Horserace Betting and Olympic Lottery Bill

Public Bill Committee, 22 January 2004.

Standing Committee D

Horserace Betting and Olympic Lottery Bill

Andy Reed (Labour/Co-operative, Loughborough)

On a point of order, Mr. Illsley. I see that on the list of Committee members for today I am listed as Mr. James Reed. I am sure that my four-and-a-half-year-old son James would be in some difficulties in this Committee, however, as he started school only last week. I am not sure which he is more frightened of—being told off by the head teacher or being told off by the Whip for not being present. I should be grateful if you would make sure that the name is corrected to Mr. Andy Reed.

Eric Illsley (Labour, Barnsley Central)

The hon. Gentleman's problem is a printing error. Suffice it to say that I know who he is, so I shall be able to call him to speak. He is listed as Mr. Andy Reed on the Division list. I shall see that the printing error corrected.Clause 15 Abolition of levy

Clause 15 - Abolition of levy

Don Foster (Liberal Democrat, Bath)

I beg to move amendment No. 48, in

clause 15, page 10, line 11, at end insert

'subject to receipt of the agreement of the Office of Fair Trade,'.

I welcome you to the Chair, Mr. Illsley. We have made great progress under your co-Chairman, Mr. Sayeed, which I hope we shall continue.

The second part of the Bill deals with the Horserace Betting Levy Board. The Committee will be aware of the relevant history. Until the 1960s, money was transferred from the bookmakers to the racing industry through a voluntary arrangement, but in the early 1960s more formal arrangements establishing the Horserace Betting Levy Board and the levy that goes with it were put in place. However, many people in the industry and the Government have been seeking for some time a different arrangement that removes Government interference and regulation. As the Bill is a deregulatory measure, we are pleased to support the Government's proposals, as I am sure the equally deregulatory Conservative party is.

You will be aware, Mr. Illsley, from reading the record of our deliberations that at the end of Tuesday's sitting the Minister seemed to think that the Liberal Democrats were not keen on deregulation, but I can assure him that we are. That is why we are happy to support the Government's intention, which is broadly supported in the racing industry, to abolish the board and the levy and to find an alternative arrangement.

As the Committee is only too well aware, the problem is that there is now some doubt about the

alternative developed by the board, the industry and the bookmakers because of the involvement of the Office of Fair Trading in the industry and sport of horse racing. As a result, there is considerable doubt about whether the proposed mechanism, which primarily involves the sale of data to the bookmakers, will be possible. I was delighted to hear the Minister say on Second Reading that he was aware of that problem. He would be, as he has been closely involved, and he went on to say that, as a result of the concerns that had been expressed, the Government had decided to extend the life of the levy board to September 2006. As the industry agrees, that is a sensible move. However, the Bill contains nothing to ensure that we can be confident that a satisfactory and agreed alternative will be put in place before the Horserace Betting Levy Board and the levy are abolished.

We know that the industry, the Government and the bookmakers intend to find an alternative that ensures that money continues to go into racing for a number of important purposes, including improvements in the breeding of horses and the advancement and encouragement of veterinary science and education for the improvement of horse racing generally. There is a clear desire for a mechanism to be found to achieve that result. Racing brings about £70 million or £80 million into the industry for those activities, so an alternative is necessary. The problem is that we do not know what that alternative will be. We know that there are question marks about the existing arrangements. The Government have acknowledged the difficulty and have sought to assist in bringing various parts of the industry together to find a way forward in respect of OFT rule 14 issues and, if necessary, to look for an alternative way forward in the light of any OFT ruling, although we do not know when that will happen or even what it will be.

The amendment is an attempt to find a different way of ensuring that nothing moves forward until we are sure that what happens will not be rejected again by the OFT. It seeks to introduce a new mechanism that is agreed by all the relevant parties and will have the agreement of the OFT. That will ensure that instead of having a fixed date, as the Minister is suggesting, we can leave things open until those issues are settled. We are also conscious of an impending European Court case on the British Horseracing Board's ability to hold pre-race data centrally. Clearly, that issue must also be borne in mind and resolved before any new solution can be found.

When I was in discussion yesterday with the British Horseracing Board, I was delighted to hear that there is a new impetus in the industry to find a new way forward. We, the board and the industry want to ensure that, whatever the solution is, it will be sustainable and ensure that funds continue to go into the industry. The amendment provides a simple mechanism to ensure that we do not move forward unless we are sure that we have got the solution right and that it is not likely to fall foul of the OFT.

James Paice (Conservative, South East Cambridgeshire)

May I add my welcome to you, Mr. Illsley,

and express the hope that our progress under your chairmanship will be as fast as it was under that of Mr. Sayeed? Having heard your sotto voce comment earlier, we must wait and see.

The OFT issue is critical to part 1 and the hon. Member for Bath (Mr. Foster) is right to refer to it. I must admit that I am not entirely convinced that his amendment is the right way of dealing with that issue because it relates to the abolition of the levy rather than to the successor arrangements. I have tabled amendments to later provisions in this part of the Bill to require the transfer plan, which I think is the central point, to be subject to the affirmative resolution procedure.

I am concerned that the hon. Gentleman is simply suggesting that the OFT should approve the abolition of the levy, which is not really the point. I cannot see that there is a problem with the abolition of the levy, and whether something is put in its place is not a matter for the OFT. I know that that is not his intention, which I think is exactly the same as mine: that we should not proceed with the totality of part 2, which covers abolition of the levy and the transfer scheme that goes with it, and abolition of the board, until we are certain that there is a robust mechanism for alternative funding of the racing industry, as well as the sale of data and media rights, although that issue has largely been resolved. We briefly discussed the sale of data on Tuesday and I shall not detain the Committee by going through it again.

