Camelot furious over Mintel claims of National Lottery decline

The popularity of the National Lottery is falling at a faster rate than other forms of gambling, according a report published yesterday that has sparked fury from Camelot, the lottery operator.

The popularity of the National Lottery is falling at a faster rate than other forms of gambling, according a report published yesterday that has sparked fury from Camelot, the lottery operator.

Analysts at Mintel, which carried out its latest survey of UK lottery habits in May, said Camelot's position as the National Lottery operator was in danger. "The situation for Camelot does look pretty precarious," Mark Brechin, a leisure analyst at Mintel who helped compile the report, said. Camelot's licence to operate the lottery runs out in 2009.

The report found that the percentage of Britons playing the main Saturday night draw has fallen to 63 per cent in 2004 from 76 per cent in 1999. It argues that the introduction of new games has led to a cannibalisation of sales, and the number of people playing its Thunderball draw has halved over the past five years to just 8 per cent. These figures compare with a 1 per cent drop in betting on sports events, such as horses and greyhounds, over the same period and a 2 per cent drop in fruit and quiz machine use.

"The introduction of new games have failed to sustain long-term interest," Mr Brechin said. "The biggest problem seems to be way the lottery is run. People are bored with the main Lotto draw and want more prizes with lower jackpots. They also want to see the money they spend go back to their local communities."

But Camelot hit back at the report, denouncing the it as "spin" and saying sales of lotto tickets and scratchcards were enjoying strong growth. It said the report was riddled with inaccuracies, pointing to figures released in April, for example, which showed a leap in sales for the first time in six years, with annual sales up £40m to £4.5bn. This sales growth has accelerated in to this financial year, with sales up 5.7 per cent in the three months from April to June, and up 6.7 per cent in July.

Camelot has also challenged Mintel over the proportion of adults playing the National Lottery main draw. It claims this figure has stayed steady at about 70 per cent, not the 63 per cent reported by Mintel. Another figure it disputes with Mintel is the average weekly spend on National Lottery tickets. The report states that the average spend is no more than about £1 per person, but Camelot says the average spend of its customers is £2.66.

According to Mintel, the lottery is losing popularity at a faster rate in London and the South-east than in any other region, but Camelot said the number of players in the South-east has not declined.

A Camelot spokesman said: "It is a great pity that Mintel has chosen to 'spin' a report that contains quite so many inaccuracies and contradictions, especially when the National Lottery is enjoying its longest period of growth for seven years."

Mintel puts the recent growth in sales down to the introduction of the new Euro Millions draw, which has paid out jackpots of nearly £17m. But it believes people will soon grow bored with this game. "How long can you keep introducing new games for? The National Lottery may have to be nationalised or run on a not-for-profit basis," Mr Brechin said.

The Mintel findings will play in to the hands of Sir Richard Branson, who failed to unseat Camelot as the National Lottery operator in 2002.

The bid attempt, the People's Lottery, reportedly cost the entrepreneur £20m.

But the Government is still consulting on the shape of the new lottery licence agreement and it is thought that Sir Richard may be prepared to bid again if the terms of the agreement are changed.s