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03/11/2011 No.33
he Good Gambler
The Editor, Richard Whitehouse makes regular contributions to coverage of the gambling world.
Email : TheEditor on any subject.
Health Lottery

Richard Desmond's new Health Lottery challenges the Gambling Commission

In October 2011 the Health Lottery launched in the UK. The premise of this lottery is that it is a collective of 51 local society lotteries each representing one or more local authority areas. Money raised goes towards services that are not covered by existing NHS funding. Instead, through the local society lotteries’ partner charity, the Peoples Health Trust, the monies are distributed across Great Britain to health related good causes important to local communities within each local society lottery area.

That all sounds good but there are plenty of issues raised by charities, the Advertising Standards Authority and Jeremy Hunt the culture secretary.

To start with the Health Lottery is run by Northern & Shell a British publishing and television group. This company is owned by Richard Desmond and along with several newspapers and magazines it also operates channel 5 and several porn channels. A bit of a strange juxtaposition when you think that lotteries are not-for-profit organisations. Then you look into the details of the distribution of money and you find that Northern & Shell takes 22 pence from every pound spent for operating costs. This is how lotteries make money for their operators.

There is nothing illegal about organisers making a profit but it is illegal for anyone other than Camelot to operate a national lottery. So is this a national lottery? Well it has more outlets than Camelot, 40,000 compared with 28,000, and it is nationwide. No wonder Camelot are crying 'foul' and are asking the Gambling Commission to investigate as to whether the Health lottery is actually legal.

The Gambling Commission were the people who gave Northern & Shell a license to operate in the first place and their history of acting against breeches of the law is poor to say the least. Back a few years when bookmakers began introducing roulette machines into betting shops, they briefly objected and then, conveniently, altered their interpretation of the Gambling Act 2005 to suit the new world order.

The Health Lottery say that they are in fact 51 lotteries and so do not break the law. The beauty of this approach is that small lotteries don't have to pay the Exchequer the 12% of income that Camelot have to. Controversially there are also no limits on profits for a small lottery but Camelot are limited to 0.5%. More critics point to the 20.3% of sales donated to the various charities whereas the National Lottery hands over 28%.

More questions are raised when the proposed breakdown of revenue is investigated. With 22% in operating costs, 20.3% donated and 33.4% returned to winners, there is a gap of 24.3% which looks like pure profit. That is more than the charitable donations. The list of complaints go on and on but this will have to turn into a top flight political issue if the Gambling Commission are going to do anything about it.

So what is the Health Lottery? You have to choose 5 numbers from 1 to 50 and the are only three prizes; matching 3, matching 4 and matching 5 numbers. Three numbers pays £50, four numbers pays £500 and matching all five pays £100,000.

For more on the Health Lottery go to the Health Lottery Section.
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