§ `() In section 30 of the 1993 Act (winding up of funds allocated under section 22(3) (e)) after subsection (3) there shall be inserted:
§ "Within one year of exercising its powers under section 28(1) the Secretary of State shall—
- (a) prepare a report containing an assessment of the performance of the bodies which distribute money under section 25(1) of the 1993 Act;
- (b) set out the criteria governing the reallocation of sums held under section 22(3)(e); and
- (c) consult any body which distributes money under section 25(1) and other interested bodies".'. —[Mr. Maclennan.]
§ Brought up, and read the First time.
Mr. Deputy Speaker
With this, it will be convenient to discuss the following amendments: No. 8, in clause 6, page 7, line 23, leave out from beginning to end of line 10 on page 8 and insert—'(1) In relation to any sum that is paid into the Distribution Fund under section 21(2) of the 1993 Act after 31st December 2000, section 22(3)(e) of that Act shall have effect as if for "on projects to mark the year 2000 and the beginning of the third millennium" there were substituted "on or connected with education, environment and public health, including children's play.".(2) Section 30 of the 1993 Act (winding up of fund allocated under section 22(3)(e)) shall cease to have effect.(3) The Secretary of State may by order substitute a later date for the date that is for the time being specified in subsection (1).'.No. 1, in page 7, line 43, at end insert—'(6A) In section 28 of the 1993 Act (power to amend section 22) in subsection (2)(a) for "5 per cent." there shall be substituted "13i per cent".'.
§ Mr. Maclennan
I have pleasure in moving the new clause and I shall be brief. It is designed to enable the Minister to give some indication of what the Government propose following the winding-up of the Millennium Commission in respect of the substantial expenditure involved. There is anxiety, particularly in the 84 voluntary sector, that the money is in a sense floating money, which could be diverted from good causes to other, no doubt desirable, public spending objectives—I can candidly declare that the new clause was suggested by the National Council for Voluntary Organisations. There is also concern that the very fact that that shift will take place might impact on the ability of voluntary organisations to attract funding and it is certainly appropriate to raise those fears well in advance.
The Government should be able to give undertakings that they will consult widely with the voluntary organisations and the other good causes about how best to utilise the money, bearing in mind the Government's expressed commitment to the additionality principle, which was underlined in the previous debate and which I do not call into question in general.
The new clause also suggests an appraisal of the work that has been done by the existing distributing bodies, which must be appropriate and sensible when considering how best to deal with moneys that will not be spent in the future. Of course, it is difficult to predict what the volume will be by that time and whether it will have peaked and be on a downturn, but that would only make that course of action more urgent. I hope that the Government will find the new clause helpful and that it will enable them to give us some glimmerings into their thinking.
§ Mr. Spring
We have listened with interest to the comments of the right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan). I was not clear whether he would press the new clause to a Division. I hope to secure your permission, Mr. Deputy Speaker, to separate amendments Nos. 8 and 1, which we have tabled, from the new clause if necessary.
The amendments in this group deal with the Government's raid on the original good causes and the need to protect those causes. The reason for the raid is simple. The Government made a series of promises in opposition that were incompatible with the tight control of public expenditure. Indeed, once a week we have had the sight of the Prime Minister having to defend the fact that those early pledges, particularly on health and education, have not been borne out in practice and that, in fact, the reverse has happened. That is part and parcel of the problem. Given the Chancellor's views on public expenditure, Ministers are scratching around for alternative sources of cash to pursue the political agenda that is inherent in the new opportunities fund. As a result, the lottery, which was set up as a fund to pay for projects that would, in the words of the 1992 Conservative manifesto,restore our heritage and promote projects which will become a source of national pride",is, if Royal Assent is obtained, to turn into the milch cow for Ministers to supplement their departmental budgets by raiding it for that express purpose, through the generosity of the Secretary of State.
Even under the Government's original plans, the good causes would have lost out. The National Lottery etc. Act 1993, which was enacted under the former Conservative Government, provided for the Millennium Commission, which finances projects to mark the millennium, to be wound up once the celebrations are over and the projects 85 all paid for. That money would have been re-allocated to the other good causes. However in 1996, the Labour party in opposition decided that it would not reallocate the money to the original good causes but would set up its own fund to subsidise the budgets of other Departments.
Let us be clear. Under a Labour Government, the original good causes were always destined to lose out; it was only a question of when. None of the amendments would prevent the Government from setting up the new opportunities fund. They deal with the fundamental problem of the Government's smash-and-grab raid on the lottery.
Amendment No. 8 deals with whether the new opportunities fund should replace the Millennium Commission, as was promised in Labour's manifesto, or whether it should simply elbow its way to the front of the queue as a sixth good cause. In view of the threat to the lottery, we also want to establish a minimum percentage below which the share of the proceeds of the lottery allocated to the original good causes will not fall. We are concerned that the Government will try to take an increasing percentage of the proceeds of the lottery for their own new good cause and we were not at all assured by the so-called assurances of the Minister for Sport in Committee. I hope that this evening he will give us further assurances, as they have not thus far been satisfactorily forthcoming.
