National Lottery

– in the House of Commons at 3:38 pm on 23rd October 2002.

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Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport 3:49 pm, 23rd October 2002

I beg to move,

That this House
notes that since its creation in 1994 by the last Conservative Government, the National Lottery has raised over #12 billion for good causes;
believes that the principle that Lottery money should not be used to fund projects that are the responsibility of the Government has been undermined by the establishment of the New Opportunities Fund and that this has also significantly reduced the money available for original good causes;
further notes that grants made to organisations like the National Coalition of Anti-Deportation Campaigns and the Communities Empowerment Network have destroyed public trust in the Lottery, with the result that ticket sales are falling rapidly;
and calls upon the Government to take urgent action to restore public confidence and to return the Lottery to its original purpose of raising money to support deserving causes that command widespread public support.

It is a pleasure to find that my first outing in this Chamber in my new brief should be to debate with the Secretary of State an issue that I know both of us believe to be of great importance. In her recent consultation paper, the Secretary of State said that after eight years it was now the right time to review the operation of the national lottery. I agree, although recent events have made the need for that review even more urgent. I hope that this debate will help to inform the consultation on which the Govt are embarked.

It is worth saying that the national lottery has been a fantastic success. It was created by the last Conservative Government to raise money for good causes, while at the same time providing the enjoyment of a modest flutter with the admittedly small chance of winning a life-changing amount of money.

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

It has been a major success.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

It has indeed, despite the fact that the Liberal Democrats voted at every stage against the Bill that introduced it, I believe.

Photo of George Osborne George Osborne Conservative, Tatton

On that point, is my hon. Friend aware of any Liberal Democrat Member of Parliament supporting lottery grants in their constituency, having voted against the lottery when it was introduced?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

That is an interesting point. Indeed, I look forward to hearing the Liberal Democrat spokesman try to defend that very point later in the debate.

To get back to its success, the national lottery has surpassed all expectations of how much money it might raise. It was originally suggested by the then Home Secretary, Ken Baker, when he proposed the idea that

Xonce fully developed, it could raise up to #1 billion for good causes".

Less than eight years after its establishment, it has already raised over #12 billion.

Grants awarded by the national lottery are transforming the landscape and have provided a boost to arts, sports and heritage that could never have been achieved from reliance on the taxpayer alone.Some of the major projects that have been supported by the lottery have been an unqualified success: Dynamic Earth in Edinburgh, the Eden project in Cornwall and the Tate Modern. Others have not been so successful. The millennium dome, which used up #630 million of lottery money, is perhaps a case in point. However, in many ways, it is the thousands of smaller grants that have really made a difference.

There have been many arguments in the Chamber about whether the distribution of grants has been fair. We may hear them again this afternoon, but every hon. Member will know of organisations and projects in his or her constituency that have benefited from lottery funds. Village halls, sports pitches, museums, galleries and community centres have all been transformed thanks to lottery money. Many will argue over the record of the Conservative Government, but few would deny that one of their lasting achievements was the establishment of a national lottery in the United Kingdom.

One of the fundamental principles of the lottery from its beginning was that the money raised should be used to finance projects that were unlikely to be regarded as of sufficient priority to get financial support from the taxpayer. Both sides have always accepted the principle of additionality—that lottery money should not be used to fund core spending programmes that should be paid for by the taxpayer. Indeed, in the Government's own White Paper published five years ago, the Prime Minister himself wrote:

XWe don't believe it would be right to use Lottery money to pay for things which are the Government's responsibilities", yet the creation in 1998 of a sixth good cause, the new opportunities fund, was in direct breach of the additionality principle. It was created specifically to fund health, environment and education projects, which traditionally have always been regarded as the responsibility of Government.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

Does not the hon. Gentleman accept that a manifesto commitment should be implemented, that Labour put it to the electorate in 1997 that health would be one of our lottery-funded targets, and that that has produced great improvements and been welcomed by the public?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I heartily disagree with a large part of the Labour party manifesto, including that particular provision. Just because it was in the manifesto does not necessarily make it the right thing to do.

Photo of Claire Ward Claire Ward Labour, Watford

The hon. Gentleman forgets a fundamental fact: in a democracy, the people decide. The people very clearly decided that they wanted our manifesto commitments, not the hon. Gentleman's.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

In a democracy, it is the Opposition's job to oppose what they think is wrong, which is what we shall continue to do.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

I thank the hon. Gentleman for giving way—we are having such a reliable hat trick. Does he accept that, most importantly for constituencies such as mine, the new opportunities fund has been one of few ways to ensure that money is spread more equitably throughout the country?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I accept that a large part of what the new opportunities fund has done is extremely welcome. My point is not that the money should not have been spent, but that lottery money should not have been spent. I shall give one or two examples.

The new opportunities fund has financed information technology training for teachers and the treatment and prevention of coronary heart disease and cancer. The Prime Minister got up at the Labour party conference to announce that #750 million would be spent on improving sports facilities in schools, but it was only afterwards that we discovered that that money would come from the national lottery via the new opportunities fund. None of those are bad things—they are extremely desirable—but they represent activities that most people would believe are core responsibilities of the Government.

The new opportunities fund also explicitly breaks the arm's length principle, and I suspect that we may hear quite a lot about that this afternoon. Unlike the other distributing bodies, the new opportunities fund receives direct instructions from Ministers about the projects that it should finance.

Photo of Claire Ward Claire Ward Labour, Watford

Is the hon. Gentleman not aware of the Omnibus survey, which took place in July this year and which indicated that 59 per cent. of the public wanted the national lottery's proceeds to be spent on health and that 53 per cent. wanted the lottery to spend money on education? Does he not believe that that shows that the public want some national lottery funds to be spent on those two areas?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I have a great mistrust of opinion polls, but if people understood that the Government were using national lottery money to pay for projects that would otherwise rightly be paid for out of central Government funds, the hon. Lady might find that those figures would be rather different.

Photo of Gregory Barker Gregory Barker Conservative, Bexhill and Battle

Is my hon. Friend aware that there is a scandalously long wait for radiotherapy treatment in my part of East Sussex and Kent? Some women in my constituency have had to wait up to 24 weeks for post-operative radiotherapy care. Much needed linear accelerators are now being bought, but the money is coming from lottery funds via the new opportunities fund, to which he refers. Many of my constituents find it absolutely obscene that such core health facilities are being funded from lottery money.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

My hon. Friend cites a very good example, which demonstrates that the Government are completely failing to deliver in the health service—and lottery funds will not bail them out.

I shall now return to the lottery's original purpose. Perhaps most damaging of all is the impact of the new opportunities fund on the other good causes. When the lottery was first set up, each of the original good causes—sport, the arts, heritage, charities and the millennium celebration—took an equal share of the proceeds. However, since the new opportunities fund was created, it has taken a steadily bigger share of the cake. Instead of the 25 per cent. that sports, art, heritage and charity bodies expected to receive when the Millennium Commission was wound up, they now only get 16.7 per cent., but the new opportunities fund receives a third—twice as much as any other cause. That has significantly reduced the money available for the original good causes.

The community fund's grant income has dropped from #366 million in 1997 to #296 million last year, and it predicts a further fall to #213 million over the next three years. The income of the Arts Council of England has dropped by the same amount, as has that of Sport England. Falling income has meant that many applications for deserving projects now have to be turned down. In the first round of the arts capital programme, #400 million worth of applications were received for just #88 million of available funds. According to Sport England:

Xannual Lottery income has been falling and one of the main reasons for this drop is the creation of the New Opportunities Fund."

It continues:

XAny further reduction in Sport England's annual Lottery income could have serious implications for English sport. At a time when many communities recreational deprivation is acute, falling Lottery revenue will mean that a growing number of much-needed projects will not go ahead".

Photo of Christopher Chope Christopher Chope Shadow Spokesperson (Transport)

Would my hon. Friend accept that one way of solving this problem would be to introduce competition and choice into the process, denationalising the monopoly national lottery—as it is at the moment—and allowing rival lotteries to be set up, perhaps by sports organisations or health organisations? Is not that the way forward, rather than the dirigiste approach being adopted by the Government?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

There are already possibilities for societies to have their own lotteries. Nevertheless, my hon. Friend's suggestion is a good one, and I hope that it will be considered. There is no doubt that we need to do something to restore public trust in the national lottery, which is the main point that I want to make.

The good causes are suffering not just because the Government are now siphoning off lottery money to pay for programmes that are core responsibilities and that should be financed by the taxpayer: falling ticket sales mean that they are suffering from a double squeeze. There may be many reasons why ticket sales have declined. It is beyond doubt, however, that one factor is a growing concern that money raised by the lottery is going to support causes that are highly controversial and that do not command public support. Two causes in particular have received considerable publicity in recent weeks.

The decision by the community fund to award #340,000 to the National Coalition of Anti-Deportation Campaigns should never have been made. Far from being an organisation concerned with the welfare of those seeking asylum, it is a political organisation that has called for the overthrow of Britain's asylum laws. I do not usually come to the defence of the Home Secretary, but that organisation's claim that he is Xcolluding with fascism" is one that most people would find unacceptable, and even I would not go as far as the body's organiser, who has stated that new Labour is Xthe heart of evil". The organisation will have received #740,000 of public money raised by the lottery once its current grant goes ahead.

It is hardly surprising that the Home Secretary was on the phone to the Secretary of State three times in one day to protest. We have been told that the subsequent talks between the Department and the community fund were Xfrosty". Even after the grant was confirmed yesterday, the Secretary of State issued a statement saying that she Xstill had doubts" about this particular organisation. I suspect that the Home Secretary might have put it a bit more robustly. We are now assured that the organisation will cease its political activities, but it is hard to imagine what else an organisation whose raison d'être is to oppose our asylum laws is likely to do.

Photo of Evan Harris Evan Harris Liberal Democrat, Oxford West and Abingdon

Is the hon. Gentleman arguing that to qualify for community fund funding charities should not have political views? On that basis, organisations based in my constituency, such as Oxfam, would find it very difficult to access lottery funding. Surely recipients of such funding have a right to different views from those of the Government as long as the funding goes to core charitable causes that are separate from those political views.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

Of course, many charities have political views, but the core purpose of this particular organisation is to oppose the legislation passed by the House. It is a political organisation, and it is waging a political campaign. Most people would regard such a body as not appropriate to receive funding from the national lottery.

That is not an isolated example. A few weeks ago, the Secretary of State for Education and Skills rightly expressed her anger that an appeals panel had overruled a head teacher's decision to exclude two pupils for threatening to kill their teacher. It was revealed shortly afterwards, however, that the Communities Empowerment Network, which had given legal support to the two pupils, had received #200,000 from the community fund. Once again, an organisation that actively campaigns against the actions and policies of Ministers is funded by national lottery grants.

Photo of Andrew Turner Andrew Turner Conservative, Isle of Wight

Did my hon. Friend hear the Secretary of State on XNewsnight" yesterday busily putting herself at arm's length from the community fund and these nonsensical grants, on the ground that she had to allow the fund to make its own decisions? Did not the Government back the community fund's priorities and appoint most of the people on it who hand the money out?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

My hon. Friend is absolutely right—that point is at the core of my argument. Although we support the arm's length principle, he is right to point out that the community fund operates under guidelines set by the Government.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

Is the hon. Gentleman seriously suggesting that he has not once in his life been lobbied by a charity? Is it not true that charities have, at some point, tried to put their arguments extremely forcefully to every one of us in the Chamber and that they are thoroughly involved in the political process? Many Labour Members regularly welcome that.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

The hon. Gentleman should put his argument to the Government. They have made it plain that they do not agree with the grants that have been made, especially the one to the organisation campaigning against our asylum laws. They have disowned it, so he should direct his comments first to the Secretary of State and to the Home Secretary, who are absolutely right to say that it is not an appropriate body to receive lottery funding.

Let me make it clear that I am not suggesting that the work of the community fund is not valuable; the vast majority of grants that it awards are to organisations that I thoroughly applaud. The community fund's work in supporting local causes, such as carers associations, village halls, community centres and citizens advice bureaux, has done enormous good. Only last month, I was informed that the community fund had awarded #258,000 to the Steeple village hall trust in my constituency. I do not believe that that happened just because I had been appointed to my present position six weeks earlier.

The majority of the thoroughly deserving causes that have been supported have been eclipsed by a number of awards to politically correct organisations that command little public support. The community fund should, of course, support less popular charitable organisations that find it harder to raise voluntary contributions, but awards to help farmers in Peru to breed meatier guinea pigs for eating, that support the staging of a lesbian and gay pantomime in Manchester or that strengthen the contribution of women to the peace movement in the great lakes region of Africa simply undermine public confidence that the money raised from lottery tickets is used to help the causes that they wish to support.

Photo of Gerald Howarth Gerald Howarth Shadow Minister (Defence)

My hon. Friend is absolutely right. It is precisely because it has come to the public's attention that the lottery is giving money to such disreputable causes that there has been a decline in ticket sales. My newsagent in my constitutuency lost 10 per cent. of sales when the information was revealed. Do not such grants stand in sharp contrast to the lack of support that the lottery gives to many deserving veterans' and ex-service men's organisations that desperately try to help those who risked their lives or suffered for their country? St. Dunstan's is a case in point. It has been refused a #600,000 lottery grant, and the whole country knows what a fantastic job it does for those who were blinded in the service of their country.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

My hon. Friend anticipates my remarks. I am not suggesting that the work of some of the organisations that have been offered support is not worthy. However, I think that most people would find it a fairly strange set of priorities to give them money when other organisations that command universal support and are regarded as thoroughly deserving are refused funding.

Photo of Evan Harris Evan Harris Liberal Democrat, Oxford West and Abingdon

The hon. Gentleman will not be surprised to hear that it is possible that no group that works with refugees and asylum seekers supports Government policy. On that basis, does he argue that none of those organisations should receive lottery funding because of the worry that they might be forced to change their views and agree with the Government to qualify? I hope he agrees that that is not the civil society that we want.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I do not want to go into too much detail on individual applications, but there is a difference between organisations that work to improve people's welfare and those that run political campaigns. The latter group is inappropriate for lottery funding, but no one is saying that organisations dedicated to improving people's welfare do not deserve support.

