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National Lottery

1 pm

Mr. Colin Challen (Morley and Rothwell): I am grateful for the opportunity for this debate, which comes at an opportune time.

Someone once said that if life was fair, Elvis would be alive and all his impersonators would be dead. I am reminded of that remark as I make my first Adjournment debate speech, on the subject of the national lottery. Perhaps it is a philosophical question whether something called a lottery should be expected to be fair; you pays your money and you takes your chances. The trouble is, I cannot let the matter pass as easily as that. Some constituencies contribute more than their fair share in the purchase of lottery tickets and scratch cards, compared with what they get back in lottery grants to their local good causes. Let me not beat about the bush; mine is such a constituency.

Since the inception of the national lottery, my constituency has spent well over £40 million on it and currently ranks at 253rd out of 659 on that score. However, where are we when it comes to getting money for good causes? According to Library figures, to the end of June this year we came 654th out of 659 constituencies for grants to good causes. However, mine is by no means the worst case and I am pleased to see in the Chamber one or two hon. Members who represent other such constituencies. The lowest-ranked recipient is Denton and Reddish, which ranked 255th in the purchasing of tickets. Poor old Hayes and Harlington was in the top 50 payers but came second from bottom in what it got out of the lottery.

By June this year, Morley and Rothwell had received just £814,000 in the whole of the six years since the lottery started. The average for a constituency was £14,086,000 nationally. Of course, the average is somewhat inflated by the fact that some constituencies contain locations such as city centres where applicants for geographically widespread awards are based. Alternatively, they may have nationally prestigious and widely acclaimed projects within their borders, such as the dome in Greenwich and Woolwich, which came top of the list with more than £672 million. However, even if we removed that factor from our reckoning, I doubt very much whether it would result in a ratio better than 10 to 1 between the average awards and those given to the bottom dozen or so.

I am pleased that the Government announced, earlier in the year, that they intended to tackle that appalling deficit in the worst-off areas by creating a £150 million fund called "communities first", which, starting next April, will channel money to areas that are deprived or that have received less than their fair share of lottery funds. What constitutes an area for the purpose of this scheme is yet to be announced. Will it be a county, a city, a constituency or a district? If communities are being considered, in my view only one definition of an area will suffice—a constituency.

In a city the size of Leeds, of which my constituency is a part, there are many communities, some of them fiercely proud of their local traditions and identities. It would be wrong to lump them all together, so this is my first plea: if we are interested in communities first, let us ensure that the communities first fund tackles its remit at the lowest possible level—that of the constituency.

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However, I do not want to focus entirely on the new fund. If it receives all our attention, we may, by default, miss out on all the other lottery funding streams, yet still imagine that our problem has been solved. The whole ethos has to change. With the declining sales in lottery tickets, it is clear that fewer large awards will be made. The emphasis now is on many smaller awards. In that sense, therefore, it is even more unlikely that we at the bottom will be able to catch up.

I come now to some of the obstacles that are placed in the way of successful applications. A highly respected charity in my constituency has been turned down for grants on four occasions. The most recent disappointment was with regard to its application to the community fund's poverty and disadvantage programme to tackle issues on one of the most problematic housing estates in my constituency. The charity employs professional fundraisers. Their applications are not made lightly or without very serious attention to detail. It seems that the fundraisers have been refused because of some missing details. If that is the case, why were they not asked to fill in the alleged gaps rather than being refused and told to start all over again?

Another reason for the charity being turned down was that its board was not considered representative enough of the community. That was despite the fact that the charity's board was necessarily constituted to reflect the institutional arrangements with some of its key funding bodies, such as the local authority, which meant that such arrangements would be difficult to alter. I am not a fan of the phrase "politically correct", but there seems to have been a politically correct pretext for turning down bids that had not been exercised thoughtfully.