In respect of making the new opportunities fund a replacement for the millennium fund, amendment No. 8 would give the Government the opportunity to honour their manifesto commitment on the lottery. I remind members of the Standing Committee that we had the truly appalling sight on a number of occasions of Labour Members voting against their manifesto commitment—a ludicrous situation. Accepting the amendment would restore to the original good causes some of the money that they will lose under the Government's plans.
In its manifesto, the Labour party gave a commitment to create a new millennium fund—what is now called the new opportunities fund—to replace the existing fund. Indeed, the 1997 manifesto, "New Labour, because Britain deserves better", stated:Labour has already proposed a new millennium commission to commence after the closure of the Millennium Exhibition, to provide direct support for a range of education, environment and public health projects, including those directed at children's play, currently excluded from the lottery".The Opposition's amendments would give effect to that commitment.
Perhaps the House would care to reflect here on the irony of the Government, barely a year in office, facing the embarrassment of being held to implementing their manifesto commitments by the Opposition. I accept that this may be small beer compared with the appalling travesty as regards the early pledges, which have simply not been carried out—the growth in waiting lists and the difficulties in education—but it is a principle of considerable importance for the continuation and success of the national lottery.
We are giving the Government another opportunity to consider their over-hasty raid on the lottery and the damage that the Bill will do to the original good causes by depriving them of money that they had expected. We ask the Government to think about the damage that they are doing to the lottery by turning it into a form of 86 voluntary taxation from which to subsidise general public expenditure on health, education and the environment. The Government have brought forward the creation of the new opportunities fund to let them get their hands on the lottery as soon as possible.
The Bill will mean that the arts, charities, sport and the heritage will lose one sixth of the proceeds of the lottery until the Millennium Commission is closed, and a fifth of the proceeds thereafter. That results from the Government's decision to introduce their own good cause before the Millennium Commission is wound up. The new opportunities fund, to which we object in principle, was conceived as a replacement for the millennium Fund, not as an additional sixth good cause.
The Government are so hemmed in by the embarrassment arising from their failed pledges and their performance on health and education, and by their self-imposed public spending constraints on the Chancellor, that they are desperate for cash. The lottery is the ready source. As has been said, the real lottery winner will be the Chancellor, at the expense of good causes up and down the country.
Labour announced its decision to set up the new opportunities fund before the closure of the Millennium Commission only during the general election campaign. There was no mention of the effects that it would have on the good causes, or on the lottery. It was not made clear then, and the Government have persistently failed to admit it since, that the original good causes are losing as a result of the switch. Sums in the region of £140 million to £150 million will be taken from the good causes and put into the so-called shadow account for distribution after Royal Assent.
The good causes would, of course, have lost out anyway. They had previously expected the Millennium Commission's share to be divided among them when it was wound up. When the decision to bring forward the new opportunities fund was announced, Labour claimed that it had been made possible only by the Wednesday draw. That was complete nonsense, and they knew it. The only reason why the original estimates of about £9 billion rose to about £10 billion was the spectacular success of the first year of the operation, which far exceeded expectations. A midweek draw was always planned, as well as scratch cards and the other games that have been introduced. The Wednesday draw was not an unexpected windfall, and it is nonsense to suggest that it generates a finite sum.
The fact is that the Government wanted to get their hands on the lottery money as soon as possible and were prepared to set up a new good cause to do so, even if it meant taking from existing good causes. In Committee, the Minister acknowledged for the first time that the Government had brought forward their raid on the arts, charities, heritage and sport by saying:when we first proposed the new good cause in our manifesto and in the lottery documents published before the election, we anticipated that it should follow the running down of the Millennium fund. We have had second thoughts, however, which is perfectly reasonable. We were surprised and pleased at the strength of support for the new good cause. As it was so widely welcomed, it seemed perverse and unnecessary to delay it for several years. As it was supported by the public… we feel that if the content is right we should go ahead now, be decisive and get on with it.The Minister could offer no credible justification for why the Government should have brought forward the date of their raid, except political expediency. He was not 87 prepared to admit that they simply wanted to get their hands on the money. He claimed, unconvincingly, that the proposals were popular—though he presumably did not mean popular with the new causes, which do not share his view. The Minister refused to make public the details of consultation with existing good causes. I asked him to do so, and he talked about some sort of seamless flow. I fear to say that that was not a particularly satisfactory answer.
The Minister has claimed that the distributing bodies agreed. However, he was not so definite in Committee. There was no suggestion then of agreement. He said:We have running discussions and consultations with all the distributing bodies. They are fully aware of the plans and happy with them. Consultation is not an exercise, but a continuous process …It has always been made clear that the other distributing bodies will receive £1.8 billion each, and they have accepted that. That was the understanding on which they planned …The distribution bodies have always accepted that figure; it is the basis on which they have been able to plan. The important thing was the amount of money that they were to receive—£l.8 billion. They will still receive precisely that sum."—[Official Report, Standing Committee A, 28 April 1998; c. 45–46.]What a contrast those assertions make with the responses to the Bill made by the original good causes. Many people who have an interest in this subject because of their involvement in the distributing bodies—for example, Lord Gowrie and Lord Rothschild—make a very different interpretation. It is absurd to suggest, as the Minister does, that they are delighted and pleased that traditionally under-resourced parts of our economy that are always put at the back of the Treasury queue will once again be hit severely by this raid.