However, it is abundantly clear that the number of race courses would decline if OFT rule 14 were to stand. That would mean a break-up of the competitive nature of the balance between the racing provider and the consumer in the main bookmakers in bidding for data rights. As the right hon. Member for Livingston (Mr. Cook) said on Second Reading, it seems absurd that the OFT should propose that race course owners should not be allowed to group together to sell data rights when bookmakers can group together to buy them. That seems a slightly odd position for the OFT to adopt.

I welcomed the Minister's inferences—they were no more than that—in that Second Reading debate. He made it clear that the Government were sympathetic to the problems that would arise and referred to a letter that the Secretary of State had sent to the OFT, but which cannot be published. I take it—perhaps I am rash to do so—that the letter expresses concerns about the potential impact of the rule 14 notice on the racing industry. I hope that the OFT will amend its stance and that the industry will come to an agreement in its discussions, as that is critical. As I intimated, I shall speak to amendments later that would enable us to put off rule 14 until we are convinced that there are alternative orders.

None the less, I entirely support what the Government are trying to do. The levy is an anachronism, particularly with regard to the role of the Secretary of State in settling it. The concept of shifting to a much more commercial arrangement is right. I simply want to ensure that we do not jump

before we know what we are jumping into and that there are viable alternative arrangements for the racing industry.

I believe that that is what the hon. Member for Bath is suggesting in his amendment. In principle, I support what he is trying to achieve. Let us see what the Minister says. My gut feeling is that the amendment does not achieve its intention, but the hon. Member for Bath is right to say that the current deliberations of the OFT are central to the future of the levy board and what comes after it. I hope that the Minister will take that on board. We support the end of the levy, but we want to ensure that we do not get rid of it before we know exactly what will replace it.

Richard Page (Conservative, South West Hertfordshire)

May I, too, welcome you to the Chair, Mr. Illsley? If you have a chance to read the record of the previous two sittings, you will discover that they have been conducted with good humour on all sides. My hon. Friend the Member for South-East Cambridgeshire (Mr. Paice), my new-found friend the hon. Member for Bath—we will leave his wife and her postcards out of this—and I have made various requests of the Minister, who has put his hand somewhere near his heart, or perhaps his wallet, and said, ''Trust me. I shall ensure that all your concerns are recognised in the fullness of time.'' We poor trusting souls have agreed to that, and we are looking forward with great anticipation to the Report stage.

Like my hon. Friend the Member for South-East Cambridgeshire, I appreciate and understand the thrust of the amendment but have doubts about whether it would achieve its basic intention. Equally, I understand why the Government want to get rid of the levy board. It is unacceptable that a Secretary of State should be drawn into what is essentially a business transaction, and I can appreciate their wanting to say goodbye to the board as soon as possible.

However, in discussing the amendment, we must also be careful that we clearly understand the value of the levy board. Many a time I have been to various race courses, particularly in the winter. I stand on corrugated iron—

James Paice (Conservative, South East Cambridgeshire)

On the roof.

Richard Page (Conservative, South West Hertfordshire)

Or on the roof. I stand on concrete steps under a corrugated iron roof, the rain drips down, it is windy and I think, ''I really am enjoying this.'' This is where the levy board plays an important part. Over the years, it has been responsible for seeing many of our race courses upgraded, because it wants to make racing more enjoyable. Is it a coincidence that the number of people going racing has over the past couple of years gone from 5 million to 6 million? That is just the start. The number of people going to the races will climb higher and higher.

If we were at the filibustering stage, I would read out all the contributions that the levy board has made to race courses over the past few years. The list is most impressive, but I will not do so. I just want to make the point that the levy board has spread its money between the big courses and the small. It gave £600,000 to

Fakenham, which, dare I say it, is one of the more remote courses. People need a guide dog and a map to get there, but it is a pleasant place. Indeed, Fakenham is very up and down, but that contributes to the individuality of British racing. In addition, the levy board has given £3.5 million to Sandown, where Members can see some new stands.

On top of all the support that the levy board gives to race courses, it gives important support to the veterinary side of racing. I have been to some of its seminars and the work being put into understanding the conditions of the horse, and how the horse population can be cared for and advanced, is most impressive. Indeed, the efforts of the levy board, under the leadership of Rob Hughes, are exceedingly valuable and we must not see them go. They must be protected in some shape or form.

On the abolition of the levy board, there are a variety of ways in which the Secretary of State can move to see it taken on into another arrangement. I have to point out, however, that the financing of racing does not involve a solid, guaranteed income stream. It depends on a number of things, including media rights.

We watch with considerable concern the attheraces discussions that are taking place. The deal that has already been done for the race courses may be put in doubt. We must ensure that whatever we do means that the successor to the levy board can continue and continue to be financed, and that there is not a short-term deal that collapses in a short time. That is where the OFT puts a potential spanner in the works. Its remit is closely drawn—too tightly drawn—and there is not a proper mechanism in government to rein it in if necessary to ensure that we see the overall picture, and achieve a balance rather than a tight, focused view.

I share the concerns of my hon. Friend the Member for South-East Cambridgeshire. I do not think that the amendment would achieve the result that my new-found friend, the hon. Member for Bath, and I want. I suspect that we will get another of those statements from the Minister giving the overall picture. He will put his hand on his heart and say, ''Trust me. This is the way it will work.'' I look forward to what he has to say.

