National Lottery Bill

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The Chairman: With this it will be convenient to discuss the following: amendment No. 25, in clause 7, page 4, line 27, leave out subsection (3).

Government amendment No. 4.

Amendment No. 55, in clause 14, page 8, line 41, leave out 'or'.

Amendment No. 56, in clause 14, page 8, line 41, after 'Ireland', insert 'or Isle of Man'.

Amendment No. 57, in clause 14, page 8, line 46, leave out 'and'.

Amendment No. 58, in clause 14, page 9, line 3, at end add


    (d) may be given by the Isle of Man Tynwald in relation to Isle of Man devolved expenditure.'.

Government amendments Nos. 7 to 9.

Mr. Swire: I should have said at the outset how pleased I am to be serving on this Committee with the hon. Member for Bath, who I know will support many of the Conservative amendments. It seems to have fallen to me to table the majority of the amendments. I was lulled into a false sense of security by the hon. Gentleman, who told me that he is still recovering from the after-effects of the London Olympics Bill. If his response to the programme motion was anything to go by, what he might have lacked in eloquence on Second Reading he fully intends to make up for in Committee.

Let me refer to the Second Reading before I move on to the meat of the clause—I know that you will not allow me to go wide of it, Mr. Cook. It is worth bearing in mind that we last debated this Bill back in June, and at this stage we have no idea when Report and Third Reading will happen. One of the questions that arises is: what is the reason for the delay? That is particularly relevant given that a series of statutory instruments have been laid before us, one after the other—like rainfall—to extend the shelf life of the New Opportunities Fund. The Minister will no doubt wish to explain.

I am pleased to say that we get straight to the heart of the matter with these amendments. In a sense, we are starting off with the most contentious clause in the Bill. Amendments Nos. 24 and 25 would remove the ability of the Secretary of State to prescribe expenditure by the Big Lottery Fund. We do not believe that the Government should have such wide prescriptive powers in respect of what the Big Lottery Fund spends its money on and the bodies to which it makes its grants. The Minister will maintain, as he has done consistently, both in public and in private, that the Government will not prescribe spending in the controlling and detailed way that we fear—that there will be no micro-managing of the BLF. However, even the Big Lottery Fund itself speaks of having a new, less prescriptive relationship with the Government.
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Whether or not they are fully used, the simple fact is that the Bill contains draconian powers. When passing legislation, one should always be aware of the law of unintended consequences. Our experience of the New Opportunities Fund suggests that, in time, the powers will be used to the utmost. No doubt others will mention the example of Jamie Oliver and the school dinners initiative during the last election campaign. Ministers panicked and decided that they needed some extra cash quickly. Where better to go than to the lottery? How can we be sure that the Government will not prescribe expenditure in other areas in which Government expenditure needs to be supplemented? Where a Government can prescribe—as they seek to do by adding new section 22(3)(d) of the National Lottery etc. Act 1993—they can later proscribe, with all the sinister connotations that that carries. Proscribing is the reverse of prescribing and none of us in this Room would be happy to see that development.

Some £93 million of lottery funds has already been spent in breach of the principle of additionality. Rightly, Mr. Cook, you will not allow me to stray into a definition of additionality, which is a key part of what we shall be deliberating over the coming few days. I know the hon. Member for Bath is keen to get additionality defined in the Bill. I am talking about spending on MRI scanners in NHS hospitals. I agree that the sum is relatively trivial compared with the £285 million that the Minister has directed to be spent on child care, not to mention the £42 million for fruit in schools—something that I now understand has been taken on by the Department for Education and Skills. Powers of prescription will allow the Secretary of State to use the lottery funds as her personal treasury. In that respect, the powers will mean that the Department for Culture, Media and Sport is the only Department that has its own source of revenue—hypothecated revenue, I would argue.

10.45 am

How jealous the Chancellor must be when he looks at his falling Treasury receipts and the rising expenditure created by his unleashing of expenditure on recruitment, particularly in the public sector. How jealous he must be when he looks over at his Cabinet colleague the Secretary of State for Culture, Media and Sport, who is a close friend of the Prime Minister, and sees her with an embarrassment of riches—awash with money—and under the clause, she can decide to whom it goes. No wonder the Chancellor wants to direct as much of that money as he can into the health and education services—a trend that we have seen begin—under prescription from a compliant Secretary of State.

The Bill is trying to invest powers in the Secretary of State and the Opposition are trying to divest them from the Secretary of State. Secretaries of State change, and while I have nothing personal against the current Secretary of State for Culture, Media and Sport, how many of us know for how long we will occupy our present positions, particularly if there is a rather public leadership contest in one's own party?
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Before the Minister scoffs at that, I suggest that that will be a situation in which he might well find himself in the not-too-distant future.

Treasury revenues are falling and a nice big fat lottery is pumping in money. What do the Government do? They decide to give more power to the Secretary of State to prescribe where that money goes. That is unacceptable.

Mr. Tom Harris (Glasgow, South) (Lab): Will the hon. Gentleman tell the Committee whether in the National Lottery etc. Act 1993, which the Conservative Government introduced to set up the national lottery, the then Secretary of State for National Heritage reserved powers to himself to prescribe good causes? I seem to remember that, at the very least, the Government issued guidance to ensure that only good causes approved by them were set out.

Mr. Swire: The hon. Gentleman will know that language is everything, particularly, no doubt, in Glasgow, South.

