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The National Lottery and the non-profit sector

1.5 The Distribution Process
 
The Lotteries Act prescribes the purposes to which funds invested in the NLDTF can be used by distinguishing five categories within which good causes money is to be allocated. The categories are:
  • The Reconstruction and Development Programme,
  • Charities,
  • Arts, Culture and National Heritage,
  • Sport and Recreation, and
  • Miscellaneous Purposes.
The Act stipulates that a minimum of 10% of the total funds are to be allocated to the first four of these categories, and a maximum of 5% to the Miscellaneous Purposes category. Should the demand for funds administered by the four primary categories exceed this statutory floor, the Distribution Agency responsible can approach the Minister of Trade and Industry and motivate for an additional allocation.

The Lotteries Board has sometimes come under criticism for allocating money to sporting and cultural bodies at the expense of the poor.11 Whatever the merits of this claim, it is important to emphasise that it is the Lotteries Act that determines these broad parameters. It is a decision taken by parliament, not by individual members of the Lotteries Board or by the Minister of Trade and Industry.

The decision to stipulate only minimal levels of support for each of the four primary categories was taken in order to give the Minister of Trade and Industry the discretion to respond to changing sectoral needs. Prior to the introduction of the Lottery, no one knew with any certainty what type of organisations would apply for funds, and it was felt that by stipulating only minimal levels it would be possible to satisfy the competing need for multi-sectoral funding (Arts, Culture, Sport, Development, etc.) and to respond more innovatively to demands from the ground up.12 As we see below, the Charities category has received the greatest share of the overall allocation to date.

The Department of Trade and Industry has indicated that it will use the experience learnt through the first seven years of funding applications to further develop the principles informing allocation.13 The non-profit sector must seek to influence this learning process.

Footnotes:
  1. This sentiment is widely held in the non profit sector, and has been expressed within the Portfolio Committee for Welfare and Development. Interview with Rob Davies, 11/06/2002.
  2. Interview with Edwin Smith, spokesperson for Alec Erwin, 28/06/2002.
  3. Interview with Edwin Smith, spokesperson for Alec Erwin, 28/06/2002.
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