Richard Caborn (Labour, Sheffield Central)

I, too, welcome you to the Chair, Mr. Illsley. As a fellow Yorkshireman, I know that you will be very fair in your deliberations. We will expedite things as effectively as the Government have in previous sittings. If the hon. Member for Bath reflects on the official record, he will find that we were debating competition, not deregulation. What worried me was a gradual slide into some anti-competitive coalition between his party and the official Opposition. I was getting a bit worried about the political direction that he was taking, and I had to remind him that we are trying to bring more competition to the industry, which is why I resisted the amendment. My concern politically was that Opposition Members should not get into such a coalition. [Interruption.] They have obviously taken my advice.

I understand the concern about the OFT, but what hon. Members have said this morning is true. There is a realisation that we need the OFT, the BHB and the industry to come together and find a solution. All the feedback this week from the discussions with the BHB and the OFT was fruitful. The last board meeting of the BHB was moving in that direction in that it created an understanding between the industry and the sport so that a resolution to the rule 14 problem might be found. I am cautiously optimistic that we can resolve it.

As the hon. Member for Bath said, I have already taken the precautionary measure of extending the levy by one year because of the need to deal with fixtures, the business plan and so on. It was sensible to bring some certainty to the process. I made the point on Second Reading, and I make it clearly again today, that it is our intention to end the levy. Therefore, the Government cannot agree with amendment No. 48. The levy board should be abolished when my right hon. Friend the Secretary of State is satisfied that the time is right, not subject to the agreement of a public body with no particular responsibility for it. That is what the amendment would require.

I understand the anxiety and uncertainty in relation to the OFT inquiry. For that reason, I extended the levy for one year. What has been happening this week will find a solution—I hope—to the dispute between the OFT and the racing industry. With that reassurance, I hope that the hon. Gentleman will withdraw the amendment.

Don Foster (Liberal Democrat, Bath)

I am grateful for the Minister's response and, as the hon. Member for South-East Cambridgeshire said, we will have an opportunity to continue the discussion in a few minutes when we debate subsequent amendments. One thing is absolutely clear: there is unanimity about the need for a solution concerning the desire to end the levy and the board, but we must do so only when a sustainable alternative has been agreed. I am delighted to hear further confirmation from the Minister of the Government's determination to play a role in helping to bring that into play.

I am more than happy to withdraw the amendment, not just because of the assurance given by the Minister, but because I happen to believe that there are better ways of achieving what I want. We may come to those when debating subsequent amendments.

I give the Minister notice that when we come to further discussion of the issue, I shall refer, as I have in previous discussions relating to the Bill, to the regulatory impact assessment. If it will help him to start doing his homework, he might want to look at pages 32 and 33, which touch closely on the issue. With those remarks, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Kali Mountford (Labour, Colne Valley)

I beg to move amendment No. 54, in

clause 15, page 10, line 26, at end insert—

'(3A) The Secretary of State shall not make an order under this section unless satisfied that arrangements are in place for—

( ) funding for the employment of veterinary surgeons at horseracing grounds;

( ) adequate funding for the care of retired race horses'.

I, too, am a Yorkshire MP and, as a Yorkshire person, a respecter of tradition and one who knows what side their bread is buttered on, so may I welcome you to the Chair, Mr. Illsley?

The horse racing industry cannot operate at all without dealing with the welfare of the horses. The industry has a better record than some sports that use animals. For example, it has a better record on horse welfare than greyhound racing has on the welfare of greyhounds. That said, the welfare of those animals derives from the contribution from the levy in two ways, which are indicated in the amendment. The first, obviously, concerns the tracks themselves and the payment of vets when they are attending horses. Horses are often injured during a race, or need assistance before it, so it is important that vets are present. Nobody would argue that they should not be.

Further to that, at the end of their career, horses are often valued by their owners and trainers and they go on to have very productive, and sometimes lucrative, lives after finishing racing. Nevertheless, that is not the case for all horses and about 4,000 per year have welfare concerns that are brought to the industry's attention. Of those, 300 need some charitable intervention, which is why the industry set up its own charity. Charities depend on the vagaries of the good will of the people giving donations, but one dependable part of that charity is the donation from the levy.

The Minister will notice that the amendment is probing. We need an assurance that that valuable part of the industry—the horses—will have the best care during their working lives and when their working lives have come to an end. I seek the Minister's assurance that some robust mechanism will be put in place post-levy to ensure that vets are present at the race course, that their fees will be covered and that the charitable contributions to the welfare of horses at the end of their racing lives will continue. Race horses cannot curl up on a couch like a greyhound, but there are plenty of things that retrained horses can do so that their lives can be extended comfortably and appropriately when they have earned such a lot for the industry during their working lives.

Andy Reed (Labour/Co-operative, Loughborough)

I never want to repeat a speech that has been made by an hon. Friend, but I would like to reiterate the point that we seek clarification that there is a commitment to horses' welfare. A great deal of work is done and it is acknowledged that the contribution from the levy board, while minimal in terms of percentage of turnover, is significant to the amount that the charity raises.

It is necessary to understand that the vast majority of horses are treated excellently after their retirement from racing. However, the fact that the charity has been established and the acknowledgement that 300 or 400 horses a year require charitable intervention mean that it would be a mistake if the many positives that

will come out of the Bill do not include a statutory requirement that an amount of money such as that which comes from the levy should continue to be given. We seek the Minister's reassurance that, if not necessarily through the amendment then at least in other ways, that will continue.

Richard Page (Conservative, South West Hertfordshire)

Naturally, I am immensely sympathetic to what the hon. Gentleman and the hon. Member for Colne Valley (Kali Mountford) are trying to achieve, because I have been involved with horses all my life and want them to be properly looked after. However, I am slightly curious about the words

''funding for the employment of veterinary surgeons at horseracing grounds'',

which appear in the first part of the amendment.

