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Dr. Lewis Moonie (Kirkcaldy): I pay tribute to today's long and interesting debate and, in particular, to the excellent speeches of my hon. Friends, even though I disagreed with them on occasion. I recognise that they were constructive and sincere.
I wish to start with a confession: I like the lottery and I play the lottery. I regret that I have another confession to make: I have yet to win a brass farthing. If the lottery is, as Adam Smith described:
"A tax on all the fools in creation",
I plead guilty to being one of that number--if only in this instance. Illustrating the old maxim about remarriage--the triumph of hope over experience--there is no doubt that the hand in the sky has pointed at me from the advertisement. Unfortunately, it has used the wrong number of fingers--think about it.
There is also no doubt that the national lottery has caught the public's imagination. More than £4 billion has been wagered so far on the main lottery and its supplementary scratchcards. I think we all accept that that success is wildly beyond the expectations of the lottery's strongest supporters, among whom I happily number myself. In view of that success, it is important to get it right, to examine any shortcomings as they arise and to try to correct them. Much disquiet has been voiced over the past few weeks, generally with some justification. The purpose of the debate has been to highlight the problems that we see as critical to the lottery's long-term success and to offer our
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remedies for consideration by the House. My right hon. and hon. Friends have sought assurances from the Secretary of State on many points. Sadly, she has in the main failed to provide them. At one stage she resorted to the tactic that she used in the Department of Health of bombarding us with misleading statistics and bland assurances that all will be well. How foolish of us to expect anything else.I shall recap on some of the most obvious areas of concern in the hope that the Minister of State can do better in his speech. I shall deal first with the Treasury and the attempt by the Chief Secretary to offset lottery income against Arts Council grants. The Secretary of State rightly took action against that to defend her corner through the letter that was leaked to The Independent a few weeks ago.
The Government's initial position was absolutely straightforward. The then Secretary of State said in 1993 that the proceeds would not be brought within the control total and that the Government would not make any case-by -case reduction in conventional expenditure programmes to take account of awards from lottery proceeds. As my right hon. Friend the Member for Copeland (Dr. Cunningham) has said, that was followed by the Prime Minister's statement to the English Heritage conference in 1994 that the Government would make no case-by-case reduction on conventional public spending programmes to take account of awards from the lottery.
Surely the position is clear enough, but the Government amendment makes absolutely no mention of it, although we have mentioned it in our motion. I have carefully read their amendment but, alas, it contains no reference to this robust defence of the arts or of any other sector covered by the lottery. However, I am quite prepared to take the Secretary of State's word that she is fighting her corner and to wait until the figures are before us at the end of November to see what transpires. I accept that with the Budget coming up she may be constrained in what she can say, but I suspect that we may find that the position is not nearly as rosy as she would like us to think.
It is not as though the Treasury has done badly out of the lottery over the past year. I reckon that by the time of the Budget the Government will have taken more than 500 million quid out of our pockets and put it into theirs. They have done well out of the lottery and I see no need for them to come back for more. Surely what they have had is enough.
The action of the Wales tourist board in refusing to fund a jazz festival showed that at least one Department had not adhered to the spirit of the original commitment. The position had to be clarified and clear guidelines issued, and I welcome the Secretary of State's assurances in the debate that she has confirmed the original position and that the Department has agreed that in future it will apply. The next issue is the profit accruing to the operator. Conservative Members always salivate when Labour Members start to talk about profits--as if they would defend any level of profits in any circumstance at any time. As a generality, at least to those who have brains, that is not the case. It is clear that the profits are wildly in excess of the original predictions. I fully accept that they match the success of the lottery and I also accept that success deserves some reward, but I warn Conservative Members that as the profits ring up from £100 million to
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£200 million, £300 million, £400 million, £500 million they will have much more difficulty than the Opposition in defending their position before the public.Mr. Jenkin: Is the hon. Gentleman saying that the Government chose the wrong lottery operator?
Dr. Moonie: No, I am saying that it is possible with hindsight to say that perhaps mistakes were made. I accept that it is always easy to argue in hindsight. We are arguing in hindsight. All modifications to schemes, after all, are carried out in hindsight. I am saying that the Government may have been taken for a ride by the lottery operator, which would not surprise me, and that the Government should, in turn, recognise that its profit is higher than a fair return on the risk that has been taken--effectively nil--and on the capital deployed, which is very much less. That is what profit and risk are based on: the capital deployed, not business turnover, as Conservative Members would like us to accept.
