§ Mr. BurnsTo ask the Chancellor of the Exchequer what proportion of the money taken by the purchase of premium bonds is spent on(a) administration and (b) prize money.
§ Mr. Lilley[holding answer 3 March 1989]: None of the money taken by the purchase of premium bonds is spent on administration or prize money. The administrative costs of running premium bonds, which amounted to £20.5 million in 1987–88, is paid from the Department for National Savings vote. Prize money, which totalled £139 million in 1987–88, is a charge on the Consolidated Fund. The prize money is calculated as a percentage of the value of all eligible bonds in the prize draw. In 1987–88 this was 7¾per cent. per annum to 31 July and 7 per cent. per annum from 1 August.