News

Contrary to the message from the television adverts, the National Lottery is not just about Billy Connolly's pink beard. It's about giving billions of pounds to good causes, and last month a white paper pledging to transform the way this is distributed was published by the Department for Culture, Media and Sport.1 The consultation ends this October.

The first national lottery in this country took place during the reign of Queen Elizabeth 1 in 1569. It continued regularly until 1826 when it ended after falling into disrepute. It provided funding for many projects over the 250 years it operated, including the British Museum and construction of Westminster Bridge.


The current National Lottery started in late 1994. By the end of April 2003 it had raised £14.3bn, including interest, for good causes and had funded 134,000 projects. Charities and the voluntary sector have received the largest chunk at £2.6bn. This is followed by £2.3bn for heritage, £2.1bn for the arts, £2bn for health, education and the environment, £1.9bn for millennium projects and £1.9bn for sport.



Merger mooted

The impending controversial merger of the National Lottery's Community Fund and the New Opportunities Fund, confirmed by culture secretary Tessa Jowell in February, is detailed in the white paper. It says that, despite their different funding approaches, "there is a significant overlap between the work" of the two funds.

A new distributor will take over the functions of both funds and continue to provide grants to charities and the voluntary sector, education, the environment and health - much like the Community Fund. It will also assume the Millennium Commission's responsibility for supporting large regeneration projects. It will control half the lottery money for good causes, and will be the single point of contact for applicants seeking funding advice.

In their separate roles, the Community Fund supports voluntary groups as well as less popular causes, while the New Opportunities Fund awards grants in line with government priorities. Despite assurances from Jowell that the new body will not lose its rights to independent decision-making, charities remain to be convinced.

Stuart Etherington, chief executive of the National Council for Voluntary Organisations, says the new distributor should provide additional funding for good causes and support the development of a sustainable funding environment for the voluntary sector. He wants its grants to be distributed by independent bodies.

Phil Jarrold, deputy chief executive of Wales Council for Voluntary Action, urges the new distributor to give more money to the voluntary sector and to make sure it is used for projects that are "genuinely additional" to public sector provision. He adds: "Voluntary and community groups have already seen their share of lottery proceeds fall as more funding is channelled into public sector projects, and they want to know how a merger will help them."

The white paper recommends introducing six new National Lottery funds, including a Young People's Fund. This will be established within a year and have an initial budget of £200m. It will focus on projects promoting youth inclusion, particularly by providing facilities and activities after school and during school holidays. More detailed plans for the fund will be developed after children's and young people's groups are consulted.

National Children Bureau's chief executive Paul Ennals says the fund should do more than support schools and their capacity to engage with disaffected young people. "We would like to see it place young people at the centre and show it has listened to them."

Young people, he adds, should be able to decide what activities are needed locally and help to run them alongside adults. Ennals says the fund's capacity should be expanded through "creative and sensitive partnerships" with the private sector.

Pat Thompson, parliamentary policy officer at children's charity Barnardo's, welcomes the fund's emphasis on activities for young people during the holidays. Thompson says children from low-income families face extra pressure during this period and can feel excluded.

"The loss of free school meals adds to the financial burden and is compounded by limited summer holiday provision in many areas," she says.


Susan Burgess, from Calne inWiltshire, has two boys and three girls aged between three and 12. She wants more adventure activities for under-16s provided locally at subsidised rates: "If these were available in the holidays, the children would be in the same place and it would get them out."



Devolution

The issue of devolution is covered in the white paper, which says: "We are committed to preserving the overall integrity of the UK lottery; hence our provisional view is that we should retain a UK structure for distribution." However, it offers an olive branch to Scotland, Wales and Northern Ireland by saying that they should all have "more influence" in setting specific priorities and strategies.

But this has not appeased those in Scotland or Wales. The Scottish Council for Voluntary Organisations' (SCVO) corporate affairs director, Lucy McTernan, says continuing the existing centralised approach to lottery distribution is "bad news" for Scottish charities and voluntary organisations. Although Scotland has received £1bn from the lottery since 1994, there is a "north-south difference" in priorities, and decisions to allocate the New Opportunities Fund are based on priorities set from London without taking local needs into account, she adds. The SCVO will work with the Department for Culture, Media and Sport and the Scottish executive to ensure the structure of the new single distributor reflects devolution.

Jarrold says it is vital that distinctive policies and programmes are developed for lottery funding by the Welsh assembly. He adds: "The white paper does make reference to devolution, but we are disappointed that the culture department has not set out any clear proposals for devolving strategic planning and decision-making to Wales."



Spending decisions

Increasing public involvement in deciding how lottery funding is spent is a key government priority. It suggests allowing the public to vote on which projects receive funding after watching weekly television presentations from those bidding for money. Although the idea of a charity version of Pop Idol will benefit some agencies, there is a fear that those seen as working with "unpopular" groups such as asylum seekers or drug users risk losing out.

Only 10 per cent of people would give time or money to an HIV and Aids organisation, according to research by HIV charity the Terrence Higgins Trust. Fund-raising manager Debbie Holmes says: "We would be very unlikely to receive lottery funding if our application went to a public vote."

The sector needs government assurances that "those causes that are less obviously popular with the public are safeguarded" so all parts of the community benefit from the lottery, says Etherington.

Another issue is that the complex work some agencies do with disadvantaged groups cannot be "presented in the short, snappy, appealing way television requires", says Liz Monks, homeless charity Shelter's deputy director of fund-raising.

But some have fewer qualms than others. Maurice Wren, co-ordinator of charity Asylum Aid, says although the organisation fears the public would not vote to give money to asylum seekers, it welcomes a more transparent process. "It is better to have an informed public debate about what we do rather than sneak money in through the back door," he says. CC

1 Department for Culture, Media and Sport, National Lottery Funding Decision Document, DCMS, 2003