I have always travelled under the impression that a race meeting cannot be held unless there is a certified vet in attendance. Have the hon. Gentleman and the hon. Member for Colne Valley introduced the amendment because there has been a failure to have vets in attendance? If so, that is most serious and I am certain that the racing bodies will want to know about it.

Andy Reed (Labour/Co-operative, Loughborough)

My experience is that that is not the case. I understand that some payment for veterinary services at the course or race ground comes from the levy, so we seek an assurance on the continuation of that good practice. I do not think that we have that assurance in the Bill as it stands. All we are trying to do is ensure that the good practice continues. The hon. Gentleman is right that veterinary attendance at courses is vital and the race cannot go ahead unless vets are there. The issue is the funding for that, and I am sure that race course managers would be happy with the amendment on the basis that they will not pick up the tab themselves.

Adrian Sanders (Liberal Democrat, Torbay)

I congratulate the hon. Member for Colne Valley and her seconder on moving the amendment because it is important to place it on the public record. Although I do not think that the Minister is likely to come up with a robust mechanism that is in accord with the amendment, I am sure that he can provide firm governmental intent on the public record to which we can refer at a later date.

As the hon. Lady said, this aspect of the levy gives financial support for the care and welfare of racehorses. She mentioned that about 4,000 horses leave the industry every year. That is an extraordinarily high number, although when one considers the number of meetings and horses that are involved, and the number of years that they can compete during their lifespan, it is perhaps not so surprising. About 300 horses every year need support. Of course, there is one horse missing from those figures—Shergar—and we still do not know what has happened to him.

Only a tiny percentage of the levy is used for such welfare, but it is a significant amount because its impact is so great. I hope that the Minister will provide some assurance of his intent to ensure that it continues. The money also helps the improvement of

breed support, which should not be forgotten. It is used not only to ensure that vets are in attendance at race meetings, but to advance and encourage veterinary science, which is of enormous benefit to all. Its overarching purpose is the improvement of horse racing, and I am sure that the industry would not wish to lose sight of that.

Nick Hawkins (Conservative, Surrey Heath)

I wish to underline some of the points that have been made, and to express some personal views. I welcome the fact that the hon. Members for Colne Valley and for Loughborough (Mr. Reed), both of whom I know well and for whom I have a great deal of respect, have tabled the amendment, as it is important to put such matters on the record.

As I made clear on Second Reading, I do not have the detailed knowledge of all aspects of racing that my hon. Friends the Members for South-East Cambridgeshire and for South-West Hertfordshire (Mr. Page) have. However, I have some knowledge of racing, of the preparation of racehorses and of veterinary science, not least because my father, early in his career, taught at the Royal Veterinary College, and several family friends were and still are vets.

From my experience of visiting racecourses and, as I mentioned on Second Reading, of having an uncle who was an owner of point-to-point horses, I have found that the standards of care in racing are tremendously high. I welcome the statement from the hon. Members for Colne Valley and for Loughborough that the purpose of their amendment is to obtain on the record the confirmation that those high standards will continue.

I want to place on the record the fact that standards are taken very seriously by all whom I have met in racing. If any hon. Members want that point reinforced, they might be interested to read a superb book that I was lucky enough to receive as a Christmas present and read over the recess, which is the autobiography of Lord Oaksey—somebody who could properly be described as the doyen of racing journalism. It is called ''Mince Pie for Starters'', and a great deal of it demonstrates the care for the welfare of horses that not only he had, but everybody in racing had.

If the lessons that Lord Oaksey sets out are followed, we will see a continuation of the care of horses that, as he makes clear in his book, has been improving over the course of his life.

Kali Mountford (Labour, Colne Valley)

The hon. Gentleman's statement about the current state of racing is absolutely right. Without going through my connections with racehorse owners, I would like to tell him of some cases of abuse of horses during training many years ago. Although those practices have been wiped out, I would not like to see a return to them. That is partly the purpose behind the amendment.

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the hon. Lady. I have already said that I understand that she and the hon. Member for Loughborough tabled the amendment to enable us to have this short debate. I simply wanted to place on record my own observations and links, which suggest to me, as the hon. Lady has just confirmed,

that standards are now very high. All of us who care about racing and horses want that to continue.

Richard Caborn (Labour, Sheffield Central)

More right hon. and hon. Members have probably spoken on this amendment than on any other, which shows that we are a nation that loves its animals.

Amendment No. 54 prevents the Secretary of State from abolishing the levy board unless she is satisfied that arrangements are in place to fund vets at racecourses and to care for retired racehorses. I agree with my hon. Friend the Member for Colne Valley that it is an important issue, as participation in the debate has shown, but the amendment would not affect the provisions in the Bill.

We have always made it clear that the important work done by the levy board will not be neglected when it is abolished. For that reason, clause 16(6) makes it clear that, when the levy board's assets are transferred, they will be used for their current statutory purposes. The BHB, to whom the bulk of the assets will be transferred, has already given us an undertaking that it will continue to fund public-interest areas such as veterinary research and education. It will also continue to provide funding to welfare projects such as Retraining of Racehorses, which have in the past received levy board grants.

Everybody acknowledges that the levy board has done an excellent job for 40 years. We have simply transferred into the Bill the statutory purposes referred to in the Betting, Gaming and Lotteries Act 1963, so it does not need to be changed. I do not believe that either the Jockey Club or any future regulator of the sport would allow the well-being of racehorses, and therefore the future of the sport, to be jeopardised by inadequate veterinary provision at race meetings.

