Page last updated at 13:51 GMT, Tuesday, 24 March 2009

Lottery grants drop as costs soar

Lottery balls
The Commission says it protects the interests of players and good causes

National Lottery grants to sport and heritage projects have dropped by over 50% in a decade while administration costs have soared, figures reveal.

Sport funding fell from £461.5m in 1997-8 to £217m in 2007-8, and heritage grants dropped from £464.6m to £217m.

Lottery Commission administration costs rose by 132% from £271,000 in 1999-2000 to £628,000 in the period 2007-8.

The government said the figures were misleading as they were inflation-adjusted.

The Tories accused the lottery regulator of becoming "bloated".

Arts projects saw funding fall 52% from £449m to £214.5m in the same period.

But grants for health, education, the environment and charitable expenditure rose 9% from £596m.

'Special responsibility'

The National Lottery Commission spent £1.367m on staff salaries and paid out no bonuses in its first year.

But by 2007-8, salaries had gone up 94% to £2.65m and £72,000 was paid in bonuses.

Barbara Follett, minister for culture, creative industries and tourism, revealed the figures in response to questions from shadow culture secretary Jeremy Hunt.

Mr Hunt said: "Why on earth has the Lottery regulator allowed its costs to become so bloated when Lottery good causes are desperate for every penny they can get?

"The Lottery was set up partly to help charitable organisations get through tough times so the regulator has a special responsibility to keep their costs under control."

It is perfectly legitimate for a large-scale organisation like the National Lottery to spend a small proportion of its income on administrative and core function costs
Department for Culture, Media and Sport

A Department for Culture, Media and Sport spokeswoman said the figures were misleading: "Lottery funding to good causes did not fall by the amounts suggested. The figures are inflation adjusted comparisons derived from the actual amounts which were significantly lower.

"This also ignores the fact that the price of the main Lottery draw ticket has remained at £1. Of course, the amount raised for Lottery good causes is subject to fluctuations from year to year but our records show a far less exaggerated decline."

She added: "It is perfectly legitimate for a large-scale organisation like the National Lottery to spend a small proportion of its income on administrative and core function costs."

A spokeswoman for the National Lottery Commission said it existed to protect the interests of players and to ensure returns to good causes were as great as possible.

"Our typical operating costs are around £4.6m per annum. We also run the competition for the operator's licence and have just delivered a 10-year licence that will, at current levels of sales, generate between £60m and £100m each year in extra funding for good causes.

"Without the competition and the regulation that underpins it, good causes would be significantly worse off. Full details of our costs are reported annually on our website."



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