Big Lottery Fund

Mission

The Big Lottery Fund’s mission statement is that “The Big Lottery Fund is committed to bringing real improvements to communities, and to the lives of people most in need.”

Values

To achieve this mission the Big Lottery Fund has these values which underpin its work:

Making best use of Lottery money

• by funding projects that are most likely to make a difference where it is needed
• by running our operations as efficiently as possible, while still providing an excellent service
• by being an Intelligent Funder, meaning we focus on the impact of our funding, rather than just the process

Using knowledge and evidence

• to develop new programmes and make fair funding decisions
• to understand the needs and solutions for different communities
• to ensure we are meeting the needs of all our audiences including applicants and the public

Being supportive and helpful

• to help good projects to succeed even if they are not familiar with applying for Lottery funding
• through excellent customer service
• by supporting our staff to provide help and support to all audiences.

Big Lottery Fund: Context

The Big Lottery Fund was launched as an administrative merger of the Community Fund and New Opportunities Fund on 1 June 2004. The National Lottery Act 2006, legally establishing the Big Lottery Fund, came into effect on 1 December 2006 charging it with making funds available to community groups and projects for health, education, environment and charitable purposes.

The other Lottery distribution bodies are:

• The Arts Councils of England, Northern Ireland, Scotland and Wales
• The Sports Councils of England, Northern Ireland, Scotland and Wales
• The Heritage Lottery Fund (HLF)
• UK Sport
• British Film Institute
• Creative Scotland
• Olympic Lottery Distributor

Each week 28% of the money raised from the National Lottery through the operator, Camelot, is shared between these ‘good causes’. The money goes into a special interest earning bank account known as the National Lottery Distribution Fund (NLDF).

The 2006 Act also extended the powers of all the Lottery distributors including to:

1. solicit applications from eligible organisations;
2. delegate the power to award grants to its committees, officers and, in some circumstances, to other organisations;
3. work jointly with any, or all, of the other Lottery distributors to distributeLottery funding.

It also allowed the Big Lottery Fund to distribute funds on behalf of others and required it to establish four Country Committees to decide on funding in each country.

From April 2012 the Big Lottery Fund will distribute 40% of the money available for the ‘good causes’ from the National Lottery while Arts, Sports and Heritage will each distribute 20%.

The National Lottery Act etc 1993 (Big Lottery Fund) (Amendment of Schedule 4A) Order 2011 provided for the Big Lottery Fund to have between 9 and 12 Board Members, including the Chair, with one each from England, Northern Ireland, Scotland and Wales as Chairs of the Country Committees.

Board Members are appointed by the Minister for the Cabinet Office, the current sponsor Department, in consultation with the Ministers in Northern Ireland, Scotland and Wales.

All executive non departmental public bodies (NDPBs) have a sponsor Government Department. For the Big Lottery Fund the responsibilities are divided as follows:

• The Secretary of State for Culture, Olympics, Media and Sport (“the Secretary of State”) has responsibility for the National Lottery including the system of distribution of Lottery funds, and all pan-Lottery matters.
• The Minister for the Cabinet Office (“the Minister”) has responsibility for sponsorship of the Fund, and for issuing the Big Lottery Fund with policy directions related to Big Lottery Fund expenditure in England, the Isle of Man and UK wide expenditure. He/she also has responsibility for dormant accounts funds in England and for Big Lottery Fund’s non-Lottery distribution activities.
• The devolved administrations have responsibility for policy relating to the use of Lottery and dormant accounts funds by the Fund in Northern Ireland, Scotland and Wales.

For the Big Lottery Fund, the Department for Culture, Media and Sport (DCMS) issues the Big Lottery Fund with its Statement of Financial Requirements which cover pan-Lottery matters and direct the Big Lottery Fund as to DCMS’s financial, risk and accountability requirements.

The Big Lottery Fund has arrangements in place to ensure compliance with the requirements of its Management Statement, Policy and Financial Directions.  It also has arrangements for detecting and responding to inefficiency, conflict of interest and fraud, to minimise losses of Lottery funding.

The 2006 Act also provided for the Millennium Commission’s residual responsibilities to pass to the Big Lottery Fund which, as the successor body to the Millennium Commission, has duties of accountability to Parliament for the Commission’s work.  

The Big Lottery Fund:  Its status

The Big Lottery Fund is an executive Non-Departmental Public Body (NDPB).  The Cabinet Office defines an NDPB as “a body which has a role in the process of national government, but is not a government department or part of one and accordingly operates to a greater or lesser extent at arms length from Ministers.”

The Big Lottery Fund has certain statutory obligations laid down under the Lottery legislation and can be directed by the Minister.  It is also required, as are other NDPBs, to act within the constraints of administrative law, which means that all decisions must be reasonable, proportional and in accordance with law.

The Big Lottery Fund has a Strategic Framework which takes it from where it is today to where it wants to be in 2015.  The Fund is required to publish annual reports and accounts which are laid before Parliament each year.  It has to satisfy the National Audit Office (NAO) that it spends its money well, both on administration and in the grants awarded, in line with its powers.

The DCMS has designated the Chief Executive, as the Accounting Officer for the Big Lottery Fund and as Accounting Officer, has responsibility for its overall efficiency and effectiveness and, may on occasions, be required to give evidence to the Public Accounts Committee (PAC) of the House of Commons. The PAC ensures that proper and thorough scrutiny is given to expenditure, and that the Fund operates to the highest possible standards in the management of its financial affairs. It does this so that the public can be confident that their money is being spent wisely and well.

The Accounting Officer also has responsibility for reviewing the effectiveness of the system of internal control.  This review is informed by the internal auditors, executive managers within the Big Lottery Fund and comments from the external auditors in their management letter and other reports.  

The Big Lottery Fund does not, unlike some NDPBs, have “Crown status” and its staff are not civil servants.  It does not, therefore, have immunity from criminal or civil prosecutions and must comply, for example, with health and safety legislation.

The Big Lottery Fund:  Its Regulations

As well as the Directions from Cabinet Office described above, the Scottish Parliament and the Welsh Assembly Government can issue supplementary Policy Directions through their First Ministers, following a consultation. The Minister in the Department for Culture, Arts and Leisure (DCAL) performs a similar role in Northern Ireland. Currently the Cabinet Office issues Directions for England as well as the UK.

The Treasury document “Government Accounting” lays down certain procedures which the Big Lottery Fund has to follow, particularly with regard to losses, write-offs of grants and special payments.

The NAO undertakes the Big Lottery Fund’s annual statutory audit.  It checks that the Fund is following the Policy and Financial Directions, the Management Statement, the guidelines in Government Accounting and the relevant Treasury guidance.  It also ensures that it is adopting acceptable public practice.

Risk Management

The Big Lottery Fund has developed a risk management framework and a corporate risk register which is reviewed regularly by the Senior Management Team and the Audit and Risk Committee and, as necessary, by the Board.  Risk management principles, include consideration of risk and recommendations for appropriate risk mitigation.  Identified risk priorities include governance risk, people risk, legal and regulatory risk, grant making risk, political risk, fraud, reputational risk and financial risk.  

The Board is required to maintain a register for Lottery funded assets and make public statements to stakeholders on the Fund’s risk management.