The return that the lottery operator will make on capital deployed in the next seven years will be indefensible, and Conservative Members know that just as well as Labour Members. Tonight's defence of that position is a sham.
Once again, a private monopoly is being allowed to take too great a share of the proceeds. We have said that, when we are in power and the contract comes up for renewal, we will ensure that a non-profit-making body will be set up to run the lottery. Meanwhile, I urge the Secretary of State to take what action she can to restrain Camelot's profit to as reasonable a return as possible, although, given the wording of the legislation, I accept that that may not be easy. It requires action and the involvement of the better nature of Camelot and, when it comes right down to it, I shall not place too much faith in its better nature,
We want transparency in decision-making. What is wrong with that? We want clear guidelines for the disbursement of money. Adequate accountability to the public is not unnecessary bureaucracy, but a necessary adjunct to the whole process. It is far superior to the use of whines and threats by Tory Members in the past week or two, and the disgraceful and covertly racist articles in some newspapers about some of the grants that have been awarded.
Those Conservative Members chose to criticise awards to the Somalia fund and the Vietnamese, but what two peoples in the world have experienced worse problems in the past two or three decades? In those circumstances, how could anyone possibly criticise the awards that have been given? It is a disgrace.
Let the public see that the process is fair. If suitable checks and balances are instituted, many of the misunderstandings that have arisen in the past couple of weeks will be avoided. That is all that we are asking for in the motion.
In the latest allocations, there have been winners and losers, which is inevitable in a lottery--trite but true. I am happy to say that my constituency has been a winner: the awards have included one substantial grant to the Cope centre of £159,000. I am proud and surprised to say that I was its referee. I should not be saying that as a great party of organisations will no doubt beat a path to my constituency surgery door next week to try to take advantage of my obvious skill in picking winners, at least on someone else's behalf, if not on my own. There have
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been other grants in my constituency, which I also welcome wholeheartedly because they will provide great benefit to communities there.Other organisations, sadly, have not been so lucky, which again is inevitable. About 600 bids have been successful and 15,000 have either been unsuccessful or are yet to be processed.
Dr. Moonie: So far. I recognise that more money is to come and that other organisations will be pleased in the coming months. The Minister must remember that he is no longer a Whip; he is not allowed to speak from a sedentary position.
Although I recognise the problems of maldistribution--all odd distributions may be ironed out in future allocations--it might be better if the Secretary of State considered having greater regional input in the selection process. I am not proposing how that could be done; I am merely suggesting that it might improve the overall allocation of money in regions. Many people and organisations have been disappointed in the present round. Let us hope that many of them will be satisfied in the rounds to come.
We need clear guidelines to ensure that the chance of success is maximised and applicants need a prompt explanation if their application has been rejected. [Interruption.] My right hon. Friend the Member for Copeland explained why he would be unable to attend all the debate. He will return as soon as he can.
Several other problems require urgent action, but I recognise that since my time is drawing to a close I shall have to touch on them briefly. The system is inflexible and I can give two examples of that. At present, Scottish Opera is ineligible for funding. It desperately needs funding to keep going because it is impossible to keep a full opera company going in Scotland. It is trying to commission a new opera and project funding would go a long way towards meeting the shortfall that it is likely to face this year. I hope that the Minister will take cognisance of that and do something about it.
In the same way, the Festival theatre in Edinburgh is facing problems. It incurred huge capital costs before it was eligible for grant. It will have difficulty in keeping going.
I regret that in the time available I am unable to say what I would like to about the problems facing medical charities, the football pools--the Chancellor may well cast a friendly nod in that direction--what to do with the millennium fund after it has been wound up and, last but by no means least, what to do about the social effects of the lottery on its users and those with gambling problems. We cannot take £4 billion out of the economy without some noticeable effects and it is about time that we thought about how to investigate what they are.
Let us remember that without the lottery we would not be having this debate because there would not be any money to disburse to good causes. Let us accept that it has been a good thing and that the Government have learnt something from the debate, but that may be a bit too much to hope. Let us hope that even now they can learn from the mistakes and act promptly rather than risk the whole thing turning sour in the long term.