We have taken what is working well in the 1963 Act, with which I think everybody concurs, and put that into the Bill. With the assurances that the BHB has given us about the way in which those assets will be used, I have every confidence that the Bill takes full account of all the issues that my hon. Friend the Member for Colne Valley raises in her amendment. I therefore ask her to seek to withdraw it.

Kali Mountford (Labour, Colne Valley)

I am grateful to my right hon. Friend the Minister for those assurances. As a fellow Yorkshire Member, I know that he is a man of his word and can be trusted. If he is satisfied that he has received the appropriate assurances from the industry that, under the new arrangements, horses will be protected, I have no misgivings and I beg to seek leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 ordered to stand part of the Bill.

Clause 16 - Property of the Levy Board

James Paice (Conservative, South East Cambridgeshire)

I beg to move amendment No. 13, in

clause 16, page 10, line 29, after 'specified', insert 'assets,'.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss the following:

Amendment No. 14, in

clause 16, page 10, line 40, after 'specify', insert 'assets,'.

Amendment No. 15, in

clause 16, page 11, line 1, after 'whom', insert 'assets,'.

Amendment No. 16, in

clause 16, page 11, line 9, after 'any', insert 'assets,'.

James Paice (Conservative, South East Cambridgeshire)

This little group of amendments could cause immense ructions, but, on the other hand, the Minister could easily accept them, and we could then press on.

I tabled the amendments because I find it odd that the Bill refers repeatedly to the transfer of ''property, rights and liabilities'', but does not use the word ''assets''. In his remarks on the previous amendment the Minister referred to the transfer of assets. I think that most of us understand that we are talking about a transfer plan of everything to do with the levy board, including its assets. The asset that I am most concerned about is the capital fund, which currently stands at about £50 million. It can loosely be described as a revolving fund: it lends money to race courses for improvements, so there is a constant inflow and outflow of resources. As my hon. Friend the Member for South-West Hertfordshire said earlier, it is a huge contributor to the improvement of race courses. He referred to the capital sums granted to courses, which ranged from £100,000 for Perth, a remote but important race course, up to very large sums, as he said, for Sandown, Newbury and York, the famous race courses. That money is vital. The levy board has advanced more than £180 million in project loans since the inception of the capital fund 34 or 35 years ago, which has led to a huge improvement in race course facilities, and about £450 million has been committed for 2001–05. I am sure that the Minister is familiar with all of that and is as supportive of it as I am.

I am concerned, however, that the word ''assets'' does not appear in the Bill. As a layman—I am not a lawyer—I do not believe that the word ''property'' includes capital funds and assets. It might include physical assets, but I would not normally include cash in the bank or outstanding loans as property. Therefore, I seek to insert ''assets'' into the relevant parts of the Bill after ''property'', to make it absolutely clear that we are talking about, if may use the word, the totality of the levy board, and to ensure that all of it is transferred into racing.

I could be sceptical and say that it is conceivable that the word ''assets'' has intentionally not been used because the Treasury has its eyes on the capital fund and does not want to transfer it. I am sure that the Minister will reassure me that that is not the case, but I hope he will understand that there is a real concern that, if ''assets'' is not in the Bill, although he used it in his earlier remarks, the clause and transfer plan are not as inclusive as we want them to be.

Clearly the Horseracing Forensic Laboratory and the National Stud come under the heading of property and should be transferred. As I said on Second Reading, both these important institutions are in my constituency. The Government have already begun

discussions about their future, but, as I understand it, no real discussions have taken place about the future of the capital fund. I know that the Racecourse Association does not want it to be transferred to the BHB, but would prefer it to be set up as a free-standing charitable trust to continue the good work of the National Stud over 35-odd years. I hope that the capital fund will be part of the transfer plan, but I should be interested if the Minister would say what the Government's thoughts are about its future, as the thought process on many other aspects is already well advanced.

I strongly believe that the word ''assets'' should be in the Bill. The Minister has used the word, and I cannot understand what objection he can have to including it after the word ''property''. I cannot believe that it detracts from the Bill. The Minister may try to convince me that legally it is not necessary, but it would still be helpful and comprehensive if it were in the Bill and I hope that he will agree to include it.

Don Foster (Liberal Democrat, Bath)

I congratulate the hon. Member for South-East Cambridgeshire on using the amendment as an opportunity to raise the importance of the capital fund. He wishes to add a word to the clause did not concern him earlier because the same phraseology is used in clause 2 about the transfer of the Tote. ''Assets'' is not mentioned there, but perhaps there is a difference between the two and a reason why it should be added to clause 16 and not to clause 2. Be that as it may, it is important to obtain some comments from the Government about the capital fund.

Earlier, I said that until recently we all knew the new arrangements. They were not in the Bill but we knew the intention. As discussed, the intervention of the OFT has made that extremely difficult. It is worth remembering that in the previous arrangements the intention clearly was to follow the line of argument advanced by the hon. Member for South-East Cambridgeshire. If we consider the report on future funding produced in October 2000 by the BHB, along with its recommendations for the basis of the hoped-for new deal to replace the levy, it said:

''The Capital Fund, subject to Government confirmation, will be transferred to BHB. BHB will then transfer it to a Trust for the duration of the agreement between the BHB and RCA to be administered by three Trustees. The Fund will be set initially at £50 million and be available to racecourses and other organisations which are currently HBLB beneficiaries for capital improvements.''

It is clear that the original intention was a transfer to the BHB, and that by working with others it would have established a trust with several benefits, not least that it would have been a tax-efficient operation.

In any new plan that is developed for the replacement of the levy, it is important to hear from the Minister whether he envisages the arrangement recommended by the BHB, which is fairly widely accepted and close to the views expressed by the Racecourse Association, being in the scheme.