Section 6(3) of the National Lottery Act 1998—I happen to have the relevant information in front of me—amended section 22 of the 1993 Act, which clause 7 will also amend. The 1998 Act mentions 16 and two thirds per cent.—I will not repeat each allocation, although we will argue why they were right as opposed to what is now proposed in relation to the Big Lottery Fund. It clearly says that 16 and two thirds per cent. shall be allocated for expenditure. Before that, section 22(2) of the 1993 Act stated:

    ''So much of the sum as the Secretary of State considers appropriate shall be allocated.''{**tw4**}

The difference between the Secretary of State's being able to consider what is appropriate and a guarantee that certain amounts of money will be allocated for expenditure is very different from 50 per cent. of lottery being allocated for prescribed expenditure. That is the kernel of the argument. One is guidance and the other is an instruction. That is the key to the debate, and the hon. Gentleman has done this Committee a favour by rightly putting his finger on it at an early stage.

The powers of prescription mark a fundamental difference between, on the one hand, the Opposition, the Liberal Democrats, almost the entire voluntary sector, and numerous other bodies and institutions, and on the other hand, the Government, who sit like Canute in a rising sea of opposition. They are oblivious to the clamouring of dissatisfaction with their Bill. Only yesterday, the National Council for Voluntary Organisations called on the Government to rethink their powers of control over the BLF, saying that the Bill

    ''compromises the independence of the BLF and its ability to make decisions free from Government interference.''

I alluded earlier to the fact that the Big Lottery Fund itself is nervous about the perception of Government control over its deliberations. Amendments Nos. 24 and 25 would place the BLF on a par with all other lottery distributors. The amendments are reasonable and would not adversely
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affect the operations of the BLF, but simply give it more independence, which it would like very much.

Mr. Foster: The hon. Gentleman, although perhaps not all Committee members, will be aware that his point about the Big Lottery Fund's concern has been clearly expressed in its briefing to Members. It says in its note that it recognises the political concern about the principle of additionality and goes on to make suggestions about what definition should be in the Bill. The BLF shares our concerns, which the Government have clearly not yet accepted.

Mr. Caborn: We are not debating additionality.

Mr. Swire: The Minister and the hon. Member for Bath are both correct: at this stage, we are not debating additionality, and, quite rightly, you would not allow us to do so, Mr. Cook. However, we are debating what the Big Lottery Fund—the creature of this Government—is saying about its maker. In a sense, we are debating what the monster is saying about Frankenstein. The fund is the son of the Government, but is saying that it is not happy with aspects of the way in which it has been created. That is clear, and it has nothing to do with the principle of additionality, although that is also one of its concerns, to which we shall come later.

I am grateful to the Minister and his civil servants for providing us with a copy of the National Lottery Act etc. 1993 with the suggested Government amendments; it is an extremely useful point of reference, and I recommend it to all who do not already have it—no doubt it is readily available in all leading bookshops. It shows that the original 1993 Act was far better than this Bill will be if it is enacted unamended. The Minister is fond of saying that occasionally he would like to come to a Committee and agree to all the amendments to see what chaos that would cause, but I would say that that if the Opposition withdrew all our amendments and left the Bill as it is currently drafted, it would lead to even greater chaos. Anyway, we shall not go down that particular road; I digressed for only a minute, Mr. Cook.

Under section 22 of the 1993 Act, all other distributors, including the New Opportunities Fund, were given a share of lottery funds ''allocated for expenditure''. If such a form of words has sufficed for all other distributors, why change it? If the BLF says that it hopes to enjoy a less prescriptive relationship with the Government, why include prescriptive powers in the Bill? When the Government changed the rules on lottery distributors' independence for the New Opportunities Fund, they rightly attracted much criticism for eroding the independence of the lottery as a whole from the Government. Why then do the Government continue to use and even extend such powers of prescription? I should like the Minister to spend some time explaining the thought process behind clause 7.

The Government are proud of their consultation record on the lottery; I suspect that we shall be hearing a lot about that in the next few days. On Second Reading, the Minister said:
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    ''we are responding to what was said in the consultation, which was that people wanted more power to be given to the distributors''—[Official Report, 14 June 2005; Vol. 435, c. 170–171.]

However, binding the BLF to prescribed expenditure, as set out in clause 7, does the exact opposite: it gives the Government more power over more lottery money. Almost every voice that one hears from the charitable sector, from the National Council for Voluntary Organisations and the Association of Chief Executives of Voluntary Organisations downwards, is seriously concerned about the control that the Bill gives the Government over lottery funds. A recent NCVO poll found that 73 per cent. of people wanted lottery funds to be distributed by ''an independent body''. However, the Big Lottery Fund is not such a body as it is constituted in the Bill.

Other amendments in this group include some that would cover what seems to be an anomaly in directions on devolved expenditure. Our amendments Nos. 55 to 58 would make provision for devolved expenditure in the Isle of Man to be decided by the Tynwald. I must confess that I do not know much about the governance of the Isle of Man and I have never been there, but I greatly admire its spinning legs logo. That is about as much as I know about the Isle of Man. The amended Bill now refers to the Channel Islands and the Isle of Man, but at some stage the Isle of Man disappears. We are suggesting that it should be mentioned again and I look forward to hearing the Minister's thoughts on that.

That concludes my opening remarks on this group of amendments, which form the kernel of the debate. I look forward to other hon. Members joining in because I am sure that they will have some interesting things to say.

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