The Health Lottery will not increase the 20p per £1 of ticket sales it gives to good causes until the media owner Richard Desmond has recovered his investment in it, according to one of its directors.
Jeremy Muller, one of the three directors of the 51 community interest companies that make up the Health Lottery, told Third Sector that Desmond, whose main company Northern and Shell owns the Daily Express and Channel 5, had made an initial investment of £35m.
He said Desmond received income from ticket sales only once the running costs, including prizes and the 20 per cent that went to good causes, had been covered. Because there were some weeks when the total needed for prizes was particularly high, the company did not always make a profit, he said.
In the first 30 weeks that the lottery had run, he said, Desmond had lost money in seven. Muller could not say how much Desmond’s company had made in the other 23 weeks, but said he had not yet recouped his original investment.
The Health Lottery has attracted criticism, notably from the sector chief executives body Acevo, for giving only 20p per £1 of ticket sales to good causes, compared with about 28p in the National Lottery.
"The Health Lottery takes all the risk and has no guarantee of any return," said Muller. "We agreed with Northern & Shell that the proportion going to good causes would be 20p and if it were any significantly different number the thing wouldn’t work.
"The last thing we’re going to do is kill the goose that lays the golden egg. We’d be bonkers to insist those numbers change until Desmond has at the very least earned back the investment that he’s made."
Muller said the Health Lottery would be launching new products soon, in much the same way as the National Lottery has products such as EuroMillions and Thunderball, but he did not know the details at this stage.