Nick Hawkins (Conservative, Surrey Heath)

In the opening remarks of my hon. Friend the Member for South-East Cambridgeshire, he said that, although he was not a lawyer, he would prefer the phraseology to be more complete. From my background as a lawyer, considering how commercial

agreements are interpreted, although commercial agreements are, of course, rather different from Acts of Parliament, I recall that the guiding principle on which commercial lawyers are always trained is to ensure that any phraseology is as complete as possible for the avoidance of doubt.

In about 12 years in the House of Commons, I have tended to come to the same conclusion about legislation. Since the leading case of Pepper v. Hart, which set out that Ministers' comments at the Dispatch Box can be used as a guide to the intentions of Government and Parliament, it has become particularly important to press Ministers, even if they are not prepared to amend a Bill, at least to clarify meaning.

It would be helpful if ''assets'' were added to ''property'' in the relevant places described in the amendment. As a lawyer, I think that it adds something to the general term ''property''. My hon. Friend the Member for South-East Cambridgeshire is right, and I hope that the Minister will accept the amendment or at least make it clear that the Treasury does not have some hidden agenda and that all the assets, not merely a limited category of property, will be transferred.

Richard Caborn (Labour, Sheffield Central)

I must admit that I have a great deal of sympathy with the amendment. When I met my officials last night, I asked for an interpretation and whether assets were included. We had the ''Oxford English Dictionary'' on the table. They reassured me that the legal interpretation of ''property, rights and liabilities'' included assets.

As I said, I have sympathy with the amendment, but the lawyers assure me that the word ''asset'' does not need to be included in the clause because it is already incorporated under property, rights and liabilities.

On the capital fund, yes, the BHB has given us assurances. As the hon. Member for Bath said, the amount is about £50 million. It has broadly—not wholly—been used for interest-free loans for the development and upgrading of race courses. There has been flexibility even under the levy board. The fund was not used solely for interest-free loans. Hon. Members who were close to the discussions with the OFT and the industry will know that there are possibilities for restructuring the governance of the sport and its commercial activities. It would not be very wise to accept this amendment, which would tie hands and leave no flexibility for redefining the governance and funding of the sport. People who are close to the negotiations know that they are ongoing.

I give clear assurance that assets are incorporated in the wording, and my officials have reassured me that when the capital fund is handed over to the BHB it will broadly be used as it is at present. The amendment would tie that down such that flexibility would be difficult.

James Paice (Conservative, South East Cambridgeshire)

Let me separate the two issues. I understand entirely what the Minister says about the future of the capital fund.

I return to the word ''assets''? I am grateful for the right hon. Gentleman questioning last night the use of the word ''property''. When his lawyers advised him that it was not necessary, did they come up with any reasons why it would not be helpful to include it in the Bill? Would there be anything wrong with including it? In other words, would he humour me by accepting the amendment? Unless a lawyer can produce a reason why not, I cannot see why the wording should not be more explanatory, even if we accept the advice about the definition of property.

Richard Caborn (Labour, Sheffield Central)

Too many words. [Laughter.] That is the advice.

As the hon. Gentleman well knows—he is an old hand at this game—we can go on expanding, but there must be a final position. My officials and I had an interesting debate last night. In fact, we had three dictionaries out and were cross-referencing property to assets and assets to property. It was a good discussion. The hon. Gentleman wants reassurance about the assets, and I am convinced that they are included. Nothing detracts from the capital fund, as an asset, going to the BHB. That is absolutely clear and covered by the wording.

We could continue writing more and more words into the proposed legislation. That would make more and more money for lawyers such as the hon. Member for Surrey Heath (Mr. Hawkins). Let us keep the legislation short, precise and focused. My lawyers assure me that the wording deals with all the concerns that have been expressed this morning. Therefore, I ask the hon. Gentleman to withdraw the amendment.

James Paice (Conservative, South East Cambridgeshire)

Even though the Minister did not actually put his hand on his heart, it was there metaphorically. I am reasonably reassured by what he said, and particularly by the fact that he made a challenge and has been reassured. Given what my hon. Friend the Member for Surrey Heath said in relation to Pepper v. Hart, it is important that the Minister has stated things clearly on the record. In the light of that, I am reasonably persuaded that the financial holdings of the levy board, and in particular the capital fund, will be part of the property that will be part of the transfer plan. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

James Paice (Conservative, South East Cambridgeshire)

I beg to move amendment No. 19, in

clause 16, page 10, line 36, leave out from 'modification' to end of line 37.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss the following:

Amendment No. 20, in

clause 16, page 11, line 7, leave out subsection (5).

Amendment No. 18, in

clause 16, page 11, line 14, at end insert—

'(6A) Any transfer scheme made or approved by the Secretary of State under subsections (2) or (4) shall be subject to approval by an affirmative resolution of each House of Parliament.'.

James Paice (Conservative, South East Cambridgeshire)

This is the group of amendments that I referred to in an earlier discussion. It represents the fall-back position. Like everyone else, I do not know the outcome of the OFT matter, or the European

Court of Justice case, which we have not really referred to this morning. Those two issues are overhanging the racing industry. As far as the OFT is concerned, I share the Minister's optimism that a solution can be found, and I hope that it will be. Nevertheless, that solution has not been found yet. Therefore the matter hangs over the industry. Should a solution not be found, and should the OFT decide, despite everybody's efforts, to stand by its rule 14 notice published last April, the consequences for the racing industry could be horrendous. There would also be consequences for the racegoer and for the punter, although there are those who would disagree with that. The situation would certainly be serious.

