| Description | Concordat |
|---|
| ISBN | (Web Only) |
|---|
| Official Print Publication Date | |
|---|
| Website Publication Date | November 25, 1999 |
|---|
ANNEX A
NATIONAL LOTTERY: INVOLVEMENT OF THE SCOTTISH MINISTERS FOLLOWING DEVOLUTION
Note by the Department for Culture, Media and Sport and the Scottish Executive.
Background
1. The question of the involvement of Scottish Ministers in the distribution of the proceeds of the National Lottery in Scotland after devolution was discussed during the passage of the Bills which became the National Lottery Act 1998 and the Scotland Act 1998. This Annex sets out in detail Government policy in this area. This has been given effect by orders made under various powers contained in the Scotland Act 1998.
General Principles
2. The Government believe that a single National Lottery offers the best prospects of the highest returns to good causes for the benefit of all parts of the United Kingdom. If there is to be a single Lottery operation, with full flexibility for the allocation of funding to priority initiatives and projects, it follows that funds for good causes need to continue to be paid into and flow out of a single National Lottery Distribution Fund (NLDF). The Government recognise equally, however, that the administration of Lottery distribution has very significant implications for policy areas which after devolution are the responsibility of the Scottish Ministers.
3. The Scottish Ministers will exercise the same powers in relation to the Lottery functions of the Scottish Arts Council (SAC) and sportscotland as were previously exercised by the Secretary of State for Scotland. The Scottish Ministers will have power to make directions and take other decisions about the Scottish operations of the UK-wide distributing bodies, inasmuch as these operations relate to devolved policy areas. They will also be consulted on, and as appropriate their consent will be required to, the appointments of the members of these bodies who are particularly concerned with Scotland. These provisions will apply, with necessary adaptations, to the National Lottery Charities Board (NLCB), the National Heritage Memorial Fund (NHMF) and the New Opportunities Fund (NOF), but not to the Millennium Commission: that body has now completed the main part of its work and it is not anticipated that any further major directions will be given to it. In order to preserve the overall UK-wide administration of the Lottery, Scottish Ministers will not have power to make decisions on the allocation of resources between Scotland and other parts of the United Kingdom, or on the general principles of the administration of Lottery funding as against the purposes to be achieved by particular initiatives or schemes. These arrangements protect the position of the DCMS Permanent Secretary as Accounting Officer for the NLDF. Scottish Ministers, in common with UK Ministers with relevant interests, will nevertheless be consulted by the Secretary of State on the exercise of his powers in these areas.
4. The following paragraphs set out the arrangements in more detail.
Appointments
5. The position on appointments to Lottery distributing bodies varies according to the nature of each body. The Scottish Arts Council (SAC) and sportscotland are Scotland-only bodies with grant-in-aid as well as Lottery functions. Responsibility for the appointment of members to each Council is transferred from the Secretary of State for Scotland to the Scottish Ministers. The National Heritage Memorial Fund (NHMF) is a UK-wide body with both Lottery and non-Lottery functions. Appointments as Trustees of the Fund are a matter for the Prime Minister, and remain so after devolution. The Trustees are required to include persons who are connected by residence or otherwise with England, Wales, Scotland and Northern Ireland respectively. At present one such "Scottish trustee" is appointed, and as a matter of administrative practice the appointment has been subject to consultation with the Secretary of State for Scotland. This consultation will now be undertaken with the Scottish Ministers.
6. The National Lottery Charities Board (NLCB) and the New Opportunities Fund (NOF) only have Lottery distribution functions. In both cases their membership includes Scottish representation, but this is provided for in slightly different ways. All members of NLCB are appointed by the Secretary of State, and the Board itself is required to establish four committees to determine applications from England, Scotland, Wales and Northern Ireland respectively. There is not therefore a separate statutory category of members of the Scotland Committee, whose numbers may vary from time to time. As a matter of administrative practice, however, the appointments of those members who are expected to be appointed to the Scotland Committee have been subject to consultation with the Secretary of State for Scotland and the appointments have been made with his agreement and generally on his nomination. These appointments are now administratively subject to consultation with the Scottish Ministers, from whom nominations will be invited. The Secretary of State has undertaken that in future such appointments will normally be made on the nomination of the Scottish Ministers.
