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Mr. Caborn: Let me my preface my remarks by responding to the hon. Members for Broxbourne (Mr. Walker) and for East Dunbartonshire (Jo Swinson). They should bear in mind that the Bill was drafted after very wide consultation. Out of that consultation came the broad themes that we should advance through the Big Lottery Fund; creating opportunities, and promoting community learning, safety, cohesion and well-being. That is the high-level direction that is given by Government to the Big Lottery Fund.
We are talking about one of the most successful lotteries in the world. Over the past year or so, the take has gone up as more people have participated. It has been hugely successful in terms of the Olympics. Well over £4 million has already been banked, and we only won the Olympics on 6 July last year. The general public have responded to that.
The hon. Member for East Dunbartonshire said that we have a bad record on consulting the voluntary sector. In fact, when we consulted it on the terms of reference,
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we were accused of consultation fatigue. The accusations swing from one extreme to the other. Nevertheless, we will continue to have these positive consultations. The proposal to include a statement about additionality in the annual report to Parliament was made by Stephen Dunmore, the chief executive of the Big Lottery Fund, in consultation with the voluntary sector. That was a significant move.
This group of amendments is concerned with the Big Lottery Fund and what it will spend its money on. We discussed identical proposals in Committee at some length.I have set out clearly our reasons for resisting the amendments. No new evidence has been produced to support the amendments since our Committee proceedings, so my comments today will mirror what I said then.
Amendment No. 2 would remove the Secretary of State's power to prescribe expenditure for the new Big Lottery Fund good cause. Amendment No. 3 would remove the related order-making power. Those amendments would mean that the Big Lottery Fund was given 50 per cent. of all the lottery good cause money to spend on anything that was charitable or connected with health, education or the environment, without further recourse to Parliament. That is simply not sensible. The new lottery good cause is both broad in scope and large in terms of the percentage of lottery money allocated to it. The other good causes of arts, sport and heritage are relatively narrowly prescribed areas.
Within those relatively narrowly prescribed areas, existing legislation further prescribes sums to be distributed by different distributors, as has already been shown. That has the effect not only of limiting who can spend the money but restricting what it can be spent on. For example, prescribing the percentage to be distributed by the Film Council in effect prescribes the percentage of money from the arts good causes that must be spent on film. Parliament took the view in 1993 that such arrangements were necessary to ensure the effective distribution of lottery money. The powers in the Bill are not so different in effect, and it is our view that they are as necessary now as they were in 1993.
Creating a large and responsive good cause was one of the main reasons why we wanted to bring the Community Fund and the New Opportunities Fund together. However, given the breadth of the new good cause, we need to be able to set out at the highest level the types of expenditure on which the Big Lottery Fund should focus. It is right that that should be done in a transparent and accountable way, and that there should be proper parliamentary scrutiny of the process. That is why we are clear that that should be done by secondary legislation and subject to the affirmative resolution procedure.
The order-making powers in clause 7 will allow us to prescribe the three high-level themes of community learning and creating opportunity; promoting community safety and cohesion; and promoting well-being. I explained in Committee that the Big Lottery Fund has consulted widely on the three themes. Some hon. Members unfortunately sought to belittle this consultation, saying that the 850 responses was hardly a representative sample. However, the respondents included 429 voluntary and community sector organisations, 178 local authorities,
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43 health authorities or primary care trusts and 30 local education authorities or schools. Between them, those bodies represent millions of people.
Fifty-eight per cent. of the respondents agreed that the themes provide a sensible and flexible strategic framework for future funding. Only 5 per cent. disagreed. The order-making powers also allow us to prescribe devolved expenditure, which will be the responsibility of new country committees, subject to directions issued by the relevant devolved Administrations.
The Bill represents a significant devolution of power to Scotland, Wales and Northern Ireland, and the ability to prescribe devolved expenditure is central to achieving that. Without those powers, devolved arrangements in the Bill will not work. For the reasons I have given, we cannot accept amendments Nos. 2 and 3, and I ask the hon. Member for Cities of London and Westminster to withdraw them.
Amendment No. 4 would require the Big Lottery Fund to allocate 70 per cent. of its funding to bodies other than public bodies or local authorities whose activities are carried out not for profit. I well know the desire for reassurance on that matter. It has wrongly been suggested that the loss of the separate charitable good cause will cause voluntary and community sector organisations to lose out.
We fully recognise the vital role played by voluntary and community sector organisations in our society. Such organisations have benefited enormously from the success of the national lottery and we are determined that that should continue. The Big Lottery Fund has given an undertaking that 60 to 70 per cent. of its funding will go directly to voluntary and community sector organisations. That is a significantly higher proportion than has been the case under the New Opportunities Fund and the Community Fund combined.
At the moment, only the Community Fund's share of the money—16.6 per cent. overall or 33.3 per cent. of the Big Lottery Fund half—is allocated to charitable expenditure. The Big Lottery Fund's undertaking will ensure that, in future, voluntary and community sector organisations can count on twice as much—I repeat, twice as much—money as before.
Much has been made of the nature and ownership of the undertaking. Let us be clear about that now. The "Oxford English Dictionary" defines an undertaking as
That is exactly what the undertaking amounts to; a formal pledge or promise that 60 to 70 per cent. of Big Lottery Fund money will go directly to voluntary and community sector organisations. By any standard, that is a huge increase compared with the moneys going to those organisations now. The undertaking has been given by the boards of the Community Fund and the New Opportunities Fund—now operating as the Big Lottery Fund—not the Government. We fully support the undertaking but we do not need to repeat it or to enshrine it in the Bill.