Labour Members should be grateful to have the opportunity to make sure that the Government keep at least one of their promises. The amendment will let them clear their consciences by doing that. By accepting the amendment, the Minister would ensure that the original good causes continued to get the percentage of lottery proceeds that they were originally promised, rather than the reduced percentage that will result from the premature creation of the new opportunities fund.
Amendment No. 1 deals with the setting of a minimum percentage share for the good causes. The great fear of the original distributing bodies is that the Bill is the beginning of a remorseless chipping away at their resources. They are concerned that the Government plan to take a growing percentage of the proceeds of the lottery to pay for their own new good cause. The bodies fear that this is the beginning of a series of raids.
The Bill is specifically designed to ensure that that happens. Despite being pressed on Second Reading by a number of my hon. Friends—including my right hon. Friend the Member for Huntingdon (Mr. Major)—and being pressed again in Committee, the Government have failed to undertake to adhere even to the reduced new percentage allocations contained in the Bill. I extend to the Minister, once again, the opportunity to give that assurance, and I should be delighted if he did.
In Committee, the Minister claimed that it was absurd of the Opposition to want to amend our own National Lottery etc. Act 1993. He was being somewhat disingenuous; he knows that no Government would have had any incentive under the 1993 Act to divert money 88 from one distributor to another. It is different now. The Secretary of State is, in effect, setting up a political fund under his own direct control. He is introducing sweeping powers that will enable him to gerrymander the distribution of lottery money. He is changing the very basis on which the lottery operates and on which it has been such an enormous success. The Government now have an incentive to vary the percentages even further to favour their own good causes, and that is why existing good causes are worried.
I have repeatedly said that it is dangerous to set a precedent for future Parliaments by entrenching in legislation the opportunity for some future Secretary of State to abuse the lottery for political reasons and to change the balance of the lottery in a way that is deeply destructive to the lottery and the under-resourced good causes. The Government are not prepared to offer genuine reassurance to the good causes, and that is why we are resisting the Bill.
As so often with this Bill, it is not the introduction of a single power but the combination of powers, a sort of block building of centralisation of control, that puts a dangerous amount of control in the hands of the Secretary of State. The apparently harmless power to vary the percentage allocation to each good cause in the original Act can be combined with the creation of the new opportunities fund to allow, in theory, the diversion of up to 75 per cent. of money for good causes, and eventually 80 per cent. to the Government's own good cause.
The Government repeatedly resisted this amendment, which was tabled perfectly reasonably by Conservatives and Liberal Democrats in Committee. They combine lukewarm assurance of their good intentions to the good causes with an abject failure to give them statutory effect. They have failed to commit to a percentage for the good causes but say only that the good causes would get £9 billion if the proceeds reached £10 billion. They will not commit even to the reduced percentage share in the event of proceeds exceeding £10 billion, as Camelot confidently predicts that they will. Will they commit to percentages in the Bill today? We await an answer.
The Government also made it clear that, in the event of a shortfall, the original good causes will lose out, meaning that there is a possibility of a further fall for them. As Conservative Members have noted, there is always the risk of lottery fatigue, which has been seen in other countries. What assurances can the Minister give against the possibility of revenue shortfall for the good causes, including sport, that are so genuinely concerned about the matter? The Government will not even give a commitment that the original good causes will continue to receive any money at all after the current licence expires in 2001. Will they give clear assurances today?
This is an opportunity for the Government to show good faith and to set a percentage floor below which the good causes will not fall. The minimum share that we propose would not have been necessary without the creation of a new good cause under the direct control of the Secretary of State. The Bill centralises far too much power in his hands.
The new good cause is radically different from the previous ones. The 1993 Act sets out the five areas to be supported by the national lottery on an equal percentage 89 basis: the arts, sport, national heritage, charity and the millennium. The money was to be drawn on by distributing bodies to make grants to such projects as they chose to support, within their terms of reference. The Secretary of State had no power to tell them what projects to support. The new opportunities fund is to have no such freedom.
As the Government's note on clauses 6 puts it:rather than providing general support to its sectors as the other distributors do, it will support a rolling programme of specific initiatives. These will be determined by the Secretary of State.The first three initiatives are to be IT training for teachers and librarians, out-of-school-hours activities and healthy living centres. The Government claim that such initiatives are consistent with the arm's-length principle. They are not. The new opportunities fund will simply be a Government agency with limited operational autonomy. What is to stop the Secretary of State diverting more and more lottery money to the new opportunities fund at the expense of other good causes? We have not had a satisfactory answer.
We have already been told that the new cause's share will rise to 20 per cent. in 1999 as millennium spending tails off. Why not 25 or 50 per cent? There is nothing in the Bill to stop it. The existing percentages can be varied by ministerial order, and it would be tempting to do so. To set a precedent and give a future Secretary of State the opportunity to do that in an unscrupulous way would be a terrible legacy of our consideration of the Bill.
