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Tuesday, 19 December, 2000, 12:10 GMT
Lottery race unravelled

The bidding process has been lengthy and controversial
As Camelot and the People's Lottery wait to hear which of them has won the licence to run the National Lottery for the next seven years, media correspondent Torin Douglas looks back over the troubled selection process.

This race should have been over six months ago and though the end is in sight, significant doubts remain - which is why the five National Lottery commissioners met late into Monday evening, dotting every "i" and crossing every "t" of their decision.

The process has already been delayed several times since the original June deadline.

Sir Richard Branson
Sir Richard says he would challenge a Camelot win in court

In August, the commissioners turned down both bids, saying neither satisfied the legal requirements.

Camelot was failed because of doubts over its American software and equipment supplier, G-TECH, which had covered up a software fault.

The People's Lottery, headed by Sir Richard Branson, needed an extra 50m to guarantee prize payouts.

But although both bidders had failed, the commissioners decided to continue negotiating with Sir Richard, because they believed his problem would be easier to sort out and because they judged his bid would provide more for the good causes.

Camelot challenged that decision in the High Court and won.

The judge described the commissioners' action as "conspicuously unfair" and shortly afterwards their chairwoman, Dame Helena Shovelton, resigned.

Lord Burns: Strong control over the selection process

She has been replaced by the former Permanent Secretary to the Treasury Lord Burns, who is now very much in charge of the process.

The slow pace is being dictated by the Commission's lawyers, who are determined to ensure the decision is legally watertight.

On Monday the commissioners met for almost 12 hours, finalising their decision and preparing a statement of their reasons.

If they should choose Camelot, as some newspapers have predicted, it would be a remarkable turnaround.

Further delays

Why might the commissioners have changed their minds?

Both bidders have been allowed to put right the faults in their original bids, though not to improve them in other ways.

But the Commission now has new lawyers as well as a new chairman - and following the defeat in the High Court, they may take a different legal view of some aspects of the two bids.

Both bidders announced that they would raise 15bn for good causes over the seven-year licence period - a 50% increase on present takings.

But the commissioners judged that, of the two, the People's Lottery would raise more, partly because its costs were lower.

If they should now award the licence to Camelot, Sir Richard Branson says he would challenge the decision in the courts - and that would delay the process still further.

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See also:

23 Nov 00 | UK Politics
Lottery saga could 'run and run'
24 Aug 00 | UK Politics
Lottery 'fiasco' prompts inquiry call
05 Oct 00 | UK
Camelot ups good cause cash
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