Nandy says National Lottery ‘showing its age’, as good cause funding review launched – Arts Professional

The government has announced a “comprehensive review” of National Lottery Good Cause funding, which will see the public given the opportunity to have their say on how the money should be spent.

A 12-week call for evidence, open to anybody, will explore where future investment can have the greatest impact and how funding can become more accessible to communities across the UK.

It’s the first time there has been such a public consultation since former Culture Secretary Tessa Jowell’s review in 2002.

According to the figures for 2025, the National Lottery generated more than £8 billion in total revenue from ticket sales, of which good cause funding equated to at least £1.17 billion. Approximately 23p of every £1 spent goes towards such causes.

This amount is then shared across four causes and to each of the 12 National Lottery distributors, with 20% going towards arts and culture (Arts Council England, BFI, Creative Scotland, Arts Council Wales, and Arts Council of Northern Ireland), 20% to sports funding bodies, 20% to the National Lottery Heritage Fund and 40% to the Community Fund.

In a written ministerial statement, Culture Secretary Lisa Nandy says despite the National Lottery funding being “literally the public’s money”, not since “the brilliant Tessa Jowell has anyone asked if we are spending the public’s money the way they actually want it to be spent”.

Putting the public “in the driving seat” of how good causes funding is spent, Nandy said the review is about “being honest that the model – which sits largely unchanged from its launch over 30 years ago – is showing its age”.

“Too often decisions are top-down, remote and made in distant rooms hundreds of miles away from the communities who know their needs and ambitions best.

“Funding is concentrated in London and the South East and is weighted to reflect populations, rendering too many towns and villages invisible to decision makers.”

Since the National Lottery was launched in 1994 by John Major, it has provided more than £53bn across arts and culture, sport, heritage and charity.

It has helped create institutions such as the Lowry in Salford and restored heritage sites including Beamish Museum.

However, Nandy said: “The majority of funding is spent on large grants to the detriment of smaller, community-led organisations. Smaller organisations face significant barriers – administrative burdens, digital exclusion and capacity constraints.

“The system favours those who have the ability to write grants that meet the needs of the system, rather than the system bending to the needs of communities.”

ACE chief executive Darren Henley, who is also chair of the UK National Lottery Forum hailed the review “an important opportunity” to ensure funding “continues to reflect what matters most to people in our villages, our towns and our cities”.

“Over the past three decades, The National Lottery has made a permanent, positive change to the whole country,” he added.

Stripping away ‘bureaucracy’

Starting from today (1 July), the call for evidence will be guided by three principles, including that funding raised from public money must “reflect the modern priorities of the British people” and that decisions must be made by them.

Thirdly, Nandy said community ambition “shouldn’t be met with red tape”, adding: “We are determined to strip away the bureaucracy that acts as a barrier to community investment, making it easier for grassroots groups to access the funding they need.”

She reassured that the review will not “tamper” with the rules of additionality, which state good causes funding must only be used to support projects that would not typically be financed by government statutory spending.

Adding that the Labour government would not allow the National Lottery to be used “to plug day-to-day funding pressures”, she said it would equip it “for the future”.

What communities ‘want and need’

The news comes after the National Lottery’s distributor Allwyn committed to an ambition to double good cause income by the end of its licence in 2034, from £30m to £60m a week.

Minister for museums, heritage and gambling Baroness Twycross said: “This call for evidence is a genuine chance to shape where the money this generosity raises goes and make sure it reflects what players and communities want and need.

“After 30 years, now is the right time to ask you how we make sure your community is funded properly from the National Lottery.”

The government wants to hear what is working, what could be improved, where future funding should go, and how to make it easier to access.

The call for evidence closes at midday on 23 September this year.