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9.41 pmThe Minister of State, Department of National Heritage (Mr. Iain Sproat): I welcome the hon. Member for Kirkcaldy (Dr. Moonie) to thDispatch Box for his first national heritage debate. I thank him for the extremely pleasant manner in which he made his speech and I hope that it will be ever thus. I can confirm that the right hon. Member for Copeland (Dr. Cunningham) courteously explained why he would not be able to be here, and I accept that.
I want to answer one or two of the general points that arose several times during the debate and, if there is time, I shall answer some of the specific points raised by hon. Members.
One of the first things that struck me was how, so often, Opposition Members raised points to which I thought that the answer had been given clearly and irrefutably. For instance, they raised the question of whether jackpot prizes should be capped. Let me explain as calmly and clearly as I can that the whole point of not capping the jackpot is that if there is a roll-over, more people buy tickets in the lottery that week and that means more money for good causes. That is the simple and irrefutable reason for that. The hon. Members for Liverpool, Mossley Hill (Mr. Alton) and for Glasgow, Hillhead (Mr. Galloway) mentioned that. I am not sure whether that is the Labour party's policy at the moment. That is why it would be wrong in simple arithmetical and financial terms to cap the jackpot. The hon. Member for Kirkcaldy raised the question of additionality. Let me say beyond any doubt that the Government never had, and never will have, any intention of substituting lottery funding for what would otherwise be paid for by the Government. That is absolutely clear, and there was no need to put it in the motion.
Mr. Rhodri Morgan (Cardiff, West): If there was no need to put it in the motion, why did the Wales tourist board withdraw the offer of grant to the Brecon jazz festival information centre in the first place? The decision was reversed only this afternoon.
Mr. Sproat: There is a simple reason for that. That grant had to be matched by private sector funding. That was stated specifically. The lottery funding was not private sector funding. However, my right hon. Friend the Secretary of State for Wales has considered the matter and agreed that the Wales tourist board should be in parallel with all the other tourist boards. The position has been changed. That has nothing to do with additionality. There are a number of Government schemes where there has to be private sector money. For example, Sportsmatch has to have private sector money levered in, as do environmental action grants. There was nothing dramatic about the matter to which the hon. Gentleman referred. I think that my right hon. Friend the Secretary of State acted extremely swiftly in responding to what he thought was an anomaly. Opposition Members should be happy about that.
The Opposition state in their motion that they want the lottery to be run by a non-profit-making organisation. They fail to understand that it is precisely because Camelot is a private sector organisation that the lottery has been so successful. The more successful the lottery, the more successful the good causes, and the more successful are Camelot and its shareholders. It is exactly
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right that the general good is benefited by the private sector good. I do not know whether Opposition Members realise that, despite the short time that the lottery has been operating, it is about to become the most successful national lottery in the world. That is because of the excellent way in which Camelot has managed it. Camelot has not made the massive, unfair and unjustified profits that Opposition Members have chosen to portray. In fact, profits are less than 1 per cent. of the turnover of the lottery, and are likely to remain so. That is a small amount of profit. If Opposition Members study what I believe is known as the bible of the lottery world, "La Fleur's Lottery World", which records all that happens in all the lotteries round the world, they will find that Camelot has been judged by that bible as No. 1 in the world league of efficiently run operators. It is the slimmest and cleanest lottery operator in the world. Camelot has built up almost the largest national lottery in the world--it is now No. 2--by operating the most efficient lottery. It is argued by Labour Members that there was no risk attached to the lottery and that Camelot was given a licence to print money. I remember that when the relevant legislation was passing through the House, all the estimates of the turnover of the lottery were a little over £1 billion. Camelot bid on the basis that the lottery would not be the huge success that it has become. It was thought that the turnover would be very much less. There were eight bidders and Camelot offered the most money to good causes. If it was such an obvious no-risk business, why did the seven other bidders not do as well? In fact, there was a serious risk and, as I have said, Camelot offered the best deal for good causes.We have been reminded that Mr. Richard Branson submitted a bid. If Opposition Members take the trouble to read page 33 of the National Audit Office's account of the matter, they will find that Mr. Branson did not offer as much to good causes as did Camelot. He was not even second. Indeed, he was not even third. The bid, as the NAO stated, was conducted in a manner beyond reproach. It said how well the bid was done, as did La Fleur's, the bible of lotteries around the world, which also said that we have the most efficient lottery in the world. Not even a year after its establishment, our lottery is the second biggest national lottery in the world. I think that we should be extremely pleased and proud of what Camelot has managed to do. I said that in the short time available I would try to go through some of the points raised today. I shall do it in order, as that is perhaps the fairest way. The hon. Member for Sheffield, Heeley (Mr. Michie) referred to what the churches have said about the national lottery in the past day or two. I shall not say too much about what I think about what the churches have said except that I believe it to be completely wrong. They are entitled to their view and I am entitled to mine, but it seems odd to say that the lottery should never have happened and that it is damaging society but then to take lottery money. I understand that the Church of Scotland said that it does not condone gambling and has refused to take the money, which seems the honourable thing to do.
