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Lord Donoughue: My Lords, as the Minister defined my political position and it goes on record, I think I should make it clear that I am very old New Labour.

Lord Inglewood: My Lords, I always understood that the old ones were the best ones.

The noble Lord raised a number of other points. For example, he said that distributors should have strategic award plans. One of the characteristics of the lottery is that distributors cannot solicit applications. After all, this then ensures that the projects which might be funded will have the support of their local communities. However, the lottery distribution bodies are free to encourage certain types of application, such as the National Heritage Memorial Fund's urban parks programme, of which mention was made earlier, or the Sports Council's efforts to encourage applications from deprived areas and from schools--to go to a point raised by the noble Baroness, Lady Seear.

Perhaps I may respond to another point raised by the noble Lord, Lord Donoughue, about the United Kingdom Sports Council. Initially, the United Kingdom Sports Council will not be a lottery distributor. Its role will be in advising the home country councils on projects which have United Kingdom significance, for example, the British Academy of Sport. At present we see no need to have a fifth lottery distributor for sport although my right honourable friend the Secretary of State will want to look again at that once the United Kingdom Sports Council is formally established.

The aim of the Department of National Heritage (set out most recently in the departmental report) is to enrich people's lives, through encouraging high quality and diversity in creative activities; to safeguard existing creative achievements and promote understanding of the past; to extend opportunities to enjoy and appreciate rewarding leisure activities; and to promote the contribution which all of the department's sponsored sectors make to national prosperity and prestige.

The introduction of the National Lottery has effortlessly fitted into those objectives. In the areas of sport, arts and heritage, the lottery is building on work which has traditionally been done by our non-departmental public bodies. It is also providing us with the opportunity to celebrate the new millennium in a number of different ways and, following the transfer of responsibility for charities and the voluntary sector from the Home Office, is supporting and focusing our thoughts on what can be achieved in these areas. In the coming months, my department will be seeking discussions with a wide range of voluntary groups and organisations to listen to their perspective on the system of making applications and awards. In this way we hope to ensure that the maximum benefit possible will accrue to these areas.

The lottery has had direct effects on local communities across the country. As my noble friend Lord Gowrie pointed out, in many respects it is doing what was done in the Victorian and Edwardian eras by

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private philanthropy. Perhaps I may return to a point made by the right reverend Prelate the Bishop of Worcester and say that although this may be a change in the way in which things are done, it is part of a longer evolution. For example, in Scotland, in Clackmannanshire, lottery money has been used to repair an early 19th century iron bridge which had fallen into disrepair; and in Wales, in South Glamorgan, conservation work is to be carried out on Llandaff Cathedral to help to preserve it for future generations.

Perhaps I may respond to a point that was raised initially by my noble friend Lord Boyd-Carpenter and later by others and say that funds can be made available for churches.

I have a personal anecdote to tell. I am personally familiar with a project in Keswick, where the Cumbria Theatre Trust Ltd. has been awarded a grant of up to £3.1 million to build a new theatre. Before the advent of the lottery, those running the old theatre which these funds will help to replace dreamt of a scheme such as this. More than a decade ago, I recall going to meetings in the backroom of a pub called "The Packhorse" to try to help bring forward a scheme and feeling very daunted and depressed by the financial problems it posed. Now it is going to happen. It is an excellent example of the way that the lottery has provided an opportunity for people to use their imagination to come up with worthwhile and innovative projects and see them realised.

Lord Annan: My Lords, is there any money for endowment in that Cumbrian project? The great Victorian philanthropists, and even Lord Nuffield in our time, always saw to it that there was an endowment as well as a building.

Lord Inglewood: My Lords, no endowment comes with that project, which involves a new theatre building for an existing organisation.

The lottery is also helping the disadvantaged and the less well off through the National Lottery Charities Board, the programmes of which have so far focused on poverty, health, disability and care. Future grant programmes will focus on improving opportunities, the living environment and community involvement.

In thinking about those distributions, it is important (for the long term well-being of the lottery) to ensure that particular disbursements command a wide degree of support. The noble Baroness, Lady Wharton, and my noble friend Lord Soulsby raised the question of animal charities and whether they can benefit from the lottery. Although animal charities have not been eligible for grants under the first two grant rounds of the National Lottery Charities Board, the board has had discussions with a number of such charities. I understand that they will be able to apply for funds in the grants round covering the physical environment and the social fabric of communities which will be launched later this year.

Lottery money has also been used to help the disabled--not only in ensuring that buildings built with lottery money must provide access for disabled people and be accessible to them, but also in helping them to participate in activities such as sport and the arts.

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The lottery is helping urban regeneration. For example, the Tate Gallery of Modern Art will help to regenerate Bankside in this city; and the Lowry Centre in Salford will bring huge benefits to the surrounding area. The Millennium Earth Centre in South Yorkshire will provide a world-class educational, research and business centre for sustainable development.

The lottery is also bringing benefits to rural communities. Many awards from the distributing bodies have gone to rural areas and the Millennium Commission has set up a scheme designed specifically to help to preserve and build village halls which, as those who live in the country like me will know, are very important.

The noble Viscount, Lord Falkland, underlined the importance of the lottery to film. That point was echoed by the noble Viscount, Lord Chandos. Their comments entirely accord with what I have been told by those in the film industry whom I have met.

As I have already said, sport is important. In addition to the lottery, Sportsmatch is doing what it can to try to provide improved sporting facilities for the very people to whom the noble Baroness, Lady Seear, referred.

The lottery is creating jobs. It is estimated that the Tate Gallery of Modern Art will create 650 permanent jobs in its immediate locality, and perhaps 2,500 throughout London. The Millennium Commission award of £46 million to the new National Stadium in Cardiff should also provide more than 700 permanent jobs. In addition, it is likely that that redevelopment will have a substantial and durable wider economic effect. Another Millennium Commission award, to create an international maritime arena at Portsmouth Harbour, will generate temporary employment for around 5,000 architects, designers, construction workers, electricians and people in associated industries; and when completed is expected to provide 2,100 new jobs.

Less directly, the lottery has also provided an important boost for shopkeeepers. Retailers received a total of £265 million in commission in 1995-96, an average of just under £9,000 each. Many will also have employed extra staff to cope with the public's great demand for lottery tickets.

Tourism is now one of this country's most important industries. The lottery is enabling us to improve the attractions and infrastructure needed to attract visitors in an increasingly competitive marketplace. Grants such as those to national theatres and museums will, in addition to making this country a better place for us to live in, also attract more visitors from other countries and thus trigger additional money entering the economy. In East Anglia, for example, £6.5 million of lottery money is being used by the Imperial War Museum to create a major attraction to be designed by Sir Norman Foster which will commemorate war-time links with the United States Air Force.

The lottery is also providing money for projects which will enhance the environment. For example, the RSPB has been awarded £675,000 of lottery money to recreate fenland feeding habitat of reedbeds and meres

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in Suffolk. This sort of award can bring tourism benefits as well as meeting a recognised need to preserve our natural environment.

The lottery is a means of encouraging national pride--for example, through flagship projects such as the Welsh National Stadium, Hampden Park, and the Tate Gallery. All these projects have an impact on the entire population of the country, not just in the locality where the new facilities are built. In addition, the lottery is also having a similar but perhaps more narrowly focused impact on local communities, through awards to smaller organisations such as local sports clubs and play groups.

My department is not resting on its laurels. It had always been anticipated that the lottery would evolve over time--and it will. The framework for the distribution of lottery funds is kept under continuous review. We very much value the kind of constructive comments and suggestions that we have heard this afternoon, and I am grateful for all that has been said--

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