National Lottery

Viscount Younger of Leckie Excerpts

Tuesday 18th December 2012 Lords Chamber

[Lord Naseby]

To ask Her Majesty’s Government what action they propose to take to safeguard the position of the National Lottery in the light of competition from groups of local society lotteries.

[Viscount Younger of Leckie]

The Health Lottery is the most significant scheme that promotes numerous society lotteries under a single banner. Since it was launched in October 2011, the Government have been monitoring its impact on the National Lottery and other society lotteries. While there appears to be a limited impact overall, the Government want to ensure that the lottery market delivers the maximum benefit to charities and other good causes, including those supported by the National Lottery. The Secretary of State for Culture, Media and Sport has therefore announced today the Government’s intention to consult in the new year on whether to increase the minimum percentage of the proceeds that certain society lotteries have to return to their good causes.

[Lord Naseby]

Is my noble friend aware that when the National Lottery was set up in 1993, 28p in the pound went to good causes and 12p went to the Exchequer as a levy, whereas the Health Lottery provides only up to 20p in prizes and no subvention to the Treasury? Against that background, and with recent calculations that the Health Lottery has siphoned off £70 million that would have gone to the National Lottery, does my noble friend really think that consultation is the right approach? Would it not be preferable to have an amending Bill that re-emphasises that the National Lottery is a monopoly and is there to provide for good causes throughout the nation?

[Viscount Younger of Leckie]

My Lords, I do not agree with the idea of an amending Bill. Independent research that we commissioned and have published today suggests that there is a potential sales diversion of up to £300,000 a week. Camelot believes that it is potentially up to £1.5 million a week. It is difficult to assess the true figure due to seasonal factors and complexities in customer behaviour. However, an impact at these levels would be relatively minimal, particularly in the context of National Lottery sales, which are on track to beat last year’s record sales figures of £6.5 billion. The Government are determined to ensure that the lottery market delivers the maximum benefit to good causes, which is why we wish to consider whether the minimum amount that society lotteries are required to provide to their good causes is set at the right level.

[Lord Collins of Highbury]

My Lords, is it not an obvious loophole in the idea of a national monopoly when the Health Lottery’s 51 supposedly separate companies have the same three directors, office addresses and branding? It is in effect enabling it to operate as an alternative national lottery with a £510 million turnover. Is it not time to act now?

[Viscount Younger of Leckie]

I suggest to the noble Lord that any issues relating to that are for the Gambling Commission. The National Lottery, I remind noble Lords, generated more than £92 billion from its inception in 1994 to mid-November this year. The annual sales figure for the year to April 2012 was £6.5 million, which is the highest since the start of the lottery. Therefore, it is a very successful operation.

[Lord Hodgson of Astley Abbotts]

Is my noble friend aware that people who give to local lotteries often do so because they wish to support a specific cause and, as such, will not give to a national lottery? In that sense, their contributions are additive. Since the National Lottery grew by 8.1% in the half-year to September—that is £264 million—what does it need protecting from? Would it not be better to let a thousand flowers bloom, encourage localism and not interfere?

[Viscount Younger of Leckie]

I agree with my noble friend. He gives me an opportunity to say that the Health Lottery has raised more than £28 million for good causes. Its turnover last year was £119 million. Although it has not been long since its inception, it has been highly successful and has benefited more than 30,000 people across Great Britain. Relations have been developed with strategic partners, including the Alzheimer’s Society and the Carers Trust.

[Baroness Farrington of Ribbleton]

My Lords, can the Minister explain to the House why his answer to the question from my noble friend Lord Collins was “the Gambling Commission” and not “government policy” in determining what should happen?

[Viscount Younger of Leckie]

I will stick to my original answer: my understanding is that it is up to the Gambling Commission to decide these matters.

[Lord Sharkey]

But, my Lords, the Gambling Commission itself has recently stated in court proceedings that the Health Lottery was clearly designed to circumvent the proceeds limits, the gambling equivalent of a tax avoidance scheme that exploits loopholes in legislation. Is the Government not about closing such loopholes?

[Viscount Younger of Leckie]

I thank my noble friend for that question, but the holistic approach to the lottery, which includes the National Lottery and the Health Lottery, has proved highly successful and we hope that it will continue. However, the Government will continue to monitor the progress of the operation, particularly of the Health Lottery and the society lotteries.

[Lord Foulkes of Cumnock]

Has the Minister estimated how much money is diverted away from the National Lottery by the EuroMillions lottery, and how much of the EuroMillions lottery goes to good causes in the United Kingdom?

[Viscount Younger of Leckie]

I do not have the answer to the noble Lord’s question but I will certainly get back to him. However, given that the National Lottery does not bite too much into the Health Lottery, I would hazard a guess that EuroMillions does not have too much effect.

[Baroness Gardner of Parkes]

Can the Minister tell me whether all the money from the Health Lottery really goes to health charities, and can he confirm whether my noble friend Lord Naseby is right that no money goes to the Exchequer? These days, when we are trying to see that money does go to the Exchequer, why is that?

[Viscount Younger of Leckie]

First, I just wish to clarify that no duty is paid to the Exchequer from the local society lotteries and the Health Lottery. To answer the first question, “Health Lottery” is an over-arching description of 51 other lotteries which focus on a range of good causes, including some health charities.

[Lord Taylor of Blackburn]

My Lords, does the noble Viscount agree that, in answering the noble Lord, Lord Naseby, he was stretching it a bit too far by saying that the Treasury was a good cause?

[Viscount Younger of Leckie]

I have noted the noble Lord’s question.

[Lord Phillips of Sudbury]

My Lords, I declare an interest as a member of the National Lotteries Charities Board at its inception. Given the booming income of the National Lottery and other lotteries, has any work been done on the anti-social effects of this huge amount spent by the public?

[Viscount Younger of Leckie]

I do not believe that there is an anti-social effect. I am not entirely clear what my noble friend is aiming at, but perhaps I can talk to him later.