We have heard much during this debate about the need for less prescription and less Government control. It has been said that lottery distributors should be
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independent and make their own decisions, free from Government interference. But when it suits the Opposition for something to be prescribed by the Government, their fears about compromised independence seem to evaporate. They are happy for the Big Lottery Fund to spend 50 per cent. of all lottery good cause money without further recourse to Parliament, but they do not trust the fund to deliver on a formal pledge to the voluntary and community sector.
I believe that the Big Lottery Fund has done everything possible to show that it intends to deliver on its undertaking and to do so in a transparent and accountable way. The fund has worked closely with key voluntary and community sector stakeholders to develop the definition of voluntary and community sector organisations for the purposes of dispensing the 60 to 70 per cent. undertaking. It has invited key stakeholders to a lunch on 16 February to review the progress that has been made and to discuss further guidance on what will be funded under the definition. The Big Lottery Fund has already said that it will ask independent auditors to monitor where its funding has been going, and that the results will be published in the fund's annual report, which will be laid before Parliament.
The undertaking to the voluntary and community sector is unique. No other type of organisation is guaranteed a percentage of lottery funding. The undertaking will ensure that voluntary and community sector organisations benefit as much, if not more, from the lottery in future as they do now. There is no question but that the Big Lottery Fund will deliver on its formal pledge. I am not persuaded of the need to include provisions on this matter in the Bill, and I hope that amendment No. 4 will not be pressed to a vote.
Amendment No. 5 would add to the list of people whom the Secretary of State must consult before making a prescribed expenditure order
—that is, the voluntary and community sector. We would certainly expect to consult widely with representatives of the voluntary and community sector before making any orders. Although the amendment seems to assume that representatives of the voluntary and community sector are the only people with a legitimate interest, we would also want to consult other groups, for example local authorities and, importantly now, social enterprises. So we require a degree of flexibility in our approach.
There is a statutory requirement to consult the Big Lottery Fund and the devolved Administrations because, unlike representatives of the voluntary and community sector, they are directly affected. I am aware that precedents of a sort exist in certain other legislation requiring consultation with particular groups of people. However, each piece of legislation is considered on its own merits, and what is right in one case is not necessarily right for what will become the National Lottery Act 2006.
Instead of focusing on what is not in this Bill, I think we should look at the bigger picture. The Government are of course already obliged to comply with Cabinet Office guidance on consultations, and with the requirements of the compact. I explained this point in
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great detail in Committee. We have shown our good faith in consulting recently on the interim order and directions for the New Opportunities Fund. Indeed, we made a change directly as a result of the helpful comments we received from the National Council for Voluntary Organisations.
The Big Lottery Fund itself is consulting closely with voluntary sector and other stakeholders on, among other things, the 60 to 70 per cent. undertaking, additionality reporting proposals, and general programme development. The Government will continue to consult widely, not because a statutory requirement says that we must, but because we think that that is a good way of doing business. That is the real safeguard, and I therefore hope that amendment No. 5 will not be pressed to a vote.
Finally we come to amendment No. 11, which would provide that the Big Lottery Fund must "take account of" rather than "comply with" directions given to it by the Secretary of State under new section 36E, inserted by clause 14 of the Bill. As I explained in Committee, all Lottery distributors are required to comply with directions about financial and operational matters; the points set out in new section 36E(3). I can see no good reason why the Big Lottery Fund should be treated any differently.
Financial directions are designed to protect public money and incorporate controls similar to those applying to all non-departmental public bodies through their financial memorandums. The requirements in section 26 of the 1993 Act are exactly the same as those placed on the Big Lottery Fund by proposed new section 36E(3).
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Concern is perhaps centred more on the power in proposed new section 36E(2) to issue policy directions. The powers have been drafted as they have in order to bring together the different regimes of control that existed over the Big Lottery Fund's predecessor bodies in a coherent way. A child can be expected to demonstrate the characteristics of both its parents, not just one. The Big Lottery Fund will therefore have characteristics, both in terms of control and framework, of both the Community Fund, which makes up one third of the money, and the New Opportunities Fund, which makes up two thirds of the money.
I should perhaps comment on proposed new section 36E(2)(a), which I know is a source of concern, albeit misplaced. The provision allows the Secretary of State to specify persons to whom the Big Lottery Fund may or may not make grants. I can give the House a categorical assurance that the purpose of the provision is not to intervene in individual grants or to choose between voluntary organisations. Its purpose is to enable Ministers to specify particular outcomes and priorities for the Big Lottery Fund related to specific groups of people, such as young people, as we have done in the interim and illustrative directions. We have given repeated commitments that we will adopt a light touch on the direction of the Big Lottery Fund.
We have put our money where our mouth is on the issue of new interim policy directions for the New Opportunities Fund and Community Fund. We have also made available illustrative directions, using the powers set out in the Bill. Both the interim and
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illustrative directions are very different from the type of directions issued in the past to the New Opportunities Fund. They neither prescribe how the funding outcomes agreed with Government should be delivered nor preclude the funding of other worthwhile priorities. They will allow the fund full scope to make decisions on programmes, choose delivery mechanisms, identify partners and select projects.
I cannot, of course, guarantee that if one of the Opposition parties were in power it would not seek to exercise the powers in a different way. This Government, however, have shown by their words and actions that we intend to direct the Big Lottery Fund with a very light touch. I therefore hope that my comments will reassure hon. Members, and that the amendment will be withdrawn.
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