National Lottery: 20th Anniversary

Lord Collins of Highbury Excerpts

Thursday 27th November 2014 Lords Chamber

[Lord Collins of Highbury (Lab)]

My Lords, I too would like to thank the noble Baroness for initiating this very important debate. Earlier this week, in Grand Committee, I was reminded by my noble friend Lord Rooker that when the National Lottery was launched, many in my party had strong reservations and concerns about it and even opposition to the principle. The concerns have been mentioned already. Would the funds raised replace government expenditure on things that should be paid for out of taxes, such as nurses, teachers and road repairs? To address such concerns John Major’s Government adopted the principle of additionality, which meant that the funds would go to projects that would not happen without them and would have to be spent on capital projects. I agree with the noble Lord, Lord Smith, that the expansion of the good causes under the previous Government did not breach that principle; it maintained that principle, which allowed a broader range of schemes.

The approach of the millennium saw a focus on grand building projects which it was hoped would result in a “culturally led regeneration” of inner-city areas. The Dome may have failed in terms of its broader cultural and educational objectives but it has led to regeneration of a depressed part of London, with most Londoners today being pleased with its subsequent use as the successful O2 entertainment centre. However, that success came with additional investment of £350 million from the private sector. Rowan Moore, in his recent excellent piece in the Observer, reminds us of some of the successes. The noble Lord, Lord Smith, has also reminded us of some. The Tate Modern now attracts about 5 million visitors a year. The Eden Project, Cornwall, captured the public imagination and earned impressive visitor numbers. Antony Gormley’s Angel of the North was firmly established as a symbol of Gateshead, and other towns seek to emulate it. We also have the American Air Museum in Duxford, designed by Norman Foster, which won the Stirling Prize. These are just a few examples of the remarkable range of new-built and refurbished cultural buildings. However, with local authorities being so severely constrained in their ability to support the arts, we could find, if we are not careful, that many of these facilities are empty and simply going to waste.

As we have heard in the debate, the National Lottery has delivered more than the iconic projects that I have highlighted. More than 450,000 individual awards have been made across the UK, with 12 independent specialist organisations awarding the money; 70% of National Lottery grants are for £10,000 or less, helping, as the noble Lord, Lord Smith, identified, small projects that make a big difference in their community. National Lottery funding has saved more than 700 playing fields, supported 1,400 museums and galleries, restored 6,000 village halls, enabled 57,000 World War II veterans to go on commemorative visits, bought and restored 72,000 hectares of land to protect key habitats and rare species, and given more than £750 million to regenerate public parks. As we heard from the noble Lord, Lord Holmes, at the London 2012 Olympics, nine out of 10 Great Britain and Northern Ireland medallists were lottery funded. Eighteen lottery-funded films have gone on to win a total of 31 BAFTAs and 14 Oscars.

It is a well established requirement that lotteries should be the exclusive preserve of good causes, an issue which has been raised in the debate. However, I am becoming increasingly concerned about the prevalence of gambling products that do not clearly differentiate themselves from lotteries and appear to trade on the good name of lotteries for commercial gain. Can the Minister reassure me that the Government will take steps to maintain the important distinction between lotteries and gambling? The use of external lottery managers—ELMs—and umbrella brands have historically been a means, as the noble Baroness pointed out, by which society lotteries can maximise their returns to good causes, without competing substantially with the National Lottery. I, too, have raised in recent times my concerns with the Minister over the use of ELMs by the Health Lottery. It is supposedly made up of 51 separate companies, yet has the same three directors, the same office and the same branding—in effect enabling it to operate as an alternative to the National Lottery. It is competing with the National Lottery and people think that it is a national lottery. It is even called a “national lottery”, which, as the noble Lord, Lord Addington, said, is in breach of the spirit, though not the letter, of the law. While many might say that the Health Lottery’s turnover is a fraction of that of the National Lottery, I am concerned that such a loophole might lead others, such as a big retail chain, to be tempted into the market because they have the infrastructure capability to do it. Does the Minister believe that operations such as the Health Lottery which utilise ELMs to run multiple society lotteries under one brand remain within the spirit of the original legislation? We need an answer.

The success of the National Lottery over the past 20 years is testament to the monopoly model designed by Parliament which encourages a lot of people to play a little, and has created a national institution. More than £32 billion has been raised since the National Lottery began in 1994. More than £12.6 billion has been paid to the Exchequer in lottery duty. Around 70% of adults in the UK play on a regular basis. This year, Camelot commissioned Frontier Economics to re-examine the case for this monopoly, and its findings continue to support this model. Evidence from a number of countries shows that larger jackpots attract more players. By concentrating sales, a single lottery provider maximises the available jackpots, and thus maximises sales and returns to good causes. It is the good causes on which we need to be focused. Uncertainty in the market could lead to operators being less willing to bid for future licences to run the National Lottery or demanding increased margins to do so, which could reduce returns to good causes.

I hope the Minister will state clearly the Government’s ongoing commitment to maintain and protect this model for the foreseeable future.