Lotteries: Limits on Prize Values

Brendan O'Hara Excerpts

Tuesday 12th December 2017 Westminster Hall

[Brendan O'Hara (Argyll and Bute) (SNP)]

It is as always a pleasure to serve under your chairmanship this afternoon, Sir Edward. I congratulate the hon. Member for North West Norfolk (Sir Henry Bellingham) on securing this important debate, and pay tribute to all those who contributed. The SNP in this place and the Scottish Government agree that the current law covering society lotteries is past its sell-by date and is in need of an overhaul. The restrictions placed on charity lotteries make that kind of fundraising increasingly difficult and complicated, and limit charity lotteries’ ability to support those working at the front line at a time when demands have never been greater and budgets have never been tighter.

Increasing the annual turnover limit and the draw limit will ensure that the moneys raised by society lotteries can be used to fund charities across the UK and the wider world, making a significant difference to the lives of individuals and communities. Like many hon. Members, while preparing for this debate I was contacted by numerous organisations seeking a change in the law. Among them was ActionAid, which explained that like many other UK charities it uses the income from its lottery to provide a level of service and support it would otherwise not be able to provide. The money that ActionAid receives goes on life-saving work here and around the world, including programmes aimed at tackling violence against women and girls in Kenya, Ghana, Ethiopia and Rwanda. As a result, ActionAid and many other charities are strongly petitioning the Government to change the legislation to allow the annual turnover on a single society lottery to rise from the current £10 million to £100 million, and to raise the individual draw limit on a single society lottery from the current £4 million to £10 million.

I take on board what the hon. Member for Strangford (Jim Shannon) said, when he made his usual sensible contribution and highlighted the danger of encouraging further gambling, but I feel that there is a growing consensus that a change in the law is required. We have heard the Digital, Culture, Media and Sport Committee, the Lotteries Council, the Institute of Fundraising, the Hospice Lotteries Association, and many other charities such as ActionAid calling for that change.

One of the biggest concerns is the fear that increasing the scope of society lotteries will somehow have an adverse effect on the national lottery—as has been mentioned, there has been a drop in national lottery income and funds going to good causes this year. As I understand it, however, there is no evidence to suggest that the success of society lotteries has had a negative impact on the national lottery. Numerous studies by a range of organisations between 2012 and 2015 came broadly to the same conclusion that society lotteries complement the fundraising of the national lottery. The recent drop-off in people participating in the national lottery is believed to be due more to changes made by Camelot to the games themselves—both the Gambling Commission and Camelot recognise that.

In February this year the Gambling Commission stated:

“Despite remaining the most popular gambling activity, there has been a continued decline in participation in the National Lottery draws coinciding with, amongst other factors, the increase in ticket price from £1 to £2 which was introduced in October 2013.”

In September, Camelot was reported in the Financial Times as saying that

“the main reason for the fall in sales last year was the disappointing performance of the National Lottery’s core draw based games—especially Lotto, with player confidence in the game still fragile following the recent game changes.”

Let me be clear: this is not a case of playing off the national lottery against society lotteries. Indeed—perhaps worryingly—I find myself in complete agreement with the Secretary of State who said last month that

“we of course want to ensure that we have one strong national lottery, but that does not mean that we cannot also have strong society lotteries”.—[Official Report, 16 November 2017; Vol. 631, c. 565.]

I am therefore pleased therefore that Nigel Railton, Camelot’s new CEO, is on record as saying that, following an internal company review, he is optimistic that the national lottery will return to growth next year. I believe that we can have a world in which the national lottery and society lotteries co-exist, and that charities and good causes can continue to benefit.

We are all aware of the billions that the national lottery raises for good causes and we are delighted by that, but society lotteries also make a hugely valuable contribution and are successful in raising much needed funds for a wide range of charities and good causes. As the hon. Member for Cannock Chase (Amanda Milling) said, the current law means that there is a growing gap between what society lotteries do and what they could do. Nevertheless, they still raise a huge amount of money—as the hon. Members for Ceredigion (Ben Lake) and for North West Norfolk said, in 2011 society lotteries raised around £100 million for good causes, but they now raise more than £250 million. Such has been their success that that money has become one of the principal means of survival for many charities and organisations. As the hon. Member for Ceredigion said, society lotteries can help small local charities that could not otherwise access national lottery funding.

The hon. Member for Aldridge-Brownhills (Wendy Morton) and the right hon. Member for Witham (Priti Patel) spoke eloquently about the scope of local charities in their constituencies, and they were right to do so. However, not only local charities benefit. Many of the UK’s best known charities, such as Children 1st, the Red Cross, the Marine Conservation Society, the Royal Botanic Garden Edinburgh, Dogs Trust, Save the Children, WaterAid, the Riding for the Disabled Association, and the wonderful Mary’s Meals in my constituency, all benefit as well. Collectively, those charities are asking the Government to revisit the Gambling Act 2005 and make it fit for purpose. They argue that raising the existing cap on what society lotteries can pay out will allow more money to go to charity and good causes while reducing administration costs. The proposed changes have been much talked about—indeed, I understand that the Government’s review was announced on 15 December 2012, which means that this was first discussed five years ago this week.

If we raise the prize money cap on society lotteries, the amounts of money won would not be the complete life-changing experience that happens by winning the national lottery. The Select Committee recognised that. The Secretary of State said recently that the Government remain committed to helping both the national lottery and society lotteries to maximise their contribution to good causes by establishing the right conditions to help them thrive with the appropriate level of regulation. Again I agree, but surely it is time for them to get on and create the conditions that will allow both to thrive.

There is clearly broad cross-party consensus for change. We know that those changes will not come at a cost to the taxpayer or damage the national lottery, and they can be brought forward easily via secondary legislation. It therefore remains only for Ministers to stop delaying and to bring forward the proposed changes as soon as possible. If the Minister is unable to make an announcement today, will she at least provide a timescale for when we can expect such an announcement?