The Big Lottery Fund will not have its budget cut, Chancellor George Osborne announced in his joint spending review and autumn statement today.
In his speech on the government’s spending plans, he told the House of Commons he would not be "raiding" the Big Lottery Fund, "as some feared".
A blog earlier this month by a group calling itself Save Big Lottery claimed Osborne was planning to take £320m of the cash the BLF receives from National Lottery proceeds to make up for funding cuts at the Department for Culture, Media and Sport.
Such a cut would have represented a 48 per cent drop in the BLF’s funding since last year. It is not known who was behind the blog, but the group claimed the information had come from "reliable sources".
But Osborne told parliament today that neither the BLF nor culture, sport or the arts would experience cuts. "Deep cuts in the small budget of the Department of Culture, Media and Sport are a false economy," he said. "Its core administration budget will fall by 20 per cent, but I am increasing the cash that will go to the Arts Council, our national museums and galleries."
He added that UK Sport would also have a 29 per cent increase in its budget, and announced support for a range of museums and an increase in funding for the BBC World Service.
"And all of this can be achieved without raiding the Big Lottery Fund as some feared," he said. "It will continue to support the work of hundreds of small charities across Britain."
A BLF spokeswoman said: "After recent uncertainty we are pleased there is no change to the distribution of funds raised by the National Lottery."We look forward to continuing our work supporting thousands of projects every year across the UK."
Several voluntary sector organisations had warned any cut could have a devastating impact on services provided by charities and welcomed the news.
Karl Wilding, director of public policy at the National Council of Voluntary Organisations, said the NCVO’s campaign to publicise the impact of the rumoured cuts had "won a reprieve from a move that would have had a drastic impact on small community projects in particular".
As part of the campaign, the NCVO invited people to use a data tool on its website to find how their area would be affected.
Wilding said: "I’d like to thank everyone who has helped us demonstrate the importance of Big Lottery funding over the past week, including people who got in touch with their MP, used our data tool to highlight good causes in their local area, and spoke up on behalf of projects and people who benefit from this vital source of funding.
"And I’d like to thank the Chancellor for listening to them and recognising the value the Big Lottery Fund adds to communities."
Sir Stephen Bubb, the chief executive of charity leaders’ body Acevo had written to the Chancellor before today’s statement asking whether the claims about the cuts were true. "I’m delighted there was to be no raid on the Big Lottery Fund," he said. "The joint Acevo and NVCO campaign against this was successful."
Ciaran Price, policy officer at the training and publishing charity the Directory of Social Change, said the news that no cut would happen was "a near miss".
"The damage that could have been done today, had we not acted quickly and loudly, is unthinkable," he said."It should be taken as evidence that charities and their beneficiaries need the Big Lottery Fund to be independent of government interference.
"Until this is achieved we will see its funding threatened again - perhaps soon."