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

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

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

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

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.”


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

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

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

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

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