IoF backs plans for society lottery annual sales limit of £100m

Responding to a government consultation, the institute says the government should go further than it plans on sales for individual draws and maximum prizes

The Institute of Fundraising has given its backing to plans to allow society lotteries to sell up to £100m worth of tickets a year.

In its response to a Department for Digital, Culture, Media and Sport consultation on society lotteries, which closes today, the IoF says it agrees with the proposal to increase the maximum annual ticket sales, but calls for it to go further on the value of tickets lotteries could sell for individual draws and on the maximum permitted prize money.

Gambling legislation limits society lotteries to £4m of sales per draw, £10m of sales a year and a maximum draw prize of £400,000. The limits were last changed in 2009.

The consultation document, which was published in June, recommended increasing the amount society lotteries could raise per draw to £5m, increasing the number of tickets they could sell to a value of £100m a year and raising the maximum draw prize to £500,000.

The IoF response to the consultation says: "The IoF strongly supports the government’s proposal to increase annual limits to £100m."

It says: "This would address extra administration costs and bureaucracy faced by larger lotteries that are forced to run lotteries across multiple societies using an umbrella structure.

"It would allow them to grow substantially before hitting the upper limit, and may assist in long-term fundraising plans by providing greater flexibility for societies to offer either larger draws, or more frequent draws."

But, the response says, the limit for the value of tickets that can be sold per draw should be raised to £10m, rather than the proposed £5m.

The response says a survey of IoF members showed that 69 per cent agreed that per-draw limits should be raised, with 52 per cent favouring a £10m ceiling.

It says there has been "substantial growth" in lotteries since the ceiling was lifted and if there was to be a similar amount of time to when it was next looked at, raising the ceiling by just £1m would do "very little" to future-proof the draw limit.

The maximum prize limit should be raised to £1m rather than £500,000, the response says.

"The limit has remained the same since 2005 so is now worth less in real terms," it says, adding that players were motivated by prize money as well as the cause.

"Therefore, increasing prize size has the potential to raise lottery demand, boosting overall proceeds without raising operating costs significantly – resulting in greater proceeds for good causes."

The IoF also uses its response to call for further changes not set out by the government consultation, such as asking for more flexibility in the rule that society lotteries must give at least 20 per cent of their proceeds to the good cause.

In a blog explaining the IoF response, Lizzie Ellis, policy and information officer at the IoF, said this rule "discourages new entrants into lottery fundraising since start-up costs mean society lotteries struggle to reach the minimum to good causes in the first year. We would like to see more flexibly applied in this area."

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