The point made by my hon. Friend Mr. Howarth goes to the core of the problem. The situation is made worse by the refusal of a large number of applications made by organisations that everyone would agree are deserving. The anger expressed by Simon Weston a few weeks ago about the refusal of applications from service charities, such as the Royal British Legion and St. Dunstan's, is widely shared. In the introduction to the Department's publication XLottery Funding: The First Seven Years", the Secretary of State wrote:

XPublic confidence in the integrity of the Lottery is the key to its success. It is the knowledge that their money is put to good use which keeps people playing".

Yet it is precisely that public confidence that has been so badly shaken by the revelations about some of the organisations that benefit from lottery grants.

Photo of Andy Burnham Andy Burnham Labour, Leigh

The hon. Gentleman says that he supports the arm's-length principle, but the Conservative motion calls for Government intervention. Does he agree that there is a contradiction in those two positions? If so, what would he do to resolve the problem?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I assure the hon. Gentleman that there is no contradiction. I will explain what the Government are responsible for and what they should do. It is not fair to place the blame for the crisis in the lottery on Lady Brittan and the board of the community fund. Although it is correct that the Government do not decide individual applications, they do set the guidelines under which the fund operates. Ministers changed the guidelines in 1999 and the emphasis was shifted. The community fund recently published a new strategic plan, from which it becomes clear that the focus will be on causes that are more politically correct. Ministers have been involved in that decision. Lady Brittan and her colleagues are simply following orders.

Photo of Mr Matthew Green Mr Matthew Green Liberal Democrat, Ludlow

Was the Daily Mail right to encourage its readers to Xvent their justifiable anger" on Lady Brittan? Was it right to give the address of the community fund, to which people sent hate mail?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I have no hesitation in condemning without reservation the letters sent to Lady Brittan. The Daily Mail has made it clear that it, too, condemns the letters, and it has told its readers to write not to Lady Brittan, but to the newspaper. It has since received about 40,000 letters. That is a serious indication of the level of public concern. No one would hesitate in condemning racists who send hate mail, but there is genuine public concern, which we need to address to return to the original principles of the lottery.

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

Does the hon. Gentleman realise that the changes to ministerial guidelines in 1999 involved the following: that the lottery distributors should take account of the needs of areas of particular social deprivation; that they should pay particular attention to the needs of children and young people; that they should pay attention to the needs of environmental sustainability; and that they should pay attention to the fairness of geographical spread of lottery grants? With which of those changes does he disagree?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I do not disagree with any of those objectives, but the right hon. Gentleman confirms that the community fund operates under ministerial guidance. If we have, as I believe, reached the point at which some of its grants are being given to causes a long way removed from the national lottery's original purpose, it is the responsibility of the Ministers who operate the guidelines to ensure that the community fund concentrates its attention on causes that command widespread public support.

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

I am afraid that the hon. Gentleman misses the point entirely. Ministers do not operate the guidelines but put them in place, and under the legislation they have of necessity to be broad. Our Conservative predecessors established most of the guidelines, and we made the changes that I have just described. It is up to the lottery distributors independently to operate the guidelines. What problem does the hon. Gentleman have with them?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I am saying that because Ministers set the guidelines they have a broad responsibility for the way in which the community fund operates. The degree of public concern is evidence of the widespread view that the community fund is not operating as it should, so Ministers should revisit the guidelines to ensure that the fund returns to supporting causes that command universal support. That is the way to restore public confidence in the national lottery, as hon. Members on both sides of the House wish.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

I was interested by the contribution of the former Secretary of State, Mr. Smith. Although we want a geographical spread to ensure that every community feels that it has gained something from the national lottery, it is not obvious to me why young people should be singled out for support when a great many deserving old people and military personnel may feel that they should benefit in accordance with the guidelines set by those distributing the funds, not by Ministers. Does my hon. Friend agree?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I do. The community fund might take account of the widespread public view that the lottery has not given sufficient priority to deserving causes such as veterans and former military personnel, and Ministers might suggest, in their guidelines, that the fund should focus on those causes in future.

Photo of Huw Irranca-Davies Huw Irranca-Davies Labour, Ogmore

Will the hon. Gentleman recognise the fact that he is filling with dismay people in my community who have benefited from the largesse of the community fund? He is right to say that the guidelines are broad and that the operational detail is down to the distributor.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

I entirely agree. I have already made it clear that I welcome the vast majority of grants made by the community fund. However, it is necessary to deal with the problem of public perception, and, through issuing guidelines, Ministers have some control over that matter.

Photo of Claire Ward Claire Ward Labour, Watford

Will the hon. Gentleman give way?

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

If the hon. Lady will forgive me, I should move on.

The point at issue is what has happened to lottery sales. Having already been in decline, they are now plummeting. In July, it was reported that public disenchantment with the good causes has led to a slump in sales that could lead to proceeds being over #1 billion below forecasts. Sales have fallen by 12 per cent since the peak in 1997–98, just before the Government set up the new opportunities fund. Last weekend, takings hit a record low for a weekend rollover draw. Previously, rollovers could be expected to lead to ticket sales of more than #70 million. On Saturday, the figure was barely over #40 million.

In July, the Secretary of State announced a review of lottery funding. I welcome her recognition of the fact that action needs to be taken. Some of the suggestions that she has made, such as establishing micro grants to be delivered at local level with the minimum of red tape, are sensible; others, such as the merger of the distributing bodies, are not. The suggestion that purchasers might tick a box to indicate the type of good cause that they want to support also raises serious difficulties. However, nothing in the Secretary of State's consultation paper addresses the real problem. Public confidence in the merits of the good causes has been undermined. People resent the fact that their money is being used to finance projects for which the Government should pay, and that it is being given to organisations that they do not support.

The Secretary of State must act now to restore public trust. She should issue new guidelines.

Photo of Andrew Lansley Andrew Lansley Conservative, South Cambridgeshire

As my hon. Friend said, the Government have commented on micro-grants in local areas. Does he agree that it would be better if the money for the community fund and the new opportunities fund, which accounts for a substantial proportion of good cause funding, were genuinely delegated to local areas? Spending the moneys raised for good causes on local causes that attract local support might restore confidence in the distribution and encourage people to play the lottery.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State for Culture, Media and Sport

That is an interesting suggestion. My hon. Friend is right that the priority is restoring people's confidence that the money raised through purchasing tickets will go to worthy causes, especially those in local communities that they want to support. If there were a way in which to achieve that without the bureaucracy of ticking boxes, it would be worth examining.

The priority is to restore public trust. The Secretary of State should issue new guidelines to the community fund to ensure that the charities to which it gives money command widespread public support. She should also stop raiding the till to pay for Government programmes that the Chancellor is unwilling to finance.

The national lottery has been an enormous success but it is under threat. Unless action is taken quickly, the original good causes, which we all support, will be the losers.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport 4:21 pm, 23rd October 2002

I beg to move, To leave out from XHouse" to the end of the Question, and to add instead thereof:

Xwelcomes the fact that the Lottery has so far generated over #12 billion for investment in good causes and has brought much needed support for sport, the arts and heritage, charities, and organisations dealing with health, education and the environment;
notes that the Lottery has created funds for projects to mark the new millennium;
also notes that the typical constituency has received millions of pounds of Lottery funding, often transforming local communities and their economies;
welcomes the contribution that Lottery funding has made throughout the United Kingdom;
believes that Lottery players can have full confidence in the Lottery and in Lottery fund distribution;
and welcomes the current review being undertaken by the Department of Culture, Media and Sport to ensure that the Lottery continues to make the fullest possible contribution to the nation."

I welcome Mr. Whittingdale to his new position as Front-Bench spokesman. However, I am surprised that the Conservative party has chosen to ask for a debate on the national lottery today. Conservative Members did not ask for such a debate when the Baltic Mill in Gateshead opened to international acclaim, or when the lottery-funded Commonwealth games put Manchester and the United Kingdom on the world map for sporting excellence. They did not request it in March when I announced that #169 million of lottery money would be targeted at the deprived areas that fared least well from the lottery, or in July when I announced the most fundamental review since the lottery's inception.

Conservative Members chose this week simply because they have read a lot in the papers about a specific grant by the community fund, which is funded by the lottery. That is not profound, but it is a good example of the bandwagon tendency in the Conservative party. It tends to hang around, wait for a passing issue of public anxiety and leap aboard. Conservative Members did not care about the national lottery previously, and they will not in future, once the bandwagon has moved on.

Perhaps the Conservative party wants to be considered the nice party, but the timing of the debate shows that it is still the nasty party. Moreover, to connoisseurs and historians, it remains the stupid party. Although Conservative Members have called for the debate for all the wrong reasons, I am glad that they did so. It gives Members of all parties a chance to condemn the vile campaign of racist hatred and abuse against the chair and staff of the community fund. Human excrement and needles sent through the post, threats of physical violence: all in all, that is the disgusting face of racial thuggery masquerading as concern for the lottery. I am glad that the hon. Gentleman eventually condemned those racist attacks in his opening remarks, and I hope that he and his colleagues will do so without reservation.

Before moving on, I would like to dwell a little longer on the individual case of the community fund.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

No, I want to make a little more progress.

As the House knows, the community fund yesterday confirmed a grant of #336,000 to the National Coalition of Anti-Deportation Campaigns. The grant will be paid subject to a number of conditions that will address directly the concerns that I and my right hon. Friend the Home Secretary had about the original grant. The funds will be issued to support individual case work, not doctrinaire campaigning, and they will not be used to fund support for people who are being deported because they have criminal convictions. The chief executive of the community fund made it clear in a television interview last night that the money will not be paid unless those conditions are met.

Photo of Andrew Turner Andrew Turner Conservative, Isle of Wight

The right hon. Lady is reading her speech very well, but she seems to have ignored the point made by the representative of that organisation—on the television programme on which she herself appeared last night—who said that the money was very welcome because it would pay salaries this month. What control is there over the payment of those salaries to those people this month?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

Responsibility for ensuring the proper spending of this grant within the terms under which it has been awarded now rests with the community fund. That is one of the many illustrations of the arm's-length principle to which the hon. Member for Maldon and East Chelmsford referred, and which the House is united in believing to be the proper principle to govern lottery grants and their distribution. A consequence of the arm's-length principle is that I doubt that it would be possible to go through a list of the grants awarded by any of the 15 distributors and find unanimity, either in the House or in our constituencies. By definition, the arm's-length principle means that government and parliamentary lobbying is removed from having a direct influence on grants. This is a cross-party principle, and I believe that there is cross-party consensus that it is right.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

No, I want to make a little more progress.

The community fund has made its decision without interference from me or anyone else, and whatever my own views about this grant, I will defend utterly the fund's right to make its decision without any political interference. As I have already said, there is long-established cross-party support for the principle that lottery funding decisions are taken at arm's length from government, out of the reach of meddling by politicians. That means that lottery distributors will sometimes fund grants about which we are passionately supportive and, at other times, they will fund grants with which we violently disagree.

Photo of Henry Bellingham Henry Bellingham Shadow Minister (Trade and Industry)

In the light of the fact that there are about seven different funds—or more, if we take into account Scotland and Wales—does the Secretary of State feel that it might make sense to have one overall strategic body in charge of the different funds, the chief executive of which would report directly to her? Would that not make life a bit easier?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

There might well be a case for looking at rationalising the number of lottery distributors, but not in such a way that would put politicians in control of making decisions about how lottery grants are made and what those grants were.

Having said all that, I now consider this matter closed. We should learn the lessons of this saga, and we should move on. The community fund, too, is learning the lessons. It is producing guidance that was not available to the commissioners when they made that award. It will produce guidance on the nature of political activity engaged in by organisations applying for grants. Those that encourage the breaking of the law will not be eligible for funds. The community fund has also asked the National Audit Office to review its processes in the particular case of the grant to the National Coalition of Anti-Deportation Campaigns. I welcome that; but there is one thing I do not intend to ask the fund to do.

Photo of Mark Francois Mark Francois Opposition Whip (Commons)

If the matter is now closed, as the Secretary of State says, does she expect lottery ticket sales to go up again?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I certainly believe that if we—as a country, as a Government, as a Parliament and as constituency MPs—focus more on the way in which lottery investment has changed and improved people's lives, rather than identifying specific grants that are in themselves bad cases and generalising about the performance of the lottery, lottery sales will increase again and public trust in the lottery will begin to be restored.

I want to make clear what I will not ask the fund to do. I will not ask it to end its support for the most marginalised groups and individuals in our society. I will not ask it to end the support—5 per cent. of its total allocation—that is given to drug addicts, homeless people, people with AIDS and, yes, asylum seekers and migrants. The lottery gives us a great and unique opportunity to help build a strong civil society—a society in which we can live and thrive; a society that is pluralistic and mostly tolerant. It is in all our interests for marginalised people to find a place in our society, and there should be no bar in principle to their eligibility for funds to support and sustain services provided for them.

Photo of Sandra Osborne Sandra Osborne Labour, Ayr

My right hon. Friend speaks of marginalised groups. Is she aware that 20 years ago groups such as Women's Aid, which supports abused women and their children, were marginalised? That was not a mainstream issue, as it is now. It was not generally accepted to be a worthwhile cause. Indeed, such groups were regarded by certain people—for instance, some Conservative Members—as nutters. They would certainly not have attracted the support of funding bodies. Does my right hon. Friend agree that it is extremely important for vulnerable groups to have a voice through the lottery?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

Yes. In their day, the suffragettes were probably regarded as politically correct. Certainly this party, when in opposition, was denigrated for making efforts to get more women into Parliament, in order to secure a Parliament that would be more representative of society as a whole. My hon. Friend makes a very good point about the way in which grants to progressive voluntary organisations can in turn improve the cohesion and solidarity of society more generally.

Photo of Gerald Howarth Gerald Howarth Shadow Minister (Defence)

The Secretary of State will have heard my earlier intervention on the speech of my hon. Friend Mr. Whittingdale. While I do not think anyone present would describe ex-service people as marginalised, will she give us some idea of the Government's view on the eligibility of the many wonderful ex-service organisations, which do such wonderful work? Do the Government really think it fair that they should receive so little of the cake?

The right hon. Lady is at pains to say where she thinks the priorities should lie. Perhaps she will say something about where she thinks service charities come into the equation, because they do not receive Government money.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I will come on to that point. It is worth recording that some 200 veterans' organisations have already had #1 million in grant from the community fund. I welcome the fact that Simon Weston is to be invited to meet members of the community fund board in order to discuss with them lottery funding for veterans' groups. At its heart, lottery money exists to make a difference, to add value to other Government and voluntary sector activity and to be a form of venture capital for communities that cannot get funds through more orthodox routes. Sometimes it will take risks, therefore by definition some grants will be more successful and popular than others, but without that element of risk the lottery would simply become an agent of the status quo.

