Legal row over National Lottery could cost voluntary sector £600m, parliament told

Good causes could lose out on as much as £600m because of a legal row between firms bidding to run the National Lottery, MPs have heard.

Camelot Group, which lost the licence to run the lottery earlier this year after three decades, could try to claim hundreds of millions of pounds in damages, MPs on the Digital, Culture, Media and Sport Committee were told.

Andrew Rhodes, chief executive of the Gambling Commission, said he did not know whether Camelot would go ahead with a claim.

But he said that in the event that such a claim was successful, the money could be taken from the fund used for distributing income from National Lottery sales to good causes.

Any claim from Camelot could be heard later this year,

A legal judgment this week indicated that the Gambling Commission could go ahead with awarding the licence to a new provider, the Czech firm Allwyn, from 2024. But Camelot and its technology provider IGT are still expected to press ahead with their claim that the commission got its decision wrong.

One Labour MP on the committee, former civil society minister Kevin Brennan, asked Rhodes “whether or not Camelot and any associated parties would have any claim for damages because of the processes which were followed by the gambling commission in awarding the new licence?”

Brennan cited press reports suggesting that “damages could amount to as much as £600m”, and suggestions that those damages could come from the National Lottery Distribution Fund.

Rhodes said “it is almost impossible to calculate an accurate figure”, but did not rule out the possibility that Camelot would take legal action.

He said: “It would be a matter for the secretary of state at DCMS to decide where any damages do get paid from. One possible fund would be the one that you described. It is also possible it could come from somewhere else.”

Rhodes also argued any potential damages would still be “considerably less” than the money raised for good causes if the National Lottery proceeds under its new preferred provider.

The Conservative MP Julian Knight, who chairs the committee, said Camelot had “some brass neck”, adding that any damages claim “could basically rob the futures of young people across this country by taking such huge sums from good causes”.

In April, Camelot launched legal action against the Gambling Commission, saying its decision to award the Lottery licence to Allwayn was “badly wrong” .

Camelot has run the National Lottery since it was created in 1994.

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