National Lottery and Gambling (Hansard, 6 June 1995)

The Parliamentary Under-Secretary of State, Department of National Heritage (Viscount Astor)
My Lords, the Government have directed the Director-General of the National Lottery not to license games as part of the National Lottery which he considers will encourage excessive participation.

§ Lord Allen of Abbeydale
My Lords, I am grateful to the Minister for that reply which falls a little short of answering the points lying behind my Question. Does he accept that the number of appeals to Gamblers Anonymous and the accumulating anecdotal evidence suggest that what was presented as a harmless flutter is causing problems to quite a lot of people? Are not the scratch cards with their characteristic of handing out small instant prizes which are designed simply to encourage the gambler to go on and on proving particularly addictive? These are early days, but has not the time already come to put in hand some well funded research and even possibly to go back to some basic re-thinking before an obsessive gambling culture really gets out of hand?

Viscount Astor
My Lords, I do not believe that there is any danger of what the noble Lord would call an obsessive gambling culture getting out of hand. It is important to remember that the National Lottery is generally considered to be at the softest end of the gambling spectrum. Low stakes, prizes, the odds of winning and the lack of skill are all involved. They will make the lottery and the instant win games less likely to lead to addiction or major losses than other forms of gambling that are available to the public.

§ Lord Stallard
My Lords, I believe that the noble Lord, Lord Allen, is absolutely right. There is a danger of a culture of addictive gamblers. Scratch cards are already proliferating. There are scratch cards for everything in every shop. There is no age limit for the people who can buy them, which causes a great deal of concern to parents and school teachers. The Minister ought to take the matter more seriously than he seems to have taken the original Question.

Viscount Astor
My Lords, I took the original Question very seriously. The point I was making concerned the National Lottery. Scratch cards have been around for a long time and have been in use for a number 1258 of years. Instant win games and cards were included in Camelot's applications for the licence to run the lottery. They are expected to be the important factor in the achievement of forecast revenue for the National Lottery distribution of funds.

§ The Lord Bishop of Oxford
My Lords, since there has been a change in government policy so as to promote and encourage gambling, does the Minister agree that the Government have a special responsibility to assess the effect of the new schemes on those addicted to gambling? After all, the Rothschild Committee on Gambling drew particular attention to the needs of that group. Calls to Gamblers Anonymous have apparently increased by about 17 per cent. over the past three months.

Viscount Astor
My Lords, the right reverend Prelate makes an important point. The Director-General of Oflot takes seriously the suggestion that the National Lottery games should not encourage excessive participation. He is actively considering the scope and nature of the research required. I hope that that will answer the right reverend Prelate's point. The Government's policy is that we should not interfere with the liberty of the individual to gamble, but we should take steps to protect the vulnerable.

§ Lord Avebury
My Lords, the noble Viscount says that he does not believe that the lottery scratch cards are leading to excessive patterns of gambling but he has just admitted that research has not yet been put in hand to show what effect the lottery has had on people's expenditure patterns. Will he instruct those who are investigating the matter to pay particular attention to the expenditure on the National Lottery scratch cards by people who are least able to afford it, such as those living on income support?

Viscount Astor
My Lords, it is early days with the National Lottery and one must not forget that scratch cards were only introduced at the end of March. Our market research at the moment indicates that on average most people spend slightly over £2 a week on the lottery. That is quite a small sum, but obviously it is important that the Director-General of Oflot monitors the situation on a regular basis.

§ Lord Finsberg
My Lords, does my noble friend agree that most of the arguments we have heard this afternoon are a repetition of the arguments from those who opposed the whole concept of lotteries from the start? Is it not time that they accepted that the will of Parliament is that there should be a National Lottery with the safeguards which my noble friend mentioned?

Viscount Astor
My Lords, my noble friend makes an important point and one with which I thoroughly agree. There is no question but that the National Lottery has been a success. Already, almost £600 million has been raised for good causes, fully vindicating the Government's decision to have a national lottery, and to have a private company run it. The benefits of the lottery are already being seen the length and breadth of this country: 297 projects have now been approved, involving grants of almost £72 million.

§ Lord Mason of Barnsley
My Lords, is it true that, at the same time, surveys indicate that donations to charities fell by £71 million in the first four months of the lottery 1259 being in operation, and that medical research, especially cancer research, is excluded from lottery donations? Does not that aspect of the matter necessitate an urgent review of the lottery operations?

Viscount Astor
My Lords, medical research is not excluded from the National Lottery. Obviously, a number of factors affect charitable income. Charities stand to gain from 20 per cent. of the net proceeds of the national lottery, which could be as high as £320 million a year. That money will be distributed by the National Lottery Charities Board.
During the passage of the Act we gave the assurance that we would monitor charitable income. We are indeed doing so. The evidence so far is that some charities are doing better and some are doing worse. It is too early to tell. It is important to remember that the National Lottery Charities Board expects as many as 200,000 applications this year. No body is ruled out from applying. The charities board has made it clear that medical research charities can apply for funding. It has also said that it will look in the first instance at applications from people suffering poverty.

§ Lord Rix
My Lords, is the Minister absolutely accurate when he states that 20 per cent. of the proceeds of the National Lottery goes to charities? Is not the correct figure in the region of 5 per cent., with the rest of the money going to different forms of grant aid, such as the heritage, the arts and so forth? Is not the figure of 20 per cent. a slight exaggeration in regard to charities?

Viscount Astor
My Lords, I was referring to the National Lottery Fund, 20 per cent. of which goes to charities.

§ Lord Donoughue
My Lords, I was tempted to ask the Minister whether he was aware—as I am sure he is—that this month is the 350th anniversary of the Battle of Naseby, which should remind him that these arguments between the Puritans and the Cavaliers have been going on for some time. My specific question is this: is the Minister aware that this morning Camelot, the operator of the lottery, announced its first year's financial results, which make it clear that over its licence period Camelot will take out upwards of £1.5 billion in profits and expenses? Is he further aware that a leading businessman has said that this kind of take is unacceptable while small lotteries are being squeezed, and has suggested a windfall tax to be distributed to the lotteries? Will the Minister comment on that statement?

Viscount Astor
My Lords, as I have said in this House before, the take over the seven-year period of Camelot's licence will be just over 5 per cent. of turnover. Camelot's bid retained a lower share of turnover for operating costs and profit than that of any other applicant, including Mr. Branson, who made a statement this morning on that issue.

§ Lord Harris of Greenwich
My Lords, will the Minister indicate, having referred, as he has, to the possibility of research, who will pay for that research? Will it be Camelot or the taxpayer?

Viscount Astor
My Lords, the Government will pay for the research out of the funds that devolve from the National Lottery. So it will be funded neither by Camelot nor by the taxpayer.