My right hon. and learned Friend the Member for Putney (Mr. Mellor), who had so much to do with starting up the lottery in the first place, said that the purpose of the lottery was to
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"make a fundamental difference to the sporting and artistic fabric of the nation."That was the purpose and that is what has happened.
My hon. Friend the Member for Falmouth and Camborne (Mr. Coe), a man whose credit in the sporting world none would venture to dispute, said that the difference made by the national lottery is incalculable. Hon. Members have only to look at the figures; they do not need to take my word for it. The Sports Council gets almost £50 million a year and will continue to get something of that order. However, the national lottery gives £200 million a year to sport and will provide more when it gets even better. The lottery is therefore giving four times as much to sport as the Sports Council was ever able to do and the Sports Council goes on giving. A similar thing is happening with the Arts Council. My right hon. and learned Friend the Member for Putney was right to say that the lottery has made a fundamental difference to the way in which the arts and sport are handled in this country, let alone the national heritage millennium fund and charities.
My right hon. and learned Friend also said that perhaps the National Lottery Charities Board should give more money to mainstream charities. I know that that view is widely held in the House. No doubt the NLCB, which is responsible for making such decisions, rather than the Government, will have heard what has been said and will act accordingly.
The hon. Member for Mossley Hill made a moderate and interesting speech. He mentioned Richard Branson, to whom I have already referred. He said that the charities have lost out but I have two responses to make to that point. First, the research done so far into what has happened to charities since the lottery was established is extremely mixed. Money given to the Red Cross has increased, as has the money given to the Cancer Relief Macmillan Fund. However, the Royal National Institute for the Blind said that its income has dropped considerably, although it turns out that the drop has been in legacies, which are not affected by the lottery.
The Irish lottery carried out some research into what had happened to Irish charities and found that the majority had seen an increase in their income since the lottery had been running. There is no proof in what has been said, and it is perfectly proper for the hon. Member for Mossley Hill to keep his viewpoint at this stage. My right hon. and learned Friend the Home Secretary has instituted research into what exactly has happened since the lottery began.
Mr. Alun Michael (Cardiff, South and Penarth): At last.
Mr. Sproat: One cannot undertake research into the lottery's effect on charities until the lottery has had an effect on them. Once the research has been done, we shall see whether the hon. Member for Mossley Hill was right.
My right hon. Friend the Member for Mid-Sussex (Mr. Renton), who had so much to do with promoting the lottery in the House, mentioned the tremendous change in the funding of the arts and sport and the fact that we are living with a success. How pleasant it is to debate something whose absolute success cannot be disputed. We thought that we would be turning over £1 billion a year--we find that we are turning over almost £5 billion a year. We thought that the arts, sports, national heritage and the charities would have some £80 million a year to spend
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among themselves--now we find that they have £200 million or perhaps £300 million a year. It is a marvellous success.The hon. Member for Glasgow, Cathcart (Mr. Maxton) made a very supportive speech, and one that, as my hon. Friend the Member for Falmouth and Camborne said, was extremely interesting. The hon. Gentleman began by criticising the Scottish National party for saying that the money which went to the Royal Opera house in London somehow did Scotland out of money. Perhaps there could be agreement across the Floor of the House on how that shows appalling ignorance about the way in which the lottery is run, because of course Scotland has its own Arts Council with its own money from the lottery for it to distribute. The Royal Opera house lottery money, whatever anybody may think about it, came from the Arts Council of England and not the Arts Council of Scotland.
