Culture, Media and SportsWritten evidence submitted by the National Lottery Distributors Forum

Background/Summary

The National Lottery Distributors are responsible for distributing money raised by the National Lottery for good causes. Lottery good cause distributors exist to provide support to their sectors/good cause area (s). There are currently 13 Lottery distribution bodies. It is important for the Distributors to respond to this consultation, as the National Lottery Commission has a duty to maximise the amount of money available to good causes. This submission is from members of the Lottery Forum: British Film Institute, Big Lottery Fund, Heritage Lottery Fund, Sport England, UK Sport and Arts Council England.

To date over £29 billion has been raised for good causes by the National Lottery. Funding is distributed across the UK by the National Lottery Distributors, making a difference to the lives of thousands of people and improving places across the UK.

The Merits or otherwise of the Merger of these two Bodies

The National Lottery Distributors do not oppose the merger of the two regulators. As set out in our response to the consultation on the merger we are keen to ensure that a single regulator continues to maximise the amount of money available to good causes.

We are pleased to see that all the existing responsibilities of the National Lottery Commission (NLC) will be transferred to the Gambling Commission. Importantly the Impact Assessment also recognises that the public benefits of the National Lottery and returns to good causes can justify certain regulatory standards being set at a higher level.

In our consultation response we raised a number of areas where we are keen that a single regulator exercises the NLC’s statutory duties effectively, specifically:

Designing and running the competition process for the next Lottery operator in a way that enables strong competition for future licences;

Negotiating and reviewing favourable licence terms with a Licensee in response to changing circumstances or proposals from the Licensee (for example, in cases of change of ownership; organisational structure; introduction of new technologies or to facilitate significant investment).

Protecting public interest in the Lottery by preventing the licensee taking steps that might increase returns in a current licence period, but have adverse consequences for returns under future licences;

Maximising receipts from licensable activities;

All of the above carried out in line with the duties of propriety and player protection.

The proposed governance arrangements for the merged body should ensure that the public benefit derived from the National Lottery is not affected. The potential governance arrangements set out in the Impact Assessment, such as having a dedicated team to lead National Lottery issues and delegating certain Commissioners to take decisions and make recommendations in relation to the National Lottery, would help provide transparency and impartiality.

The proposed savings identified should deliver value for money for Lottery good causes and fee payers, whilst still providing effective regulation.

Any Potential Conflict of Interests which might arise as Result of a Merger and the Governance Structures which might Overcome these

We note that the risk factors set out in chapter 3 of the consultation document have been explored within the impact assessment. However, whilst the impact assessment states the consultation responses raised concerns regarding society Lotteries, the assessment determines this to be a matter for Parliament rather than the merged body. While legislative changes to society Lotteries are a matter for Parliament the regulation of these Lotteries will be a matter for the merged body.

We recognise the valuable contribution society Lotteries make, however without effective regulation the changing scale of society Lotteries raises some concern regarding future returns for good causes. The National Lottery Distributors are aware of the planned Department for Culture, Media and Sport consultation on Society Lotteries and we hope that this will explore the role the merged body will have in regulating society Lotteries.

May 2013