National Lottery: Contribution to Good Causes

Question

14:49:00

Asked by

To ask His Majesty’s Government what they expect the National Lottery’s contribution to good causes to be in the first twelve months under the new operator, compared to the last twelve months under the previous operator.

Good cause returns generated from ticket sales are expected to be £1.6 billion in the year 2024-25. This is consistent with returns last year and in line with performance over the last five years. Allwyn, the new operator, has publicly committed to safely doubling returns to good causes by the end of its licence. Its first year has focused on delivering stable good cause returns while completing its modernisation programme to build strong foundations for the future.

I thank my noble friend the Minister for her reply, but note that this is unchanged year on year, when, as she said, Allwyn committed to doubling or more. It pledged at the time of the licence being awarded to give £38 billion in the next 10 years, which looks fanciful now, to put it mildly. Will my noble friend say what the Government will do to hold Allwyn to its pledge—or was the Gambling Commission taken for a ride?

My noble friend is correct that Allwyn is committed to increasing the amount of funding going to good causes over the course of the licence—from £30 million to £60 million a week. The Gambling Commission has direct oversight of Allwyn and its implementation of the technology transformation needed to realise its bid commitments, to ensure that these are delivered safely and effectively. In addition, I have met with Allwyn on a couple of occasions, including last Wednesday, to receive additional assurance around delivery.

May I remind the Minister that the National Lottery is a gambling exercise? With that in mind, what contribution is the new lottery operator making, or does it intend to make, towards research, education and treatment of gambling harms? Do the Government consider that the contribution is fair and adequate, given the significant number of problem gamblers who participate in the lottery? During my time as chair of GambleAware, the lottery’s contribution towards research, education and treatment of gambling harms could only be described as derisory.

The fourth licence requires Allwyn to contribute to research, prevention and treatment for gambling-related harm, or we will make a payment of £1.6 million annually, which triples the amount given under the third licence.

My Lords, further to that point, the Government will be well aware that almost half of National Lottery income now comes from instant win games, including scratchcards, which, unlike weekly draws, have a notable risk of gambling harm. It is welcome that Allwyn has introduced a limit of 10 scratchcards per shop visit, but does the Minister agree that this is wholly inadequate, since it allows determined gamblers to make repeat visits, even on the same day? Does she agree that Allwyn should be required to do more, and to have independent published verification of compliance?

Allwyn is introducing further measures compared to the previous licence. The noble Lord will be aware that while some players do experience gambling harm, that experienced by National Lottery players is the lowest of all gambling products. Allwyn is also implementing further protections. As was noted, this includes introducing a maximum of 10 scratchcards per transaction, as of last October, and an extensive mystery shopper programme to test retailers’ enforcement of the age-verification measures. We are clear that protecting participants is an overriding statutory duty of the Government and the Gambling Commission. It is embedded within the fourth licence, with a significantly strengthened requirement on the operator to protect people exposed to the National Lottery as well as those directly participating in it, which goes further than under previous licences.

My Lords, when I was Minister for Gambling in the Conservative Government, we turned our backs very much against the idea of increasing gambling advertising, particularly on television and at sports facilities during games. I put it to the Minister that matters have got completely out of hand, and that there is far too much of this visual advertising of gambling, which is doing much damage to a lot of people, particularly the younger people in our country.

The noble Lord raises a good point about the need to protect children from gambling advertising. As he will be aware, operators are prohibited from targeting advertising at children. The Advertising Standards Authority strengthened the rules in 2022 to ban content of strong appeal to children from gambling ads. The wider issue of advertising involves the Gambling Commission introducing new requirements for operators to allow customers to have greater control over any direct marketing they receive. I have personally set the industry a clear task to raise standards further in this area.

My Lords, I refer to my interest as chair of the Fundraising Regulator. Can the Minister comment on media speculation that a legal challenge to the Gambling Commission’s decision is possibly being mounted by one of the unsuccessful bidders for the franchise? The Gambling Commission reportedly said that, if that proceeds, it could lead to a reduction in the moneys available for good causes. Can the Minister explain why the good causes will be affected, rather than this being a matter between the Gambling Commission and the unsuccessful bidder?

While I understand the legitimate interest of my noble friend and others, it would not be appropriate to comment at this stage on the legal process. The Gambling Commission is confident that it ran a fair and robust competition to award the fourth licence. As my noble friend noted, legal challenges relating to the award of the fourth licence are ongoing. DCMS is not a party to those, so it would not be appropriate to comment at this time.

My Lords, it was reported on Friday that the Gambling Commission had accidentally handed over more than 4,000 sensitive documents to the lawyers acting against it in the case that the noble Lord, Lord Harris of Haringey, mentioned. I know that the Minister cannot mention the ongoing case, but what conclusions have she, as Gambling Minister, and her department drawn about what that says about the Gambling Commission’s competence to perform its oversight functions, and about the appropriate oversight of our regulators by her department?

I have confidence in the Gambling Commission. I will not go into details about media reports. It is clear that legal challenges are ongoing, and while I understand the legitimate interest from Members, it would not be appropriate for me to comment at this point.

My Lords, in a previous life, I sold National Lottery tickets for years and years, and I always got the impression that it was a tax on the poor. Does the Minister agree?

I cannot agree with my noble friend’s suggestion that the National Lottery is a tax on the poor. It is an incredible national institution, founded by Sir John Major’s Government, and which had great ambitions to become part of the lifeblood of DCMS sectors. If we had not had the National Lottery, by default, it could not have contributed money to such incredible iconic national treasures as the Angel of the North—a particular favourite of mine—Shakespeare’s Globe, the Wales Millennium Centre, the Glasgow Science Centre, the Ulster Museum and many more local projects.

My Lords, on that point, does the Minister feel that more could be done to publicise the good causes to which people contribute when they buy a lottery ticket, particularly at the point of sale?

The noble Earl makes a very good point, and I hope that this will start happening as Allwyn progresses its stewardship of the lottery during the course of the fourth licence. Having reached its 30th birthday year, the National Lottery has raised over £50 billion for good causes, with over £94 billion in prizes to players and over £21 billion in lottery duty to the Exchequer.