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Baroness Rawlings: Coupled with Amendment No. 39 is Amendment No. 39A. This is a probing amendment which is intended to seek clarification about the destiny of the old good causes' share in the lottery proceeds. At Second Reading the noble Lord, Lord Rothschild, raised serious concerns about the provisions of Clause 17(2). The Minister had little reassurance for him at the time. He said:

This provision seems to give the Secretary of State licence to raise a distribution fund at the expense of the old good causes on which so many people depend. We believe that such action is wrong in both principle and practice. In principle, it represents a further departure from the equality between the good causes enshrined in the 1993 Act; in practice, it would cause the problems of planning difficulties, over-commitment and uncertainty for recipients that the noble Lord, Lord Rothschild, highlighted. We want to protect the old good causes. We want to see only the Millennium Commission's share of funds go to NESTA when it completes its task.

Lord Crickhowell: This group of amendments takes us to Section 22(3) of the 1993 Act and the distribution to the good causes. It therefore enables me to press again the point that I raised earlier, particularly to pursue the point that, having got the money from the distribution fund, in whatever proportion, into the good causes, how much discretion then exists for moving from the previous policy of confining expenditure largely to capital projects to a wider interpretation and to a greater use for revenue funding, and what are the Government's intentions in this respect. I look forward the hearing the Minister's reply.

Lord Rowallan: The initial endowment for NESTA is to come from money set aside for the new good causes. However, after one year the Bill enables one to increase the NESTA endowment directly from the National Lottery Distribution Fund. This could reduce the amount to existing good causes.

The home countries' sports councils, as noble Lords are probably aware, have a very good programme at the moment of supporting up-and-coming elite sports performers through their world-class performance programme. Nearly £300 million will go towards that, which is extremely worthy. Can the noble Lord confirm that sports funding will not be reduced? If NESTA is to receive further endowments from the National Lottery Distribution Fund, can the Minister also confirm that this funding will not reduce the amount of funding for sport?

Lord McIntosh of Haringey: My noble friend Lady Ramsay said in response to the earlier amendment that

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we would address these issues of funding when we came to this group of amendments, and I am happy to confirm that I plan to do so.

The noble Lord, Lord Crickhowell, has said that the percentages are set out in Section 22(3) of the 1993 Act, and he is quite correct. If he turns to Section 28 of the 1993 Act, he will see that amendments are possible by order to those percentages, with only the condition that none of the existing good causes can come below 5 per cent. of the money available for good causes. The point I tried to make at Second Reading is still valid--it was the intention of the previous government that there should be this degree of flexibility in the funding of the existing good causes--that any of them could go down to not less than 5 per cent. at any stage by order without primary legislation. In this Bill, we are simply extending the same flexibility as was intended by the previous government to, first, our new opportunities fund, and secondly, to NESTA. I am sorry to deal with these issues before I come to the specific amendments, but this is the right way round because we are talking about the continuing financing of NESTA.

The noble Lord, Lord Crickhowell, asked me in what sense we would tackle the problem which he rightly identified of risking having lottery funding for buildings rather than for people and having a large number of very fine buildings with nothing to put into them. There are two answers to that. On the face of the Bill, from Clause 8 onwards, there is a whole series of measures to increase the flexibility available to the existing distributors in the way in which they handle funding applications. They are enabled to solicit applications if they think that is appropriate, if they think there are significant gaps in applications for funding in different places or for different purposes. They are enabled to delegate their powers of approving applications to smaller groups of people who might be officials or regional committees or whatever. They are enabled to undertake joint schemes so that good causes which fall at the boundaries between arts, sports, charities and heritage, or indeed the millennium, can be undertaken and approved in a more rational way. This comes back to the case which the noble Lord, Lord Crickhowell, himself raised in Cardiff, and on which I still have to write to him. They are required to produce strategic plans which will enable applicants to understand the thrust of their funding policies and make it easier for applicants to respond appropriately.

The specific point the noble Lord makes, which is in addition to these provisions, concerns the change of emphasis from capital projects to revenue projects. That will be given effect by policy directions made under Section 26 of the 1993 Act. We do not need to have it on the face of this Bill, although the provisions to which I have referred in Clauses 8 to 10 will help in the working of distribution.

