New plan for Lottery cash

Who gets the Millennium Fund after 2001? Richard Halstead reports

WHAT will happen to the Lottery money now going to the Millennium Fund when the Millennium is over? The Government's Lottery White Paper, published two weeks ago, is strangely silent on the issue.

Conventional wisdom says that the money, which makes up one fifth of the "good causes" budget from the Lottery, will be redistributed to the other good cause funds when the Millennium Fund is wound up in 2001. It may also go towards the National Endowment for Science, Technology and the Arts (Nesta) and the New Opportunities Fund, ideas put forward in the White Paper by Culture Minister Chris Smith to finance special projects, the latter concerning itself with health and education projects.

Commentators have pointed out that such a fund could become a substitute for statutory government spending; fears have also been expressed about what happens to the pounds 300m a year allocated to Millennium celebrations once they are over.

The answer, according to plans drawn up by leading players in the charity sector, is to take the Government out of the loop altogether. Flemings, the merchant bank, and the charity trade magazine NGO Finance are working on a proposal that lottery cash currently earmarked for the Millennium celebrations should be directed into an independent "national endowment" fund.

Such a fund would be independent of the government, and would operate in much the same way as a charity, investing the Lottery donations in equities, paying out income either as one-off grants or as continuing support to projects. It would go much further than the planned Nesta fund in that it would be completely autonomous and it would not simply act as a distribution method for cash, rather a long-term charitable fund along the lines of the Wellcome Trust.

According to Richard Fitzalan Howard, head of charities at Fleming Investment Management and co-author of the plan, the fund would make Lottery cash go further and might help offset the income losses expected to be suffered by the charities sector when advance corporation tax exemption on charity dividends is phased out in 1999.

"Putting the Lottery money from the Millennium into such a vehicle is useful firstly because it makes good financial sense for long-term distribution of funds to good causes, and secondly because it will be independent of the politicians," Mr Fitzalan Howard said.

Daniel Phelan, the other co-author and editor of NGO Finance, questioned the wisdom of assuming that Lottery revenue would not be affected by the predicted increase in competition from other lotteries.

"No one can guarantee that revenue from the National Lottery will run at current levels forever, and yet no one is saving this money for a rainy day when the commitments will be as great but the revenue won't be there," Mr Phelan said.

The plan calculates that if the Lottery had started 15 years ago, and begun contributing to the National Endowment at that time (in 1982 money), the value of the fund today would top pounds 15bn, generating an annual income of pounds 495m. The authors say they will submit the plan to Mr Smith during the consultation phase of the White Paper.

Start your day with The Independent, sign up for daily news emails
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...

Guru Careers: C# Project Team Lead

£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

Guru Careers: Graduate Editor / Editorial Assistant

£16 - 20k: Guru Careers: A Graduate Editor / Editorial Assistant is needed to ...

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Day In a Page

Raif Badawi: Wife pleads for fresh EU help as Saudi blogger's health worsens

Please save my husband

As the health of blogger Raif Badawi worsens in prison, his wife urges EU governments to put pressure on the Saudi Arabian royal family to allow her husband to join his family in Canada
Birthplace of Arab Spring in turmoil as angry Tunisians stage massive sit-in over lack of development

They shall not be moved: jobless protesters bring Tunisia to a halt

A former North African boom town is wasting away while its unemployed citizens stick steadfastly to their sit-in
David Hasselhoff's new show 'Hoff the Record': What's it like working with a superstar?

Hanging with the Hoff

Working with David Hasselhoff on his new TV series was an education for Ella Smith
Can Dubai's Design District 'hipster village' attract the right type of goatee-wearing individualist?

Hipsters of Arabia

Can Dubai’s ‘creative village’ attract the right type of goatee-wearing individualist?
The cult of Roger Federer: What is it that inspires such obsessive devotion?

The cult of Roger Federer

What is it that inspires such obsessive devotion?
Kuala Lumpur's street food: Not a 'scene', more a way of life

Malaysian munchies

With new flights, the amazing street food of Kuala Lumpur just got more accessible
10 best festival beauty

Mud guards: 10 best festival beauty

Whether you're off to the Isle of Wight, Glastonbury or a local music event, we've found the products to help you
Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe

A Different League

Unai Emery’s passion for winning and eye for a bargain keep Seville centre stage in Europe, says Pete Jenson
Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey - Steve Bunce

Steve Bunce on Boxing

Amir Khan and James DeGale’s remarkable Olympic performances were just the start of an extraordinary journey
Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf