National Lottery Bill

My Lords, I am grateful to the noble Viscount for the terms in which he has moved the amendment. He will recognise that Clause 9 changes the way that income earned from the investment of the National Lottery Distribution Fund is divided between lottery distributors. We proposed changes to the method of allocating investment income because we considered that the existing method created an unintended advantage for distributors which hold high balances. Thus, potentially, communities were deprived of realising the benefits of lottery spending on the ground as fully and as soon as they might otherwise because of those high balances. The proposed changes will remedy that problem. They will mean that investment income on the NLDF balance will be shared out between distributors in the same fixed percentages as proceeds from the lottery operator, Camelot. As I pointed out in Committee, the new arrangements brought about by Clause 9 are consistent with our overall policy that there should not be a build-up of large balances, but that lottery proceeds should be delivering benefits on the ground as quickly as possible. That was the conclusion of the Public Accounts Committee of the other place in its report last October. The committee made it quite clear that the public benefit of lottery money is delivered when the money is spent in the community. I also repeat what I said in Committee about the proposed new arrangements being fairer and more transparent for all distributors. Under the new arrangements, distributors will have greater clarity about their share of the potential future income from the lottery. I recognise the concern that has been expressed about the impact on income to the heritage good cause. I recognise that it is possible to argue that there might be winners and losers in these arrangements. It is true that at present, the Heritage Lottery Fund holds a higher share of the overall NLDF balance than its share of operator-related proceeds to the fund. However, as the overall NLDF balance and distributors’ individual balances continue to fall, the new arrangements that we have proposed here will have less and less effect over time. The NLDF was never intended to be an investment fund built up of huge balances. Lottery money does good when it is spent in the community. It is unfair that good causes and distributors who spend lottery income more quickly—for example in the sports and arts sectors—should in effect be penalised by receiving a lower share of investment income because they have spent their income. I recognise that a balance must be struck here—if I can use that term in this context. I understand the noble Viscount’s anxieties. However, he will recognise that the concept behind Clause 9 is a worthy one. It is to ensure that money is spent most effectively. On the basis of that reassurance, I hope that the noble Viscount will feel able to withdraw his amendment.