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Lord McIntosh of Haringey: My Lords, I cannot quite give that assurance. However, let me explain why I cannot do so. I am grateful to the noble Lord for raising what I believe to be an important issue; the significance of directions issued under Section 26 of the 1993 Act. The Government are currently in the process of comprehensively reviewing both the main kinds of directions, the policy directions and the financial directions, in line with the aims set out in the White Paper of reforming distribution so that,

That review takes into account not just the proposals in the White Paper, but the useful comments which many organisations and individuals made about the lottery in the consultation which followed its publication, and indeed views which have been expressed at Second Reading and in Grand Committee. For example, the noble Lord, Lord Redesdale, will be glad to know that we are actively considering how best we can reflect the principles of sustainable development in the directions. That will arise when we consider Amendment No. 13.

The review of directions is the culmination of a process which, I hope noble Lords will agree with me, has been conducted very openly and with every chance for those with an interest to offer views on matters which ought to be taken into account.

I can also assure noble Lords that the directions will be published. The Government are still considering the best timing and approach to that, but noble Lords may be aware that it has been the practice in the past for directions to be published at the stage when the formal consultation with distribution bodies required by the Act opens, and any third party with an interest in them can comment at that stage. Even after directions have been finalised and issued, they are of course public documents. They are included in distributors' annual reports, and the Government welcome representations on their drafting and effect at any stage.

Our commitment to openness on the lottery goes beyond the issue of directions. As noble Lords will be aware, the requirement to draw up strategic plans which is the subject of Clause 11 of the Bill, involves distributors in a process of statutory consultation. That will be another way in which external opinions will help shape distributors' policies and practices.

The directions themselves, in particular the financial directions, are complex technical documents, which reflect policy rather than create it. Leaving the Secretary of State as issuer of directions on one side, the distribution bodies clearly have an interest in their detailed content and drafting which is of a different nature from all the other organisations and individuals who have an interest in, and views about, the operation of the lottery.

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Occasionally it is also necessary to issue a new direction very urgently. Bilateral consultation with the distributors can take place very speedily, especially where the Secretary of State and the distributor are of the same view on the change required. A formal statutory requirement to consult publicly which the amendment imposes would get in the way of that.

With no disrespect to the thought underlying the noble Lord's amendment, I believe that the existing legislation is right to confine the formal statutory requirement for consultation on the directions themselves to the distribution bodies. This is a distinct stage in the process which should be as inclusive as possible and, I hope noble Lords will agree, has been extremely open all the way back to the White Paper. On that basis--it is not quite the assurance that the noble Lord seeks--I hope that he will feel able to withdraw the amendment.

Lord Redesdale: My Lords, that is as full a response as I had hoped for. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 9 [Delegation by distributing bodies of their powers of distribution]:

Lord McIntosh of Haringey moved Amendment No. 10:

Page 13, leave out lines 41 to 45 and insert--
("(b) require a body, before appointing any body or person not falling within section 25A(2) to exercise on its behalf any function of making decisions concerning the distribution of money under section 25(1), to obtain the approval of the Secretary of State to its plans for making such appointments.".").

The noble Lord said: My Lords, this is a drafting amendment for which I apologise. It depends on an amendment which was introduced at Committee stage. It is consequential to the amendment to subsection (2), new Section 26(3A) of the 1993 Act, on the Secretary of State's power to issue directions concerning distributors' powers to delegate decision making. I beg to move.

On Question, amendment agree to.

Schedule 3 [Joint schemes: Schedule 3A to the 1993 Act]:

Lord McIntosh of Haringey moved Amendment No. 11:

Page 27, line 10, leave out ("£5 million") and insert ("£15 million").

The noble Lord said: My Lords, this amendment is somewhat more substantial. The noble Baroness, Lady Rawlings, moved an amendment that joint schemes up to the value of £10 million should not require the express approval of the Secretary of State. I undertook to review our approach to the approval of joint schemes in response to her amendment.

Noble Lords will see from this amendment that, on due reflection, and after consulting all the distributors, we agree with the noble Baroness's view that it would be sensible to increase the limit for approval by order. We think that it is reasonable to increase it to expenditure of £15 million in any one year. Distributors

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will welcome the higher limit. It will permit a less cumbersome means of approving a higher number of joint schemes while enabling Parliament to retain a considerable degree of the control over the allocation of lottery funds which it laid down in the 1993 Act. I beg to move.

Baroness Rawlings: My Lords, I thank the Minister for including the provision.

On Question, amendment agreed to.

Clause 11 [Strategic plans for distributing bodies]:

Baroness Rawlings moved Amendment No. 12:

Page 15, line 2, leave out from beginning to ("in") in line 3 and insert ("A body which distributes money under section 25(1) may,").

The noble Baroness said: My Lords, I cannot tire of repeating that the lottery created by the previous Administration has been an outstanding success. Yet I accept that like most things it is not perfect. It is therefore understandable that an incoming Administration would want to improve it and to set on it its own stamp.

Unfortunately the Labour Government have tried to do more than that. They have been too clever by half. They want to be seen to be popular and effective--that is, to provide cash promptly on vote-catching schemes; and, at the same time, they do not want to renege on the commitment to stay within the Conservative spending limits. This Bill allows them to solve that contradiction. The solution is politically brilliant but it has dramatic consequences for the existing good causes.

The effect of the Bill will be, first, to divert funds away from the existing good causes; and, secondly, to deflect from the purposes it was set up to fulfil, namely, to clear up the backlog of capital underfunding. It also brings the existing good causes under tighter control by the Secretary of State.

