, would not it make much more sense to use lottery money for education and opportunity to support students rather than teachers being trained?

Mr. Smith

I am astonished that the hon. Gentleman does not think that the training of teachers is important. Any question of grants and fees for students is a matter for my right hon. Friend the Secretary of State for Education and Employment, who will make a statement later this week on the subject. The present scheme for dance, drama and other students was introduced by the previous Government and has been in operation for about three months. I want to see how it works before making hasty proposals to change it.

Mr. David Lock (Wyre Forest)

May I congratulate my right hon. Friend on his fresh thinking on the lottery? I particularly congratulate him, as a London Member of Parliament and one who appreciates the high arts, on his acceptance that there may have been a south-east tilt in lottery applications and distribution in recent years. I hope that the review and any mechanisms for future distribution of lottery money will ensure that the people's priorities are reflected in the people's lottery and, especially, that people in the regions outside the south-east get a fair crack of the whip in future schemes.

Mr. Smith

I thank my hon. Friend for his compliments. I observe in passing that some parts of London have not done as well as some of the high-profile projects in the heart of the capital city, but I can confirm that the people in the regions can expect to benefit from the proposals that we have put forward today.

Mr. Patrick Nicholls (Teignbridge)

Is it not a fact that we have been treated to a thoroughly miserable statement this afternoon? The Secretary of State has come to the Dispatch Box and said that teacher training and public health are no longer core functions of the Government, but can instead be supported by gambling. We have seen the Secretary of State squirming with unease, because he loathes the profit motive totally and yet is driven to the conclusion that the profit motive has provided the most successful lottery in the world.

We were promised a cheerful fairy tale this afternoon, but it has turned out to be a tale of two muggings. First, the Secretary of State has been mugged by the Chancellor and thoroughly rolled over and caned for his pains. More important than the indignity that the Secretary of State has suffered is the mugging of the people's lottery. The people's money has been raided by an incompetent Government, who, when faced with hard, genuine choices about public finances, have reneged on the promises and undertakings that they have previously given—on the arrogant assumption that the public will never spot the difference. The public will spot the difference, and the Opposition will make sure that they do.

Mr. Smith

That summation—if that is what it was meant to be—bore precious little resemblance to our exchanges this afternoon. The statement and the White Paper will enable the people of this country to get what they have long demanded: support from the national lottery, alongside the existing good causes, for innovative projects in health, education and the environment which add to the public's health, education and aspirations. That support will not replace the core responsibilities of the Exchequer and will put in place the people's priorities in the people's lottery.