HL Deb 16 March 1998 vol 587 cc460-5

3.5 p.m.

Read a third time.

Clause 5 [The new good cause and the re-allocation of lottery money]:

Lord Skidelsky moved the amendment: Page 8, line 12, leave out subsection (9).

The noble Lord said: My Lords, as this is my last appearance before your Lordships' House on this matter I take the opportunity afforded by this amendment to sum up our main objections to the Bill. They are four in number. I shall do this as quickly as I can because I do not want to delay the House unduly. The first objection concerns the character of the new good cause. It is very different from the others. It is an integral part of the Government's social programmes, not a desirable extra. As such, it has two consequences. First, the new opportunities fund will be much more directed as to what it should do than the other distributors. The much greater powers that the Secretary of State has taken under the Bill are a direct consequence of the new good cause. The second consequence is that the new good cause is voracious. The Government have already announced three initiatives. There are sure to be others added. That is why we expect that over time the new opportunities fund will take a larger and larger share of the total of national lottery money available for distribution. That is our first objection to the Bill.

Our second criticism arises from the Government's refusal to entrench the shares of lottery moneys going to the arts, sport, the national heritage and charities. Together with the Liberal Democrats, we have repeatedly asked for such entrenchment and the Minister has always refused. It is hard to resist the conclusion that the Government regard the flow of money to these causes as residual—the amounts of money left over after their prior commitments to the new opportunities fund and NESTA have been met. I have read carefully what the Minister said at Report. He promised that, barring the extremely unlikely circumstance in which lottery income for good causes is less than £10 billion in total"— that is, over the existing seven-year contract period— we shall ensure that each of the existing good causes receives by 2001 the £1.8 billion expected when the lottery started".—[Official Report, 9/3/98; col. 21.]

They have already received £1 billion each under the legislation of the previous government. Of the remaining expected total of £5 billion, the National Millennium Commission will get £1 billion and the new opportunities fund another £1 billion, leaving £800 million each for the remaining good causes; that is, for the arts, national heritage, sport and charities. Therefore, they will lose £200 million each under the new legislation. Admittedly, this is a loss in relation to the expected £10 billion rather than the originally estimated £9 billion. Therefore, the Minister was able to argue that their original expectation had been left undisturbed. But this is a feeble argument, as my noble friend Lord Crickhowell pointed out at Report. The original expectations were not for a sum of money but for a percentage. No one knew in 1993 that the money would be £9 billion, just as no one today can say for certain that over the next three-and-a-half years the lottery will have £5 billion, £4 billion or even £3 billion to distribute. Suppose that the economy goes into recession. Stranger things have happened, even under Labour governments.

Does the Minister claim that in such circumstances people will go on spending the same on the lottery as they now do? He would be very incautious if he were to do so. That is why percentages are at the heart of the matter. The Minister cannot guarantee money but he can guarantee percentages. That he has always refused to do.

Let me rephrase the questions I asked on Report. Will the Minister assure us that in the event of the total for distribution over the next three-and-a-half years falling below what is expected he will protect the £1.8 billion that he has promised for the four good causes? Will he give an undertaking that in the event of the total for distribution exceeding the £10 billion he will ensure that a fair share of that surplus goes to those good causes?

Our third criticism concerns the commercial aspects of NESTA—the new endowment set up to help science, technology and the arts. We do not believe that it should become a business angel. It is not set up to second-guess the market, and it should not be trying to do so. I have put that argument repeatedly during the Bill's passage, but it has been water off a duck's back so far as concerns the Government. They will have to live with the consequences.

Finally, I come to the subject of the amendment. I have just one thing to add to what I said on Report. It arises directly from the Minister's remark: Carrying the re-allocation of funding back to October 1997 does not affect the total money re-allocated from the existing good causes to the NOF and NESTA".—[Official Report, 9/3/98; col. 31.] I am glad that we have at last a candid admission that the Government have been re-allocating money from last October. There is no fiction about those shadow accounts in that statement.

The Minister said that had that re-allocation not started, the new opportunities fund's share would have had to be set higher and the existing distributors' share lower than is now the case to make up for lost time. He asked what was improper about that. What is improper about it is that the national opportunities fund was not entitled to receive a penny of the money before the Bill became law. Had the Government wanted the new opportunities fund to have the £1 billion that they imprudently promised in their manifesto they should have put a higher percentage in the Bill with a lower percentage for the existing distributors. That would have been the honest thing to do. It would also have made transparent the extent of their raid on the four good causes. I understand why they preferred to do it the way that they did but it is underhand and sets a thoroughly bad precedent. I beg to move.

