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Mr. Caborn: May I make clear what is actually in the Bill? Balances will not be moved from one good cause to another, but the interest accrued on those balances can be moved. The right hon. Lady, however, is talking about balances, which cannot be moved from one good cause to another.

Mrs. May: The point that I was making was a simple one. If the Minister would listen to the whole argument, he might understand it better.

The Bill does two things—it allows for the redistribution of interest, as the Minister said, but it also allows for the movement of balances from one distributor to another. The Government could therefore require that money held by the Heritage Lottery Fund for works on a heritage site be assigned to the Big Lottery Fund to distribute. The Minister has suggested that the money could be distributed for heritage purposes, but it can be moved to a different distributor for allocation. As I said in my intervention on the Minister, the whole point of the Heritage Lottery Fund is that it has been set aside for particular projects, so there is little point in moving funds from one distributor to another unless the intention is that the balances should be spent differently. If that is the case, who will tell the heritage project that comes to ask for its money that it cannot have it because the Government have decided that someone else should distribute it?

It is evident from the Bill that the Government have failed to understand what is needed to breathe new life into the lottery and to secure the resources for good causes into the future. The spin from the Government is that the public will have a greater say in where the money goes. Indeed, as I said in response to an intervention, that is something for which we argued in our manifesto at the general election. In recent weeks, we have seen the new "big idea" to restore support for
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the lottery. The people's millions project will give the public a chance to vote for good causes that they see on "Coronation Street" or "GMTV". The Secretary of State said it was

Since its inception, the national lottery has donated more than £16 billion to good causes. The people's millions project totalled £66.5 million. That equates to little more than 1 per cent. of lottery grants in any one year. This is not a big say; it is a big con.

We want to restore the public's faith in the lottery by giving them a greater say in how money is spent. Public confidence has been undermined by the Government's misuse of lottery funds and by the politically correct awarding of grants. It is time to take the Chancellor's hand out of the lottery till. If the Bill becomes law, we will be establishing not the people's lottery, but the Secretary of State's lottery. That is why we tabled the reasoned amendment. I urge my colleagues and all those in the House who want lottery funding to continue to go to good causes to support it.

4.45 pm

Mr. Wayne David (Caerphilly) (Lab): When the national lottery was established by Act of Parliament in October 1993 and then brought into existence in November 1994, there was, it has to be said, a great deal of concern. People thought it a wrong-headed idea that would not generate the resources that were anticipated or claimed by some. There was concern, too, that it would undermine the morality of the country.

I am pleased to say that that has not been the case. The lottery has been very successful—so successful that it is estimated that some 70 per cent. of the people of this country regularly play one game or more. Although some people have pointed to a gradual decline in participation since 1997–98, that modest decline has been reversed, and in 2004–05 we saw an increase in the income generated and in the number of people participating. That has happened to such an extent that we are able to say that, to date, some £16.8 billion has been raised by the national lottery; 50 per cent. of that has been allocated to prizes and 28 per cent. to good causes. In other words, the lottery has been a success; indeed, it is one of the most successful lotteries of its kind, if not the most successful, in the world.

The lottery was established under a Conservative Government, and in its early days, as has already been said, there was some suspicion that grants were being allocated disproportionately, to the benefit of villages and towns in the Tory shires. That may or may not have been the case, but it was certainly the perception. Since 1997, however, the allocation of grants has certainly been scrupulously fair, to the extent that every constituency in the country has benefited from at least 50 lottery grants, most having had a great deal more, irrespective of their political complexion.

At the risk of being parochial, I must say that I think my constituency is a good example of how the national lottery has brought real benefit to grass-roots organisations. It has already been suggested in this debate that small groups are not able to access funds effectively. The reality is somewhat different, and the case of Caerphilly proves my point. A
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few examples will suffice. In July 2004, the Bargoed YMCA in the top half of the Rhymney valley received a £4,600 grant to fund a summer activity scheme for young people. It was enormously successful. The grant helped to pay for workshop costs, materials and outdoor activities for the young people of the community. Another example, from further down the valley, is that of Ystrad Mynach old-age pensioners. In October 2003, they received a grant for £1,960 to pay for such things as bingo machines, a projector screen, catering and amplification equipment for their pensioners' hall. They also had resources to pay for the trips that they enjoy during the summer.

In another part of my constituency, the Nelson and Llancaiach civil and historical society received in January 2003 a grant of £2,040 to help pay for educational projects in the area and for historical visits. Last but not least in the category of small grants is the Aber Valley YMCA, which received in September 2003 a grant of £5,000 to help with the cost of refurbishments. With the help of the local authority and money from the European regional development fund through objective 1, that YMCA has been one of the most successful ventures of its kind anywhere in the south Wales valleys. In fact, it has been so successful that it has received numerous awards. The national lottery has made a significant contribution to the success of that regenerated YMCA. Indeed, I was there only this Saturday to hold one of my advice surgeries, and I saw at first hand the excellent work that was being done for the community generally and for disadvantaged young people in particular.

