Government forced to back down on Lottery

The Government yesterday changed its plans to shake up the National Lottery after a scathing report by MPs.

The Government yesterday changed its plans to shake up the National Lottery after a scathing report by MPs.

Tessa Jowell, the Culture Secretary, said: "We take seriously the concerns that have been raised about the proposals as they stand. We have listened to these concerns and recognise the need for a fresh look at how we can maximise returns to good causes."

The Commons Culture, Media and Sport Committee said in March that a proposal to replace the single licence to run the National Lottery with a series of licences risked destabilising the game.

Its report also attacked plans to use up to £1.5bn of Lottery cash to help fund London's bid to stage the 2012 Olympic Games. It described the idea as "a straightforward raid" representing a huge potential drain on the Lottery.

Government proposals to alter the running of the lottery follow criticism of the way the current licence was awarded. Camelot was granted the licence after a protracted battle with Sir Richard Branson's proposed People's Lottery. Ms Jowell said the Government remained "committed to maximising returns to good causes by encouraging more competition into the next licence round". But she added: "We cannot allow a situation to develop where there is only one bidder for the next licence."

The Culture, Media and Sport Committee said the funding plans for the proposed London Olympics eroded the principle of additionality - meaning that Lottery resources are not supposed to be used by ministers to replace government spending.

But Ms Jowell said: "We simply do not accept the committee's conclusion... in fact, I think helping fund the Olympics is a perfect example of what the Lottery was set up to do."

The National Lottery Commission, the lottery regulator, said it would use the review to press the Government to ensure there was greater flexibility in running the game.

The review is due to be completed by the autumn.