Treasury Plans Scots Lotto Raid

Thousands of community projects in Scotland will be in dire financial straits if the Treasury raids the lottery fund supporting them to meet the soaring costs of the London Olympics. The warning has come from Dharmendra Kanani, the Big Lottery Fund Scotland Director.

He has echoed the concern voiced south of the border by Sir Clive Booth, chairman of the Big Lottery Fund who recently indicated he feared “dark forces in Whitehall” were planning to plunder the cash pot to help plug the £900m Olympic funding shortfall. That, he said, would have a “chronic and damaging effect” on the fund’s mission to help Britain’s neediest groups.

Kanani told SCVO’s Third Force News the BLF wholeheartedly supported the 2012 Olympic and Paralympics Games. “That’s why we have already committed a substantial share of our good cause funding to support the Games.”

He said in Scotland alone it had already invested £87m in providing sporting activities and revamping sport and PE facilities which would directly impact on the sporting capabilities and aspirations of young people in its communities.

“However, what concerns us is that any share over and above that already agreed for the Olympics would mean Scotland would stand to lose a further £51m. As Scotland’s voluntary and community sector knows too well, that’s a lot of money which has the potential to deliver a great deal of social change across the country.

“To put that into context, the loss of £51m is the equivalent of closing the small grants scheme ‘Awards for All’ for six and a half years leaving some 10,000 small community projects without funding – or closing one of our four current investment areas and some of our smaller flagship initiatives such as ‘Investing in Ideas’.

“Losing that money”, Kanani predicted, “would affect the ability of Scottish communities to engage, provide services, become healthier and tackle inequalities.”

Last week Booth, a former senior civil servant, indicated he believed ministers regarded the Fund as a “soft target” which could absorb the overspend with minimal political impact. However he claimed the government was in danger of sleepwalking into deeply damaging cuts affecting hundreds of communities and small charities.

Those at risk included disabled children, homeless young people and users of community sports facilities.

SCVO chief executive Martin Sime said it had harboured concerns about the spiralling cost of the London Olympics for over a year and had made those concerns clear along with colleagues in sister bodies like the National Council for Voluntary Organisations.

“When the Big Lottery Fund themselves are forced to go public on their concerns we know this is an even more grave situation than we had feared. It appears projects that assist some of Scotland’s most vulnerable people are set to lose out on £50m – an intolerable situation and one we will fight.”

He added: “The lottery is not a trough that government can use to bail itself out of difficult situations at their whim. The Olympics cannot be paid for by leaving vulnerable people without vital services.”

Christine Grahame, SNP social justice spokeswoman, said taxpayers and Lottery supporters would be appalled at the attempt to effectively cut lottery spending in Scotland. The South of Scotland MSP said hard-working voluntary organisations and charities were the foundation of most support services for vulnerable people.

“Most Scots will be outraged to learn, as I am, that money will now be diverted to an expensive and most likely over-budget event which will benefit few outside the south-east of England.”

Unanticipated VAT appears responsible for most of the additional Olympic costs and charities in Scotland are penalised by the tax to the tune of around £50m annually.

The MSP said she would be investigating the VAT issue further, claiming the current arrangements of charging it on charities was unreasonable given the value-added work they did in Scotland’s communities.

Meanwhile NCVO has claimed an alternative means of funding the over spend could be a 12 per cent tax on lottery tickets.