National Lottery Proceeds: Allocation (Hansard, 8 June 1995)

The Parliamentary Under-Secretary of State, Department of National Heritage (Viscount Astor)
My Lords, the Government have consistently made clear the percentage of lottery proceeds going to each of the five good causes. Each will receive 20 per cent. of the approximately 28 per cent. given to good causes from each ticket sold.

§ Lord Allen of Abbeydale
My Lords, I am obliged to the Minister for that reply. Does he agree that there is a good deal of misapprehension—not, of course, in this House—about the proportion of the take which goes to the five good causes? Is he aware that the other day an article in the Sunday Telegraph stated that it was 50 per cent? Does he further agree that there is even more misapprehension about the share which goes to charity, as one of the five? Can there be very much doubt that that is one of the reasons why charitable giving, especially to the smaller charities, has declined so sharply? Some of them, to my knowledge, have already had to give up altogether. I know that the Government are monitoring charity expenditure. But my question today—to which I am not sure I have had an adequate reply—is perfectly simple. Will the Government do a good deal more to get over to the public just what the facts are?

Viscount Astor
My Lords, the percentage allocation for each good cause was set by Parliament. Each beneficiary sector could argue equally that it should receive a greater proportion of the proceeds. It is the Government's view that it would not be right for one sector to benefit disproportionately, although the situation can be reviewed after the lottery has been running for some time. The noble Lord mentioned charitable giving. It is early days for the lottery; I must stress that. So the evidence on charitable giving is not wholly reliable. It suggests that, while some small charities may be suffering a loss of income, some larger charities are not. We shall be monitoring the situation closely. The Home Office has had discussions with the NCVO and is now considering the way forward with that monitoring. We shall always try to make clear to the public that the reason for buying a lottery ticket is to win a prize. That is the primary purpose of the lottery.

§ Lord Allen of Abbeydale
My Lords, I am sorry to come back. I wish to make clear that I do not for a moment suggest that the share going to charity should be 1458 increased. I suggest that the facts should be made plain so that one day I might hope to meet someone who actually knows that the share of the charities is 5.6 per cent.

Viscount Astor
My Lords, it is early days for the lottery. As I said, we try to make known as much information as possible. We have to remember that out of the money raised for good causes, which is now £586 million, so far £94 million—less than 6 per cent.—has been spent on just over 400 projects. During the course of this year we expect over 1,200 successful applications for lottery funds. Once that has started happening and the public see where the money is going, I am sure it will raise the level of understanding.

§ Lord Hailsham of Saint Marylebone
My Lords, is there not a danger that the extra publicity postulated in the original Question would give further currency to the totally false belief that the reason which actuates those who buy lottery tickets is pure zeal for good causes and not a desire to win a share of the jackpot?

Viscount Astor
My Lords, my noble and learned friend makes an important point. During the passage of the Bill through your Lordships' House, the Government always made clear that, in order not to affect charitable giving significantly, they would emphasise the point that one buys a lottery ticket to win a prize. Over 33 million people in this country have so far won a prize.

§ Lord Howell
My Lords, can the Minister tell the House, bearing in mind that the charities committee will not be paying out any money to charities until November when the lottery will have been in existence for almost a year, what the cost is likely to be of administering the charitable side of it? Is he aware that the Charities Board is to set up 13 regional committees and 13 regional bureaucracies to advise it how to dispense the money? Can he say what estimate the Government have made of the cost of that regional bureaucracy on top of the national bureaucracy which is all to come out of the money that people thought would go to charity?

Viscount Astor
My Lords, I do not have the figures for which the noble Lord asks. I shall write to him and let him have them. I should emphasise that the National Lottery Charities Board will have many more applications than any other of the four distributing bodies. They will come from all over the country. There will be many of them. It is important that we set up a system whereby people who wish to make applications to the National Lottery Charities Board will have their applications dealt with quickly and efficiently.

§ Baroness Robson of Kiddington
My Lords, can the Minister tell the House why, in view of the fact that some medical research charities report a substantial drop in their income, which they attribute to lottery fever, the National Lottery Charities Board continues to exclude medical research from financial considerations?

Viscount Astor
My Lords, the National Lottery Charities Board is not excluding charities involved in the medical field. It has said that its primary aim in relation to the first applications will be grants to improve the quality of life for people and communities in this country disadvantaged by low income. It will 1459 certainly address applications from medical charities for the second and further rounds. There are many factors which affect charitable income: the lottery is only one of them.

§ Lord Peyton of Yeovil
My Lords, does my noble friend accept the figure given by the noble Lord, Lord Allen, of 5.6p in the pound going to charities? If he does— I was not clear from his Answer—ought not that figure to be much more widely known?

Viscount Astor
My Lords, the total amount going to the National Lottery distribution fund is between 28 per cent. and 31 per cent. depending on turnover. The greater the turnover, the greater amount goes to the fund. The figure therefore can be between 5.6p and 6.2p. We try to make that information known but it is important that we do not forget that the primary reason why people buy a ticket on the lottery is not to give money to good causes. If they want to give money to charity they can give it directly. People buy a ticket to win a prize.

§ Lord Donoughue
My Lords, following the Minister's answer that medical research charities are not excluded, does he agree that the practical reality is that in the first round they will not be included? The priority criterion announced by the board does not include them.

Viscount Astor
My Lords, yes. That is the answer I gave to the earlier question.

§ Lady Saltoun of Abernethy
My Lords, is it not the case that if charities received nothing from the lottery, no one could be under the illusion that by buying a lottery ticket they had made a handsome contribution to charity?

Viscount Astor
My Lords, the noble Lady makes an important point. No one should be deluded that by buying a lottery ticket they are helping a charity. They are buying a lottery ticket because they wish to win a prize. If they wish to give money to charity there are many other ways to give money directly.

§ Baroness O'Cathain
My Lords, can the Minister confirm that this is one of the few countries which has a national lottery where any amount goes to good causes? What happens in most countries is that the total take goes to the exchequer. From that point of view, charities and other good causes, including arts and heritage, are well served by the lottery.

Viscount Astor
My Lords, my noble friend is absolutely right. In other countries, the money made from their lotteries is simply subsumed into general government expenditure. We have created a structure in this country which provides an incentive for the operator to make as much money as possible for good causes, along with a transparent distribution process. That ensures that lottery funding remains additional to existing government support in those areas. It is for those reasons that the lottery is such a great success in this country.