Orders of the Day — National Lottery Bill [Lords]

Part of the debate – in the House of Commons at 5:51 pm on 7 April 1998.

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Photo of Mr Robert Maclennan Mr Robert Maclennan Party Chair, Liberal Democrats 5:51, 7 April 1998

The debate is novel in a number of ways. Perhaps the most gratifying novelty has been the opportunity to follow a speech by the former Prime Minister, the right hon. Member for Huntingdon (Mr. Major), from the Back Benches on a major Bill. I have always thought that he missed his vocation, and that the role of constructive opposition was one that he could fulfil without challenge and without peer.

The right hon. Gentleman made the best possible case for the lottery—a case which has not always been made so strongly or clearly—and about why the particular heads of expenditure originally conceived made some sense. However, it could not be said, and cannot be said by the present Government either, that those necessarily conformed with the people's perceptions of their priorities for public expenditure. Indeed, the very converse of that is the justification of the peculiarities of the particular good causes that the lottery funds. It is because the Government are, in a sense, trying to have their cake and eat it, that the contents of the Bill are not entirely welcome.

I must admit that, as the Minister is well aware, I come to the debate with a studied ambivalence, for I was not one of the proponents of the Bill in principle. There I differ again from the former Prime Minister, in that I do not see the lottery as the archetypal exemplar of the classless society at work, or even as something that would greatly assist the achievement of the classless society.

I fear that, although it is a voluntary levy, the lottery bears hardest on those least able to pay. I admit to a certain moral revulsion when I see people whom I know are in deep poverty spending money that I doubt whether they can afford on the lottery. In taking that view of the lottery, I am no killjoy. I realise that hope lends encouragement to such poor people—but their hopes of being richly rewarded are slender indeed.

The second novel feature is that we are debating a Bill that will be very different from that which concluded its passage through the House of Lords, in that, since then, the Government have announced a major change in the regulation of the lottery, and seek to substitute a commission for the role of the director general. In an intervention, I have already welcomed that move. Indeed, I put the proposal to the Minister across the Floor of the House a few weeks ago, and I am pleased that he has seen the merits of the argument made with considerable force by, among others, the Foundation for Sport and the Arts.

The management experienced under the former director general, Mr. Peter Davis, was one that I, as a member of the Public Accounts Committee, could not regard as exemplary. I understand why the Secretary of State said what he did about Mr. Peter Davis's tenure. None the less, that tenure fell far short of what the House expected of the regulator.

To avoid problems of regulatory capture, the possibility of behaviour that suggests an identity of view between the regulated body and the regulator, and a certain loss of awareness of the need to protect the beneficiaries of the lottery and the clients— those who spend on the lottery—the widening of the regulatory body is important.

The third novelty—although it is perhaps not quite so novel as the others—has been the announcement in the debate of a wide-ranging directive from the Minister that will redirect the expenditure by the funding bodies. Like the former Prime Minister, I do not wish to jump to too speedy a conclusion about what the Secretary of State said. It sounded much in line with the priorities that I would have for redirecting the funding, but I should like to examine it more closely.

It is sensible to have a wider geographical spread. Many of the causes that the Minister appears to espouse—such as the importance of access and of facilities for young people and children—are priorities which no one would quarrel with. I know that the distributing bodies have endeavoured to make some of those priorities a feature of their performance.

Part of the difficulty was the need to get off the mark quickly with very large sums, which could most easily be deployed by bodies with well-established development plans. It is, therefore, not entirely surprising that major capital expenditure went to some of the best-financed bodies because they were already sitting there ready for development.

Some of those major bodies in the constituency of the right hon. Member for Cities of London and Westminster (Mr. Brooke), which were noticed by another hon. Member, were national bodies from which people from the whole of the United Kingdom, including my constituents in the far north of Scotland, have derived benefit. Geography cannot be more than a factor in deciding the appropriateness of particular directions.

I have expressed my moral tentativeness about the lottery, but I accept that it has provided much cash for the arts, as well as for charities, heritage support and projects to mark the millennium. The lottery has enabled many activities to take place throughout the country, but there have been victims, such as the Foundation for Sport and the Arts, which, before the lottery's establishment, supported many projects and exemplified in its distribution of funds the priorities that the Secretary of State's new direction to the lottery appears to embrace.