The sums involved are not negligible. The distributors have so far had about £5 billion. The good causes can expect another £5 billion over the next three years. The Secretary of State is at liberty to channel up to £3.75 billion out of the expected £5 billion to the new opportunities fund. He does not have to give the five other distributors more than 5 per cent. each of the total. That minimum of 5 per cent. was put into the 1993 Act before this voracious new cause made its appearance. That is at the heart of the difficulty.
In view of the changed nature of the national lottery and of the composition of the good causes, we believe that the percentage is too low. It does not sufficiently curb the Secretary of State's political appetite, now or in future. To put it simply, we wish to raise the minimum percentage for all the causes to 13.33, the present percentage allocated for the new opportunities fund. The effect would be to ring fence £3.3 billion of the £5 billion for the five original good causes, as opposed to only £1.25 billion under existing legislation. The Secretary of State would still have the flexibility to give the new opportunities fund more than the others, but not nearly as much flexibility, with all its inherent dangers, as now. I ask again whether the Minister will give a binding undertaking that in this Parliament, he will not reduce the level below 16.67 per cent.
The arts, sport, heritage, the charities and even the millennium fund should have such protection. It is with that protection that the distributing bodies have carried out their work effectively and won the confidence of so many recipients of lottery money. The Bill, with its centralising powers and the ability given to the Secretary of State to interfere in the smooth working of the lottery, demands that if the lottery is to continue to be the success that it has been in the past and should be in future, the good causes need proper protection. The Bill as it stands 90 makes that more unlikely. The minima required to make it work are something that we urgently wish to raise once again for the Government's consideration, in the hope that, even at this late stage, they will think again.
§ Mr. Fraser
I wish to confine my comments to the protection of the good causes, as mentioned by my hon. Friend the Member for West Suffolk (Mr. Spring). We all accept that the national lottery has so far exceeded expectations. The original good causes had expected to benefit from public enthusiasm and support and to receive their fair share of the £1 billion excess projected over the first seven years of the lottery's operation. Not least, they expected the Government to keep their general election promise that the new opportunities fund would be introduced to replace the millennium fund. There is now a sixth good cause, as well as the National Endowment for Science, Technology and the Arts. Everyone's relative share can only fall. That means that the original good causes will inevitably lose out.
The White Paper is worth quoting. It says:Although the existing good causes will be receiving a smaller share of Lottery revenue, the success of the Lottery means that they can still plan on receiving the same amount in total as was envisaged when the Lottery was set up".The Secretary of State is telling the good causes that they will get less in future. They will get the same amount as was predicted when the lottery was set up as a paper concept. They are being told to forget the years of success and not to worry that the Government will not establish a minimum percentage below which their share of the proceeds will not fall. They must press on and be grateful for what they can get.
Our amendments give the Government the opportunity to honour their manifesto promise that the new opportunities fund should replace the millennium fund. As the Bill stands, the Government have brought forward the creation of the new opportunities fund so that they can get their hands on the lottery money as soon as possible. The Treasury is, after all, desperate for cash that only the lottery can provide.
Public awareness of that grab-for-cash policy is growing. Hon. Members may have seen newspaper reports that the Treasury will take 20p on every lottery ticket when the sixth good cause is introduced. Independent research was carried out by David Wornham, senior lecturer at Bristol business school, and quoted in The Daily Telegraph on Monday25 May. The article stated:Mr. Wornham said: 'One of the most disturbing findings is people's assumptions of where the money goes. The public believes that between 15p and 20p in the pound finds its way to charities.In reality, the figure is less than 6p—and that doesn't take into account how much charities have lost from a drop in charitable contributions since the lottery began. To find out where the money is going,' he said, 'you need look no further than the Exchequer.Once direct and indirect taxation is taken into account, together with the use of lottery money to replace public expenditure, the Government's "cut" upon realisation of the new sixth cause will turn out to be over 20p in the pound, not the published figure of 12p.'I could go on, but that illustrates my point and provides confirmation, if confirmation is needed, that the real lottery winner is the Chancellor of the Exchequer. To rub salt in the wound, the Government continue to dispute that the existing good causes will lose out, which is quite incredible when one considers the evidence. If public 91 confidence in the lottery starts to fall, not least because of newspaper reports such as the one I have just quoted, they will really start to feel the pinch.
The fact that the Secretary of State can involve himself completely justifies the concern expressed by my hon. Friends. The Secretary of State will involve himself and decide on the scope and direction of his involvement at a whim and a fancy. Having recognised that as a dead certainty, we seek through our amendments to limit the powers of the Secretary of State and to limit the amount of money he can divert into the Government's new opportunities fund at the expense of the original good causes. To guarantee them an allocation of 13.33 per cent. offers them a future, albeit a lean one; at the moment, they fear for the future and face the prospect that the Government plan to take an ever-increasing percentage of the proceeds for their own salvation.
The current model of awards is transparent and free from accusations of political gerrymandering. Ministers cannot tell us how that positive characteristic will be safeguarded in future—I hope that the Minister will answer that question this evening. If they believe that there should be safeguards, the Government should be happy to give an undertaking to the original good causes, which they currently cannot and will not do. Instead, the Government have every good reason to vary the percentages even further in future to the benefit of the new opportunities fund as the economic situation inevitably worsens and the calls for health, education and environment spending increase.