Since being elected to Parliament in June, I have been campaigning in my constituency to raise awareness of our poor record in receiving grants. I have no doubt that if we applied for more money, we would receive more money. However, we must first develop our capacity to make good applications. I visited one local charity that desperately needed to improve its accommodation. The only person who was really interested in performing the role of applicant was the charity's septuagenarian secretary. Unfortunately, he died before a successful bid could be made. The organisation has since folded, even though it served many local people and provided a heart for the community.

The problem is that organisations need capacity building before they can do anything and those in deprived areas are most likely to lack capacity. There may be no easy access to the services of solicitors, accountants or other professionals who could help such organisations with complex applications. Volunteers in the community who have such skills may already be overstretched. Has any research been commissioned into the matter?

I come now to my second plea. If we seriously want to ensure that lottery money goes to the areas that have missed out on it before, we must analyse why that has happened, learn the lessons and take active steps to remedy the problem. Such steps must include providing training as well as having lottery funding officials

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meeting groups and assisting them. At a meeting in my constituency, they did just that. It was useful to have experts on hand to answer specific questions. We must ensure that that happens regularly. It should not have to be the local Member of Parliament who initiates such activity. We must also ask whether enough time is given to the application appraisal process. What is the average time given to reading, checking and analysing applications? Is it 20 minutes or half an hour? In some cases, the process may be too summary. What I have sought so far might help the problem, but I know that only marginal improvements can be made to our local success rate. Turning the tanker around will take a long time and, after six years, that is too long a time to wait.

I come now to my third plea. A ring-fenced sum from the communities first fund should be reserved for the bottom dozen or so constituencies, which have received less than 10 per cent. of the average amount given nationally to constituencies. Even if that ring-fenced sum were aimed at ensuring that each of the constituencies received only £1 million each, thereby doubling what they had received in the previous six years, it would still be less than 10 per cent. of the entire value of the communities first fund.

Mr. Kevin Hughes (Doncaster, North): I am grateful to my hon. Friend for allowing me to intervene. As he knows, my constituency—like his own—has received less than £1 million, although it has paid into the lottery a great deal more than that. His idea of targeted funding is excellent, but is he not being a little too modest? Is he aware that other targeted funding such as "Brass for Barnsley" was more than £3 million? Perhaps we should have funding along the lines of "Money for Morley" and "Dosh for Doncaster". That should be more than £1 million. It would bring us up to at least half the average, which would be a huge increase in our constituencies.

Mr. Challen : My proposal may be a little modest, although later we shall find out how modest the Minister believes it is. Those of us at the bottom of the heap have to raise the profile of our constituencies, but we must do it in a way that does not upset people further up the ladder who may not want to be overtaken in the stakes. The exact sum must be right, but I am grateful that such a debate has been opened.

The situation demonstrates how little we have received. It is like asking for a new crumb to match the crumb that we have already received. Nevertheless, that would go a long way towards alleviating the problem that I fully anticipate will continue throughout next year. Unless we take a radical step, those of us at the bottom will stay at the bottom and will not notice a change in our fortunes. That would be a real scandal.

My proposal is called "top slicing". It is a familiar, justifiable concept and I hope that the Minister will consider it on its merits. After all, it is merely a small refinement to the principle that has been admitted: that the distribution of national lottery money to good causes has not worked fairly. It is a great shame that we could not just have kept our original £40 million. The money that has been drained from my constituency over the past six years to subsidise other areas could have been better spent on renewing my local communities.

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However, I am pleased for the other areas. The lottery is probably the least efficient form of charity invented. More often than not, it hurts poorer pockets disproportionately. However, even though we have not been able to fulfil our pledge to ensure that it is run on a not-for-profit basis, the lottery has brought benefits to many communities that otherwise would not have received them.

My campaign to bring more lottery cash into Morley, Middleton and Rothwell will continue. It would be wrong to make a plea for assistance if local people did not get their act together and submit good, well-thought-out applications. The principle of fairness implies that we should not receive something for nothing. It also implies that we should not expect to receive nothing from something, or in our case, £40 million plus.