The main fact remains that the lottery, having provided a welcome source of alternative funding for areas such as the arts, is covering an unattractive trend in arts expenditure, for which, I regret to say, the Secretary of State is in part responsible. Since 1992, central Government expenditure has increased by about 15 per cent., whereas spending on culture has fallen by 23 per cent. I am informed that the Department's arts budget for last year constituted only 0.073 per cent. of total Government spending: one of the lowest figures in Europe.

That is a somewhat depressing state of affairs. It is tempting to eulogise what the lottery has done in raising significant sums to be spent on the arts and sport. We must recognise, however, that the prospects are for considerably reduced expenditure from what was anticipated when the lottery was set up and, indeed, during its more recent operation.

I do not quarrel with the Secretary of State's figures or deny that the lottery has, in some ways, been more successful in raising funds than was anticipated, but I think that the right hon. Member for Huntingdon was right to draw attention to the percentage of expenditure as the crucial key to giving security to the grant-giving bodies. Like him, I will listen carefully to the Secretary of State to hear whether we are to be given any assurances on that point.

There was a passage at arms between the right hon. Member for Horsham (Mr. Maude) and the Secretary of State about whether the Government might freely change further the direction of expenditure in the course of the development of their thinking about where the people's priorities might lie. There was a somewhat technical and legalistic argument about whether that would be done with or without the approval of the House.

It seems to me that clause 14 contains a requirement for an affirmative procedure for any such change, but in a House in which the Government have a majority of 179, the Secretary of State or, perhaps more important, the Chief Secretary to the Treasury, would probably not find that an obstacle to implementing changes such as those already outlined.

Those changes, it is true, will not have the authority of a party manifesto, but I have never known that to stop a Government enunciating what they perceive to be the people's interests. That argument from the Government must be challenged head on. It may be true that healthy living centres are close to the heart of the people, but so are bobbies on the beat and 101 other matters, such as cutting hospital waiting lists and improving local medical facilities.

There is nothing in the Bill's drafting to curtail in the slightest the possibility of raiding the lottery to fund central essential services that are close to the perceived wishes and needs of the people. If that happens, the lottery will have served its time, and it will be better for the House to revisit the whole issue and consider whether it is not more equitable and less regressive to raise taxation directly to pay for the central funding of centrally provided services.

The Secretary of State kindly responded to my intervention about whether it would be preferable to entrust a separate body—or an individual supported by advisers— with the task of choosing the new lottery franchise holder, and to separate that function from the subsequent regulation. He has demonstrated his open-mindedness in his approach to the Bill.

With the best will in the world, and notwithstanding the undoubted integrity and independence of the five good men and women whom the Secretary of State will, no doubt, appoint shortly, they are bound to be influenced by the consequences of their choice in considering the behaviour that they witness. They will find it difficult to stand totally at arm's length from the company that they are regulating and not to give it the benefit of the doubt. That is a well-recognised feature of regulation, of which the Secretary of State is obviously aware. I do not make the point with dogmatism, but merely ask him to reconsider it as the Bill proceeds.

Members of the Public Accounts Committee are certainly aware that, under Mr. Davis's regime, when there was any discretion on what to do with unexpected funds released by the lottery, that discretion was almost invariably exercised in favour of Camelot, and not of either the good causes or the punters. That is partly an institutional problem, and not entirely Mr. Davis's fault.

The Government must come a little further with us on the new good causes and the New Opportunities Fund. At least at this stage, in widening the causes, they are relying on utterances made before the general election, but it cannot be said or thought that that is without cost. The new activity will take away about 20 per cent. of the money that would otherwise have gone to the arts, sports, charities and heritage.

The Arts Council budget for this year has been cut by £8Million in real terms and, in conjunction with the Bill's proposal to remove another £50 million a year from the lottery proceeds for the arts and other causes, that means that the balance sheet is becoming less obviously weighted in the direction of the arts. For the majority of our arts organisations, this is the sixth consecutive year of either a cash standstill or a cash reduction, equivalent to an 18 per cent. cut in real terms.