The operator of the National Lottery UK – Camelot – is boosting its marketing budget following an increase registered in lottery sales. This, however, has ended up with smaller funding for good causes, with the latter receiving £39.6 million less from the National Lottery in the last fiscal year.
According to reports, Camelot generated about £1.65 billion for good causes in the UK for the year which ended on March 31st. This fund is used for cultural heritage, arts, sports and various charitable projects, but the overall amount it received in the last fiscal year was about £600,000 smaller than the one received in the 2017/18 financial year.
On the other hand, the money available for distribution declined by further £39 million after the National Lottery operator took the money from the Good Causes fund in order to boost its marketing budget by over 50%. The move, however, was discussed and agreed with the UK Gambling Commission (UKGC), as both organisations believe that the investment Camelot’s marketing strategy would lead to more money being available for good causes at a later stage.
A spokesperson for the Department for Digital, Culture, Media and Sport (DCMS) explained that 2018/19 returns to UK arts councils, the British Film Institute and Creative Scotland were stable compared to the previous financial year, despite there were £7.9 million less to distribute. Still, no numerical data was provided by the Department to back this claim.
Marketing Spending Boost Was Necessary for Camelot to Face “Synthetic” Lotteries’ Competition
The smaller amount of money distributed to good causes happened in spite of a considerable £255-million growth in sales generated by the National Lottery.
The £600,000 decline in the returns to the Good Causes fund in comparison to the returns in 2017/18 fiscal year was highlighted by the fact that online instant win game and scratch cards generated record sales in the last financial year. As revealed by a spokesperson of Camelot, both types of games had a smaller percentage of their profits distributed to good causes in comparison to draw-based games such as EuroMillions and Lotto.
The UK National Lottery operator confirmed that the additional £39 million spent to boost its marketing strategy would have otherwise been granted to good causes. As explained by a spokesperson of Camelot, the increased marketing spending was necessary in order for the company to deal with the competition posed by so-called “synthetic” national lotteries.
The marketing expenditure of the National Lottery is otherwise fixed at about 1% of the operator’s overall revenue. In the 2018/19 fiscal year, that was worth over £77 million. According to reports, the money taken from the good causes fun has boosted the company’s marketing spend to £116 million. Still, as mentioned above, Camelot believes that the increased marketing spend would help it generate even more funding for good causes in the months to come.