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23 Mar 2001 : Column 612

National Lottery (Amendment) Bill

Question again proposed, That the Bill be now read a Second time.

11.47 am

Mr. Forth: --uncontroversial.

Having said that, the question is whether that point applies simply to the Bill or to the context in which the Bill is promoted. Although the Bill focuses on a particular element of the availability of lottery funding, I am always nervous when there is apparent unanimity on a measure. That bothers me greatly. I am also nervous when, obviously with the best possible motives, Members seek to build on one particular worthy cause or case and then claim that that legitimises taking the matter more widely. The Bill's contents raise several much wider questions about which we should at least satisfy ourselves before we allow it to make progress. I suspect that the Bill will be given a Second Reading today, but enough has already been said by my hon. Friends and in my few remarks to suggest that it will need careful scrutiny in Committee and on Report.

The first question is the role of Government and taxpayer funding relative to moneys channelled through the lottery. That is not a new question, but we should keep a close eye on it.

When the lottery was set up, I remember well that the philosophy behind it was that lottery funding should be available for matters that did not or could not attract Government--I prefer to say taxpayer--funding. As the years have passed, however, the distinction has been constantly blurred--especially, it must be said, under the present Government--to such an extent that it is now almost non-existent. The Government are using--I might even say plundering--the substantial lottery funds to do many things that we have thought hitherto should be done with Government, or taxpayers', money.

Mr. Fabricant: My right hon. Friend has raised the important question of additionality. When the lottery was established, we looked at examples in France, where the state--the taxpayer--traditionally funds grandiose projects of a kind that we in this country do not generally fund, at least not since the Victorian era. When the millennium fund was set up, it was planned that on its closure the money would be distributed among the existing funds. Is he aware that it was this Government, and this Government only, who decided that the money--money normally spent by the taxpayer--should instead be spent on health and education?

Mr. Forth: I think that we should emulate very little of what happens in France, although one exception might be, funnily enough, the French health service. We should perhaps look closely at that, not least because it was recently rated the best health service in the world. It is odd that we do not take a closer look at what the French apparently do better than we do: there may be lessons to be learned.

My hon. Friend's point reinforces my concern. I understand, for example, that the new opportunities fund has already been used to finance a network of healthy living centres, out-of-schools learning, out-of-schools child care, information and communications technology

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training for teachers and librarians, and the improvement of cancer prevention, detection and treatment. No one would claim that those were not the worthiest causes, but we must still ask why we have slid away from the proposition that the Government of the day should accept responsibility for such matters through, say, the national health service or the Department of Social Security. The Government look increasingly to lottery funds for those purposes, which is a radical departure from the philosophy that originally underpinned the lottery.

Let us leave aside the question of whether the lottery itself is a good or a bad thing. I think that we have largely finished with that argument, although there will always be echoes of it. We are now in danger of accepting that lottery funding is to be subsumed in general taxpayer, or Government, funding, and then used for what Ministers, bureaucrats or boards consider worthy purposes.

I say all this because I think that the Bill takes it for granted that the process is complete, and that there can be no further controversy about it. I am not ready to accept that proposition; I put it no higher than that. It appears to blur seriously the relative roles of Government and taxpayer, of the lottery and ticket buyers--what ticket buyers think is happening to their money is an important consideration--and of charities and community-based local activities. That last element was described eloquently by the hon. Member for Norwich, North. The Bill entails a risk of continued blurring of the distinction between those activities.

I have another reservation, which concerns the overall principle of endowment. That has been mentioned by other Conservative Members and, indeed, by the hon. Member for Norwich, North. It is apparently taken as read that endowment is a good thing, and the more we have of it the better. Whether private individuals who have taken out endowment policies, or endowment-linked policies, for their private provision would agree with that is an interesting question. Indeed, many hon. Members--probably more Labour than Conservative--have recently expressed reservations about endowment as a principle, mechanism or approach. I am not sure that it is as incontrovertibly beneficial as the Bill seems to suggest.