The Bill's approach to the existing good causes continues to shift the balance of cultural policy away from heritage towards the creative arts and industries. Let me reassure noble Lords that I shall not go into the sterile debate between high and low culture. However, I should like to point out that the approach that this Government are taking is the same as that adopted by Jack Lang when he became the French socialist cultural minister in 1981. It is a classic socialist approach; and an almost 20 year-old socialist policy cannot now be labelled New Labour policy. We disagree with the approach because we disagree on the role of the state in relation to culture.

That brings me to my first amendment to Clause 11, new Section 25C(1). The prime objective underlying the amendment is to protect the existing good causes. That has been the main thrust of the Conservative approach to the Bill, as my noble friend Lord Skidelsky has explained. The second objective is to stop the erosion of the arm's length principle by limiting the powers of the Secretary of State. The amendment is intended to make the strategic plans of the distributors truly their plans and not the Government's plans. It does so by making the language of the clause permissive. At present the clause lays down that the Secretary of State

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may instruct a distributing body to prepare, adopt and not only review and modify but even replace a strategic plan.

The background to this provision is that distributing bodies feel restrained at being unable to solicit applications from areas in particular need, which this Bill empowers them to do. But, if they are to do so, they should do so according to a clearly and widely understood strategy. Such a strategy would also increase transparency, which is highly desirable--hence this clause.

So far, so good; and we broadly support the proposals. As presently drafted, however, the clause raises serious concerns. We feel that any Secretary of State would be able to send the strategy back to the drawing board until it contains exactly what he wants. In Committee, the Minister objected that our amendment did not give sufficient weight to this important proposal; whereas we feel that, as drafted, the requirements of the clause do not empower the distributors, but place them in a straitjacket. I am particularly worried by a paragraph in the White Paper which states:

    "Our proposals are designed to make the existing structure work better so that ... Lottery funding is seen as part of regional and local strategies to bring about economic, cultural and social regeneration".

That is redolent of interventionism. We object to that approach in general. In particular, we oppose it because it perverts the original purpose of the lottery by endeavouring to make it an instrument for implementing social policy from above.

There is wide concern at government statements and proposals, which a recent leader in The Times described as,

    "Symptomatic of an unhealthy desire to direct".

The practical implication of that desire is the erosion of the arm's length principle. That principle may well be a peculiar English invention. Despite its shortcomings, however, it has largely ensured the independence of culture from politics. I feel that, if the Secretary of State may dictate the contents of the strategic plans as proposed, then the independence of the trustees of the distributors in relation to specific decisions will be lost. I commend this amendment to the House. I beg to move.

5 p.m.

Lord Crickhowell: My Lords, this amendment provides an opportunity to touch again on a very important clause and some very important issues. Let me make it perfectly clear that I am entirely in favour of the publication of strategic plans and widespread consultation and comment about them. Indeed, as one noble Lord opposite will recall, as a millennium commissioner I was highly critical of the Millennium Commission's totally different policy on the funding limit; it was one of the reasons for the disaster in relation to the application for an opera house in Cardiff in which I was deeply involved. I was extremely critical. I said why I thought the policy was wrong and that we were in a situation where one lottery funding body was following a completely different set of policies from others, and that led to enormous difficulties.

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It seems to me absolutely right that that kind of issue should be out on the table, that it should be the subject of consultation and debate, and that there should be strategic plans on which people can comment and in relation to which advice can be taken. One would hope that the bodies involved would take some notice of the views expressed on these issues. I suppose that the precedent set by the Millennium Commission does not encourage the view that note would always be taken. However, as my noble friend pointed out, this clause goes much further and appears to give the Secretary of State the right to interfere considerably in this process.

As noble Lords will know, I have chaired a public body, the National Rivers Authority, and have had to draw up strategic plans. I know how important it is that at the end of the day that body must be responsible for its plan and be able to stand by it, confident that it believes in it. If it is under excessive interference from the Secretary of State, there is likely to be a breakdown of confidence and relationships.

The precedents in recent months have not been entirely good. My noble friend referred to the arm's length principle, which has been of fundamental importance in the operation of the arts councils for many years and has been widely acknowledged to be one of the strengths of the system that has operated. There have been many comments in recent months about the tendency for the nanny state to interfere more and more in the way that things are done. Certainly, the present Secretary of State has shown a willingness, an eagerness even, apparently to wish to influence arts policy--which some of us are not entirely convinced is healthy. Indeed, the kind of comments made, for example, about the relationship between the English National Opera and Covent Garden is the type of interference which some of us do not find very encouraging. So at the very least, we need to hear what the Minister has to say about this clause and the proposed amendment.

I noticed that when my noble friend suggested that this provision would lead the Secretary of State to interfere in an unsatisfactory manner, the Minister shook his head. I therefore hope that we shall hear a number of statements that will reassure us that this clause is not to be used as an extension of the nanny state and will not be the basis on which the Minister intends to interfere more and more with the activities of the funding bodies. There is no reason to think that that will lead to the better administration of the funds to be distributed. We need to make sure that there are clearly understood principles; that they are published; that there is consultation in relation to them; and that then the organisations are allowed to get on with matters, to take the decisions and be answerable for those decisions. No public body that has any sense of its own integrity can allow a situation in which it has to put up with a strategic plan in which it does not believe and which has been imposed upon it by Ministers. I hope the Minister will be able to provide reassurance.

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