7. The structure of NOF is rather different, in that four members of the Fund are required to be persons suited to make the interests of England, Scotland, Wales and Northern Ireland, respectively, their special care. In view of the high levels of funding to be channelled in future through NOF, and the consequential importance of the statutory appointment of the member charged with representing Scottish interests, the appointment of that member by the Secretary of State should require the consent of the Scottish Ministers. Again, in practice the Scottish Ministers will be consulted and the appointment will normally be made on their nomination.
Control of Lottery Distribution
8. Section 26(1) and (2) of the National Lottery etc. Act 1993 ("the 1993 Act") allows the Secretary of State to issue policy directions to Lottery distributors. In relation to SAC and sportscotland, this power was previously exercised by the Secretary of State for Scotland. The power has been transferred directly to the Scottish Ministers and is exercisable by them subject to consultation with the Secretary of State.
9. In relation to NLCB, NHMF and NOF the powers to issue policy directions have been exercised by the Secretary of State, after consultation as appropriate with other UK Ministers including the Secretary of State for Scotland. The same applies to the powers under s.43B(1) of the 1993 Act, inserted by the National Lottery Act 1998 ("the 1998 Act") to specify initiatives to be funded by NOF, and under s.43C(1) of the 1993 Act to give binding policy directions to NOF. The powers have been split to allow the Scottish Ministers to exercise them inasmuch as they impinge on devolved matters. In order to avoid unintended inconsistencies in the exercise of the split powers, their use by the Secretary of State on the one hand is subject to consultation with the Scottish Ministers and their use by the Scottish Ministers, on the other, is subject to the agreement of the Secretary of State . In addition, the exercise by the Scottish Ministers of the powers to specify initiatives applying only in Scotland is subject to the consent of the Secretary of State, in order to avoid the theoretical position whereby an initiative could be specified without the accompanying funding being made available. Any use of any of these powers is also, as previously, subject to consultation with the body to whom the directions are to be issued.
10. The scope of the split, with examples of the kinds of direction which might be involved, is set out in the table below:
Scottish Ministers are able to make directions which require distributors to take into account the desirability of achieving particular objectives for devolved policy areas, including giving priority to particular categories of recipients, to recipients in particular parts of Scotland, or to Scottish Ministers' policy objectives. In the case of a NOF initiative applying only in Scotland, Scottish Ministers are able to make the order specifying the initiative, and to make directions on any matter except the amount of money to be allocated to the initiative in total. | Scottish Ministers are not able to make directions which require distributors to take into account matters relating to the allocation of resources between Scotland and other parts of the United Kingdom, or those relating to the administration of Lottery funding in general, rather than in relation to the purposes to be achieved by particular initiatives or programmes. Note: sportscotland directs Lottery funding to sport in Scotland. The policy and practice of the UK Sports Council will be to treat the United Kingdom as a whole. Scottish Ministers will not therefore be able to make directions which either specify individual initiatives for Scotland or require it to take into account matters relating to the allocation of its resources between Scotland and other parts of the UK. |
Examples:- - how far to give priority to areas suffering from different kinds of deprivation;
- how far to give priority to particular geographic areas, or to urban or rural areas;
- how far (subject to legislation on equal treatment) to give priority to different kinds of recipient or beneficiary, eg charities, children, elderly people;
- policy objectives of the Scottish Ministers in devolved areas other than those with which the good causes are directly concerned;
- policy objectives of the Scottish Ministers for areas with which the good causes are concerned, eg for the heritage, the development of the voluntary sector, or health, education or environmental policy objectives closely related to particular NOF initiatives;
- co-operation with other organisations, or specification of where information or advice should be obtained before decisions are made (for specific kinds of grants).
| Examples:- - allocation of resources to Scotland, or between Scotland and the other parts of the United Kingdom.
