Public confidence in the lottery could be shaken if funds are not handed out to charities more quickly, Culture Secretary Tessa Jowell has said.
£2.8bn of lottery money meant for good causes is sitting in the bank
Some £2.8bn is still sitting in bank accounts despite Ms Jowell's promise two years ago to halve the 2002 figure of £3.6bn by March 2004.
Ms Jowell has now called in Whitehall's spending watchdog to cut the figure.
All the money had been assigned to projects but was waiting to be signed off, she told a committee of MPs.
"I have been very concerned by what we have seen as the unacceptably high level of lottery balances," Ms Jowell told the Commons Culture Select Committee.
However, balances had fallen by almost £1bn in the past two years and the National Audit Office would look at cutting them further, she added.
Distributors of good causes cash
Four national Arts Councils
Four national Sports Councils
the Heritage Lottery Fund
the Community Fund
the Millennium Commission
the New Opportunities Fund
The bodies responsible for distributing National Lottery money make their own funding decisions independently of the government, but within a framework of government policy.
This says there should be a fair geographical spread of awards, with each distributor giving funds to areas of the country which have not previously benefited from lottery money.
The culture committee is already looking at ways to give lottery players a greater say in how the money for good causes is spent.