Charity funding concern over lottery plans


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 £14.3 billion, including interest,
for good causes and had funded 134,000 projects. Charities and the
voluntary sector have received the largest chunk at £2.6
billion. This is followed by £2.3 billion for heritage,
£2.1 billion for the arts, £2 billion for health,
education and the environment, £1.9 billion for millennium
projects and £1.9 billion 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

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 £200
million. 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

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.

Wiltshire-based mother Susan Burgess 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.”


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 £1 billion 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

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.

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

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