Except for a NOF initiative applying only in Scotland: - matters of general eligibility, eg the ability of any project falling within the good cause to apply for Lottery funds;
- the types of expenditure for which Lottery funding may be awarded, eg capital, revenue, time-limited or ongoing;
- the framework within which the partnership funding requirements should be set;
- co-operation with other organisations, or specification of where information or advice should be obtained before decisions are made (across the whole of the body's activities);
- matters to be taken into account in decisions on whether to use powers of solicitation;
- financial viability of applicants, during the period of the grant and beyond.
|
11. The power to issue financial and accounts directions to distributing bodies under ss.26(3) and 35(3) of the 1993 Act generally remains with the Secretary of State, because these directions relate to matters of financial accountability and propriety which impinge directly on DCMS's Accounting Officer responsibility for the NLDF. In the cases of SAC and sportscotland, however, these directions were previously issued by the Secretary of State for Scotland. This function has therefore passed to the Scottish Ministers, with a requirement for the consent of the Secretary of State, because of DCMS's Accounting Officer responsibility.
12. The Secretary of State may make orders under s.27(1), (2) and (8) of the 1993 Act to prohibit a distributing body from awarding money to any organisation which is a company of which the body is a member, or over which it has material control or influence. In practice this power has not yet been used: if, however, a case had arisen in relation to SAC or sportscotland, it would have been exercised by the Secretary of State for Scotland. The power in respect of these bodies has therefore transferred to the Scottish Ministers.
13. The Secretary of State may make orders under s.28 of the 1993 Act to vary the percentages of Lottery funding allocated to each of the good causes. This allocation determines the structure of Lottery distribution and is therefore central to general Lottery policy. The power therefore continues to be exercised by the Secretary of State, who previously consulted other UK Ministers as appropriate, and is now required to consult the Scottish Ministers on the allocations he proposes.
14. The Secretary of State may make orders under s.29 of the 1993 Act to substitute, add or remove distributing bodies, and to vary the percentages allocated within each good cause. Any variation in the arts or sport percentages among the countries of the UK would be a matter for the Secretary of State, but any such change affecting the percentages for SAC or sportscotland will be subject to the consent of the Scottish Ministers. The Scottish Ministers will also be consulted about changes to UK distributors. Within the Scottish arts and sport percentages, the functions of changing distributors, and allocating percentages among them, has passed to the Scottish Ministers.
15. Section 25A of the 1993 Act, inserted by the 1998 Act, gives distributing bodies power to delegate their functions. This is subject to the power of the Secretary of State in s.26(3A) to issue directions about delegation. It is proposed that in relation to SAC and sportscotland this power has passed to Scottish Ministers, but is to be exercised with the consent of the Secretary of State, since the directions might well contain provisions on the financial status of delegates which would have direct implications for DCMS' Accounting Officer responsibilities. The Secretary of State is required to consult the Scottish Ministers on the directions on delegation he gives to UK distributing bodies.
16. Section 25B of the 1993 Act, inserted by the 1998 Act, provides for joint schemes to be set up by distributing bodies. Schemes to distribute a total amount up to a prescribed value (at present £15m) require the written approval of the Secretary of State: schemes above that value require the Secretary of State to make an order, subject to the negative resolution procedure in Parliament, authorising the scheme. In the case of joint schemes applying only in Scotland the powers of the Secretary of State have passed to the Scottish Ministers, with scrutiny by the Scottish Parliament as appropriate, and subject to consultation with the Secretary of State. Consultation with the Scottish Ministers is required before the Secretary of State approves or authorises any scheme applying in Scotland as well as elsewhere in the United Kingdom.
17. Section 25C of the 1993 Act, inserted by the 1998 Act, requires distributing bodies to prepare strategic plans if instructed by the Secretary of State to do so. The plans are subject to consultation with the Secretary of State, who is required to lay a copy of the final plans before Parliament. The Secretary of State's power to require SAC and sportscotland to prepare plans, and to be consulted on them, have transferred to the Scottish Ministers, and they, as well as the Secretary of State, will be consulted on the plans of UK distributors operating in Scotland. The Scottish Ministers are also required to lay the plans of all these distributors before the Scottish Parliament.
Reports and Accounts
18. The Annual Reports and Accounts of all the Scottish and UK Lottery distributors (apart from the Millennium Commission), and the Annual Report of the National Lottery Commission, are required to be sent to the Scottish Ministers. Arrangements will also be made to ensure that the Scottish Ministers also receive a copy of the Report and Accounts of the Millennium Commission. These reports and accounts will be laid before the Scottish Parliament as well as before the Westminster Parliament.