As to whether the Government would offer the same contract to Camelot again, a question asked fairly by the hon. Member for Cathcart, the answer is that the matter will be for the recommendation of the Director General of Oflot; but I do not dodge the question. Since the lottery has been running for less than a year, I would not say what my attitude would be when the franchise came to an end. Let us see what happens. At the moment, I think that Camelot has done an absolutely wonderful job, and with net profits as a percentage of turnover of less than 1 per cent., it is giving remarkably good value.
The hon. Member for Cathcart mentioned the important matter of capital versus revenue, and asked whether we should spend all the money on capital or allocate some for revenue. My hon. Friend the Member for Falmouth and Camborne also mentioned that. I would like to find a way of funding revenue, but it is extremely difficult. It is almost a straight banking problem: if we fund revenue, if we fund the coaching which my hon. Friend says is so vital--I agree with him--to sportsmen at the highest level, that means that revenue funding has to be spread over at least three, and perhaps five, years for it to bite. Of course that means that we would be undertaking to spend in years one, two, three, four and five money that we do not have at the moment. That is the problem.
We shall try to find a way round the problem and we have already said that certain capital projects can have a revenue tail to them. That is a start. I promise the hon. Member for Cathcart and the House that we are trying to find a way to solve this important matter in a manner that is financially prudent.
My hon. Friend the Member for Twickenham (Mr. Jessel) made his usual incisive speech--[ Laughter .] It was a very good speech and it ill becomes hon. Members who were not even in the Chamber at the time to laugh at one of the outstanding contributions to the debate. My hon. Friend said that we should look again at the way in which the charities board is working. I shall draw that to the attention of my right hon. and learned Friend the Home Secretary, who is responsible for the charities board, to ensure that it understands that there is some feeling in the House that mainstream charities should be supported a little more, but it is for the board to make the decision.
My hon. Friend the Member for City of Chester (Mr. Brandreth), in an extremely amusing and powerful speech, made the essential point of which the House must not lose sight--already some 2,111 awards have been made. We
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are talking about a great success, and it really was a little dispiriting to see, on an Opposition Supply day, first that the Opposition Benches were almost empty for most of the afternoon, and, secondly--apart from one or two speeches such as that made by the hon. Member for Cathcart--that, without doubt, the general tone was of a rather whingeing, carping nature. I hope that that will stop when Opposition Members have it explained to them that Camelot is not making the excessive profit that they thought it was.I congratulate my hon. and learned Friend the Member for Burton (Sir I. Lawrence). As we all know, he was one of the great originators of the lottery. He deserves great credit and I am sure that in his speech he felt a great deal of pride knowing that what he helped to begin has become a great lottery.
With those few words at the end of a debate about one of the great successes of this country, I urge my right hon. and hon. Friends to reject the Opposition motion, a motion that has shown clearly that the Opposition have no idea what the lottery is about. I invite the House to oppose the motion and to support the amendment in the name of my right hon. and hon. Friends.
Question put, That the original words stand part of the Question:
The House divided: Ayes 264, Noes 302.
Division No. 224] [10.00 pm
AYES
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Abbott, Ms DianeAdams, Mrs Irene
Ainger, Nick
Ainsworth, Robert (Cov'try NE)
Allen, Graham
Alton, David
Anderson, Donald (Swansea E)
Anderson, Ms Janet (Ros'dale)
Ashdown, Rt Hon Paddy
Ashton, Joe
Austin-Walker, John
Banks, Tony (Newham NW)
Barron, Kevin
Battle, John
Bayley, Hugh
Beckett, Rt Hon Margaret
Beith, Rt Hon A J
Benn, Rt Hon Tony
Bennett, Andrew F
Benton, Joe
Bermingham, Gerald
Berry, Roger
Betts, Clive
Blunkett, David
Boateng, Paul
Bradley, Keith
Bray, Dr Jeremy
Brown, N (N'c'tle upon Tyne E)
Bruce, Malcolm (Gordon)
Burden, Richard
Byers, Stephen
Caborn, Richard
Callaghan, Jim
Campbell, Mrs Anne (C'bridge)
Campbell, Menzies (Fife NE)
Campbell, Ronnie (Blyth V)
Campbell-Savours, D N
Cann, Jamie
Carlile, Alexander (Montgomery)
Chidgey, David
Chisholm, Malcolm
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