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Thursday, 12 October, 2000, 22:06 GMT 23:06 UK
'Teflon Terry' tackles lottery
Lottery tickets
Does Lord Burns have the right ticket ?
By the BBC's correspondent Nick Higham

Terry Burns is a heavyweight. Anyone who runs the Treasury for seven years - as Lord Burns did as permanent secretary from 1991 to 1998 - is no pushover, even if he found Gordon Brown hard to handle.

The new chairman of the National Lottery Commission also spent 11 years as the Treasury's chief economic adviser.

During this time he earned the nickname "Teflon Terry" for his ability to survive crises ranging from stock market crashes to the Major government's humiliation when the pound was forced out of the European Monetary System.

Lord Terry Burns
Lord Burns: Not an easy job
Since leaving the Treasury, the grammar-school educated Burns, born in the north-east, has proved his continuing appetite for hard work and controversy as chairman of the government's inquiry into fox-hunting.

If anyone can sort out the mess at the National Lottery, ministers must be hoping Lord Burns is the man.

Indeed, it is tempting to think if they had appointed someone of his stature to run the commission in the first place, it would never have got into such a tangle.

Ever since the commission announced at the end of August that it would negotiate over a new lottery licence only with Sir Richard Branson's People's Lottery, and not with the incumbent Camelot, it has found itself at the centre of a media firestorm.

The commissioners now say they originally wanted to negotiate with both bidders, but were advised by their lawyers (the treasury solicitor - since sacked) that if they did so they risked a legal challenge.

Instead of trusting their instincts or asking for a second legal opinion, the commissioners felt, as a public body, obliged to do as their lawyers advised - with disastrous consequences.


When Camelot challenged their decision in court, the judge decided it was "conspicuously unfair" and an abuse of power. The commission was forced to negotiate with Camelot as well.

Camelot also began a vigorous lobbying campaign, enthusiastically aided and abetted by newspapers like the Daily Mail, to discredit the commission and the whole licensing process.

Three of the commissioners, it was said, had links with Branson - though some were decades ago.

At one point the campaign went too far. The commission's new lawyers, Sunday newspapers reported, had once worked for Branson.

They had - but the commission took some pleasure in pointing out that they'd also worked, more recently, for Camelot and for Guy Snowden, the boss of lottery equipment supplier GTech and the man a libel jury decided had tried to bribe Richard Branson to stay out of the race for the first lottery licence.

Culture Secretary Chris Smith
Chris Smith: A challenging time for the commission
Lord Burns's predecessor as commission chairman, Dame Helena Shovelton, resigned in early October, complaining that the media campaign had reached the stage where it amounted to personal vilification.

Her departure has not stopped calls for the resignation of the remaining four commissioners as well, on the grounds that their decision to negotiate only with the People's Lottery was a collective one.

Even the Financial Times has joined the calls for the entire commission to be replaced, and for the process to find a new company to run the lottery from the end of next year to be restarted.

That is music to Camelot's ears: the company knows that on the basis of its own and Sir Richard's original applications the People's Lottery will inevitably win the licence, since the commission decided it would provide more cash for good causes at comparable levels of ticket sales.

This is the situation Lord Burns inherits. He has a lot of catching up to do. The two bidders' original applications ran to thousands of pages. It is just as well he says he is a fast reader.


In his letter of appointment, Culture Secretary Chris Smith, with considerable understatement, told Lord Burns he was joining the commission "at a particularly challenging time".

Mr Smith - while emphasising that the commission is an independent body which must make its own decisions about the lottery licence, and promising there'll be no ministerial interference - has given Lord Burns two tasks.

One is to conduct the selection process with absolute fairness and impartiality. The other is to make sure there is no interruption in the smooth running of the lottery.

The commission's first crucial job under its new chairman comes after 24 October, the closing date for Camelot to deliver its "rectified" bid.

That is when the commission's staff will hand over both revised bids to the commissioners themselves to begin forming a judgement.

Sir Richard Branson
Sir Richard has accused Camelot of running a smear campaign
But the external pressure will not go away. Camelot, which says it welcomes Lord Burns's appointment, also says it wants to meet him to outline its concerns about the whole application process - not just that part of the process condemned by the courts.

And on Thursday Sir Richard stepped into the fray with an interview for the BBC's Watchdog programme.

For several weeks he has kept uncharacteristically silent while Camelot has effectively stolen his clothes, running just the kind of no-holds-barred public relations and lobbying campaign at which the Virgin founder himself is so adept.

But on Watchdog he accused Camelot of running a "below the belt" smear campaign against the commissioners, the government and even Cherie Blair in a deliberate attempt to derail the bidding process.

Chris Smith's pleas to both sides to "cool it" have apparently fallen on deaf ears. It makes you wonder why Lord Burns should want such a difficult job.

Asked the question when his appointment was announced he murmured something about it being a very important job, and about the importance of the National Lottery to players and good causes alike.

But perhaps he simply relishes a challenge.





See also:

05 Oct 00 | UK
05 Oct 00 | UK
05 Oct 00 | UK Politics
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