The lottery must support and reflect society, so it must change as society changes. If we are to retain public confidence it must adapt or die a slow death. To take one example, Gateshead council and the Arts Council took a risk when they commissioned Anthony Gormley, one of our greatest sculptors, to build the Angel of the North. It was ridiculed in the media, but now we have one of the most stunning pieces of public art in Europe and the north-east has an icon of its regeneration and its renewed regional pride. Who now would say that the Angel of the North was a mistake? It was a risk, but one that paid off handsomely.

The previous Administration left us a legacy of a lottery that had the power to transform the country, and it has. It has provided #13 billion to good causes ranging from the Gateshead millennium bridge and the Manchester Commonwealth games to the Northumberland family camping group which gives holidays to low-income families. There are hundreds of other examples in each and every one of our constituencies.

Photo of Ms Candy Atherton Ms Candy Atherton Labour, Falmouth and Camborne

My right hon. Friend has mentioned many examples of the national lottery making a difference to communities. Does she agree that in Cornwall the Eden project has been the very beacon, along with objective 1 status, which has made a tremendous difference to the whole economy of the county?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I certainly do. My hon. Friend has been an unstinting advocate and supporter of the Eden project which is one of the most popular tourist attractions in the country—another successful investment by the lottery. In addition the lottery has provided more than 320,000 child care places, 156 neighbourhood nurses, 300 healthy living centres, which serve more than 30 per cent. of the population in some of our most deprived communities and more than 570 pieces of cancer diagnostic equipment. Which of those do the Opposition regret the lottery paying for?

All in all tens of thousands of grants have been made to improve the lives of millions of people.

Photo of Mr Matthew Green Mr Matthew Green Liberal Democrat, Ludlow

We heard earlier from the former Secretary of State, Mr. Smith, that one of the Government's priorities for lottery distribution was young people, yet in the west midlands the regional board of the community fund has removed young people from its list of five priorities. Does the Secretary of State have something to say about that? Does she regard it as the correct decision? From what Conservative Members have been saying from a sedentary position about young people, they clearly do not consider them a deserving cause.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I am surprised that that regional board has taken that decision, because 26 per cent. of the community fund's income goes to children and young people; 12 per cent. goes to older people and their carers and 33 per cent. goes to disabled people.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

On Sunday lunchtime, I was at Morley rugby club to present a cheque for #60,000—#30,000 from the lottery and #30,000 from a local company under the Sportsmatch scheme—to help the club go to into schools over the next three years to encourage young people, both boys and girls, to take up rugby. The Opposition might argue that that should be done by schools—that it is a state function. Yet here we have an example of the lottery arrangements that they decry helping young people.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

My hon. Friend provides a good example from his constituency, and he has campaigned tirelessly for fair shares of lottery allocation to constituencies across the country. His example shows clearly how the lottery can fund sport as a force for good and a force for community cohesion, in his constituency and beyond.

Seven years ago, Britain was a different kind of country. The fact that we now have one of the most diverse and exciting cultural scenes in Europe is in no small part due to the success of the lottery. It is why the Sydney Olympics gave Britain the biggest medal tally since the 1920s and why every school in the country has books that it could not afford before. It is why—as my hon. Friend Ms Atherton said—the Eden project is revitalising the economy of Cornwall, giving us one of the greatest centres for environmental learning in the world. It is why Childline has a new home, where it can continue to help abused children. It is why Belfast has a new 10,000-seat arena and a science centre that is helping to regenerate the whole city. We are helping unite people through sport, education and having fun. The list is endless but I use it to illustrate a point.

The Tories gave us a politician-proof lottery, for which they deserve credit. But there were flaws in the original design of the lottery because it was also people-proof. People had, and still have, too little say in the allocation of funds. Under the Tories, the lottery focused on big capital projects, with 97 per cent. of lottery money in 1995–96 spent on such projects. That was reduced to 35 per cent. by February this year. Lottery funds were not spent on the areas that needed them most; the most deprived and needy areas and the places with fewest facilities.

In 1998, the then Secretary of State, my right hon. Friend Mr. Smith, re-oriented the lottery towards people and communities.

Photo of Andy Reed Andy Reed Labour/Co-operative, Loughborough

Does my right hon. Friend agree that many local organisations found the process difficult? In my area, the sports clubs that were successful were tennis clubs and others with professional support on their management committees. Those who were most deprived were the clubs that most needed the money. The biggest change that we made was to ensure that there were fair shares. I am sure that all hon. Members would agree that that was the right move at the time.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

It was the right move at the time. We have made more progress in getting a proper and equitable distribution of lottery funds, but there is still more to do.

The lottery does not belong to the Government, to the lottery distributors or to Camelot. It belongs to the people who play the lottery, week in and week out, who play in the hope that their dreams will come true. When we spend lottery proceeds on good causes, we are giving back to the people what is already theirs: their inheritance.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

It would be a shame if the right hon. Lady finished her remarks without offering some clarification. She denigrated the Conservative Government for not giving people enough choice, but surely she approves of the capital project spending for the millennium, to which she has just paid tribute in her speech. Can we make it clear that that was a considerable achievement on the part of the Conservative Government, and not to be denigrated?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I gave generous praise to the previous Government for their role in starting the lottery, but I also made it clear that the lottery had become too heavily focused on funding capital projects, to the exclusion of the range of community projects and support for voluntary organisations that we have now secured for the lottery.

Because the lottery belongs to the people of this country we owe it to lottery players—many of whom pay to play it out of their most marginal income—to ensure that their money is used wisely for the benefit of the whole nation. Our 1998 reforms have opened the way to massive investment in communities: #300 million for healthy living centres to tackle the underlying causes of ill-health; #750 million to transform the quality of sports and PE facilities across the country for schools and their communities; #200 million for after-school learning and summer camps; and #160 million for those areas that have done least well from the lottery. I pay tribute to the Members of Parliament from those areas, who have pressed their case so effectively. They made their case well for the good causes in their constituencies, and we listened. Because the lottery is strong, because people can have confidence in it, and because it is flexible and responsive, many good causes in those constituencies will now benefit. All in all, that will give everyone the chance that the lucky take for granted. Such a grant does not replace Government spending—it complements it.

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

No, I want to make some progress. I do accept that this distinction—the so-called principle of additionality—is a fine one to draw, but draw it we do. If we were not a Government who drew that distinction, people would not have seen, for instance, the investment in the sure start programme that we made in the past four years.

The review that I established in July will take a long, hard look at the way in which the lottery operates. I expect it to be radical in scope and no-holds-barred in its analysis. It will plot a route map for the lottery in the future. It will look at how to award the lottery licence in the future, and consider whether there are too many distributors. Do they complement each other's work, or do they overlap? It will also consider how to strengthen public understanding of how the lottery works, and what is does with the public's money.

Some problems we have identified already. We know that it can be too difficult for some groups to apply for grants. The process can be too long and too complex. We know that the poorest areas should receive a greater slice of the cake. The fair shares programme will distribute #169 million to areas of deprivation that have not fared well from the lottery. It is worth recording that coalfield communities, which fared very badly in terms of their share of lottery funding, have seen such income rise by 50 per cent. in the past four years.

We know that the lottery should be democratised, and that the people who play the lottery should have a greater say in how its proceeds are used. For politicians and bureaucrats, asking people what they want can be a painful business, but we must not be afraid and we must not shy away from asking searching questions.

Photo of Caroline Flint Caroline Flint Labour, Don Valley

I intervene because my right hon. Friend mentioned coalmining communities, one of which I represent. Does she agree that delivering the substantial funds created by the lottery is a learning process? The Government have been prepared to listen to the problems faced by some communities, and to make changes when and where necessary. Is that not a strength, rather than a weakness?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I entirely agree. We must—and will—build on the success of the lottery in changing the landscape of arts and sports funding in Britain. It has put culture and communities back at the heart of our country, and in that way put right the contempt for both expressed over the previous 18 years.

I am considering a number of ways to bring democracy to the lottery. There are many practical obstacles to overcome, but the principle is secure.

Photo of Andrew Lansley Andrew Lansley Conservative, South Cambridgeshire

The Secretary of State has referred to many distinct communities and areas. She has not so far mentioned rural areas, even though such areas often have the fewest facilities. There has been valuable support under the community fund for village halls and clubs, for example, which give a sense of community focus, but that support has diminished. Does the right hon. Lady agree that further resources should be made available for village halls in rural areas from the new opportunities fund?

Photo of Tessa Jowell Tessa Jowell The Secretary of State for Culture, Media and Sport

I have two points to make in response to that intervention. First, the difficulty of securing lottery funding for village halls is an example of why we must get lottery distributors to work together more closely and collaboratively. Secondly, the fair shares programme has sought to tackle the low level of lottery funding in deprived communities. There will soon be an announcement—if such an announcement has not been made already—that that programme will be extended to rural areas, as should be the case. Each lottery distributor has a responsibility to ensure that the interests of rural communities in pursuit of the equity to which I have referred are properly reflected in the way that lottery funds are distributed.

I am considering a number of ways in which the practical obstacles to the greater involvement of players in the lottery can be overcome, but the principle is secure. In connection with the point made by my hon. Friend Caroline Flint, the review is important because the lottery must show that it has the capacity to adapt and change in accordance with the circumstances in which it operates.

The lottery's future depends on public confidence in its operation. That is why it can never stand still. We must prove to people every day that their lottery pounds are well spent. Whether or not we play the national lottery, we all win in some way or other.

We will maintain the lottery as a powerful force for good in this country. We take very seriously the bond of trust that exists between the lottery and the people of this country. Despite the Opposition carping from the sidelines, we will give the lottery back to the people of this country.

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester 4:53 pm, 23rd October 2002

First, I wish to thank Mr. Whittingdale for having the decency to praise the former right hon. Member for Huntingdon, Prime Minister and leader of the Conservative party. It is a long time since a senior Conservative politician has uttered such praise.

However, I felt that the hon. Member for Maldon and East Chelmsford was very ill at ease when he made his contribution. He is a decent man, but I draw the House's attention to the 27 words in the Opposition's otherwise excellent motion which I suggest have been inserted to appeal to the racist tendencies of the Daily Mail. The motion, which otherwise would be likely to command respect around the Chamber, is thereby contaminated.

There is no doubt that the national lottery has been of great benefit to the people of the United Kingdom since it was launched in November 1994, notwithstanding any objections and reservations that may have been expressed at the time by the Methodist tendency of the Liberal Democrat party. Since then, nearly #12 billion has been raised for good causes, and every one of the communities that we represent has been improved as a result. We have new community centres, sports facilities, cultural projects and heritage centres, all as a direct result of lottery funding. For that, we must thank the former right hon. Member for Huntingdon.

Photo of Mr Peter Duncan Mr Peter Duncan Conservative, Galloway and Upper Nithsdale

Is the Methodist tendency in the hon. Gentleman's party still prevalent, and is that why they are boycotting his speech?

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

I commend the hon. Gentleman for that wise observation. However, I am pleased to say that we command far more respect north of the border than does his party.

We should be grateful for the support of the people who buy tickets—about 60 per cent. of the population—and to those who have spent lottery grants effectively to the benefit of all our communities. Of course, there have been times when some have said that lottery money has not been spent wisely. For the most part, however, the money raised and spent has been invested in improving the quality of life for just about everyone. This debate should be set against the background of that Major success.

The thousands of charities and organisations that have applied for, received and spent lottery money since 1994 should be congratulated on what they have done. The volunteers and paid staff of various organisations should be applauded for helping our top athletes achieve the medals to which the Secretary of State has referred, which have made this country so proud. They should be applauded for running our local clubs and improving access and participation for people, whatever their race, age or ability. Let us make no mistake—many of these projects would never have seen the light of day or got off the ground without such funding. In the case of the millennium dome, that would have been a blessing, but there are many other projects for which we have only the lottery to thank.

A pat on the back should also go to Camelot for running one of the most successful lotteries in the world. It has helped fund 121,000 projects and supported countless small retailers across the country. It is vital to the financial viability of many of our small shops and sub-post offices that they do not have their terminals removed because sales figures are considered too low. I would welcome an assurance from the Minister who is to respond to the debate that the Government will use their best endeavours to persuade those who are responsible for issuing and maintaining terminals to ensure that very small shops are not penalised if they are in areas where sales do not reach a perceived target.

Over the past seven years, Sport England has received #1.6 billion from the lottery, which has been distributed to sporting good causes. However, Sport England's lottery income has fallen from a peak of around #270 million in 1996–97 to just #200 million this year, and it is projected to fall even further to #185 million in the financial year ahead. That was before the recent drop in sales, so the figures are now even more dire for sport.

Every constituency has benefited, as have 62 different sports. So far, 2,800 lottery-funded capital projects have been completed and opened. I am told that the majority, some 85 per cent., are local facilities specifically earmarked for community use.

I congratulate the Government on their lottery funding aims, and Sport for All on developing sporting opportunities for all sections of our community—the active communities development fund, sport action zones and school sport co-ordinators. These are all good positive messages. However, Mr. Gordon Neale, the chief executive of Disability Sport England—which is nothing to do with Sport England—has contacted me because he wishes the House to be made aware that, when it comes to lottery funding, all is not well in the world of sport. Mr. Neale informed me that

Xit has become apparent that the distribution of Lottery funding does not support a number of genuine causes in this country. It is also the case that some applications are blocked by third parties used as distributors i.e. Sport England.

Surely this is public money for good causes, and if the applicant can justify and meet the conditions laid down by the Lottery then they should be allowed to access the funds. I have spoken to a number of like minded organisations who feel that the Lottery should review their application and distribution criteria.

Organisations who have given many years of beneficial programmes to the people of this country deserve support. I hope the House will agree that the National Lottery should be made more accountable to the public for the distribution of grants to worthy causes."

Let us not forget the silent beneficiary of the lottery, however. It sits there, raking in millions of pounds each year. So far, it has enjoyed #4.6 billion of lottery money, about a third of the amount raised for good causes. It does not need to account for its spending of that money in particular—the money is merely added to the pot and divvied up later. I am talking, of course, of the Treasury. The lottery has added #4 billion to the pot for our public services. That is something else for which we can be grateful.