1.13 pm

The Minister for Sport (Mr. Richard Caborn): I congratulate my hon. Friend the Member for Morley and Rothwell (Mr. Challen) on securing the debate. It is his first Adjournment debate and I am sure that hon. Members agree that he has put his case extremely well this morning. I want first to clear up one or two misconceptions. I understand my hon. Friend's frustration on behalf of his constituents at not receiving the level of national lottery awards that has been made from the ticket sales. I must point out, however, that 50 per cent. of the lottery money goes straight back into prize money, so no constituency will receive more money than half its ticket sales.

Money is awarded by lottery distributors according to need. Many people do not realise that those in the better-off constituencies buy most of the tickets. I did not know that before I came to my present job in the Department. So, in a sense, there is a redistribution of wealth in some respects. The Government are aware that some areas have done better from the lottery than others. Some of the steps that we have taken since we came into power have shown that we are committed to achieving a fairer spread by direct distribution to ensure that all parts of the country benefit.

We have tried to refine the distribution of moneys for good causes. Further refinement includes, as my hon. Friend said, the announcement made by my right hon. Friend the Secretary of State for Culture, Media and Sport earlier this year, in the summer, that £150 million would be targeted on schemes to be delivered by the community fund and the new opportunities fund in areas that are deprived and have received less lottery money than elsewhere.

We asked the community fund and the NOF to select the areas to be targeted under the new scheme on the basis of two criteria—deprivation and having received less lottery money. We have not specified whether they should select on the basis of county, city, constituency or district. My hon. Friend forcibly made his case for the constituency. We have not directed them in that, and we shall find out what emerges from that consultation. We hope that targeting will effectively tackle pockets of deprivation at the local level.

Coming from south Yorkshire, I understand my hon. Friend's anxiety about targeting with reference to Barnsley. The Government had discussions with

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coalfield communities because we believed that we had a responsibility to them in trying to restructure their economies. Lottery distribution was cited in 1997 as an aspect that was not being used as effectively as it should be. The then Secretary of State, my Friend the right hon. Member for Islington, South and Finsbury (Mr. Smith), took that on board and proposed a scheme in the coalfield communities, and the priorities initiative was established.

Andrew Bennett (Denton and Reddish): Precisely when will the new money be allocated? My hon. Friend the Minister says that he has referred the matter to those bodies to make up their minds. When will they tell him how that will be done?

Mr. Caborn : I hope in the next few weeks. As my hon. Friend knows, my right hon. Friend the Secretary of State has been preoccupied with handling bereavements following 11 September; indeed, she is in New York today and flies back this evening. Several decisions would have been made had she had more time in the Department; that is one of them. I assure my hon. Friend that that will happen in weeks, rather than months.

The priority area initiatives were established by the community fund in England and, as my hon. Friend the Member for Doncaster, North (Mr. Hughes) said, "Brass for Barnsley" was the first manifestation of that, back in April 1999, for an initial period of 12 months. He is absolutely right to say that it identified £3 million from the regional grants budget to be available as funding for Barnsley over the three years to 2002. Regionally based community fund officers worked in partnership with local development agencies to increase the funding given by the board to local voluntary community organisations in Barnsley in the metropolitan borough. That was successful: all £3 million was distributed in the first year of operation. That was commendable, because one of the criticisms that was rightly made of the fund was that a lot of bureaucracy was involved and that the money was not reaching the areas that it should.

Bit by bit we have refined the process. Almost 41 per cent. of lottery funds now go to much smaller schemes, rather than to the big ones that have to some extent distorted the figures to which my hon. Friend refers.

Mr. Kevin Hughes : Does my hon. Friend believe that targeting initiatives such as "Brass for Barnsley" would be better targeted at less well-off constituencies, in order to put some money into such constituencies? I have not done an analysis, but I suspect that if he or his Department were to do so, he would probably find out that the constituencies at the bottom end in this case are at the bottom end of the deprivation stakes, too.

