The government will publish its decision on a proposed removal of the charity lottery sales cap by the summer, the minister for civil society has said.
On Friday, MPs discussed proposals put forward by Liberal Democrat MP Wendy Chamberlain to remove the £50m yearly ticket sales limit on charity lotteries.
Her private members’ bill, which proposes altering the Gambling Act 2005, has received the support of over 100 charity leaders and had its second reading in parliament last week.
At the debate, civil society minister Stephanie Peacock said the government had commissioned independent research into the lotteries market and will share its position on society lotteries “by the summer recess”.
Bill could ‘revolutionise’ charity fundrasing
Chamberlain said during the second reading of her bill that although “this is a small and, on the surface, technical-looking bill, it would “revolutionise charity fundraising in constituencies up and down the country”.
Charity lotteries bring in over £420m a year for third-sector organisations and are the only type of gambling or fundraising product subject to annual caps on sales.
In 2020, the previous government increased the annual ticket sales limit from £10m to £50m; the per draw cap from £4m to £5m; and maximum prize that can be offered from £400,000 to £500,000.
However, campaigners have called for further changes, with the People’s Postcode Lottery previously estimating that removing the annual cap could free up an extra £175m over five years for the charities it supports.
Chamberlain said: “If someone is running a purely profit-driven lottery with no societal benefit, there are no caps on the number of tickets they can sell, but for charity lotteries [...] there’s a cap of £5m per draw and £50m over the course of a calendar year.”
While her bill proposes removing the cap on ticket sales, it would maintain current limits on how much can be offered as a prize.
She said: “It’s important that the proceeds of the lottery go to charities, rather than just creating bigger and bigger prize pots”.
“As things stand, there’s a limit on prizes of £25,000 or, if it’s more, 10% of the proceeds of the lottery. The limit is therefore £500,000 with the current cap.
“All the stakeholders agree that we ought to amend section 99(4) of the 2005 Act so that it reads £500,000, to maintain the current prize levels.”
Minister: ‘We must reflect on where the sector is now’
In response, Peacock said the government wants society lotteries “to thrive”, adding that the independent research it has commissioned should be published “by the end of next month”.
“I make that clear commitment to update the House by the summer recess—we have had discussions to that effect.”
She said the government “must reflect on where the sector is now and where it may be in future” before implementing any reform.
“The current picture is broadly positive, with recent evidence showing that society lotteries have continued to grow in popularity since the limits were changed in 2020. The vast majority of society lotteries are also currently operating well within existing limits.
“However, the government do recognise the challenge for large-scale umbrella lotteries, some of which have multiple licences for multiple trusts, and we know that a small number of those may reach a limit within the following year and that there are costs associated with operating in that way.
“We don’t take this lightly, but it’s worth noting that the current system doesn’t hinder overall sales of society lottery tickets for those organisations.”
She added that the government’s support for lotteries raising as much money as possible “is unwavering”.
“We’re also keen to better understand how the growth in sales is translating into the investment in good causes.
“The current picture suggests that higher sales haven’t led to an equivalent increase in funding for good causes, and there may be room to improve that.”
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