We know that not everything is rosy in the lottery garden, but we must bear in mind the fact that the lottery's contribution to the arts, sports, heritage and charities—causes that are traditionally low on the list of the Treasury's priorities—is invaluable. The same cannot be said of other recipients of lottery funds, however; for them, the amounts are more significant, the causes more important and the issue more fundamental. I am talking about the observance of the principle of additionality.

The Secretary of State has pointed out that the principle that lottery money cannot replace Exchequer spending is clear. Indeed, her predecessor said:

XThe principle is clear. Lottery money must not replace Exchequer spending".—[Hansard, 7 April 1998; Vol. 310, c. 166.]

There is thus consistency between two Secretaries of State.

However, the new opportunities fund lottery money is being used to implement Government objectives, as is clear from press releases and consultative documents. Health and education feature high on the Treasury's list of priorities—rightly so. They also top the list of voters' priorities; they are services that are legitimately and correctly funded from general taxation, and on which the Government have staked their reputation. Yet those services are being part-funded by lottery cash. Why should the Government be permitted to shirk their fiscal responsibilities by funding health and education programmes with lottery money?

The lottery is funding the Government's commitments to cancer care via a #150 million living with cancer programme. It is also meeting part of the Government's commitment to education via the school sports facilities programme. In the words of the Government, lottery funding should

Xadd to, and not substitute for, services already provided by government".

That principle, enshrined in the legislation that created the lottery, is at best being ignored and at worse being abused by such funding. We have a Government who are siphoning off lottery money, which the players think is going to good causes, and using it to pay for their election pledges—[Hon. Members: XOh."] The legislation made it clear that lottery money should not be used for that. An election manifesto is one thing; legislation in this place is another.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

Is the hon. Gentleman yet another Opposition Member who does not believe that manifesto pledges should be kept?

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

The important thing is that election manifestos should not take the place of legislation. If the hon. Gentleman wants his party to change the legislation, that is for him and his party to do, but while it remains on the statute book the House should honour it. That is clear.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

Is not the whole point of manifesto pledges to change or to retain legislation?

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

I am grateful for that intervention. Clearly, the hon. Gentleman is unaware of the difference between a manifesto commitment and legislation. Manifesto commitments lead to legislation, but as far as I know the House has not yet voted on the change to which I referred. In my opinion, this is the most regressive of the stealth taxes that the Government have so far utilised.

Photo of Andy Burnham Andy Burnham Labour, Leigh

The hon. Gentleman seems to be saying that he opposes the new opportunities fund, but I am sure that schools in Colchester—like those in Leigh—will soon be receiving money for new sports facilities under the new opportunities for school sports initiative. Will he give the House an assurance that he will not attend the photo opportunity when those facilities are opened?

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

I am not going to give such a commitment, because I would not pass up a chance like that. [Laughter.] I would be much happier, though, if the funding had come from the proper source and if the Government's education policies did something to replace all the demountable classrooms in my constituency. That is not at present on the lottery shopping list, but watch this space.

Lottery funding is not a long-term answer to the longstanding problems in our public services. If Ministers wish to pay for projects such as cancer care or teaching our librarians and teachers to use computers, they should not fund those projects at the expense of the good causes.

Photo of Evan Harris Evan Harris Liberal Democrat, Oxford West and Abingdon

Is my hon. Friend aware that many hospices providing terminal care for people with cancer rely on lottery funding? Many lottery decisions are predicated on geographical factors—which areas will receive funding and which will not—which means that hospices endure a lottery in lottery funding, as well as in NHS funding, even though they provide services that should be core NHS-fundable services.

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

I endorse what my hon. Friend says. Life is a lottery, and that is a classic example.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

The hon. Gentleman seems to be arguing that we should not have charitable support for health services, but we have always had campaigns in local newspapers raising money for machinery for hospitals. Why should the lottery be treated any differently?

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

Exactly. If punters are allowed to choose the destination for the proceeds from their purchase, as suggested in the recent consultation documents on the lottery, that is exactly what could happen. Given the choice, most people would choose to fund cancer care over community centres, but when Parliament created the lottery the intention was to remove such choices. Those schemes should not be mutually exclusive. As the Secretary of State argued in the foreword to a departmental publication, the lottery should enable

Xmuch needed initiatives, which would not otherwise have been funded, to go ahead".

Cancer care should be funded out of general taxation, because it is a priority and would go ahead anyway. Conservation areas can be financed from lottery grants because they are not a priority and may not otherwise go ahead.

The National Council for Voluntary Organisations has pointed out that lottery funding works best when it is free from direct Government control. The community fund has shown its independence from Government and has responded to genuine local needs. Picking out a few individual lottery grants for criticism should not deflect attention from the important work that the community fund has done over its eight years of operation as an independent body.

The most valuable gift that politicians can give to lottery fund distributors is their independence. The ability to distance themselves from Ministers has enabled distributors to contribute to significant successes, from big schemes such as the Eden project to smaller programmes across the country, helping to regenerate communities, rescue buildings and increase skills. However, we need only recall the millennium dome for evidence of what happens when politicians seek to lead with such projects.

The best projects are community led, respond to local needs and are driven by local people. Sometimes the aims of those people and the groups to which they belong are contrary to the Government's aims, but that makes them no less legitimate. Indeed, the chances are that it makes them more legitimate. Involving people in decisions in their communities is an invaluable exercise that can engage people in regeneration, community awareness and local politics. If the price of perpetuating that involvement is that the occasional grant is condemned by the Daily Mail, so be it.

Where the Government need to involve themselves more closely is in ensuring that the poorest and most deprived areas receive their fair share of funding. In 2001, four of the 81 most deprived districts in the United Kingdom received no new opportunities fund money. Thirty-three of those 81 received less than the national average. Of the 80 districts that received more than #10 per head, not even half appeared on the Department for Transport, Local Government and the Regions list of the most deprived districts. The fair shares programme has gone some way to redressing that but distributors need to be extra vigilant in ensuring that they are not giving grants merely to those who have the means to apply for them.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

There is an important point about different areas being described, or not described, as deprived. My constituency of Rhondda consists of seven or eight wards that would be listed among the poorest in Wales; indeed, they would be listed among the poorest in Europe. However, because Rhondda Cynon Taff, the local authority in which my constituency falls, also contains some of the wealthier wards in Wales, all of which are in the constituency of my hon. Friend Dr. Howells, grants that go to my constituency might not be counted as going to the poorest in the country.

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

I am grateful to the hon. Gentleman for that clarification but I think that he is in a way agreeing that we need to focus attention on the poorest areas to ensure that they get at least their fair share.

Ministers also need to be vigilant about how quickly awards are paid. Millions of pounds are still held for national lottery distribution but are not yet committed, despite the debate that we had on the subject some six months ago. On that occasion, my hon. Friend Nick Harvey criticised the Department for Culture, Media and Sport for the fact that lottery funds were not being distributed on time. He said:

XThe reserve funds of the distributing bodies have continued to grow—by almost #150 million since December 2000—and now stand at almost #3.5 billion."

Those funds had been allocated but not yet distributed to projects. My hon. Friend said that

Xmore than a quarter of the #12 billion that the lottery has raised since its began . . . has not yet been distributed." —[Hansard, 1 March 2002; Vol. 380, c. 970.]

That is the equivalent of almost two years' income. If it were easier for prospective applicants to apply for grants, that would not be the case. A one-stop shop for applicants would remove many of the hurdles for groups that would normally be put off applying for a grant, and enable money to be siphoned down to areas that need it most, which often happen to be those least likely to apply.

Falling lottery sales are a continuing concern to the good causes. Bodies such as Sport England have little alternative to grant in aid and lottery funding. They would be hamstrung by significant falls in income. Projects such as those that Sport England has funded and that have more than doubled facility usage in many cases would surely have to come to an end without alternative revenue streams.

Camelot's sales improvement programme is designed to arrest the fall in sales, but we need to explore other areas, too. I would like lottery-supported schemes to display the fact that they have been helped by lottery ticket sales in the hope that that will reconnect lottery ticket buyers with good causes. I have not met that many people who play the lottery whose prime concern is the good causes. I think that they have an ulterior objective. Nevertheless, they need to be told where the money is going—to the good causes—and to be reminded that when they purchase a ticket they are not only participating in a prize draw but helping to support good causes in and around their community.

Whatever steps are taken, we need to ensure that they are taken quickly. Sustained falls in sales will see the lottery diminish, and with it many of the programmes that our communities hold most dear.

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury 5:13 pm, 23rd October 2002

There is common ground among hon. Members: we all recognise the enormous importance of what the lottery has achieved. I vividly recall attending the opening of the Olympic games in Sydney just over two years ago and meeting athletes from the British team. Time after time, they thanked me for the lottery funding that had enabled them to develop their potential to fulfil what they were capable of and to give them a real chance of doing credit not just to themselves, but to this country.

I am also acutely conscious of the benefits of projects that have been able to go ahead in my constituency. Building work will be completed shortly on the London Symphony Orchestra's music education centre at St. Luke's church, Old street, so transforming one of the greatest of London's old churches into a centre that will provide the opportunity for children and others from many parts of London to have the experience of working with one of the world's greatest orchestras. That project, which is jointly funded by arts lottery and heritage lottery money, is a splendid example of what can be achieved by lottery funding and would not otherwise be possible.

Virtually all hon. Members agree absolutely that the lottery has a done a huge amount of good, but it is now under attack, so I want to say three things this afternoon. First, I congratulate my right hon. Friend the Secretary of State on standing up firmly for the robust independence of the lottery distributors, especially the community fund. That independence was, of course, put in place by the Tory Government. It was fought for fiercely by one Tory Front Bencher after another, and there have been rather a lot of them over the years.

Of course, the community fund will occasionally do things that many people do not like. It will give money to organisations that look after the interests of minorities. I have to observe, in case the Conservative party has not yet tumbled to this, that democracy is surely every bit as much about looking after the interests of minorities as about representing the views of the majority.

Photo of Caroline Flint Caroline Flint Labour, Don Valley

My right hon. Friend may recall the wide coverage given to the purchase of Winston Churchill's papers. I do not disagree with that, but one might say that a certain family benefited from it. However, is it not true that some things will please some people and not others and that you cannot please all the people all the time?

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

My hon. Friend is absolutely right, and the community fund will occasionally pay money to organisations that may be critical of the Government— indeed, most charities in this country are from time to time—and it will certainly do things that the Daily Mail does not like, and rightly so. That is its job; it is what independence is all about. I have to say with some sadness that I am not surprised that the Tories are giving in to the braying bigotry of parts of our national media. That diminishes them, and it demeans some of our national newspapers. I urge my right hon. Friend the Secretary of State to continue to resist following them down that road.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

The right hon. Gentleman seems to accuse Conservative Members of being bigoted because we do not approve of the grant given to the National Coalition of Anti-Deportation Campaigns. Does he therefore think that the Home Secretary is bigoted in also disapproving of that grant?

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

I simply observe that every example quoted by Mr. Whittingdale, first, came from the Daily Mail and, secondly, related to organisations responsible for supporting either asylum seekers or people who happen to be lesbian or gay. If that is not picking on minorities, I am not sure what is.

The second thing that I would tell my right hon. Friend is that, as she considers the representations now arriving in relation to her consultation on the lottery's future, she should resist any proposal that does away with the existing division of responsibilities for lottery distribution. I would remind her of the firm guarantee, which was put in place three or four years ago, that the existing percentages should be safeguarded for the arts, sport, heritage and charities for the entirety of the duration of the second franchise of the lottery. That commitment was given not just by me but by the Prime Minister and the whole Government.

Photo of John Greenway John Greenway Conservative, Ryedale

I am extremely grateful for what the right hon. Gentleman has said, because I totally agree with him. Does he think, however, that he would have had the opportunity to say that on the Floor of the House to the Secretary of State today had we not had a debate on the lottery?

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

Having a debate on the lottery is a useful opportunity for me to do so. It obviates the necessity for me to sit down and write a letter to my right hon. Friend the Secretary of State to make precisely the same point. The point, however, must be made, because ensuring that one sixth each of the good causes money goes to the arts, sport, heritage and charities—and making sure that that lasts into the future—is an important objective to which I trust she will hold fast.

My third point to my right hon. Friend and the House is that one issue remains that needs to be considered, on which Bob Russell has touched—the extent of the balance of funds that are sitting in the national lottery distribution fund. A stubbornly constant figure of #3.5 billion sits in the fund. We have always said—and it is true—that it is all earmarked for approved projects, which have been applied for, considered and approved for grant by the various distributors. Those projects, however, by their very nature, take years to use up all the allocated money. Meanwhile, as those years progress, more funds flow in every week to the distribution fund. For the arts, sport and heritage in particular, that means that an outstanding amount of money is apparently sitting there waiting to be used.

I know that the Secretary of State has urged the distributors to bring the balances down. That will not happen, however, without a fundamental change to the way in which approvals can be made by the distribution bodies. I urge her to put in place a system of forward allocations—especially for the arts, sport and heritage—enabling the distributors to approve applications in advance of the funds coming in, but in the safe knowledge that the money will, in due course, come in. That, of course, will need a change to the Treasury rules. She will need to persuade her right hon. Friend the Chancellor of the Exchequer that it is worth doing, but it could provide a real solution to the distribution fund problem and could enable a real boost in immediate approvals in these important areas of activity.

We must all welcome the overall success of the lottery. We should resist the minority-bashing instincts of the Tory party. We should reassert the independence of the lottery distributors. We should repeat the guarantee of funding for the arts, sport, heritage and charities into the future, which has previously been given. Finally, we should look at new ways of ensuring that the available funds can be put into use more effectively and immediately.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove 5:24 pm, 23rd October 2002

I am grateful to be called to speak in this debate, not least to mark the significance of Members on both sides paying tribute to the previous Conservative Government. That is extremely rare.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

The hon. Gentleman should at least give me a few minutes. Although he is my colleague on the Culture, Media and Sport Committee, I will not, on this occasion, allow him to disabuse me of my view that the previous Conservative Government should be accorded some merit. I, too, wish to place on record how pleased I am with the lottery and its funding of projects in my constituency.