I should repeat the warning I gave at Second Reading. You cannot simply fund a building and then indefinitely fund what goes into it. That would mean that every time you funded a building, the cost to the good cause would be cumulative. Gradually, over time, the amount of funding available for new projects will diminish as the continuing revenue funding obligations increase. So we

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cannot go that far but we can do what we have done, which is simplify and make more flexible the funding procedures of the good causes, and we can, as we plan to do, change the policy directions to make revenue grants more appropriate. With that necessary digression, I return to the amendments in this group.

If I may respond first of all to the noble Lord, Redesdale, I am afraid we cannot accept his amendment. The 1993 Act provided Ministers with wide order-making powers, subject to the affirmative procedure, to re-allocate lottery funding between the good causes. That is what I referred to in Clause 28. Parliament recognised that there were all sorts of circumstances, not foreseeable at the time of the legislation, which might mean that there was a strong case for increasing or decreasing particular good causes' shares without the inflexibility and delay which would be caused if primary legislation were necessary.

All we are seeking to do by means of Clause 17(2) is to provide an equivalent degree of flexibility for NESTA. NESTA is not, of course, a lottery distributor. It will not receive a percentage stream of lottery funds, nor should it. We see it as a body apart from the lottery, and to tie it to a stream of lottery funds, which would be the effect of the noble Lord's amendment, would undermine this. It might also make other potential contributors more reluctant to contribute. However, we need to give ourselves the opportunity in future to respond to any need to increase its funding with the widest degree of flexibility about how we do so. It might not merely work, but work wonderfully well, and need more money for very good causes indeed.

Therefore, limiting the source of funding to the new good cause share--to the new opportunities fund--as the noble Lord, Lord Redesdale, suggests, would deprive us of that flexibility. We would not be able to take a view, across the good causes as a whole, of the competing demands. NESTA would only be able to receive a further endowment if the new good cause share happened to be able to fund the whole of it. That would not be right since, as I hope is clear already, NESTA will not be a new good cause initiative, nor does NESTA have any more of a relationship with the new opportunities fund than it will with any other distributor.

5 p.m.

Lord Redesdale: I shall press the Minister. We are looking at the Government's intentions here. Is it the Government's intention to replenish on a regular basis NESTA's endowment, and to what extent, if it was a significant amount of money, would that affect the percentages of the other good causes? I realise that it is not within the stream but it would affect the money they expected to receive.

Lord McIntosh of Haringey: That is quite right, of course, and I have some specific assurances that I wish to give to the Committee about that. However, let me deal with Amendments Nos. 39A and 39B, which concern the millennium, before I come to the assurances, because they apply to both.

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The amendment of the noble Baroness, with the accompanying consequential Amendment No. 39B of the noble Lord, Lord Skidelsky, would in effect rule out NESTA ever receiving a further endowment. As I explained when we were discussing Clause 5, the Millennium Commission's entire projected funding of £2 billion is already committed or definitely allocated to programmes. There will be no scope for funding additional resources for NESTA from that money, and when the millennium stream has delivered the projected £2 billion the millennium good cause will cease to receive funding.

As I made clear in discussions on Clause 5, the Government do not believe, any more than the last government did, that it is sensible to limit flexibility to respond to circumstances which cannot be predicted. That is why I hope the Committee will reject these amendments.

However, I can give certain assurances about funding. First, the Government have no current plans to use the power. We consider that an endowment of £200 million provides NESTA with a fair and affordable endowment from the lottery. Circumstances would have to change significantly before we could consider making a further endowment.

Secondly, there would certainly be no question of using the power in a way which went against the expectation of the existing good causes that they will between them receive £9 billion over the lifetime of the current licence. Thirdly, if we were to use it, we would do so only after considering most carefully the outcome of the consultation which we are required to undertake by subsection (3), and in particular the impact any proposal would have on the distributors' ability to meet their commitments or to carry out their strategy.

I hope, with those assurances, noble Lords will feel that their amendments are not appropriate.

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