Limits on lotteries is costing charities million of pounds in revenue

A demand by the leaders of 100 British charities for the financial limits imposed on charity lotteries to be scrapped, has led to an offer of talks from the UK government.

Charity lotteries have a regulated annual sales ceiling of £50 million and are the only type of charity fundraising to face this restriction. There are no such curbs on the National Lottery.

In an open letter to Culture Secretary Michelle Donelan MP, the charities urged the government to remove the fundraising limit. They also pointed out that the limits are depriving them of millions of pounds in desperately needed funding.

The Minister responsible for gambling, Paul Scully MP, has now agreed to meet charity lottery operators to discuss reforms. He has also heard directly from charity leaders at Westminster.

The charities involved include British Red Cross, Barnardo’s, The Royal Voluntary Service, Maggie’s, Cat’s Protection, WWF, The Wildlife Trusts, Lord’s Taverners, Breast Cancer Now, Magic Breakfast and homelessness charity Crisis.

The letter to the government points out that the simple change in the law will come at no cost to the Treasury. There is growing cross-party support for the removal of the limit, but no decision has yet been taken.

Catherine Johnstone, chief executive of Royal Voluntary Service, said: “The public will rightly be surprised that there is any sort of limit on charity fundraising, but in the middle of a cost-of-living crisis, having laws in place which reduce and restrict the funds available to charities is surely counter-productive. Because of the current charity sales limits the funding RVS receives from charity lotteries cannot increase – which is unhelpful when our services are in ever greater demand.”

Laura Lee, chief executive of Maggie’s, which runs cancer centres across Britain, added: “Charity lotteries have been transformational for so many charities. That has certainly been the case for Maggie’s and it therefore makes no sense that they are stymied by government red tape.

“In the current tough times growing the contribution charity lotteries make to our society will bring real benefits to more communities and causes in desperate need of this support.”

The pandemic and cost-of-living crisis has hit charities badly. In the letter they say they are facing a difficult fundraising environment and add: “In an economic climate where many of the charities we represent are having to respond to increasing charitable needs and where charity fundraising is increasingly challenging, we believe it is time to get rid of these fundraising limits once and for all.”

Clara Govier, managing director of People’s Postcode Lottery, Britain’s biggest charity lottery operator, said: “Our players make a huge difference to charities, large and small, right across Britain, however, we are forced to operate in an overly bureaucratic way because of the charity lottery sales limit. The limit has no benefit at all and, in many cases, restricts the funding which can be given to charities.

“With over 100 national charities calling on the Government to remove the limit it is time for Ministers to act and remove this excessive red tape immediately. It is harmful and affecting lives and communities. There is no reason to delay.”

As well as leading to excessive bureaucracy round this type of fundraising the sales limits also mean some charities cannot see any increase in their funds from charity lotteries over time, despite increasing ticket sales.

The charities point out that: “Thirty one charities supported by People’s Postcode Lottery players are funded from trusts which are already up against the charity lottery annual sales limit of £50 million. This means that despite inflation, these charities can see no further increase in the funds they receive until the sales limits change.”

One of the charities affected is Magic Breakfast, who support breakfast provision in schools across the country. Their chief executive, Lindsey MacDonald, commented:

“At Magic Breakfast we are responding to vasty increased need, yet because of the charity lottery sales limits our funding from charity lotteries cannot increase. The government must take action to resolve this issue as soon as possible.”