I am especially pleased that the Secretary of State drew attention to some of the great capital projects that were funded by the millennium fund that was created under the lottery by the Conservative Government. However, she then appeared to contradict herself in her subsequent remark that the way in which they set up the lottery was not sufficiently democratic. There was a clear need to celebrate the millennium with projects, such as the Eden project in the constituency of Ms Atherton, and we then had to move on to do other things with lottery funding.

I also congratulate the Secretary of State on her desire to consider how the lottery may change in the future and to assess whether we should allow people to earmark the good causes that they wish to fund when they purchase a ticket. I have some doubts as to whether that would work, because it would entail a great bureaucracy, but the suggestion has some merit and should be considered. It may encourage people to believe that their money is being spent wisely.

The lottery has been a fantastic success in my constituency. We have recently been given #250,000 to create a ward for the Primrose hospice at my local hospital. The money came out of the new opportunities fund and, in this context, I disagree with my hon. Friends on the Opposition Front Bench. So great is the public acclamation for such projects that the Government are right to consider the principle of additionality, which did not form part of the lottery when it was set up by the Conservative Government in the early 1990s.

I wish to refer to another project on my patch. I recently visited the Charford resource centre, which is in one of the few deprived areas in my constituency. Its chairman, Kevin McNamara, a former Labour councillor, has done fantastic work for the centre, which is supported by volunteers but has received #400,000 from the community fund. It has done fantastic work in providing IT skills to young mothers and to young people who are unable to go to college.

The community fund has done great work, and it is doing good work in my constituency, and that is why I am very cross with the award that it made recently to the National Coalition of Anti-Deportation Campaigns. I am sorry that Mr. Smith, whose speech I have the honour of following, chose to say that, because Conservative Members disagree with that award, we are bigoted. I draw his attention to the fact that the Secretary of State also appears to oppose the award. It is certainly true that the Home Secretary disapproves of it. The whole awards procedure is brought into disrepute if the public feel that significant sums of money—#363,000 is a huge amount—that can do a tremendous amount of good work in all our constituencies go to such organisations. I know of other projects that I would like to receive funding, and I bet every Member can think of how to obtain good value from #363,000. Most of us do not believe it is good value to grant that sum to this organisation. British taxpayers already provide significant support to people coming to this country to claim asylum. We are a generous country, and it could be argued that our generosity to those who fear persecution is one reason why people come here.

Photo of Bob Russell Bob Russell Liberal Democrat, Colchester

Will the hon. Lady confirm that the grant was allocated by a quango system established by the Conservative party when it was in government, and according to the rules, regulations and criteria of the legislation introduced by the Conservative Government of the day?

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

I have two responses to the hon. Gentleman. First, the guidelines were changed. Secondly, the community fund in general has a responsibility to pay due and strict attention to the organisations that it funds. We are democratically elected and are responsive to the electorate, who can sack us in a general election. We are obliged to answer our constituents' mail. Our remarks in the Chamber and the way in which we vote on legislation are recorded in Hansard. So we have a democratic responsibility on which we can be challenged.

One weakness of the community fund and other grant-giving bodies is the lack of democratic responsiveness. They need to be much more attentive to public reaction when they decide to give awards to organisations that will engender a hostile response. It saddens me that they put themselves in that position because it harms the wider good works that they do.

I engaged in a radio debate with one of the community fund distributors. It saddened me to hear the distributor say that such grants account for only a tiny proportion of the money distributed. That is not the point. Hundreds of thousands of pounds would do great good in all our constituencies, and that opportunity has been lost with the award of such a grant.

Photo of Ms Candy Atherton Ms Candy Atherton Labour, Falmouth and Camborne

I am listening to the hon. Lady's arguments. Does she agree with the campaign by the Daily Mail to target the chair of the community fund?

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

No, certainly not. In fairness, the Daily Mail has condemned the opprobrium attached to Lady Brittan and does not believe that it is right and proper. [Interruption.] I am not an apologist for the Daily Mail; I am here to express my views. I am happy to make it clear that I would not support such attacks in any shape or form.

Hon. Members have mentioned the Government's changes to the guidelines. Indeed, I referred to them when I intervened on my hon. Friend Mr. Whittingdale. Apart from creating a more level playing field for the communities that benefit from a lottery grant, there is no need to issue guidelines on who should receive such funds. That decision should be for the discretion of the people who award them. We should not say that they are just for young people.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

No. I am afraid that I do not have much time.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

Yes, as the right hon. Gentleman was responsible for the guidelines.

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

No one has said that lottery distributors should just look after the interests of children and young people. There is a spread of need in our society to which the lottery distributors need to pay attention.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

The right hon. Gentleman admitted in an intervention that his guidelines stated that priority should be given to young people.

Photo of Mr Chris Smith Mr Chris Smith Labour, Islington South and Finsbury

The hon. Lady was not listening. I said—the wording was precise—that attention should be paid to the needs of children and young people. That is very different from giving exclusive priority to them.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

We will have to agree to differ on the semantics. It seems to Conservative Members that the right hon. Gentleman created a priority for young people which is inappropriate, given the needs of the entire community.

The creation of priorities in the new guidelines detracts from the fact that some organisations may have been refused a grant because of too much political correctness. For example, the British Legion was refused #500,000 for a residential home, an application for #400,000 for ex-servicemen suffering from psychiatric illnesses was refused, the British Vascular Foundation was refused #30,000 to help to promote knowledge about diseases and strokes and the British Liver Trust was refused #224,000 to help with screening for a dangerous genetic disorder that affects 200,000 people.

These are all worthwhile causes, and it is disappointing to Conservative Members that such categories of organisations have been refused grants. I do not want to excite the right hon. Member for Islington, South and Finsbury by saying which categories of successful applicants I disapprove of, but they should not have been given money when the needy organisations that I have just mentioned were turned down. 5.35 pm

Photo of Claire Ward Claire Ward Labour, Watford

Since the lottery was established in 1994, it has provided huge benefits to millions of people in every constituency. There is not a single Member who cannot point to a project in their constituency that has received a substantial benefit from the national lottery. Whether through support for the arts, heritage, sports, charities or other good causes, the #12 billion raised in that time has helped thousands of projects, large and small.

We rightly took the opportunity to review the operation of the lottery, just as we reviewed every area of legislation, and in the National Lottery Act 1998 we made the changes necessary to ensure a broader distribution of funds. The creation of the new opportunities fund was a manifesto commitment. As I reminded Mr. Whittingdale earlier, this party sticks to its manifesto commitments—something that the previous Government did not do. Since the fund has been in operation, it has funded out-of-school-hours clubs in more than 12,000 schools, provided local hospitals with more than 2,000 pieces of new equipment to treat cancer and coronary heart disease, and allocated #750 million to local PE and sports projects. Those are just some of the things that the fund has done to ensure that the national lottery benefits more and more people in the way the public wants. As I said earlier, when we talk to members of the public we find that many people do not want the national lottery proceeds to be invested only in sports, the arts, heritage, charities and voluntary organisations; they want to see the benefits in education and health.

Photo of Caroline Flint Caroline Flint Labour, Don Valley

Does my hon. Friend agree that the lottery funding priorities of health, education and sport mirror the areas that have benefited from record public expenditure, and that lottery funding is therefore added value to those massive public spending increases?

Photo of Claire Ward Claire Ward Labour, Watford

My hon. Friend is absolutely right. She reinforces the message that the national lottery provides additionality, just as the Government insisted it should.

In this debate we have heard a lot from the Opposition about a particular organisation that has received funding. It has been made clear that although many of us have widely differing views about some of the organisations that receive funding from the distributing bodies, we accept that it is important to have an arm's-length principle and to allow those bodies to make the decisions. The Home Secretary and the Secretary of State for Culture, Media and Sport were right to question the decision to award a grant to the NCADC and to remind the community fund to look carefully at how it was made. We ought to be concerned that organisations that receive lottery funding do not act in a manner that is highly political or at odds with the guidelines set by the Government and by parliamentary decisions. I disagree, however, with the unacceptable attacks by newspapers, in particular the Daily Mail, and the excessive campaign that brought out the worst elements of racism. Of course there should be an opportunity to question the allocation of grants, but in this case the manner in which that was done was not appropriate.

People play the lottery because they want to win. If their primary purpose were to give money to a good cause or charity, they would do that without buying a lottery ticket. However, when they do not win, they feel better because a proportion of their #1 has gone to a good cause. When they read a negative story, some players decide not to continue to play the national lottery; so negative stories have an impact on funding.

It will be no surprise to many hon. Members to learn that the headquarters of the national operator, Camelot, is in my constituency. It employs more than 400 people. In the past few weeks, it has noticed a direct correlation between the newspaper stories and funds. The damaging attack on the national lottery has resulted in a fall in the sum that will be made available to good causes. We should examine that in the review.

I hope that the Government will consider how we can ensure a better connection between the organisations and good causes that are funded and what the public want. However, we must achieve a balance: we must ensure that the lottery exists not only for the big causes and great national charities about which we all know, or the popular arts, sports and heritage projects, but also for smaller groups of which many of us have never heard. It is also there for minority groups and interests.

The Government's review of the national lottery presents an opportunity to try to achieve that balance. The beauty of the lottery is that thousands of small groups—voluntary organisations that carry out important work in communities throughout the country—have benefited from small and sometimes significant grants. I hope that they will continue to do that as the lottery goes from strength to strength.

Photo of Mr Peter Duncan Mr Peter Duncan Conservative, Galloway and Upper Nithsdale 5:42 pm, 23rd October 2002

I want to bring to hon. Members' attention some aspects of the lottery that have been well publicised, especially north of the border, and that form an important part of the debate.

I am only too keen to advocate any Conservative policy that brings great benefit to Scotland. The lottery, a successful policy of John Major's Administration, resulted in 14,700 awards in Scotland and a total that now exceeds #1 billion for valued good causes north of the border. That is directly related to the #12 billion that has been raised throughout the United Kingdom. I received that information through a news release on one of my regular visits to the Scotland Office website, which apparently costs the taxpayer in Scotland a considerable amount. On the website, the Secretary of State for Scotland urges Scots to make a good response to the Government's consultation.

One inequity that I wish to raise results from the fair share programme. It is a laudable programme that has highlighted some imbalances in Scotland as well as the rest of the United Kingdom. It identifies Glasgow city, Dundee city, North Lanarkshire, Renfrewshire, South Lanarkshire and South Ayrshire as places that have received less than their fair share of lottery distributions. I shall discuss some of the reasons for their under-representation later, but first, I want to consider a fair share matter that affects my constituency: rurality.

There is an inherent bias in lottery funding away from rural areas. I was delighted to receive notification recently of a grant to refurbish Rhonehouse village hall near Castle Douglas in my constituency. That valued project would not have been realised without the national lottery. However, projects are analysed by constituency and, as was said earlier, that can hide inequities in the constituencies that merit investigation.

An anomaly to which I draw the House's attention involves an aspect of the new opportunities fund that has received considerable press coverage north of the border: the Scottish land fund. I am aware, as are many hon. Members, of a case that has been publicised in the papers, in which an award of more than #3 million was made to the residents of Gigha, to purchase their island. I have before me an advertisement dated 10 August 2001, which makes interesting reading. It advertises facilities on the island, including an airstrip and the XAward-winning Gigha Hotel" with

X13 letting bedrooms, Bar, Restaurant and 6 holiday cottages".

The matter drew considerable press comment at the time, and I thought it worthy of some investigation today.

I looked at the Scottish land fund website—which is administered through Scottish Enterprise and Highlands and Islands Enterprise—which sets out the objectives of the fund as:

XTo improve opportunities and reduce disadvantage both for communities and individuals in rural areas;"—

I wholeheartedly agree with that—

XTo encourage community involvement . . .

To enhance . . .environmental diversity . . .

To facilitate positive use of the land reform legislation . . .

To diversify the pattern of land ownership".

Nowhere in the objectives is the word Xsustainable" to be found. It is causing concern in Scotland that such a substantial award was made to a small community of only 110 people. People are worried that the community may have got into an unsustainable situation, and we wonder whether it is part of the lottery's core objectives to create such situations.

Following the creation of the new opportunities fund—the Xsixth good cause"—in 1998, I found myself with a dilemma. I have a personal interest to declare, in that my wife is the fundraising manager for Macmillan Cancer Relief in Dumfries and Galloway, and she and I are delighted that a new oncology unit is being built at the Dumfries and Galloway Royal Infirmary with the assistance of more than #1 million from the new opportunities fund. I am keen to make use of whatever guidance is in place relating to the new opportunities fund, and that project would not have happened at this point without NOF funding. Is it, however, the objective of the national lottery that key health projects should happen simply because people buy lottery tickets? Although people in Dumfries and Galloway have no access to chemotherapy, for example, and the unit will resolve the problem of people who are diagnosed with cancer having to undertake a two or three-hour drive to Edinburgh every day to undergo treatment, is it right that the Government should choose to solve that problem through the sale of lottery tickets?

I have a particular problem with that, because many analyses show that tickets are generally purchased by those with less-than-average earnings. Indeed, the Secretary of State pointed out earlier that it was often the most marginal income that was used for that purpose. Is it appropriate for marginal income from those who can least afford it to be the source of spending in key areas of health and education? I would advocate that it is not. It is the absolute opposite of the progressive taxation that would be seen as the most reasonable way to do this in a fair society.

Photo of Kim Howells Kim Howells Parliamentary Under-Secretary, Department for Culture, Media & Sport

The hon. Gentleman raises an interesting question about one of the most difficult areas involved in this issue. However, is he saying that he would rather that the #1 million NOF money be held back until such time as the Scottish Executive decide that it is time to build a proper oncology unit in his area? The hon. Gentleman may be a new Member of the House, but he will know very well that politics is about choosing priorities. There is never an easy way of doing that, and never an easy moment at which to do it. I am sure that he would rather have the #1 million to build that oncology unit now than not have it.

Photo of Mr Peter Duncan Mr Peter Duncan Conservative, Galloway and Upper Nithsdale

Absolutely. As I have said, these are the present guidelines. I am only too well aware that the problems in my area relating to cancer treatment deserve attention, but they deserve attention from the Government and the taxpayer, not from people who—as the Secretary of State herself said—are on marginal incomes. They do not deserve attention from those who can least afford it. Having said that, I must say I am delighted that the oncology unit has been opened in Dumfries and Galloway, because it is greatly needed.

