9 THE FUTURE OF THE NATIONAL
LOTTERY
166. We believe that the National Lottery is a good
thing. Since 1994, the Lottery has raised over £15 billion
for good causes. Projects have been wide ranging and have varied
greatly in scale and the benefits of the National Lottery have
been felt in all parts of the UK.
167. In order to achieve a prosperous future for
the National Lottery the Department and the NLC must:
- ensure that sales are maintained and increased;
- increase competition for the licence (or within
the licence), ensuring that the operator of the National Lottery
is maximising returns to good causes and that good causes are
receiving the best possible share of the revenues;
- keep abreast of technological changes so that
the Lottery is operated efficiently;
- make all decisions transparent in order to maintain
public confidence;
- maintain effective regulation; and
- deal effectively with the consequences of the
deregulation of the gambling sector so that potential losses
in Lottery sales are minimised.
168. The Government is aware of its policy-setting
role and aims to keep abreast these issues by the proposed reforms
of the National Lottery that were announced in July 2003. The
Department's vision for the future of the National Lottery primarily
consists of:
- enabling the NLC the flexibility to award multiple
licences to operate the National Lottery if it believes it would
be in the interests of the well-being of the National Lottery
to do so in 2009;
- the creation of a mega-distributor by merging
the New Opportunities Fund and the Community Fund and by transferring
the powers of the Millennium Commission to the new body as part
of wider reforms to the distribution of Lottery funds;
- encouraging the Treasury to re-evaluate the principles
behind the taxation of the Lottery which will most probably lead
to the creation of an alternative tax regime for the National
Lottery; and
- creating the first specified good cause games
through the establishment of a hypothecated Olympic Lottery.
169. We believe that the proposed changes to the
National Lottery licensing and regulation are key to the future
success of the National Lottery and that changes in the system
must be considered carefully before implementation. As we have
concluded above, we feel that the Department's proposals are not
the right course of action and that it must look again at how
it can attract more competition for the third licence.
170. We believe that the changes proposed by the
Department in relation to National Lottery funding and distribution
do not constitute fundamental changes to the present system and
we welcome, with caution, most of their proposals. The exception
to this is the introduction of an Olympic Lottery, which is a
significant development and has implications for the future of
the National Lottery and its use to fund specific major national
projects in the future.
171. This Report has highlighted the need to improve
the method used to tax the National Lottery in the future. The
Treasury has told the Committee that it is prepared to leave behind
the principle of tax neutrality and we hope that Camelot, the
DCMS and the Treasury will be able to work together to introduce
a new tax regime which will be sustainable without taxation of
good causes - reflecting the Government's approach to charitable
giving.
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