Lord Redesdale

My Lords, I have a number of questions about the amendment. Its purpose is to expose some of the problems that we see over the way in which the new opportunities fund has been set up. First, if subsection (9) were to be left out of the Bill, what effect would that have on the moneys that have been set aside? If the money had to be put back into the funds immediately, would that mean an enormous cash injection to the existing five good causes? Could they then go ahead with some of the projects that they have put on hold? If that is the case, the Minister may have been mistaken when he said that it would have no effect on the projects that the five good causes are planning.

At an earlier stage of the Bill, the Minister said that the Government needed to set up these shadow accounts retrospectively so that the money would be available for the new opportunities fund to put in place immediately the Bill became law. He even went so far as to say that if the money were not made available, 25 per cent. of money available for good causes would have to be put aside and spent on the new opportunities fund to fund the new initiatives. I have a slight problem here, because we have had the jargon of the people's lottery. But these new initiatives have to be classified as government initiatives. The Minister said that the projects had already been put forward and so they had to go forward. I examined carefully what was said at the previous stage. I find that they were initiatives put forward by the Government in their manifesto, and this is a way of funding them.

I have a problem also with the fact that the figure would have to be 25 per cent. if the matter could not be dealt with retrospectively. I find that a seductive argument, because it is open ended. These are government initiatives. So if something comes forward which is said by the Government to have massive popular appeal they might have to provide for a larger percentage of lottery money to be allocated to it. Is that the Government's intention? The least we can expect is an assurance from the Government.

I offer the Minister this salutary thought. If a Liberal Democrat government were to be formed after the next election, this would be a Liberal Democrat new opportunities fund. We would be able to push it in our direction. A proposition that the Government might find less attractive is that if the Conservatives were to win the next election, it would be a Conservative new opportunities fund. I support the initiatives put forward by the new opportunities fund. But they are open ended. There is a good deal of concern that they will follow the political agenda of the party in power.

One of the reasons why I cannot support the amendment is that I support the formation of NESTA. I agree with the underlying reason for its formation. I like the idea of the Government becoming a business angel. However, I have difficulties over the way that the money has been allocated. I have asked in the past for some examples of shadow accounts. I have not received any examples. The Minister may have some. We are talking about retrospective legislation. In the past, when we have discussed retrospective legislation, we have always been met with precedents. I find it difficult to believe that this might not be used as a precedent for the Government to enact retrospective legislation in the future.

3.15 p.m.

Lord McIntosh of Haringey

My Lords, I am grateful, paradoxically, to the noble Lord, Lord Skidelsky, for introducing the amendment as he did, because he gave a summary of the more serious objections which, I know, he and his party have to the Bill. I realise, as he does, of course, that the first three points were not specifically relevant to the amendment. But that helps us to treat, as I think we must learn to do, the Motion that the Bill do now pass as a formality rather than a repetition of earlier debate. Although he will forgive me if I respond only to the amendment, it was welcome to have the noble Lord's broader views on the record at this stage.

The noble Lord made the points about the amendment extensively in Grand Committee and on Report. It behoves me to repeat, with all the force that I can, that we are not doing anything illegal or improper. There is some misconception that the Government and the distributors have been acting illegally by keeping shadow accounts since last October which show how the National Lottery Development Fund would be distributed if the legislation were in force. There is nothing illegal about that arrangement. Neither the department nor the distributors needs any statutory authority to keep such accounts.

I say in response to the fourth question asked by the noble Lord, Lord Redesdale, that that is why there are no precedents in legislation for us to bring before the House. It has never been a matter of primary legislation for shadow accounts to be set up. That does not mean that it has not happened. It just means that I cannot find it in legislation.

There is nothing improper or unusual about the fact that the subsection, which the noble Lord, Lord Skidelsky, is pressing us to remove, uses as its effective date a date before Royal Assent. That is not unfair; it is accepted and welcomed by the distributors. I must repeat the point that it makes no difference to the amount of money which will be allocated to the new opportunities fund and NESTA over the licence period. Therefore, my answer to the third question asked by the noble Lord, Lord Redesdale, is that, because it is neutral over time and since money has been put aside in shadow accounts, it will be necessary to have a higher percentage for a shorter time in order to obtain the same money. No more money will be required as a whole.