Time rattles on, but I want to end by raising a couple of hot issues of my own. One is the need to make the process of applying for grants more straightforward. I recently addressed a conference organised by Stewartry Community Initiatives in Dalbeattie, in my constituency. Very small groups have told me time and again that applying for lottery funds was too complex and discriminated against voluntary organisations. The projects that are supported often involve existing full-time development workers. Such organisations do not need to engage in that complex process.

Finally, let me encourage the Minister to be ever more adventurous in regard to the community outlets programme, which is an incredibly important part of the lottery's expansion into the most rural areas in the United Kingdom. Those communities have not the turnover to justify outlets of their own. I have tried to convey the message that the lottery succeeds because of public confidence. When people in rural areas know that they can buy tickets locally, they will see the benefits of the projects that can be supported.

Photo of Andy Burnham Andy Burnham Labour, Leigh 5:52 pm, 23rd October 2002

When the history books chronicling the events of the Major years are written—indeed, I believe that some have already been written—they will show that the first part of the Opposition motion is accurate. The national lottery was indeed a Conservative creation, and it has indeed raised welcome funds for communities throughout the country. There is no doubt that it provided temporary relief from VAT on fuel, negative equity, black Monday, record NHS waiting lists and the Xback to basics" campaign. For that reason, the lottery will go down in history as one of the two memorable achievements of the Major Administration: it will be right up there with the cones hotline.

So much is beyond dispute. From that point onwards, however, the motion descends rapidly into confusion. The substance involves two charges. The first is that the establishment of the new good cause for health, education and the environment was wrong; the second is that recent awards made by the community fund have undermined public confidence in the lottery.

In regard to the second charge, I remind Opposition Members that it was the Conservative Government who insisted on a strict arm's-length arrangement for lottery distributors. It was on precisely that basis that they defended grants for the Churchill papers—mentioned by my hon. Friend Caroline Flint—and the Royal Opera House. The necessary consequence of an arm's-length arrangement is that sometimes funding decisions will be made with which the Government of the day do not agree.

Opposition Members need to be clear about whether they are abandoning their previously steadfast commitment to the arm's-length principle. That is what they are saying today. The truth is that they have not thought it through. Their main reason for calling the debate was not genuine concern for the lottery or the projects that it funds; it had more to do with a cynical attempt to gain quick, cheap headlines on the back of an unpleasant press campaign.

The motion talks of public trust being Xdestroyed". Is that not precisely what the motion and the debate seek to do? We have the party of the vulnerable undermining the lottery, reducing funds to good causes and thereby denying people who could otherwise benefit. That sounds more like the Xnasty party" to me.

The first charge betrays a far more serious misunderstanding of the lottery and of what the public think about it. Lottery players strongly support the principle of lottery funds being used to support health, education and environmental projects. The truth is that Labour's introduction of such action helped to revive confidence in lottery good causes at a time when they had received sustained negative publicity. I hope that in retrospect the Opposition will accept that giving a full fifth of lottery proceeds to the millennium celebrations was a mistake. That was too much, and from the outset—when the lottery was first launched—people called for funding for health and education.

They were right to do so. In the next few weeks, as Bob Russell knows, secondary schools in my constituency will receive funds via the new opportunities fund for brand-new sports facilities and floodlit Astroturf pitches that will be open to the whole community out of school hours. Such facilities are sorely lacking in the Leigh area. Surely giving young people the chance to engage in sport with decent facilities, and in the process helping to tackle crime and improve health, is one of the best uses for lottery money.

Photo of John Greenway John Greenway Conservative, Ryedale

Those projects were funded previously by Sport England. Why did we need the NOF to fund them?

Photo of Andy Burnham Andy Burnham Labour, Leigh

I am afraid the hon. Gentleman is wrong. Those sports facilities in state secondary schools have never been funded by Sport England; they have been funded directly by central Government.

Photo of John Greenway John Greenway Conservative, Ryedale

I invite the hon. Gentleman to visit my constituency, where he will see such a facility at Huntington comprehensive school.

Photo of Andy Burnham Andy Burnham Labour, Leigh

On the whole, Sport England does not fund state secondary school sports facilities. Lottery money is now funding them—and not just Leigh is benefiting: every constituency will receive some money.

I would like to know how many Opposition Members, like the hon. Member for Colchester, will be writing to their local papers to say that they oppose that funding for secondary schools. They certainly would not have the nerve to attend photocalls. Millbank may have gone, but we will be watching.

The motion suggests that the Opposition would scrap schemes such as this—and money for cancer equipment and treatment for coronary heart disease. That would be a sure-fire way of damaging public confidence in the lottery. It is not just the projects funded by the NOF that command support; the distribution mechanism has much to commend it. National programmes mean that no areas miss out on the free-for-all application process, and an impact is created that makes people link a national initiative to a local scheme. That too is likely to increase public confidence, and I would like more funds to be distributed in the same way.

Photo of Bob Spink Bob Spink Conservative, Castle Point

The distribution formula is not working very well. People in Essex are receiving very little per head compared with those in other areas. Does the hon. Gentleman want the Minister to try to resolve the problem?

Photo of Andy Burnham Andy Burnham Labour, Leigh

That is a fair point. My constituency has not received enough from the lottery, and I think we should look at the reasons for that. Let me return the question to the hon. Gentleman, however. Does not the fact that areas such as mine and his—and that of my hon. Friend the Member for Don Valley—have not received their fair share of the lottery have something to do with the way in which his party set up the national lottery? An application-driven process and strict match-funding requirements were always bound to cause regional disparities in funding for good causes. That applies particularly to disadvantaged areas, where community groups do not have the resources possessed by those in more affluent parts.

There should be no surprise about the regional disparities. Leigh has had #3 million from the lottery, which is not a good return from the #13 billion raised so far and much less than the price of the tickets bought in my area. For Leigh, I could substitute many other deprived former coalfield and other communities. I am not against the idea of affluent areas doing well out of the lottery, but areas such as mine have found it difficult to obtain any funds at all. It sometimes seems that the Xgood causes" grants are as random as the prizes given to players.

One of the problems is that the lottery is intensely bureaucratic. XAwards for all" has been a good innovation, but it is not easy to obtain a significant lottery grant—one of #50,000 or more. That, however, is what groups in my constituency need: they need bigger lottery grants that can make an impact on the ground.

I have tried to encourage groups in my constituency to apply, but the reaction tends to be the same. People roll their eyes and talk of the work involved. It is not worth taking the risk, because they have a huge expectation of failure. Sadly, that is the case for many people living in former coalfield areas; they will not take the risk, as they know they will have to put in many hours of work.

All that has distanced the lottery from some communities, as there is no ready connection between the work of the lottery and the projects that it funds. Part of the problem is that the public do not connect with the names of the lottery distributors. I know that distributors jealously guard their identities, but public awareness of them is very low indeed. The truth is that, apart from the in-crowd and the statutory sector, painfully few people are aware of the community fund, the heritage lottery fund and the new opportunities fund.

We all complain from time to time that our areas do not get enough out of the lottery. In my case, that is absolutely true: my constituency does not get enough. Under the rules set for them by the previous Conservative Government and later by our Government, the distributors have done a good job, making difficult decisions and getting funding to all parts of the country, but the time has now come to put institutional interests aside and take hard decisions for the future good of the lottery. It should be a simple business. Playing the lottery is a simple business, but there has never been a simple way of getting funds to good causes. The lottery needs to achieve that if it is to survive in the long term.

When I look around my constituency I see countless schemes that could benefit from funding, but I also feel frustrated when I think of the difficulty of cutting through the bureaucratic morass and getting to the point at which they would receive some funding. For too long there has been an assumption that people seeking lottery funding are trying to gain money for improper or unworthy schemes. They are treated as guilty until proved innocent. I would like the system to be turned around. Like Mr. Bellingham, I have slowly reached the conclusion that it would be better to have a single good causes organisation to distribute funds and a single lottery gateway with regional offices. However, I believe that we should maintain the shares for each of the current good causes; they would simply be administered by one overarching organisation. In my experience, projects rarely fall neatly into one box and we need rapidly to move to a more integrated system.

I would support the introduction of a two-page application form for all projects. It could be followed up by visits from development workers. That would be the best way of deciding whether a project should proceed. Finally, when projects are funded through one good causes organisation, we should always make sure that the lottery logo—the crossed fingers—is placed prominently on the project, as people recognise it as the sign of the lottery and it is owned by the public sector.

Of course the great risk in simplifying the system is that some projects may get through the net and some money may be spent unwisely, but that is the price for making it simpler and more accessible. I think that it is a price that the British public are now ready to pay.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire 6:02 pm, 23rd October 2002

On 2 July, like many hon. Members, I received a briefing note from the Library that listed lottery grants by constituency. I found that my constituency came 625th out of 659. It has received only #2.4 million since the lottery started, while the constituency average is #15.7 million. The disparity between our constituencies is absolutely enormous. I quite understand, and would defend the fact, that constituencies with national facilities should expect a larger share of lottery funding, as they are providing facilities for the whole country, but the figures clearly show that constituencies in the greatest need have not been treated fairly. The top three constituencies are Greenwich and Woolwich, which received #670 million, Cities of London and Westminster, which received #484 million and Manchester, Central, which received #296 million. Around the country, Birmingham, Ladywood received #183 million, Bristol, West received #142 million, Brent, South received #128 million, Norwich, South received #85 million, Cambridge received #70 million, Truro and St. Austell received #62 million and Nottingham, South received #60 million.

At the other end of the scale, Birmingham, Hall Green, which is clearly a constituency in great need, received only #912,000. Hayes and Harlington received only #671,000, Rayleigh in Essex received just over #1 million and Billericay received #863,000. Those variations in funding per constituency are simply not acceptable. People up and down the country play the lottery.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

Does that mean that the hon. Gentleman disagrees with Miss Kirkbride, who said earlier that there should be less insistence on the geographical element?

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

I would advocate taking the average—#15 million per constituency, setting aside the national considerations, which we all understand—and introducing a 33 per cent. upper limit and a 33 per cent. lower limit around that average. There could always be exceptions. If one took the average as #15 million and allowed a variation of between #10 million and #20 million, distribution would be much fairer and we could justify it to our constituents.

Photo of Kevin Brennan Kevin Brennan Labour, Cardiff West

Is not that a rather silly point, particularly when it is applied to large cities? For example, the Millennium stadium in Cardiff is not in my constituency, but it could not have been built half in my constituency and half in the one next door.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

Obviously there will be boundary differences and variations for national projects such as the Millennium stadium. I have already conceded that point and said that there should be exceptions for national facilities. However, I hope the Government intend to address the existing variations in the review that they announced at the end of July and I would commend to them the sort of proposal that I have made.

Photo of Kim Howells Kim Howells Parliamentary Under-Secretary, Department for Culture, Media & Sport

I shall be very brief, as I know that the hon. Gentleman wants to get on. I can inform all hon. Members that, so far, the consultation has generated just four responses from hon. Members. If it were such a vital and burning issue, surely we would have received a lot more representations.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

I hope that the Minister will take this speech as part of my own representation, but I will undertake to write to him specifically about this point so that he will have a fifth representation before long. I intend to contact the chief executive of South Bedfordshire district council and all the local voluntary groups and community organisations in my constituency that have made unsuccessful bids for lottery funding to see whether we can achieve more.

Photo of Huw Irranca-Davies Huw Irranca-Davies Labour, Ogmore

I thank the hon. Gentleman for his courtesy in giving way. Can he advise me about areas of my constituency that cannot apply for lottery funding? The stuffing was knocked out of them by 20-odd years of Conservative government and they do not have community leadership or community groups.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

The hon. Gentleman makes a slightly cheap point. I drew attention to many constituencies in areas of great need that have been very poorly served. I have said that that is wrong and that I would like something to be done about it. I hope that he concedes that.

I should like to move on to look at the way in which the new opportunities fund intends to fund different constituency projects. I corresponded with the new opportunities fund in the east of England. I understand that funding is allocated according to the index of multiple deprivation for 2000. That sounds fair enough, but it has a grave drawback that applies across a range of Government projects. Constituencies such as mine, which overall are reasonably well-to-do but have significant areas that are less well off, lose out substantially. I understand from the reply that I received from the new opportunities fund in the east of England that this is of great concern throughout the area. The letter informs me that an OSEP—a multi-agency observatories social exclusion project—in the east of England area will be trying to drill down below ward level to apply lottery money to specific projects in the greatest need. In his reply to the debate, will the Minister clarify whether every region in the UK will be replicating this work, and, if so, is it really necessary or the best use of public funds? That would seem to be a slight waste of funds.

In my constituency, I have taken a great interest in homelessness and made my maiden speech in a debate on the subject. A local housing charity, First Place housing, was initially funded by the lottery for one or two years, after which the funding was stopped. That caused great difficulty; the centre it ran in Leighton Buzzard had to close and the centre that it still manages to run in Dunstable cannot do as much work as it would like. I feel extremely concerned about this matter.

We have heard about village, community and church halls, but this is not just a rural issue. There is a serious problem with regard to disability discrimination legislation. I will defend passionately the right of disabled people to have full access to all premises. My mother was in a wheelchair for much of her life and I have seen the difficulties that people with disabilities face when they want to be integrated fully.

Village, community and church halls are worried about legislation that is to come into force next year requiring them to provide full accessibility to disabled people. I do not want those facilities to close because they cannot, with the best will in the world, raise the funds to make the vital improvements. This is an extremely serious issue, and we do not have long to deal with it.

I understand that the charity, Action with Communities in Rural England, has said that a #50 million fund is urgently needed up and down the country to help halls to cope with the legislation. I commend that to the Minister so that progress can be made. I visited the Billington village hall committee in my constituency recently, so I know how desperately worried the local volunteers who run such centres are about this matter.

I have mentioned homeless charities that have had their money stopped and the desperate need among village and community halls. It is galling for causes that command widespread support, whose funds have been stopped or who cannot obtain them, to see causes with less widespread support being given money. I urge the Minister to consider the guidelines. I take the point about the arm's-length principle and about politicians not interfering, but one of the criteria in the guidelines should be that causes should command widespread support, so that we can increase the amount of giving from the public and ensure that funding stays at a high level to benefit good causes.

I urge those involved in the lottery to realise that they have a responsibility to help those who are addicted to the lottery and to scratch cards. There is a moral responsibility on the lottery in that regard. Projects funded by the lottery should be well advertised; the connection between funds going to the lottery and projects should be made clear. People will be encouraged to contribute to the lottery if they see the connection between the pound or two that they pay and the funding of a worthwhile project in their area.

