A new dual purpose for the Lottery funding

A new dual purpose for Lottery funding

back to the contents page

Stephen Dunmore, head of the New Opportunities Fund, urges the Culture Secretary to be bold and think big in her forthcoming review

Make sure you receive your fair share of lottery cash - take out a no-obligation trial subscription today.

Tessa Jowell has declared ‘permanent revolution’ as the slogan for the review of Lottery funding. The least we are entitled to expect, in the consultation paper, therefore, is a bold exploration of key issues, rather than tinkering round the edges. Reducing National Lottery Distribution Fund balances (very largely committed anyway), amending financial directions to distributors, simplifying application forms, and discussing the concept of one-stop shops and the mechanics of targeting are, although important, hardly the stuff of ‘permanent revolution’.

Every review needs a context. That context was, on the whole, absent from Tessa Jowell’s speech in March –strangely so, because it is, in fact, one of radical change and success, which should be cause for celebration. Since 1997 the content and direction of Lottery funding has been transformed in line with the Government’s aims – revenue spend has taken pole position, grant assessment processes have been streamlined, distributors have accepted targeting on disadvantaged communities as a priority and the New Opportunities Fund, set up specifically to promote social inclusion and to deliver programmes which complement the Government’s priorities in health, education and environment, is well established as the largest distributor.

In addition, distributors now work much more closely together (witness the joint telephone hotline and website) and the London-based distributors have signed up to four shared objectives which, we believe, reflect the Government’s priorities for the Lottery. These objectives are:

to improve the quality of life
l to promote social inclusion, through, for example, effective targeting of funding
to widen access for communities to funding, activities and facilities; and
to work in partnership with other key stakeholders and programmes, at national, regional and local levels.

There is one further piece of context. Currently, although communities are always the ultimate beneficiaries of Lottery funding, only a minority of Lottery funding (perhaps 30%) is distributed as relatively small grants direct to communities or local voluntary organisa-tions (the business of the Community Fund and, for example, Awards for All, Fair Share and the New Opportunities Fund’s Green Spaces and Sustainable Communities programmes). For the most part, distributors deliver pro-grammes across the public, voluntary and (occasionally) private sectors in a variety of ways, often relying heavily on partnership working at national and local levels, and seeking complementarity with other funding sources.

In the case of the New Opportunities Fund, this cross-sectoral partnership approach, underpinned by the strategic framework of the Government’s and devolved administrations’ policies and priorities, is written into the statutory policy directions which the Fund receives and is reflected in the way we deliver many of our major programmes (for example, healthy living centres and PE and Sport). So much for the context. What, then, should be the key issues for the consultation? The first, which the Secretary of State highlighted, is devolution of decision-making on funding. There is a range of possibilities here. Some, such as abolishing the distributors and giving the resources to local authorities/local strategic partnerships or, further down the track, regional assemblies, are radical. Some, such as individuals deciding on where Lottery money should go when they purchase their tickets, are impractical. Other options are community chests, hardly a new concept but certainly a possibility for some Lottery funding, or announcing local allocations of funding and inviting partnerships (for example, LSPs) to decide priorities locally, within the parameters of the particular pro-gramme. The New Opportunities Fund has already used this approach extensively (PE and Sport, Activities for Young People, Childcare) and it will also be reflected in the Fair Share programme delivered in partnership by the Community Fund and New Opportunities Fund.

Discussion about where priorities should be set and decisions made is clearly linked to the Secretary of State’s suggestion of one-stop shops for Lottery funding information. To avoid confusion and maximise resources, any funding information system will need to operate through existing structures (local authorities and CVSs). There is also little point in developing a one-stop shop network which deals solely with Lottery funding and ignores the wide range of other complementary funding streams. A more comprehensive electronic information system (Northern Ireland’s ‘Funder Tracker’ is already a good model) should be provided by the Active Community Unit’s ‘Volcomgrants’ website.

Secondly, the Government may wish to explore through the consultation whether there is a case for ‘regulating’ other distributors via more specific policy directions, on the New Opportunities Fund model. This would enable the Government to insist that its objectives for Lottery funding, for example in relation to social inclusion, are delivered more consistently in the future.

The third key issue for the consultation is sustainability. Since Lottery funding is short-term, how do we ensure that Government departments, local authorities, PCTs and other statutory agencies are engaged with distributors’ programmes in a way that enables options for mainstreaming to be developed at an early stage? Fourthly, there would be value in a sensible debate about additionality, which has been used as a political football, particularly to attack the New Opportunities Fund (rather odd, since all executive non-departmental public bodies are there to deliver the Government’s policies and priorities, and the Arts Council and Sport England hand out Lottery funding and grant-in-aid in a pretty indistinguishable way).

Simply to state that Lottery funding must be additional to Exchequer expenditure (current or planned) doesn’t really get us very far. Jane Taylor captured the essence of a more mature discussion in the April issue of Lottery Monitor. Her analysis, which I paraphrase, is that one key role of Lottery funding, exemplified by the New Opportunities Fund, is as an alternative to (not a replacement for) Exchequer money, designed to support large-scale innovation in the public services, much of which will cross the boundaries of government departments, local authorities and other agencies. That innovation will be community based, and in many cases will involve the voluntary sector. In this scenario, the additionality argument is recast as ‘added value’. And why have Lottery distributors at all, if they don’t add value?

This leads to the last, and most important issue: the central question, ‘what is the purpose of Lottery funding?’ Should it only be about small grants direct to communities, as Tessa Jowell appeared to indicate, in which case why not expand the funding available to the Community Fund and reduce or phase out the other distributors? Although distributors do now work very closely together, with shared Lottery objectives, they are nonetheless very different organisations, with different constituencies, sectoral responsibilities and statutory responsibilities. Is that diversity what the Government and other stakeholders want?

An alternative and perhaps more robust response to the central question might be that, reflecting the four shared objectives and what currently happens, Lottery funding has two related purposes:

to provide smaller grants direct to communities, particularly those that are disadvantaged; and
to deliver ‘community services’ which maximise partnership working, complement local and national strategies and programmes and provide ‘added value’.

If this dual approach is to carry conviction, ministers across Government will need to be as up-front and explicit about the second purpose as the first. While they’re at it, a rather more consistent line in positive PR about the Government’s and the distributors’ achievements in transforming Lottery funding since 1997 wouldn’t go amiss.