The Government have made it clear that, in the event of a shortfall, the original good causes will lose out. The Government's apparent lack of support for the good causes increases the concern felt by those good causes and poses the question: what does the future hold for the good causes? I suspect that their future is not particularly rosy, given the wide range of opportunities for Government interference offered by the Bill. They do not even have the comfort of an assurance that they will continue to receive money after the current licence expires in 2001. I should like the Minister to give an assurance today on the future of the good causes.
§ Mr. Green
I shall speak mainly to amendments Nos. 8 and 1, but I shall first briefly address new clause 4. I regret the absence of the right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan) in more than the usual formal sense in which those words are used in the House, because I am genuinely unsure about whether I have completely understood what he wants to achieve with his new clause. As I understand it, he wants to constrain the behaviour of the Secretary of State after the millennium fund has been wound up. That seems perfectly sensible and there is much to be said in favour of such a course of action, but, in a form of argument that will be familiar to those of my right hon. and hon. Friends who have attended debates at the Conservative party conference, I disapprove of the new clause because it does not go far enough.
If it is sensible to restrain the behaviour of the Secretary of State after the winding up of the millennium fund, 92 it would be equally sensible to do so now, especially in the context of the Bill which brings so much power over distribution under the Secretary of State's purview. One of the principal objections to the Bill has always been that it involves the nationalisation of large parts of the lottery distribution mechanism, turning it from a national lottery into a nationalised lottery. That lies at the root of many of the Opposition's objections to the Bill. One of the purposes of amendments Nos. 8 and 1 is to retain some independence for those bodies distributing to the good causes that have done so well over the past four years.
I am sure that the Minister will advance once again the specious argument that we heard several times in Committee; that the cake has got bigger, so it does not matter that the percentage of the cake that the existing good causes are to get is being reduced, as they were planning to receive only that amount of cake anyway. There are two reasons why that is an invalid and specious argument. First, if it can be done once, it can be done again. All the good causes will rightly realise that they have become a target for Ministers of this and future Governments—that they are seen as a convenient way of relieving public spending pressures in almost any circumstances. That will have a direct effect on the way they act from now on. The danger is not merely a theoretical possibility for the future, as many of the things the good causes do involve long-term planning; if they are less sure of the level of funding they are to receive for many years ahead and if they are to act prudently, as most do, they will not commit themselves to large projects or long-term revenue funding. That in itself will be damaging.
Secondly, the good causes are being cheated out of money. They recognised that the cake was growing faster than was originally forecast and planned accordingly. It is undeniable that the demand for bids has improved both in quantity and in quality over the years, as more bodies have got used to the methodology of bidding and worked out how to put together a successful bid. All the distributing bodies say that they would like to pass a higher proportion of bids now than they did two or three years ago, simply because they are generally of better quality, but the result of the Bill is that they will be able to pass only a lower percentage than before, which will be extremely damaging.
The ability to plan ahead will be particularly affected, and that will be increasingly harmful. In the past, large capital projects have been funded, but we all accept that, in future, lottery funding will move towards revenue funding. If the good causes feel that they have to cut off revenue funding after two or three years, future artists and athletes may not be given the opportunities that they deserve and that they could be given under the lottery as currently constituted.
Existing good causes will know that the new opportunities fund is open ended and can be expanded to almost any extent. The Bill would allow expansion to continue, so the good causes would be right to be even more fearful about the future as the opportunities for political manipulation introduced by the Bill become ever more attractive to future Secretaries of State.
The present division is crude but fair. Nobody would argue that there is any great science in deciding that five good causes should each receive 20 per cent. of the money. We could have had endless arguments about whether charities were more worthy than the arts and 93 whether sport was more worthy than heritage. The simple method—which has, as far as I know, received barely a murmur of protest—of dividing the cake five ways by giving 20 per cent. to each cause is seen to be perfectly fair. In this case, complication is the enemy of trust in the long term. By introducing complication into the distribution mechanism, the Government are eroding the trust that exists between them and the distributing bodies. That is likely to damage the bodies' morale and the amount of good that they can do.
I urge the Government to accept the amendments, which are in no way wrecking amendments. They would not stop the Government setting up the new opportunities fund or taking any of the significant measures in the Bill. If the House has a surprising burst of sanity and accepts the amendments, it will enshrine protection for the existing good causes so that although the Government could set up the new opportunities fund, that would not cause the collateral damage to the good causes that the Bill will inflict. I urge the Minister to have a last minute change of heart and accept the amendments.
§ Mr. Prior
It is rather sad that we have to debate amendment No. 1, which would increase the minimum allocation from 5 to 13.33 per cent. We should not feel obliged to do so. We are debating it because Conservative Members are genuinely concerned about protecting the good causes. The lottery has been a tremendous success, as has the distribution of lottery funds, but, over the past few months, in Committee and in debates in the House, many Conservative Members have come to feel that we can no longer trust the Government to ensure that the money is spent properly.
We do not trust the Government because we are not convinced by their defence of the additionality principle. We are convinced by the Bill's wording that the lottery can no longer be described as being at arm's length from the Government. The combination of those two aspects of the Bill makes us feel the need to increase the minimum percentage allocation to protect the good causes.