Finally, I echo the point about application forms that has been made by several Members. It is not fair that the smaller community organisations, such as those to which Huw Irranca-Davies referred, cannot cope with the complexity of the very long forms. It is unfair that only charities with development officers are able to benefit.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell 6:13 pm, 23rd October 2002

I rise to speak as a founding member of a rather unfortunate cross-party group of Members of Parliament who represent the constituencies that have not received a great deal of lottery money. One of the regular attenders is Mr. Francois, who has paid great attention to the subject. It is a group that we would all like to escape from.

Some twelve or so constituencies languish at the bottom of the league table, with less than 10 per cent. of the average given to constituencies nationally. These are sizeable communities, and we believe that more needs to be done to address the issues that are preventing local groups, charities, sports clubs and the like from applying for grants.

Only this morning, Mr. Baron and myself—a cross-party delegation—went to the Department for Culture, Media and Sport for talks with the heads of the various distributing bodies. It was a constructive and positive discussion, and we are trying to ensure that more effort is made to provide our voluntary organisations with the capacity to submit more applications. Our group has also had two positive and helpful meetings with the Secretary of State. There is some momentum behind those unfortunate Members who wish to get out of our group.

The Opposition may want to consider why we have had to have those meetings. They talk about mismanagement, but it would be fair and objective to ask why some areas have done so much better than others. The explanation lies to a large extent in the fact that the early years of the lottery could be characterised as a free-for-all, when all-comers could bang in their applications and money flowed out of the distributors' hands without any clear strategy or sense as to how everybody, regardless of where they lived, could benefit.

We now have a situation where it will be impossible for some geographical areas to catch up, but at least the Government have recognised this and introduced the fair shares scheme, which seeks to ensure that more lottery money goes to areas that have had a low share in the past and which are also deprived. I have some queries about exactly how the fair shares scheme is designed, and I have some ideas about how it ought to be improved. My thoughts will be submitted to the consultation on the distribution of lottery funds, and I hope that, apart from the unfortunate group of Members to which I have referred, others will append their names to my proposal. The deadline is 30 October, a week away, so there is time to do it.

We cannot go on with a situation where some constituencies have received barely #1 million pounds for local good causes, when the average is nearly #16 million. I know that there are many complexities in how one might assess the true value of the lottery to the people who live in local areas; after all, many people will use facilities in city centres, such as football stadiums, which are paid for with lottery funds from the general public but are not based in their locality.

In my view, there is a clear injustice where local people have bought a disproportionate number of lottery tickets but have not seen much happening locally as a result. I expect that, by now, my constituency has bought nearly #50 million worth of lottery tickets. The average return to constituencies is nearly #16 million; in my case, the figure is just #2 million. If there is a need for any soul-searching over the lottery, it is about whether some people are buying more than their fair share of lottery tickets and are subsidising the activities of those who could well afford not to be subsidised. I should like to see research done on that. If people are to be encouraged to buy tickets, they should know that the money is fairly distributed.

As I have said, these are very complex questions, and no one knows this better than those who organise the distribution of the funds. I invited Lady Brittan to my constituency to press the case in person. She came up without delay and spent a considerable amount of time talking about the issues with an excellent local organisation, Morley Elderly Action. She was courteous and knowledgeable, and I am sorry that the Opposition have chosen implicitly to ally themselves with a newspaper attack on her and her staff; an attack that, in their usual mealy-mouthed way, the Opposition dissociate themselves from but are secretly content to see take place.

That sort of behaviour taints everything that the lottery does and it is not a rational way to analyse how the lottery is performing. It is not designed to bring about thought-through solutions. The net result of the Opposition's behaviour will be to harm the very thing that they say they want to defend. It is the politics of ethical delinquency. If the delinquents succeed, many organisations, particularly those in areas that have not, as yet, seen great benefits from the lottery, will never see any benefit.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

I feel compelled to intervene on the hon. Gentleman. The reason why some Conservative Members have raised this matter is because we do care about the lottery. We raised it for no reason other than that we want the lottery to prosper and levels of giving to increase. I alluded to the distribution of certain lottery money only briefly in my speech, so please do not demean our motives in raising the matter.

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

I certainly do not want to demean the motives of the seven Opposition Members present; they are the ones who have not choked on their cornflakes, having read the Daily Mail, and at least they have attended today's debate.

Photo of Mark Francois Mark Francois Opposition Whip (Commons)

I want to take this opportunity to commend the hon. Gentleman for all the work that he has done on behalf of those of us who—at the moment, at least—are at the very bottom of the pile in terms of payouts to our constituencies. Does he agree that there is a real problem in those constituencies? Is there not a danger that, because so many bids have been refused, people will begin to give up if they do not see some genuine return for their efforts?

Photo of Colin Challen Colin Challen Labour, Morley and Rothwell

That is exactly the point that I am making, and I am glad that there is cross-party consensus on it. For that reason, we should get down to the real issues, and avoid the headline-grabbing stuff and the kind of discussion that puts people off buying tickets. There may be many good reasons why they should not buy tickets, but the subject of this debate is not one of them.

Photo of Gerald Howarth Gerald Howarth Shadow Minister (Defence) 6:21 pm, 23rd October 2002

Mr. Challen has shown precisely why it was so sensible of Her Majesty's loyal Opposition to table a motion on the national lottery: so he could have his say, put his constituency interests before the House, and make a wider point on behalf of other constituencies that themselves have not done so well out of the lottery. I am therefore sorry that he has chosen to attack the Opposition, instead of thanking us for presenting him with the opportunity to make his case.

I agree entirely with Mr. Smith when he says that there is a lot of common ground between us on the subject of the national lottery. Tribute has been paid to John Major for his Government's initiative in setting up the national lottery. I think that it was a good idea, and I myself am an investor. Indeed, if my wife is watching now, could she please make sure that she has purchased our ticket for tonight? [Interruption.] I have a very loyal wife, and I am sure that she is watching now. A ticket costs no more than #2.

As I said, there is a lot of common ground between us, and there is no doubt that the lottery has done great work, but the dome was an unmitigated disaster. The taking of #800 million of lottery players' money for that white elephant—now destroyed—was a tragedy. However, today is about having a perfectly legitimate debate on the priorities of the national lottery. Hon. Members have, in different ways, expressed their views about their sense of priorities. I remind the House that this issue came to light because Simon Weston, at the invitation of the Conservative party, came to our conference—not as a Conservative, but as a veteran—to explain how veterans feel about the way that they are dealt with not only by this Government, but by previous Governments. It was as a result of the impassioned plea of Simon Weston—formerly of the Welsh Guards, and one of the heroes of the Falklands campaign—that his comments came to public knowledge.

I commend the Daily Mail for running a campaign that highlighted, in essence, what I want to talk about tonight: the allocation of funds for one sector of our community—our ex-service men and the organisations that sustain them—that the entire House surely feels deserves a higher priority than it is currently accorded. There could not be a more appropriate day to discuss this, for it is today that we have marked in Westminster Abbey the 60th anniversary of the battle of El Alamein. Those of us who saw Jon Snow's television programme—made with the help of his son, Peter—at the weekend, had brought home to us the enormity of the horrendous nature of that campaign.

El Alamein was like many other campaigns of the second world war, but they are not the only ones. In the Falkland islands—part of the United Kingdom's territories—255 British service men lost their lives fighting for the freedom of the islanders. According to the Secretary of State, only #1 million out of #12 billion goes to service charities. That is unfortunate, but in fact she has slightly understated the situation. I can tell the Minister for Tourism, Film and Broadcasting, for whom I have much time—not that I wish to harm his prospects within his own party—that, according to the Library, there are 163 projects that are associated with ex-service charities, and so on. Funding totals #1.6 million, which equals about #10,000 per project. These are great projects, and I am not denying that work has been done for service charities. Many hon. Members will know from their constituency work that there is some activity in respect of the British Legion, the Normandy veterans and—as I discovered in my maternal home of the borders of Scotland—a number of pipe bands. Those are great causes, but there are very few large projects.

For example, as I mentioned in an intervention, it is unfortunate that a few years ago St. Dunstan's was unsuccessful in applying for a grant of #600,000—not a huge sum, in lottery terms—for a rehabilitation centre. As hon. Members will know, a young cadet went to the Territorial Army centre in Hammersmith, west London, a couple of years ago and picked up what he thought was a torch on the ground. It was an IRA bomb, and as a result he lost his sight. It is St. Dunstan's that picked him up, and that is what our service charities are doing every day of the week. They do not make a big fuss about it; they do it quietly, and they are a huge rock for those who have served their country, witnessed horrendous scenes, and sacrificed sight, limb or hearing for their country. I do not believe that, as currently constituted, the national lottery is giving those men and women—who deserve our support on their behalf—the proper priority that they deserve. That is what this debate is about.

The Royal Naval Benevolent Trust was told by a lottery official that it would not be worth its bothering to apply for a grant, since it has too much money in reserve already. The money that it has in reserve is used to generate income to pay current expenses. It was looking for some support for a capital project, but that was not forthcoming. The Government are not unwilling to give directions—or guidelines, as they are perhaps called—to those who distribute the funds. I want those guidelines firmly to encompass the service charities, which are not supported by the Ministry of Defence or by the Government. In fact, they are supported largely by the ex-service community itself and, of course, by the wider public at the time of the poppy appeal. I believe that some #19 million was given last year—a sum that reflects the priority that the public give to our ex-service men.

I hope that the Government will think very carefully about this issue. I hope that they will recognise that there is something wrong here, that they have the opportunity to put it right, and that they will do so as soon as possible. Simon Weston said that 20 per cent. of London's rough sleepers are ex-service men. We owe it to them to do more than we are doing; #1.6 million out of #12 billion simply does not reflect the duty that we owe. We have a chance to do something for them, and I hope that the Government will take it today without compromising the independence of the awarding authorities, but by pointing out to them the role that these people play in our society.

I am glad that the Government have agreed to ask Simon Weston to give evidence. He made an impassioned plea, which struck a chord. It was the Daily Mail that picked it up, and I hope that this House will listen to what has been said, and act on it.

Photo of Chris Bryant Chris Bryant Labour, Rhondda 6:30 pm, 23rd October 2002

I am especially pleased to follow Mr. Howarth, who spoke with great sincerity on behalf of his constituents and of the many people in the country who would agree wholeheartedly with much of what he said. However, I am being similarly sincere when I remind the hon. Gentleman of the motion under debate. Many of us would have preferred to debate a motion on the principles that he has elucidated, but they are not what is under discussion.

It is not a question of the national lottery supporting only veterans, or only the organisations referred to this evening. It should support both. In my constituency, one is less likely to meet veterans at the various veterans' organisations than at the local community association or Labour club. Throughout the Rhondda, there are people in their 60s, 70s, 80s and 90s who fought for this country in the past.

Also, the best way to help veterans sleeping rough in London is not by helping veterans' organisations specifically but by helping rough sleepers organisations. That is what many funding bodies are trying to do.

My plea as MP for the Rhondda is similar to that made by the hon. Member for Aldershot on behalf of his own constituents. We also owe a duty to this country's miners, many of whom died trying to create and build this country's prosperity. Over the years, mining constituencies across the country have not received a fair share of the lottery allocations cake. That is a matter of regret. I am glad that, since 1997, the Government have sought to address that problem, but there is still a long way to go. The average mining constituency in Wales receives only 40 per cent. of the average UK lottery allocation. That problem affects many Labour Members and, despite the kind remarks made earlier by my right hon. Friend the Secretary of State, many of us still want to press the Government on it.

I confess that some contributions from Conservative Members to the debate have been depressing. Mr. Whittingdale gave us the old, old story. I longed for the bright shoes of Mrs. May, and for a debate that revealed some of the colour of the supposedly nice party that the Conservative party has become. Yet we got a list of organisations—representing women, gays and foreigners—that should not receive money. That is the old Conservative party, just as nasty as ever.

I have shared many a pleasant Select Committee day with Miss Kirkbride, but she seemed to argue that children and young people should no longer be a priority, and that we should not expressly consider their needs when it comes to lottery allocations. For her, it seemed to be a question of veterans in, children and young people out. I think that that is a false dichotomy.

Photo of Chris Bryant Chris Bryant Labour, Rhondda

No. The hon. Lady would not give way to me earlier. I told her she would regret it, and now she does.

The debate has been depressing for yet another reason. As my right hon. Friend the Secretary of State said, we have seen the bandwagon tendency in full and fine fettle. We thought that some of the wheels had fallen off the bandwagon, but it is clear that it is more of a fire brigade tender and that all its wheels are rolling.

There are important principles at stake. When we talk about lottery allocations and the performance of the lottery, we need to deal with three important matters.

The first matter is the arm's length principle, which has been discussed in some detail. It was curious to hear demands that politicians should ensure that certain organisations should not get grants, and at the same time arguments that there should be an arm's length principle. I used to be a councillor in Hackney, and I have seen the terrible complications that can arise when councillors must decide which organisations should receive grants. My experience leads me to believe passionately that politicians should draw up the broad guidelines for applications, but that it is quintessentially fundamental that they should not be involved in doling out grants.

The second matter that I want to raise has been skated over somewhat in the debate. It is the question whether charities should be able, or allowed, to engage in politics. I believe that charities play a vital role in bringing to the political world's attention many of the problems that affect the most marginalised groups in society. Taking away from Oxfam, Christian Aid, Help the Aged or any of the other charities that we know and love the ability to campaign would deprive the political world of an enormous resource.

Of course, charities should not be involved in party-political engagements, and the Charity Commissioners should provide robust guidelines on the political engagements in which it is appropriate for charities to be involved, but there should not be the blanket ban on political campaigning implied by the hon. Member for Maldon and East Chelmsford.

Thirdly, several hon. Members have mentioned the matter of fair shares. Geographical parity might be desirable, but it is not the end of the story. The lottery should first try to address need. Almost inevitably, allocations to the arts and to sports will go to centres of excellence, giving rise to the sort of list referred to earlier by Andrew Selous. However, I still want much greater focus on the needs of communities, and especially of those communities that are most deprived.I think that the hon. Gentleman made a strong argument for the Government's decision to establish the new opportunities fund and for changing the priorities of the community fund. He made the argument for the Government.