I know that I raised similar issues in relation to part 1when I discussed the need to come back to the House of Commons with an affirmative resolution before the Tote was disposed of. It is right for the transfer plan to come back to the House for approval, which is the gist of the amendments. It is essential that the House be given a chance to reflect on the impact of the OFT conclusions, when they have been made, and on the European Court judgment about the related issue of concern to the bookmakers. We need that opportunity to reflect.

We need also to consider what exactly the Minister proposes to do in the transfer plan. I am reasonably relaxed and comfortable about the structure as laid out. As he has already implied, he has picked up large chunks of the 1963 Act and reiterated them in the Bill. He talked about what the property, the rights and the liabilities of the levy board should be used for. Clause 16(6) is quite comprehensible, although I have an amendment relating to it. I also understand and accept what he said in his last contribution about where he wants all the things to go.

I return, however, to the point that I have made over and over again, as have the hon. Member for Bath and others. We cannot be certain about what will happen, partly because of the OFT and the European Court, but partly because of a possible change in Ministers, or a possible change of heart by the Treasury, which will have huge influence over the transfer plan and will doubtless have to approve it before the Secretary of State can. It is right that the House of Commons should be allowed to make the final decision, which is why I tabled the amendment that would allow for affirmative resolution.

I do not doubt the integrity of the Minister or the Secretary of State, or the intention to do as the Government have repeatedly said—make the transfers, set up the forensic laboratory under the BHB, set up the National Stud as a charitable trust and transfer the capital fund, as the Minister has said. However, I will never be entirely satisfied until I know that those things have happened, which is why I would prefer the Government to allow the House to approve the final transfer plan.

The amendment is intended to ensure that the transfer scheme, as drawn up by the industry and the

Government, meets the desire universally shared in the House as to what should happen to the property assets, rights and liabilities of the levy board.

I hope that the Minister understands the intention behind the amendment. I am sure that he will want to resist it because, as I said in an earlier debate, Ministers always do. It is the right way forward, however, bearing in mind the huge uncertainty in the racing industry and the desire of so many Members from all parties to ensure that the future of racing in the absence of a levy board is as strong, if not stronger, than under the present arrangements. It is only right and proper that the genuine concern and interest of Members should be reflected by allowing the House to approve the transfer plan. That is the purpose of the amendment.

Richard Page (Conservative, South West Hertfordshire)

Now that my nerve is broken, it will be only a few seconds before I conclude my remarks. I would like to support the thrust of what my hon. Friend has put forward so eloquently. The Committee is fully aware of the importance of the levy board, and I suppose that I should declare an interest at this stage. As we know, the levy board earmarks a considerable sum for prizes for successful race horses. I travel in the hope of attaining some of that money at some point, but I have to say that my success has not been of any notable consequence. Knowing the paranoia of the House on matters relating to the declaration of interest, I am only too willing to mention that.

I am interested to find that the ''Concise Oxford English Dictionary'' is now written into law as the determinant of parliamentary legislation. I wonder whether the law may be challenged in the courts if that was relied on too strongly, but perhaps the Minister will achieve some status in the more arcane records of parliamentary milestones. In fact, he may have achieved such a milestone in the clause.

I am sorry to tell the Minister that I do not have his confidence in the OFT. I have already commented that its remit is very narrowly drawn and that Ministers do not have the ability, if it is necessary, to rein it in. However, I share his view and hope that all the parties involved will reach an amicable agreement so that racing can get on with worrying about how it will develop and promote the sport, rather than being held back in interminable discussions on how to reach a solution.

In supporting what my hon. Friend the Member for South-East Cambridgeshire said, I have a question to put: if an affirmative resolution is agreed to make a decision in the House on a scheme, could that resolution overturn an OFT direction? I sincerely hope that the House has supremacy in the matter. If it does not, I would have to say to my hon. Friend that his amendment is not worth the paper it is written on. If the House has that supremacy, I hope that the Minister agrees to the amendment so that the House can decide on how racing should progress.

Don Foster (Liberal Democrat, Bath)

I have a great deal of sympathy with the amendment tabled by the hon. Member for South-East Cambridgeshire for the clear reasons that he has given. Many of us have said that we support the Government's intention to abolish the levy and the

board. We believe that that is the right way to go, but we are anxious to know what is going to replace them and anxious to be confident that there will be a secure and sustainable source of funding for horse racing.

The sums indicate how important the issue is. The 2002–03 levy will bring horse racing about £72 million. However, it is accepted by many people that were the original proposals—now in doubt because of OFT rule 14—to have been implemented, the sums may have been significantly greater. Part of the proposed package was to discuss how the additional sums might be used, yet all that has been thrown into doubt even though it is important and we do not know how the matter will be resolved.

We heard from the Minister that we should not, at this stage, tie down the details of what will happen to the capital fund of £50 million. However, not tying people's hands means things are not clear. All that indicates great uncertainty, so it makes sense to have some mechanism by which Parliament, which vested powers in the Secretary of State to determine the levy, can have a say in determining and agreeing the alternative to it.

There is a great deal of uncertainty, one area of which I draw to the Minister's attention because I promised that I would refer to it. Earlier, we deliberated on the helpfulness or otherwise of the regulatory impact assessment provided by the Government. I note from the very helpful—in fact, brilliant—document produced by the Library that it is extremely generous to the Government in at least one respect. On page 26, under the heading ''Benefits of abolishing the Levy Board: the Government case'', the document says:

''Once again, the regulatory impact assessment accompanying the new Bill has a useful summary of the case for the Government's preferred option''.

