Camelot, the company licensed to run the UK’s National Lottery, is taking a lot of flak in the press this week for showing a massive 122% increase in company profits over the past seven years, while its contributions towards charity have risen only a very tiny 2% overall, as reported by the Public Accounts Committee (PAC). Contributions by the company to good causes have also dropped a full 15% for 2016-17 as compared with the previous year.
When questioned on this, a Camelot spokeswoman did point out that, “During the license period, annual returns to good causes have been, on average, 30% higher than under the previous license… National Lottery players have raised £37 billion for good causes… an average of over 185 lottery grants in every community.”
The Chairwoman of the PAC, Meg Hillier, was quoted as stating “Raising money for good causes is one of the founding principles of the National Lottery… but this objective is under threat.”
Part of the reason for the relative decline in contributions to good causes is that there has been a transition in the British population’s tendency to play certain games. Draw games have been in decline, especially since an unpopular decision was taken to increase the number of balls in the draw from 49 to 59, and scratch card games have been booming.
As it happens, draw games contribute an average of 30% of the cost of the ticket to good causes, whereas scratch card games, by contrast, contribute an average of 10% of the cost of the card. This is an element in the licensing agreement with Camelot which apparently the Great Britain Gambling Commission are not in a position to insist be changed, due to the nature of the license. The press can certainly seek to put pressure there, though.
Hillier did refer to this matter fairly directly, stating that the 2012 renegotiation of Camelot’s license had been “too generous” and “too inflexible to protect the interests of grant recipients”.
Camelot has claimed that they are willing to work with the GBGC, the Department for Digital, Media and Sport (DCMS) and the various distribution bodies to “maximise returns to good causes”. One surefire way of doing this would be to give a greater percentage of scratch card revenues to charitable causes, but shareholders would surely take a big hit. Still, what’s worse: a hit to the bank balance, or to the reputation?
