What next for the National Lottery? – Report Summary

Summary

1. In its first attempt at running a National Lottery licence competition, the Gambling Commission has at best had mixed results. While the fourth National Lottery licence aims to correct many of the deficiencies of the third National Lottery licence, which was designed, and later extended, by the National Lottery Commission, which the Gambling Commission subsumed in 2013, the competition process has been beset with controversy. At present, Camelot and International Game Technology are pursuing litigation that may see them awarded up to £600 million, with concerns raised that this may have to be taken directly from the funds that the National Lottery donates to good causes.

2. Camelot is not entirely blameless, however. As well as refusing to give evidence to the Committee on its performance throughout the third licence period and previously, it has been criticised, and not for the first time by a parliamentary Select Committee,¹ for seemingly prioritising its own profits over the maximisation of the National Lottery’s returns to good causes.

3. Gambling harms experts have questioned elements of the National Lottery’s marketing and advertising strategies, highlighting the potential for the personalisation of advertising leading to potentially vulnerable players being pushed towards products associated with gambling harms, as well as the National Lottery’s unwillingness to adequately support charities that combat gambling harms. The Gambling Commission’s decision to allow National Lottery tickets to be purchased on credit cards in certain circumstances also raised eyebrows and needs to be re-examined.

4. It is clear that the Department has work to do on co-ordinating with distributor bodies to more efficiently allocate funding to the areas of greatest need, in line with its levelling up agenda; and to establish crisis planning frameworks for future crises, based on the experience of the National Lottery distributor bodies’ response to the coronavirus pandemic. Evidence also emerged that the link between the National Lottery and its funding of good causes is not as widely known as it could be, potentially posing existential questions for the National Lottery’s future. We call on distributor bodies to ensure that recipients of funding showcase the source of that funding in the future.

5. Finally, we examined the role of the wider lottery sector. We found that society lotteries play a different role from the National Lottery and do not pose a threat to the National Lottery’s charitable giving. We also found areas of further reform that would allow society lotteries to maximise their charitable giving. Meanwhile, evidence emerged suggesting that prize draws may harm the charitable giving of the National Lottery and society lotteries, with regulation required to ensure that this does not happen.