Draft Legislative Reform (Exempt Lotteries) Order 2015; Modern Slavery Bill: Government Response - Delegated Powers and Regulatory Reform Committee Contents

Eighteenth Report

Draft legislative reform (exempt lotteries) Order 2015

1.  This draft Legislative Reform Order (LRO) has been laid by the Department for Culture, Media and Sport (DCMS) with an Explanatory Document (ED). It is proposed to be made under section 1 of the Legislative and Regulatory Reform Act 2006 ("the 2006 Act"), which allows a Minister to make provision by order for removing or reducing any burden resulting directly or indirectly from legislation.

2.  DCMS states that lotteries are illegal unless they fall into one of the categories specifically permitted by law. Apart from the National Lottery (with its own dedicated legislation), the relevant law is contained in the Gambling Act 2005 ("the 2005 Act"), which creates eight categories of permitted lottery. Two of these categories (large society lotteries and local authority lotteries) require a licence from the Gambling Commission. The remaining categories of lottery are exempt from requiring a licence. Small society lotteries must be registered with a local authority, but the remaining exempt lotteries - customer lotteries, incidental non-commercial lotteries and the three categories of private lottery (private society lotteries, work lotteries and residents' lotteries) - do not require either a licence or registration. Raffles, tombolas, sweepstakes, etc are all classed as lotteries.

Incidental non-commercial lottery under the 2005 Act

3.  An incidental non-commercial lottery is one that is incidental to a non-commercial event. Examples may include a lottery - possibly in the form of a raffle - held at a school fete or at a social event such as a dinner dance. An event is non-commercial if all the money raised by the organiser at the event - including entrance fees, sales of food and drink, etc. - goes entirely to purposes that are not for private gain. A fundraising social event with an entrance fee would therefore only be non-commercial if all the money raised by the organiser at the event went to a charity or good causes, but it would not be non-commercial if the money were retained by the organiser for private gain.

Private lotteries under the 2005 Act

4.  Three types of private lotteries are permitted by the 2005 Act: private society lotteries; work lotteries; and residents' lotteries. Private lotteries must comply with conditions relating to advertising: no advertisement for a private society, work or residents' lottery may be displayed or distributed except at the society or work premises, or the relevant residence, nor may it be sent to any other premises. They must also comply with other conditions in the 2005 Act relating to tickets: a ticket in a private lottery may be sold only by or on behalf of the promoters; tickets are non-transferable; and each ticket must state the name and address of the promoter of the lottery, the people to whom the promoter can sell or supply tickets and the fact that they are not transferable. Work and residents' lotteries cannot make any profits, and private society lotteries can only be promoted for the purposes of the society.

Proposed changes

5.  The draft LRO would amend Schedule 11 of the 2005 Act to deregulate incidental non-commercial lotteries and private lotteries, in defined circumstances. As regards incidental non-commercial lotteries, the LRO would allow such lotteries to be held at both non-commercial and commercial events, and allow the results of such lotteries to be announced after such an event. As regards private lotteries, the LRO would allow private society lotteries to be promoted for any charity or good cause; allow the promoters of work and residents' lotteries to make a profit provided it was for a purpose other than private gain; and remove the requirement in all private lotteries for a lottery ticket to contain certain information.

Tests in the 2006 Act

6.  We are satisfied that the Order meets the tests set out in the 2006 Act and is not otherwise inappropriate for the Legislative Reform Order procedure.

Parliamentary procedure

7.  DCMS has proposed that the draft LRO be subject to the negative resolution procedure. In this regard, we note that the Government's own guidance on LROs says that the negative resolution procedure "affords the least Parliamentary influence over a LRO and would therefore be most suitable for minor and technical LROs." In a letter of 28 January 2015 about the post-legislative assessment of the Legislative and Regulatory Reform Act 2006, the Rt Hon Matthew Hancock, MP, Minister of State for Business, Enterprise and Energy, confirms that "both the LRO Guide for Policy Officials and BRE advise policy teams that the negative procedure is restricted to technical amendments".

8.  In the Explanatory Document DCMS acknowledges that the changes proposed in the draft LRO "are not limited to technical amendments" (paragraph 4.17), while also stating that that the purposes for which exempt lotteries may be held will not change.  We consider that, while that is true for incidental lotteries, it is not true for private lotteries.  In the case of private society lotteries, which currently are restricted to the purposes of the society, under the LRO they would be capable of being held for any purpose other than private gain. Similarly, in the case of work and residents' lotteries, which currently cannot be held for the purposes of making a profit, under the LRO it would be possible for them to be held for the purposes of making profits, provided that such profits were for other than private gain. Moreover, as regards incidental lotteries, while the purposes would remain the same, the LRO would make a significant change in allowing an incidental lottery to be promoted at a commercial event (whereas currently the restriction is to non-commercial events).

9.  We consider that the legislative changes are in themselves substantive; that the Department should have followed more closely the Government's own guidance in the matter of Parliamentary procedure; and that the draft LRO should attract the affirmative resolution procedure.  

Modern Slavery Bill: Government Response

10.  We considered this Bill in our 10th Report (HL Paper 70). The Government have now responded by way of a letter from Lord Bates printed at Appendix 1.

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