One of the finest examples in my constituency of effective use of lottery money is at St. Cenydd comprehensive school. Some £1.6 million has been provided from the New Opportunities Fund to pay for a four-court sports hall, a dance studio, a multi-gym and changing rooms. St. Cenydd is a large comprehensive school with some 1,150 students, and although the facility has been open only a few months, the school has already derived tremendous benefit from it. Moreover, it has been made open to the local community as well.

Those are practical examples of how the national lottery is benefiting people on the ground. If things are going so well, it might be asked why we need to change them by introducing the Bill. I suggest that there are three overwhelming reasons why. First, the legislation will give formal status to the Big Lottery Fund, bringing together what is already happening in practice in respect of the Community Fund, the New Opportunities Fund and the Millennium Commission. As the Minister said, it will provide simpler rules, making it much easier for applicants to make submissions and receive the funding that they need. Things will be much more straightforward and easier to understand, and it will be easier to access the money.

The second point is fairly obvious, but it is important none the less: efficiency savings will be achieved because of the merger. The fund will significantly reduce administration and bureaucracy, which will mean more money for the desirous causes that we all want to receive the necessary support.

Thirdly, the merger advocated in the Bill will enhance the involvement of the citizens of this country. It will bring about greater public involvement in the national lottery by helping ordinary people in a variety of
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different ways not only to set lottery priorities, but to determine which awards are allocated to different projects. As I understand it, a range of options are being considered. One is the introduction of citizens juries, and telephone surveys are another possibility. Award panels could also be established, and we could have voting for individual projects.

Significantly, the Bill specifically advocates greater co-operation with the devolved Welsh Assembly and Scottish Parliament, which I welcome as a Welsh Member. There is already effective co-operation between the national lottery and the Welsh Assembly, and I am sure that it will increase significantly if the Bill is passed. The Bill strikes the right balance between reinforcing the fact that this is a UK or national lottery and recognising the scope for greater participation by the devolved Administrations. Striking the right balance is difficult, but the Bill achieves it.

We are discussing large sums of money that belong not to the distributors or to the Government, but to the people who play the national lottery week in, week out. Earlier this month, the Big Lottery Fund announced a new partnership with ITV to create a series of programmes called, "The people's millions", in which ITV will encourage regional and national competition and the winners will get money to support transformation projects. Some 50 grants of £50,000 will be available, and I anticipate that at least three of them will be made available in Wales.

I welcome that initiative, which builds on the excellent example set by the recent BBC2 programme, "Restoration", which was an extremely popular programme that mobilised people in local communities to get together, to make submissions and to take pride in participating in a viable bid. In my area, one project in particular, the so-called "Memo" or Memorial hall in Newbridge, has been extremely successful in getting people together to support its strong bid, which was the runner-up in the final of "Restoration". The hall is in the Islwyn parliamentary constituency, but it falls within the Caerphilly County borough council area. Although the bid was unsuccessful on the last lap, it successfully pulled together the community, and a number of other initiatives have taken place. I hope that the new programme is as successful as "Restoration", that it helps to open a new chapter in the history of the national lottery and that it shows that people can get involved in the revitalisation of their communities, given sufficient political will and imagination.

I support the Bill for a number of other reasons, of which I shall briefly touch on two. Excessive balances are not a problem if they are reduced quickly, but if balances are held on to and significant interest accrues, it is right to take action. Distributors currently have a perverse incentive to hold on to balances for as long as possible in order to benefit from the interest, which is a ridiculous situation that undermines the positive ethos behind the national lottery. I am pleased that the Government are taking a reserved power to reallocate such money as and when it is necessary to do so.

The Bill provides the new Big Lottery Fund with greater strategic power. Many people are cautious when they apply for lottery funding and ask, "It is all well and good if we receive a reward and put it to good use, but what will happen afterwards?" They are often concerned about their project's sustainability, and it
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would be a huge step forward if the national lottery were to provide strategic advice and support to allow projects to become truly sustainable. That would be good in itself, but it would also boost confidence and help projects to make a long-term commitment to benefit particular communities.

Match funding is often a difficult issue for applicants, and the Big Lottery Fund should be able to provide more effective advice about it. The Big Lottery Fund could also manage funds to ensure that the community gets the best possible rewards from applications and funding.

I am truly delighted that this important piece of legislation is having its Second Reading today, early in the life of this Parliament. It is important that we consider the issues before us calmly and rationally. If the Bill passes its Second Reading, it will make the national lottery even more of a success story than it has been so far. I am a firm supporter of the national lottery, as are many of my constituents. We want to recognise the success that has been achieved but also to recognise that we can go a lot further with this Bill.

5 pm

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