Threat to the National Lottery Community Fund

Today we are calling on the government to heed concerns about unprecedented cuts facing charities and act to protect the National Lottery Community Fund (NLCF), which is the sector’s largest single funder.

See the story on BBC News and in The Times.

Use our new data tool to see what NLCF has funded in your constituency.

What we know

Last week an anonymous campaign, ‘Save the National Lottery Community Fund’, was launched, claiming that £320m of NLCF funds was going to be diverted to compensate for forthcoming cuts to the arts and sports sectors.

A quick round of calls established that there was indeed something of this nature in the offing, though we are still not able to confirm precise figures.

Earlier this week, NCVO and ACEVO wrote to ministers to try and head these plans off at the pass and have made contact with various government officials. None of these conversations has provided the reassurance we have sought, hence we are calling on our members to take action now to support these efforts.

You can read more of the background in our press release.

Why it matters – the big and the small

Charities benefit from funding from all of the Lottery distributors, but the National Lottery Community Fund is – as its name suggests – the biggest. It’s funding is worth around £500m a year, of which 95% goes to voluntary organisations. This makes it the largest single funder of the voluntary sector in the UK.

Despite its name, the other important thing to note is that NLCF’s grants are primarily small amounts. Ninety per cent of its grants are for less than £10,000. This vital source of funding for small organisations enables people to come together in support of their communities and deliver projects that make a real difference.

Neither NCVO nor ACEVO would wish to pit good causes against each other. The arts, heritage and sports distributors make a valuable contribution to our communities and national life. We believe that government recognises this too and is looking to mitigate the worst impact of potential Department for Culture, Media and Sport cuts. But using Lottery cash is not the right way to do this. ‘Additionality’ is a cherished principle underpinning the Lottery – that it should add to public services, not be used to backfill spending cuts.

Finally, it need hardly be said, but charities are under a great deal of pressure and will be further squeezed by cuts to be announced next week. The sector currently receives £13bn in income from government grants and contracts, much of which could be at risk in the coming years. Central and local government grants have halved in real terms between 2006/07 and 2012/13, from £4.5 billion to £2.2 billion with the trend projected to continue downwards.

Even bigger issues

In our preparations for the spending review and autumn statement, NLCF was only one of a list of potential threats to the voluntary sector. As mentioned above, cuts to frontline services, particularly local services, are likely to have a much bigger impact.

And with the chancellor’s announcement of devolving business rates to Local Authorities, we have also been seeking confirmation that charities will continue to be exempt from paying 80% of these rates. On this, we have had slightly more reassuring sounds from the Treasury. The success of the sector’s 2012 ‘Give It Back George’ campaign is perhaps not so far forgotten in some quarters.

What can I do?

Call or email your local MP today and tell them how vital NLCF funds are to organisations in your community. Use our new data tool to show them the contribution NLCF has made through projects in your constituency.

Follow latest developments and join in the debate on social media using #SR2015 and #VCS next week.

Charlotte Ravenscroft, head of policy and public services, NCVO, and Asheem Singh, director of public policy, ACEVO.