Mr. Caborn : I do not know whether that is true. We must see this in the context of the lottery being one of the funding mechanisms to address some of the structural weaknesses of the coalfield communities. It was not standalone funding. GDP per head in Barnsley is around 62 per cent. relative to the average of the European regions. Doncaster is not down at that level. That figure is from memory, but I ask my hon. Friend to reflect that Barnsley is probably one of the poorest

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constituencies in the country. That was accelerated by the closure of the pits and consequent effect on the local economy.

My hon. Friend mentioned a charity that had had its application for an award turned down four times. I am sure that he will understand that it is not my place to comment on particular applications. That is the responsibility not of the Government but of the lottery distributors. However, I am concerned if that has been taking place without good reasons being given. Distributors take decisions independently of Ministers and concerns about specific cases should be taken up with them. If my hon. Friend approaches the various lottery distributors I am sure that he will get a full answer.

We are concerned to make the application process as straightforward as possible and for lottery distributors to work with applicants in a supportive way. That was certainly the recommendation of the quality, efficiency and standards team whom we asked to carry out an independent study of the applications process. Distributors welcomed that report and agreed to take forward its recommendations. My hon. Friend also mentioned capacity building, which is another area that needs further attention. I agree that capacity building is important and we are increasingly seeing distributors providing that kind of support, such as in the Barnsley scheme that has been mentioned. It is clear that professional support helps the lottery funds get to where they are needed.

Andrew Bennett : Does my hon. Friend accept that part of the problem with capacity building is that the people who are paid the money come from outside the areas that we are talking about? The money goes off to Cheltenham or some such area where those consultants come from, rather than going to the disadvantaged areas of the country.

Mr. Caborn : I do not know whether that is true. We put in professional community fund officers in the Barnsley area. I shall look at that. In terms of their salaries, the answer is yes, but in terms of the money coming in, I do not think that the £3 million went out of Barnsley. I think that it was invested in Barnsley. The question I would ask is, when one brings in that professionalism, does one get a better quality decision, and does the money get to where it should quicker than it would do normally? This is about cutting through some of the bureaucracy. I am open to that type of discussion and I want to see that debate taking place. I want to make sure that lottery money gets to the areas that really need it.

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Some of the criticism has been justified. There has been too much bureaucracy and we should move that out of the way, get things focused and spend money effectively. As my hon. Friend may know, Sheffield Hallam university, on behalf of the DCMS and the lottery distributors, undertook a study of professional services to the lottery on the building up of capacity so that it is not always necessary to rely on outside forces, but there is capacity building inside those communities. That brings in agencies like the local authorities and other voluntary agencies to ensure that they understand how lottery applications can be framed and be successful. A number of recommendations have been made and the Department is taking them forward and hoping to build the type of capacity that my hon. Friend described.

In some quarters there is an argument about—and, indeed, some frustration about—the amount of money being held. The figure bandied around in the press is something like £3 billion, which apparently remains unspent by the distributors. In reality, almost all the money has already been committed to projects. Grants are usually paid out over a period of time according to when recipients need them. Distributors have assured us that we can expect their balances to fall dramatically over the next two or three years as more projects draw down their grants and more awards are made. We attach a high priority to ensuring that that happens.

The lottery has brought enormous benefits to this country, as my hon. Friend acknowledged. I hope that we shall continue to refine the system and address the genuine anomalies. In the next few weeks we shall announce the new £150 million fund, which will start to address some of those problems. It is an ongoing debate and our actions over the past three or four years have helped to refine the system and make distribution fairer.

Andrew Bennett : All we need is a simple wind-up in which the Minister says that he will give us the money.

Mr. Caborn : As my hon. Friend knows, if I could come here and say that, I would—but it is not so simple, as he also knows. My genuine response is that we will try to iron out the anomalies and make the distribution as fair as possible. We have taken several fundamental steps with the distribution of the lottery, which is fairer than it was four years ago. There is still further to go, which is why we shall continue to refine the system to make it even fairer.

Mr. Nicholas Winterton (in the Chair): I thank the Minister for his response. We can now move on to our final debate, introduced by the hon. Member for Blaby (Mr. Robathan).

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