What leads me to distrust the Government is the fact that they are legislating retrospectively and have been fiddling around with shadow accounts. There was no need to do that. If they had been honest, they could have increased the percentage to the new opportunities fund later, but they did not want to. They deliberately made the Bill retrospective to make it appear as if the percentage was less. That was a deeply unnecessary and reprehensible act. The Government will grab as much money as they possibly can to use for their own purposes. That was not the intention behind the lottery; it was not even the intention of the Government when they were in opposition, when they fought strongly for the additionality principle.
It is vital to protect the interests of good causes, first, for the sake of the lottery. As long as people see that the lottery is independent and that the money goes to good causes, not mainstream public spending, they will continue to play it. The danger of lottery fatigue setting in will be greater if the Bill is implemented.
We are anxious to protect good causes, secondly, for the sake of good government. It is important that taxation is transparent. The taxpayer and the electorate should know where the money comes from to finance public spending. This is sleight of hand—the Government are 94 taking money from good causes to fund their pet projects. I do not necessarily disagree with the projects that they are spending the money on, but it is wrong that the money is being taken from the lottery.
The third reason why it is important to protect good causes is for the sake of the causes themselves. If lottery fatigue sets in and, over time, the causes that are supported by the distributing funds spend the money on revenue rather than capital, it is essential that they have a longer and longer time horizon. If there is in the background the permanent threat that the Government may take more money away from the good causes, that will undermine the causes in the long run.
For those three reasons I support, with some sadness, the proposed increase in the minimum allocation from 5 per cent. to 13.33 per cent.
§ Mr. Brooke
I declare an interest as the chairman of a trust involved in archaeology and ecology in the Andes, primarily in Peru, which has made an application to the National Lottery Charities Board. I see concern written on the face of the Minister for Sport; I give him a categorical assurance that I shall not communicate or correspond with him about it. I mention that body because, as the hon. Member for Stalybridge and Hyde (Mr. Pendry) will recall, it was the charities' concern about their allocation in the original Act that occasioned a fair amount of debate between us.
There was a recognition that, as the Millennium Commission money ran out with the coming of the millennium, there would be an opportunity to consider the reallocation of the money and whether the charities should receive more. At that stage, we would know how they had spent the money so far. In that respect, I agree with new clause 4, which has been tabled by the right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan) as it relates to the purpose of a review.
I have not had a briefing by the National Lottery Charities Board, which is my constituent. In the fourth sitting of the Standing Committee, on 30 April, my hon. Friend the Member for Eastbourne (Mr. Waterson) referred to such a briefing. I am not in any way acting on behalf of the board. I apologise for some unfamiliarity with the narrative. When I was a child, my mother taught me at her knee what I always believed to be a verse from the Old Testament: man look not back at the furrow ploughed by thee. I have never been able to find it in holy writ, but I have not given up hope. I do not spend much time revisiting my past and, if I am unfamiliar with any detail, I apologise.
My recollection is that the Home Office was originally responsible for the National Lottery Charities Board. I was conscious that my right hon. Friend the Member for South-West Surrey (Mrs. Bottomley), who was then Secretary of State for National Heritage, received into her Department the voluntary activity that had previously been looked after by the Home Office. I do not know whether she took responsibility for the charities fund at the same time, but I am conscious that the Government have moved the voluntary activities back into the Home Office. If the Government are creating a new good cause, it is a little illogical to spend money on issues that have nothing to do with the Department for Culture, Media and Sport when they criticised the earlier movement of voluntary activity to the Department of National Heritage.
95 I say, as a bystander, that there has been a lack of coherence in the development of the Government's thinking. There was a Stephen Leacock character who jumped on his horse and rode off in four directions at once. There has been an element of that in the transmogrification of the Government's policy, which has been curious in view of the emphasis that they have placed on strategy and their criticism that there was a lack of strategy in the previous thinking.
I believe that the Minister for Sport will reply to the debate, and I welcome the opportunity to hear from him more precisely what the Government's intentions are. I do not know whether, in his responsibility for heritage buildings, he has been high over the nave in Wells cathedral, but if he has he will have seen etched on the floor the design work of the masons in the middle ages, which is still visible 500 or 600 years later. We shall see the Minister for Sport set out such markings, and we shall have an opportunity to verify them over the next five years. I had profound sympathy with the observation by my hon. Friend the Member for Ashford (Mr. Green) that complication is the enemy of trust in these matters. The simpler the Government can make what they intend to do, the better it will be for the lottery.
§ Dr. Julian Lewis (New Forest, East)
I should like to add to my considerable reputation for parliamentary eccentricity by saying that I was always doubtful about the whole concept of the lottery. I felt that it would damage existing charities and drain from them funds that would otherwise go directly to them. My outlook was probably soured by the brilliance of George Orwell's description in "Nineteen Eighty-Four" of the effects of a lottery in a totalitarian society. He said:The Lottery, with its weekly pay-out of enormous prizes, was the one public event to which the proles paid serious attention. It was probable that there were some millions of proles for whom the Lottery was the principal if not the only reason for remaining alive. It was their delight, their folly, their anodyne and their intellectual stimulant.I thought that, with such a start, the lottery could only be a somewhat corrupting force in society. The Bill shows that it is also corrupting the Government. Effectively, the Bill is the second stage in the Government's attempt to make good their promise to try to keep their spending and tax-raising targets at Conservative levels. The first stage of that attempt was the raid on the pension funds and the second stage—
§ Mr. Deputy Speaker (Mr. Michael J. Martin)
Order. We are debating the new clause and the amendments. We are not worried about possible inequities of the lottery. Perhaps the hon. Gentleman could hang his jacket on that peg.