In my constituency, the new opportunities fund has meant that the Rhondda cardiac support group has received a grant, as have the Clydach vale community centre, which provides a breakfast club and a holiday club for children aged between three and 11, and the Pontygwaith community centre, which provides after-school places for three to 11-year-olds. The groups that I have mentioned are in three of the poorest wards in Europe. The new opportunities fund has therefore been invaluable in ensuring that more money goes to the most deprived communities in the country.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

Does the hon. Gentleman agree with my point that constituencies around the country that have significant pockets of disadvantage are currently not accessing money from the new opportunities fund?

Photo of Chris Bryant Chris Bryant Labour, Rhondda

There is a problem in that respect. I said earlier that if, as has been suggested, one uses local authorities to decide which areas of the country are the most deprived, the result is that certain areas could be overlooked. Although I believe that drilling down into tiny communities in individual wards is trying too hard, and that, broadly speaking, we should deal with the matter at constituency level, I accept that it is a matter of legitimate dispute.

I turn now to the community fund, and two grants just made from that source. One grant, of #199,000, has gone to the Cwmparc community welfare association in my constituency. The other grant relates to a debate that was held yesterday in Westminster Hall. The Parent Project UK has just received #45,000 to help it provide support and understanding for people suffering from Duchesne muscular dystrophy. In that connection, I pay tribute to my hon. Friend Kevin Brennan, who has already made it known that he is in the Chamber. However, constituencies such as mine still only receive some 40 per cent. of the average allocation nationally.

I welcome the changes introduced by the Government, and devolution has made possible greater accountability on the part of the funding organisations. I support the specific measures for former mining constituencies and this summer's announcements, bearing in mind the difficulties in trying to ensure that genuinely deprived areas receive the most support.

Finally, there has been some talk from Conservative Members about political correctness. I am proud to be politically correct if that means treating everybody equally. Yes, I am politically correct if it means turning my back on the knee-jerk xenophobia and homophobia that we have seen this evening. Yes, I am politically correct if it means saying that charity does not begin and end at home and if it means supporting the most needy, even if they are not necessarily the most respectable. I am politically correct if that means thinking before believing everything that appears in the Daily Mail.

Photo of John Greenway John Greenway Conservative, Ryedale 6:40 pm, 23rd October 2002

It is entirely appropriate that the Conservative party, which created the national lottery, should use one of its supply days to debate one of the great successes of social policy of recent years and discuss what Parliament and the Government should do to ensure its continuing success. The Secretary of State described our debate as opportunistic, but without the debate we would not have had a statement on what many think is the worst crisis affecting the lottery during its eight years of existence, nor would we have been likely to have a debate on the Secretary of State's consultation papers.

When the lottery was launched eight years ago, no one dared predict the scale of success that has in fact been achieved. However, the march of success has now faltered—badly so in recent weeks. If we are to have any hope of halting and reversing the decline, we need to understand why fewer people are buying lottery tickets. I was astonished that the Secretary of State had nothing to say about the fall in lottery ticket sales. It was always obvious that some players would lose interest, but the recent drop in sales is due to more than player fatigue. Claire Ward was right—the adverse publicity attached to criticism of just a handful of grants has deeply damaged the public's trust in the lottery. However, it was the Home Secretary who first criticised the National Coalition of Anti-Deportation Campaigns, not the Conservative party. The criticism from the Home Secretary and others has created a perception that more deserving causes are losing out to the benefit of organisations that do not command widespread public support or respect.

In an effort to bring down the temperature a little, let me be the first to acknowledge that there have always been controversial grants, and probably always will be; when we were in government, I raised precisely that point with the then Prime Minister. That is part of the price of sticking to the arm's-length principle. Nevertheless, some of the beneficiaries of recent community fund grants should have come as no surprise to Ministers.

In 1999, the community fund guidelines were amended. That has been acknowledged. Ministers both promoted to Parliament and approved the community fund strategic plan, which included specific reference to targeting organisations supporting asylum seekers and refugees. That in itself was not the problem. What appears to have been lacking was a sufficiently robust regime for grant approvals to prevent any organisations that benefited from the programme supporting, for example, moves to prevent the deportation of criminals—the Home Secretary's criticism—or engaging in doctrinaire political campaigns way beyond what should be acceptable from an organisation in receipt of public money. As the Secretary of State has said, the community fund appears to recognise that. However, the solution is not to abolish the community fund or the other distributors. I welcome the timely reminder given by the former Secretary of State for Culture, Media and Sport, Mr. Smith, about the second licence promise to the distributor bodies. We need to improve internal procedures and reconsider the guidelines that the distributors are given by the Government.

I profoundly disagree with the Secretary of State's comment that there were flaws in the lottery structure. There was nothing seriously wrong with the structure of distribution established for the lottery at the outset, although its priorities were always bound to develop. What has happened since, under this Government, has undermined public confidence in the lottery. In particular, the creation of the new opportunities fund has corrupted the crucial principle of additionality. One needs only to talk to the other funding bodies to know how deeply that is resented in the country and throughout the lottery scene. If we want the lottery to support health and education in the form of schools and hospitals, we should not do so through an organisation that has such close ties to Government Departments, mandated to fund initiatives that are central to the Government's policy strategy. Government policy initiatives relating to school sport, for example, should be funded out of taxation, not the lottery. That is not the same as saying that schools should not benefit. As I said in an intervention on Andy Burnham, Sport England has funded school projects in my constituency, provided that they are for community use.

My hon. Friend Mr. Duncan was right—we are not against the projects. He rightly questioned the method of funding. The Government seem to treat the new opportunities fund as an extension of the Exchequer. How often have we heard the Prime Minister announce public spending commitments, only to discover later that they will be largely funded by the lottery?

The public recognise that the lottery is increasingly being used as a means of delivering the Government's agenda rather than what schools or voluntary organisations have determined they want to achieve for their community. The lottery was established to provide an independent stream of money to support local action and self-help. In our view, it needs to return to that first principle.

Photo of Andy Burnham Andy Burnham Labour, Leigh

Will the hon. Gentleman give way?

Photo of John Greenway John Greenway Conservative, Ryedale

No, I will not, because I have only a few minutes left.

The Secretary of State recognises that all is far from well. We agree that a review of lottery funding is appropriate, although we have different solutions to offer. We agree that we need at the very least to correct inequalities of funding between the funding bodies. The new opportunities fund receives one third, while the rest receives one sixth. That is perverse and unfair.

We agree, too, that there is a need to make the application process easier and more user friendly. Increasingly, however, the disappointment of rejection is due to a lack of money, for sport and charities especially. That is why we have said for some time that a way should be found to enable at least a part of the significant sum of unspent money to be released to boost spending. Lottery money is often earmarked by the Government for other projects, which reduces the amount of money available for local good causes. It is as if the lottery candle is being burned at both ends, and it cannot stand the reduction in ticket purchases.

Finally, we agree that local decision making should be enhanced. However, the consultation paper talks of establishing local awards committees, with more than a hint of local authority involvement.

The Secretary of State has said that we should keep politicians out of the grant decision process, and we agree, but that should apply to local councillors, regional development agencies and regional assemblies as well as Ministers. The lottery should not be seen as a community resource or slush fund for local authorities or assemblies as a substitute for public funds.

For the lottery to have a vibrant future, the twin core principles of arm's-length and additionality on which it was based but which have been corrupted under this Government must be reasserted. The Conservative party created the lottery, and we remain one of its staunchest champions. In a White Paper in 1997, new Labour promised a lottery for the people. With respect, it already was a lottery for the people, but it has increasingly become a lottery for the state. For us, any lottery worth having helps volunteers, charities and independent organisations, not public sector bodies, to improve the quality of life for our people and communities. It helps our athletes and our young musicians achieve their hopes and aspirations. It helps charities provide support for the weak and most vulnerable in our society. That was, and remains, central to the Conservative vision for the national lottery. It is a vision that we commend to the Secretary of State.

Photo of Kim Howells Kim Howells Parliamentary Under-Secretary, Department for Culture, Media & Sport 6:50 pm, 23rd October 2002

We have held an excellent debate, which was refreshingly free from some of the things that could have infected it. I am glad about that.

I am sure that many right hon. and hon. Members will join me in commending the hard work done for the lottery by the Minister for Sport, who owing to family difficulties cannot be at the Dispatch Box this evening. My right hon. Friend the Secretary of State, too, has done an enormous amount to make the lottery relevant to contemporary society.

We have heard many excellent contributions. Mr. Greenway made an important point about ticket sales and income from the lottery. We expect lottery sales to be well over #4.5 billion this year and to contribute well over #1.2 billion to good causes. That is a large amount by any reckoning and it is hugely important for good causes of every sort throughout the country. I hope that the hon. Gentleman will mark my words: it is extremely important that we help in every way we can to sustain that level of income. That point raises questions which have not been discussed today about the nature of the gains or how they should evolve. Those essential questions have been absent from the debate.

I thank Bob Russell for making an important point about ensuring that many small outlets do not lose their lottery franchise. I am sure that he and other Members will want to know that Camelot introduced sales incentive schemes earlier this year to ensure that the money for good causes is maximised. Obviously, Camelot wants the maximum number of outlets. I understand that the company is spending time with every retailer who is experiencing difficulties and is in danger of losing their terminal. Camelot field executives have instituted a training period of more than 26 weeks to help such retailers to reach their weekly sales targets.

The hon. Gentleman's comments were important, because the last thing we need is for shops, often in vulnerable areas, to lose the attraction of the lottery. Ultimately, the decision for Camelot is commercial, as it should be. I am sure that the hon. Gentleman will be interested—I certainly was—to learn that more than 100,000 retail outlets are on a waiting list for a line terminal.

The hon. Member for Colchester and other Members asked whether sport was suffering. School sport alone will receive #750 million. That is a great achievement that, hopefully, will produce the goods in terms of winning teams. Most important, however, is the fact that so many young children will be involved in activities that they would never otherwise have taken part in. That is a great step forward. We should celebrate it, not knock it.

My right hon. Friend Mr. Smith raised the issue of balances, which has been extremely important since the lottery began. I am sure that he knows that the Government are working with the distributing bodies to ensure that lottery funds are not only committed to projects, but paid over to project operators as quickly as possible. We want lottery funds to give the greatest and fastest possible benefits on the ground.

My right hon. Friend was right to highlight the fact that the balance is enormous: about #3.6 billion. The lottery distributing bodies forecast that it will more than halve, to #1.6 billion, by March 2004. I assure him that the Government attach high priority to ensuring that that reduction takes place so that good causes will benefit to the greatest extent from the money raised by the lottery.

Miss Kirkbride reminded us of how the money can be used. She painted a vivid picture of the difference that it will make in her constituency, especially as regards health care. Quite properly, she referred to the accountability of quangos. I use the word Xquango", as it would take too long to explain it. I feel strongly about quangos. Sometimes, they work extremely well; at other times, they do not work too well, but they should always be accountable. As I come from Wales—a country that seemed for a long time to be run by wholly unaccountable quangos, although we have changed that—I have a great deal of sympathy with the hon. Lady's comments.

My hon. Friend Claire Ward described some of the splendid schemes in her constituency—for example, the out-of-school clubs that are such a boon. She asked the House to understand that we owe a duty to fund small but vital grants for organisations that will never receive publicity. Such organisations will certainly never be controversial like those that, through controversy, actually win funds. Lottery funds are the lifeblood of the organisations to which she referred and I support her observations.

Mr. Duncan urged us to consider carefully the simplification of the application process. That is an important point. He and other Members will be pleased to learn that, as part of the current review of lottery funding, we are examining the application process. The review has resulted in several proposals to improve the process, including a single application form, electronic applications and one-stop shops. Those innovations could bring real advantages.

There were many contributions, and I cannot answer them all this evening. Andrew Selous was right to refer to community halls—another important issue. He will be pleased to learn that we have been working with the Department of Environment, Food and Rural Affairs and taking a lead on a cross-cutting review of the funding for village halls, in liaison with all the stakeholders—if I may use that terrible word—including the Department for Culture, Media and Sport, to demonstrate the amount of funding needed to develop village halls. The review will also examine the funding process and other issues such as access for disabled people—to which the hon. Gentleman referred. Such access can be expensive but it should form part of the civil rights of disabled people. We shall certainly not try to get around that problem.

There were many contributions—

Photo of Kim Howells Kim Howells Parliamentary Under-Secretary, Department for Culture, Media & Sport

I cannot give way now. Indeed, I may have been about to answer the question that the hon. Gentleman wanted to ask.

Many Members referred to the need to ensure fair shares. My remarks may be a little controversial, but coming from a constituency that until recently was a coalmining constituency, I can say that the greatest poverty that we have suffered is a poverty of aspirations for ourselves—not necessarily for our children—and for our communities. We should start to forget the history involved; otherwise we could argue with each other from now until the end of time. If we do not raise that level of aspiration and start looking to the sky for the future of our communities, we will never achieve any of the improvement that is so important to us. That poverty of aspiration is at the heart of many of the problems that have been experienced with the lack of funding going to some constituencies. There could be many reasons for that, but we must tackle it quickly. I commend the work that my right hon. Friend the Secretary of State has done in trying to draw together such constituencies to discover how we can improve matters.

Mr. Howarth made an impassioned plea, and properly so. We owe those people who defeated fascism, the Nazis and the rest of those scum a debt of gratitude that can never be repaid. We must take care of those people and I hope that the hon. Gentleman's words will be heard outside the House. They have certainly been heard inside the House—

Photo of David Maclean David Maclean Shadow Chief Whip (Commons), Opposition Chief Whip (Commons)

rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the original words stand part of the Question:—

The House divided: Ayes 138, Noes 391.

Division number 328

See full list of votes (From The Public Whip)

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.

Mr Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House welcomes the fact that the Lottery has so far generated over #12 billion for investment in good causes and has brought much needed support for sport, the arts and heritage, charities, and organisations dealing with health, education and the environment; notes that the Lottery has created funds for projects to mark the new millennium; also notes that the typical constituency has received millions of pounds of Lottery funding, often transforming local communities and their economies; welcomes the contribution that Lottery funding has made throughout the United Kingdom; believes that Lottery players can have full confidence in the Lottery and in Lottery fund distribution; and welcomes the current review being undertaken by the Department of Culture, Media and Sport to ensure that the Lottery continues to make the fullest possible contribution to the nation.