My answer to the noble Lord's first question—I am sorry to answer them in the wrong order, but that is the way it has worked out—is that if there were no subsection (9)—in other words, if the amendment were to be carried—there would not be a cash injection to existing good causes for two reasons. First, the cash in the National Lottery Development Fund is held by the fund for the good causes and handed over only when they ask for it. It is underspent as regards the money that has so far been allocated to it. Secondly, since we put the proposal into our manifesto last April the good causes and the distributors have known that that would be the case. They have known the extent to which their expectations would be safeguarded, but at the same time they have known that additional money over and above the £9 billion which is now expected would be going to the new good cause. I am grateful for the noble Lord's general support for that new good cause.

I must continue to resist the suggestion that there is anything unfair or unreasonable about that proposition. By introducing the date of 14th October 1997, we are spreading the percentage over a longer period rather than having a much higher percentage coming into effect only after Royal Assent. The fundamental fact is that the total amount of money available to the good causes will be no different whether or not the amendment is carried, but the damage done by carrying the amendment would be the serious loss of momentum by the new opportunities fund and NESTA. It would take them longer to get themselves up and running and making grants, and we believe that that would be thoroughly undesirable.

I hope that on that basis, rather than repeating the arguments in detail, the noble Lord will see fit to withdraw his amendment. If not, I must ask your Lordships to reject it.

Lord Skidelsky

My Lords, we do not accept retrospection as the right procedure, but we recognise that we have come to the end of the Bill in your Lordships' House. I conclude by making one observation. We are witnessing the Government's determination to annex for their own purposes the money which was originally intended for arts and leisure activities in this county. Through the National Lottery, we created a unique opportunity to raise the standards of our civilisation, with benefits stretching well into the next century.

The National Lottery etc. Act of 1993 provided a unique opportunity to escape from the Treasury straitjacket. It enabled us to make modest preparations for the good life, which is, after all, the task of economics to make possible. Instead of seizing the moment and running with it, the Government now intend to encumber that civilising opportunity with their own largely utilitarian programmes. I am certain that the cultural life of our country will be the poorer for it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

An amendment (privilege) made.

Lord McIntosh of Haringey

My Lords, I beg to move that the Bill do now pass. In doing so, I wish to thank all those who have taken part in the passage of the Bill in the House and behind the scenes. I am grateful in particular to the noble Lord, Lord Skidelsky. and the noble Baroness, Lady Rawlings, for agreeing that the Committee stage should be taken off the Floor in Grand Committee. I hope they will agree that the experience was not too painful. As debate continued we were able without difficulty to allocate a third day to the Committee. Therefore, there was no time constraint, explicit or implicit, on those debates. That was to the benefit of the Bill as a whole.

From the Conservative Benches, I am grateful to the noble Lords, Lord Crickhowell and Lord Rees, and to the noble and learned Lord, Lord Fraser, for drawing attention to the Scottish and Welsh aspects of the Bill. I am pleased that it was possible to make clear to your Lordships that convergence between devolution legislation and other legislation passing through the House has been well planned and well resolved as between my department and the Scottish and Welsh offices. It was helpful to have that issue drawn to your Lordships' attention.

From the Liberal Democrat Benches, I am grateful in particular to the noble Lord, Lord Redesdale, and the noble Viscount, Lord Falkland, for their detailed, constructive interest in the Bill.

From my own Benches my noble friends Lord Howell and Lord Bassam were particularly helpful. From the Cross-Benches, the noble Lord, Lord Chorley, took an active and helpful part and I hope that we have gone some way to meet his concerns. The right reverend Prelates the Bishops of Oxford and Southwell raised the issue of under-age betting which gives them and us great concern. I am grateful to them for their contribution.

Obviously, I have left out some noble Lords, but I hope that I have recognised the contributions made in front of the camera, so to speak, during the passage of the Bill. Behind the camera there lies a highly efficient and responsive Bill team and I am grateful to them for their contributions. I wish them well as the Bill goes to the other place.

Moved, That the Bill do now pass.—(Lord McIntosh of Haringey.)

On Question, Bill passed, and sent to the Commons.