§ Dr. Lewis
The amendments seek to ring fence the amount that will be available for good causes. Good causes were nominated to enable money that formerly went to charities to continue to be spent on such activities. There is an attempt to get away from the safeguards that were provided for the lottery. That is part of a general, corrupting strategy to enable the Government to get their hands on money that, had the lottery not been created, 96 would have gone to charity. That charitable money will be used for Government expenditure. I predict that this is not the last time that such an unethical sleight of hand will be employed.
§ Mr. Banks
The hon. Member for New Forest, East (Dr. Lewis) described himself as eccentric. That is a middle-class word for loony, and he adequately proved his case. The lottery has been a great success and the hon. Gentleman was wrong to oppose it. People go in for the lottery because they want to win oodles of cash. I do not wish to strip away all the talk about good causes, but that is why I go in for it. So far, I have been unsuccessful, apart from a few tenners here and there, but I dream about the big one coming along, as do many people. As I fail, week after week, to win the biggie, I have the consolation of knowing that money is going to good causes. It is clear that people do the lottery to try to win prizes.
The right hon. Member for Cities of London and Westminster (Mr. Brooke) spoke about Wells cathedral. I have never been high in the nave of that cathedral—I have never been high anywhere—but I was interested to hear that the right hon. Gentleman will not spend much time revisiting his past. According to the interests that he declared, he will spend some time in Peru.
The Opposition amendments demonstrate two matters. First, they show the Opposition's inability to decide their position on the new good cause. As my hon. Friend the Minister for Arts said, in Committee and on Second Reading, the Opposition argued that there was something intrinsically wrong about spending lottery money on health, education and the environment. However, amendment No. 8 accepts the idea in principle, merely postponing it for a few years. Secondly, the amendments demonstrate the Opposition's failure to recognise that we are not harming the existing good causes. They are receiving the £9 billion that everyone expected them to receive when the lottery started.
Perhaps it is rather odd to say in this place that there comes a point when we ought to try to trust each other. [Interruption.] I knew that Opposition cynics would not accept that. They have described my right hon. Friend the Secretary of State as if he were Josef Goebbels. Somehow, there was an evil manifestation sitting next to me and planning all sorts of dire happenings to the existing good causes. My right hon. Friend is a perfectly sweet, decent honourable gent who does not have a vicious thought in his mind. The House should trust him.
The Liberal Democrat new clause 4 gives us a chance to explain our approach to the reallocation of the millennium stream, which seems to have worried people.
§ Mr. Brooke
I greatly enjoyed the Minister's reference to his right hon. Friend. In his capacity as Chairman of the Select Committee on National Heritage, the right hon. Member for Manchester, Gorton (Mr. Kaufman) once said to me, "Of course I trust you Secretary of State: it is the ones who come after you about whom I am worried."
§ Mr. Banks
I do not know anything about impending reshuffles. There has been one in the Opposition and we constantly read about them in the Government. Whoever is Secretary of State—and I know that it will be the present incumbent for many years—can be accorded the same trust as my right hon. Friend. Why should we want 97 to destroy the existing good causes? It offends me somewhat that Opposition Members should feel that we have ulterior motives—that we are somehow intent on destroying the existing good causes and the national lottery. On Sunday, the front page of The Observer stated that the Chancellor of the Exchequer had squirrelled away £50 billion. That is a great deal to squirrel away, but I think that we can rely on our Chancellor to manage the economy in good order and to make sure that there are sufficient funds for our spending priorities.
The right hon. Member for Caithness, Sutherland and Easter Ross (Mr. Maclennan) apologised to me for the fact that he would not be here for the winding-up speeches. I thank him for that and for his short speech. I assure him that when the time comes for us to decide how to reallocate the millennium share, we shall carefully consider what the lottery distribution bodies have achieved and the case for giving each a higher share. There is no assumption that it should go to the new opportunities fund. If that happens, it will be because we have concluded, after looking at all the good causes, that it is the right thing to do. We shall obviously take account of the representations by hon. Members and others on the merits of each good cause and, to address one of the issues in the amendments, we shall explain the basis on which we have decided the allocation.
When deciding what to do with the millennium share, we must try to ensure that each body has the potential to achieve at least as much as it has already achieved. We have adequate arrangements in place to ensure that we can evaluate the effectiveness and performance of each body. As the right hon. Gentleman will know from his membership of the Public Accounts Committee, the Department is accountable to Parliament for the effective use of national lottery distribution funds. As part of its normal sponsorship activities for the lottery overall and for individual distributing bodies, the Department is continually engaged in reviewing the performance of those distributing bodies. We will look very carefully at what has been done by each of the bodies and what can be achieved in future. That is the way in which we shall assess the performance of those lottery bodies, but, before reaching any final decision, we shall, of course, listen to what the lottery distributors and others have to say about the case for increasing the share of each good cause.
