National Lottery

Earl of Clancarty Excerpts

Monday 16th July 2018 Lords Chamber

Asked by

[The Earl of Clancarty]

To ask Her Majesty’s Government what steps they are taking to maximise the income from the National Lottery and its use for the arts and good causes.

[The Earl of Clancarty (CB)]

My Lords, I was going to start this debate by saying that we are a select group this evening, but I understand that the gap is filling up, which is very welcome. I look forward to hearing everyone’s contributions and, of course, the response from the Minister.

The National Lottery, on its inception by John Major’s Government in 1994, became very quickly a popular national institution and to date has raised over £38 billion for good causes involving 535,000 projects—an achievement, and a continuing achievement, that the British public should be extremely proud of.

At the outset I should like to mention a couple of extraordinary statistics relating to film production which have caught my eye. To date, 14 Oscar winners and 42 BAFTA winners have been significantly funded by the National Lottery, and last year a lottery-funded film, Ken Loach’s “I, Daniel Blake”, won the top prize at Cannes, the Palme d’Or. Nor was this the first lottery-funded film to win a prize at Cannes. These achievements alone illustrate how much the National Lottery has become a truly important feature of our cultural landscape, without even touching on the enormous significance of the lottery for so many areas of the arts, heritage, sport and community projects, about which I am sure we will hear more during the course of this debate.

I believe that this is the right time to have a debate about how we ensure the continuing success of the National Lottery—in other words, to take a health check. I tabled this debate in February, hearing that, after many years of continuing growth, returns from the National Lottery in 2016-17 slipped by 15%. So the question is: is this a temporary blip—and one hopes that it is—or are there other longer term concerns? Whether or not related to that fall, which has this year been slightly reversed, there are key concerns that need addressing, which I will come to. The decline in income led directly to a Public Accounts Committee report with recommendations that was published on 28 March. I understand that in a matter of months the process of awarding the new licence will begin.

Next year will be the 25th anniversary of the National Lottery, so my first question to the Minister is: what plans are there for that celebration? I hope there will be plans for a big celebration including television documentaries on the lottery’s achievements in all the different sectors, with full involvement from all the media, including the BBC which played host to the National Lottery for so many years. This week also happens to be National Lottery in Parliament Week and I hope that, among other events, your Lordships will visit what will be a hugely informative and entertaining display in the Upper Waiting Hall, as well as the reception tomorrow.

There are challenges ahead. A key concern is the threat posed by other potential rivals, in particular the umbrella society lotteries. The arguments for complementarity and competition are separate. If we believe in the prime importance of the National Lottery, and there are many good reasons why we should, it is important that there is clear blue water between the National Lottery and other lotteries, yet that gap is being increasingly narrowed. The Government’s current consultation on lottery reform ends on 7 September this year, and I hope that relevant comments made in this debate will be understood to contribute to that consultation. The Government’s preferred option, which I disagree with, is to increase quite substantially the sales and prize limits from limits which were previously set to try to ensure that the National Lottery was not affected.

What the Government ignore in the consultation is the impact on the National Lottery of an increasingly closely perceived association within the marketplace between the National Lottery and the umbrella society lotteries that, to a certain extent, already exist. As Camelot’s excellent briefing tells us, in 2010 the National Lottery represented 85% of lottery advertising, yet, worryingly, by 2017 this had been reduced to 45%. Camelot says that it cannot be correct that these industrial-scale umbrella society lotteries with combined sales of around £370 million are spending more on advertising than the National Lottery with sales of £6.952 billion. Camelot argues that an expenses cap for these lotteries needs to be reintroduced and it recommends that it is set at 15%, the limit that existed before the Gambling Act 2005.

When I walk into my local Tesco Express, I see, away from the main counter, side-by-side the National Lottery stand holding the forms for selecting your own draw numbers and the Health Lottery stand. Not only does the Health Lottery stand mimic the style of the National Lottery, it has emblazoned on it the advertising, “Only £1. That’s half the price of Lotto”, the clearest evidence that the Health Lottery sets itself up as an aggressive rival to the National Lottery. This is wholly unacceptable. It would be fair to say that businessman Richard Desmond has an understanding of how this type of competition works. One only has to think of how he launched OK! magazine as a rival to the established Hello! magazine using a very similar visual design to clever effect.

The effect of this and other advertising, such as the presence the People’s Postcode Lottery now has in television advertising, is surely inevitably not only to risk money being taken away from the National Lottery but to muddy the waters between them. Although it is good that the main television promotion of the National Lottery has returned to Saturday night TV at prime time, it is on ITV within an ad break, which means that it is disallowed as an advertised programme. At the very least there is the danger that the public start to see the umbrella society lotteries as equivalent to the National Lottery. There are some, I am sure, who will even perceive the Lotto and Health Lottery stands I have referred to as being part of the same operation when we should be doing everything possible to maintain the National Lottery’s distinctiveness.

This brings me to a second, related concern. It is one of the recommendations of the PAC report that,

“Camelot should work with the Lottery Distributors to better publicise the link between good causes and the Lottery and communicate the contribution to good causes … at the point of sale”.


I strongly agree. One of the things that really needs to be done is to reconnect the public with the original reasons for setting up the lottery in the first place, and of course the 25th anniversary next year is a perfect opportunity to do so. Although many now play and check the results online, 75% of the public still play through retail outlets. Camelot has rightly increased participating retailers from 28,000 in 2011 to 46,000 today, and has plans to extend into other supermarket brands. At present the public get little idea of the good causes currently represented at these sales points other than, for instance, being directed to the National Lottery website among other text on the back of scratchcards.

Certainly much more can be done to clearly and boldly publicise individual projects, and in particular projects that are local to the retail outlets. Just as an example, I am sure that shoppers at my local supermarket would love to know that their contributions, and indeed local winners’ contributions, have been used to fund the wonderful Mary Rose Museum in Portsmouth, where it is natural for me to take friends and family who visit me in Hampshire. To this end, I suggest to the Minister, in consideration of a closer liaison between the operator and the distributors, that Camelot’s National Lottery website and the Good Causes website could be usefully amalgamated, with good causes themselves being easier to identify by both sector and local area.

To be fair, Camelot itself has been very aware of these concerns. Perhaps more can be done internally to make the operation more effective but the Government should listen carefully to what Camelot has to say, not as another self-interested lottery operator but as having been the guardian of the National Lottery for 24 years, with all the experience that that has entailed and a successful record of running it. It should be noted, too, that the original “crossed fingers and smiley face” logo continues to be recognised by 95% of the public, and that in itself is an achievement. Something that the Government have got right is the closing this year of the loophole that allowed other lottery operators to offer bets on EuroMillions, which we are very grateful for.

The particular concern over the 15% drop has been in part because the distributors need to have the confidence that the income from the National Lottery will be reliable over a number of years. This affects long-term projects in particular. The Heritage Lottery Fund tells me that very few projects have been dropped after the initial delivery grant following a process that supports the best quality of projects in as geographically comprehensive a manner as possible, but uncertainties over the year-to-year reliability of funding will quite quickly affect the decision-making over what projects can be safely sustained. Someone working in this area said to me last week that if we are not careful we may find ourselves sleepwalking into a position of no return. The Government have to decide whether they want to allow increasingly unfettered competition or to properly and unequivocally support a much-loved institution that also happens to be a precious national asset. I hope the Government will opt for the latter and that, as a consequence, the National Lottery will continue to go from strength to strength.