As has emerged from our exchanges so far, it is at least possible that from time to time, and in different circumstances, the endowment principle may not be appropriate. It may give rise to difficult choices and decisions. Given the money available to us for good causes now--I shall leave aside the source for the moment; I have already touched on that argument briefly--is it better to put a large proportion into an endowment from which we hope to receive a continuing beneficial income or to distribute those funds more widely among many causes for their immediate benefit? It is not self-evident that the endowment approach is necessarily better in all circumstances.

The hon. Member for Norwich, North said that, through his preferred mechanism, it would be possible to apply for an endowment and the decision involved would be exactly that--a decision. I merely say that, on the face of it, the decision will not necessarily be easy.

Dr. Gibson: Did the right hon. Gentleman understand what I was saying? I said that it was not a case of

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"either/or"; both mechanisms were available, and the charities board, given its control, would decide whether the relevant endowment scheme, or any other scheme, was the best in the circumstances. We used the case of carers because it was obviously long term, but we are certainly not trying to prevent money from being spent quickly to benefit many people as he describes. Those are both mechanisms that we should use, and the board will control them.

Mr. Forth: I shall deal in a moment with whether the charities board, or indeed any board, is always the best authority to make such decisions.

I accept what the hon. Gentleman says, but it is the choice that causes the problem. To make sense, an endowment fund must involve a large sum, especially at times of low yield and low interest rates. All I am saying is that I would not like to have to decide whether to sink a large amount of lottery money into an endowment--however worthy the cause--or to provide it immediately, in much smaller amounts, for the benefit of a much wider range of equally good causes. That is a difficult choice, and I do not envy those who must make it. We are talking about a difficult choice, and not about something that is necessarily obvious.

Dr. Gibson: Is the right hon. Gentleman aware that NESTA's endowment is invested by the national debt commissioners in a combination of cash and short-dated, fixed-interest United Kingdom Government issues? The mechanism already exists, regardless of whether it returns 5 or 10 per cent. annually. We therefore already operate a very successful national endowment fund, which is called NESTA. Although we shall see how it operates over time, it currently yields more than £10 million annually, which by any account is good news for investment in the projects that it supports. It supports, for example, young people who may require only £5,000 to conduct a short-term scientific experiment. We have to meet that type of need.

Mr. Forth: If one says it fairly quickly, £10 million sounds like a lot of money. However, let us examine the size of endowment fund necessary to yield that £10 million. I would guess that the sum is not unadjacent to £100 million, and may be even more than that. However, what could we do with the £100 million that is yielding the £10 million for the excellent causes that the hon. Gentleman described? That is the nature of the decisions that we have to take.

Mr. Fabricant: I never like to criticise my right hon. Friend, especially for his arithmetic. However, he will be aware that interest rates currently yield 6 per cent. It is therefore more likely that £180 million would be required to yield that £10 million.

Mr. Forth: I always defer to my hon. Friend in such sophisticated matters. However, he reinforces the point that I am trying to make and illustrates the choice facing us.

Speaking of wisdom, it was my hon. Friend who mentioned the recent great millennium fiasco. That was, in a different guise, another of the lottery-funded good causes in which boards, bureaucrats and well-meaning people decided what to do with large lottery sums. The result was the dome and a wobbly bridge. That does not

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gives me much confidence that the great, the good and the well-meaning and well-intentioned will always make the wise choices about how to use the money that those of us who assiduously buy lottery tickets--to say nothing of increasingly put-upon taxpayers--expect of them. Those elements are all combined in the Bill.

I recognise that the Bill is relatively limited in its scope and focused, for which I pay tribute to the hon. Member for Norwich, North. The Bill is, in a sense, uncontroversial in that it is shot through with motherhood and apple pie, which are the type of thing that appeal to the House. However, it also contains important questions that we should resolve before we rush forward.

I should like to flag up some issues to which we may have to give some attention later. Clause 1(2) states:

in making a grant under section 38 of the National Lottery etc. Act 1993. Although I have no doubt that that is a proper approach to take, it places an enormous burden on the charities board to make appropriate and sensible decisions when it is granting the money. That could have considerable repercussions.

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