The hon. Member for West Suffolk (Mr. Spring) effectively said that the Bill goes beyond the manifesto. The manifesto, covering as it did the whole range of Government's responsibilities, dealt with the lottery only briefly. We did publish, as he acknowledged, during the election campaign a policy document, "The People's Money", which set out in more detail our plans for widening the benefits of the lottery. It fleshed out our plans for the new good cause and made it clear that the lottery's success enabled the new good cause to be established while the millennium stream was still continuing. Who could object to that? If having such a new good cause is a good idea, why not do so as soon as it can be afforded without damaging the other good causes?
"The People's Money" received wide and favourable media coverage, and we all know the result of the election that followed a week after its publication. The ideas in "The People's Money" are, in all essentials, the same as those that were put forward in our White Paper last July, which nine out of 10 respondents supported. I fail to see why it is not perfectly legitimate for us to base the Bill 98 on ideas that we put forward so clearly before the election and which were so comprehensively endorsed by the British people.
The hon. Member for West Suffolk is completely wrong to imply that there is some fundamental difference between the new good cause and the existing good causes. Is he saying that arts, sport and heritage are not core Government responsibilities? That may be his view, but it is certainly not mine.
I turn to the matter of damaging existing good causes, which was raised by the hon. Members for Ashford (Mr. Green) and for West Suffolk. The Opposition have returned to the most tired argument that has been used throughout the passage of the Bill—that we are taking money away from the existing good causes. That is simply not true. The Bill reduces the percentages that the arts, sport, heritage and charities will receive, but the greater than expected success of the lottery means that those are smaller percentages of a bigger total—in terms of hard cash, which is surely what matters to everyone, particularly the lottery distributing bodies, the existing good causes will receive £1.8 billion each during the current licence period, exactly the same as was forecast when the lottery started.
The other point that was made was that the good causes were counting on the extra income. The Opposition, when in power, never guaranteed that there would be no changes in the good cause percentage. They must have envisaged the possibility because they included in the 1993 Act provision to change the percentages by order. They never made it clear how they might use that power.
§ Mr. Banks
I will give way to the right hon. Gentleman, who knows a great deal about the 1993 Act. He can explain why no guarantee was given in that Act that there would be no changes in the good cause percentages, and why a 5 per cent. minimum was put in. That meant effectively that, for the five good causes, the amount could have been reduced to 5 per cent. and that could have been done by order in the House, if the present Opposition had been in government. Seventy-five per cent. could have gone somewhere else. We are giving far more of a guarantee to the existing good causes than the previous Government ever gave during their period in office.
§ Mr. Brooke
I was seeking to intervene to make a point that flows out of the exchange between us. Given that the original intention was that we should ideally have a debate in each Parliament, with the ability to change the percentages by order thereafter, having listened to the opinions of the House, would the Minister, when the time comes, be prepared to recommend to the business managers the possibility of having just such a debate at that stage, so that the House can contribute to the discussion of the allocation?
§ Mr. Banks
The chief business manager—my right hon. Friend the Chief Whip—is sitting next to me whispering sweet nothings in my ear. I am sure that he heard what the right hon. Gentleman said and will be seized of the good sense of his suggestion.
99 Let me finish on the commitment to the existing good causes. This is very important and it is where the trust element must come in. Time and again throughout the passage of the Bill, here and in another place, the Secretary of State, my hon. Friend the Minister for Arts and my noble Friend the Deputy Chief Whip in the other place have made our position on future changes on allocations abundantly clear and I am happy to repeat them.
First, barring the extremely unlikely circumstances in which lottery income for good causes is less than £10 billion in total, we will ensure that each of the existing good causes receives by 2001, when the present licence expires, the £1.8 billion expected at the time that the lottery started. Secondly, the Government have taken no decision on how any returns beyond £10 billion might be allocated—there is no assumption that they automatically fall to the new good cause or any other. Thirdly, the Government have no plans beyond those that they have announced already—the reduction in the millennium share to 13 per cent. and the increase in the new good cause to 20 per cent. in autumn 1999—to alter the funding of the existing good causes. That applies both to 2001 and beyond. That is fairly clear; one cannot be more explicit about that.
There is no way that the Department for Culture, Media and Sport is setting out to ensure that culture and sport do not receive money beyond 2001. I cannot make it any clearer than that and I hope that the hon. Member for West Suffolk will accept that point. I reject both the amendments.
§ Mr. Spring
With the leave of the House. The reassurances that the Minister has sought to give are wholly unsatisfactory because, as he knows, the new opportunities fund is a creation which involves a massive centralisation of power in the hands of a Secretary of State, which makes this completely different from the other good causes. Therefore, to protect the good causes, we seek to ensure that the minima are changed. As Lord McIntosh accepted, this is a radically different situation. Therefore, we will concentrate on amendment No. 1 to put down a clear marker to those who are concerned—the recipients of the lottery and those in the distributing bodies. We want to ensure as best we can that the smash-and-grab raid on the lottery does not continue and worsen.
§ Question put and negatived.