I had a look at that useful summary of the Government's case. It sets out the benefits and costs of both the status quo and abolition. I worked on the assumption that if one subtracted the costs from the benefits, a net value would be obtained for both. I say to the Minister that the very helpful document in which he adds up the sums demonstrates that there is far more money to be made and that we would benefit from retaining the status quo. I am not always convinced, and on this occasion I am not choosing bits selectively. I am looking, in the current jargon, at the totality of the table provided. Unlike the Library, whose document is otherwise excellent, I did not find that a particularly useful summary of the Government's case. I hope that the Minister gives us the benefit of his thinking on that aspect of the regulatory impact assessment.

On a much more serious point, there is still a great deal of uncertainty, as acknowledged by the Minister and the Government. We need to have some method by which we can have parliamentary agreement to a new scheme as and when it is developed, and as soon as possible, because that would benefit the industry. With the OFT and European Court issues still in the wings and there still being a great deal of uncertainty, we need a clear way forward. The amendment provides it.

Richard Caborn (Labour, Sheffield Central)

On the general question, if we waited for total stability before doing anything in the industry, we would never do anything. I did not know much about horse racing when I came into the job, and I probably do not now, but if I have ever seen an industry create problems for itself, this is an absolutely classic example.

Don Foster (Liberal Democrat, Bath)

I am sorry the Minister says he knew little about horse racing when he came to the job. He will recall that in the interview he gave on taking up the job he said:

''I know nothing about horse racing''.

He did not say that he knew a little.

Richard Caborn (Labour, Sheffield Central)

I go round the track and I have been to the odd race meeting, but I shall leave that on one side. I reiterate that if we waited for the industry to have a period of stability during which legislation could be introduced with absolute certainty-—that is what everyone wants—the status quo would remain for ever more because nothing would happen. That is the background against which the drafting of the Bill should provide reassurance. Due to the turbulence that always seems to exist in the industry, we are trying to draft the provision in a way that will bring certainty to the transfer of assets. Indeed, the clause states at subsection (6):

''The Secretary of State shall not make or approve a transfer scheme under this section unless satisfied that any property or rights transferred will be used or exercised''

for the purposes laid down.

Let us take a worst-case scenario of no BHB, although I cannot imagine that. There would be a transfer and the way it would be done is clearly laid down in subsection (6). The amendment is superfluous and it would add nothing.

The Secretary of State would act on the advice of the levy board and it would be the board's duty to prepare the scheme of transfer as laid down in subsection (6). There is reassurance that, whatever body is involved in the transfer, there will be a duty to carry that out. The advice will be prepared professionally by the levy board, and all those reassurances should be there. That is our intention—I hope that all of it will be transferred to the governing body, the BHB—and we want it to be the reality. If that turns out not to be the case, I believe that all the safeguards that hon. Members are asking for exist.

In reply to the hon. Member for Bath, as I said earlier, the regulatory impact is but one matter to be considered when making a judgment. I hope that from time to time it can inform debate, but no more and no less than that.

James Paice (Conservative, South East Cambridgeshire)

I hear what the Minister is saying, but I am not entirely sure that it fits with the explanatory notes that the Government circulated with the Bill.

Richard Caborn (Labour, Sheffield Central)

I read from the Bill.

James Paice (Conservative, South East Cambridgeshire)

I know that the Bill is more important than the explanatory notes and even the ''Oxford English Dictionary''. The explanatory notes are clear at paragraph 69:

''Subsection (4) gives the Secretary of State the power to make a transfer scheme herself if the Board fails to comply with a direction to make a scheme or''—

this is the important bit—

''she decides not to approve a scheme submitted by the Levy Board.''

That gives her absolute power, and she can make her own scheme if she does not like what the levy board submits. That is the critical point, but I do not think that the Minister's comments reflected the fact that things do not have to be done with the approval of the industry or the board.

Richard Caborn (Labour, Sheffield Central)

I did not say that. I said that advice would be given and that the levy board would have a duty to prepare the scheme, with advice going to the Secretary of State. That advice would be taken in conjunction with what the Bill states at subsection (6):

''The Secretary of State shall not make or approve a transfer scheme under this section unless satisfied that any property or rights transferred will be used or exercised for the purpose of''

the activities listed in paragraphs (a), (b) and (c). That is the duty on the Secretary of State. Those reassurances exist, and if we reflect on the debate they should satisfy all the concerns that have been raised by hon. Members.

James Paice (Conservative, South East Cambridgeshire)

I stated in my opening remarks that I welcomed subsection (6), which is a direct lift from the 1963 Act. It is important that the Secretary of State cannot make a transfer scheme unless satisfied that those criteria are met. The point that I was making before the Minister intervened is that at the end of the day she is not forced to take the advice of the industry—she can make any transfer scheme she wants, subject to the requirements of subsection (6).

I am therefore disappointed that the Minister believes that it is not necessary for Members of this House to have any more say in the matter. In this instance, it would have been a reasonable concession from the Government to allow the House to approve the final transfer scheme, if for no other reason than that there are so many hon. Members who are interested in, and concerned about, this issue, although hon. Members speaking to this group of amendments have also described other valid reasons. But that is not the position that the Minister is prepared to adopt, so we will not be able to make progress at this stage. In the light of that, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

James Paice (Conservative, South East Cambridgeshire)

I beg to move amendment No. 21, in

clause 16, page 11, line 12, after first 'veterinary', insert 'or equine'.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss amendment No. 22, in

clause 16, page 11, line 14, after 'improvement', insert 'or integrity'.

James Paice (Conservative, South East Cambridgeshire)

The Minister needs to get his dictionary out again here, because these are exploratory amendments. I fully recognise that the clause comes from the 1963 Act, and that as the levy board has

developed since then we must assume that the its activities continue to be compliant with the 1963 Act.

I tabled these two amendments—in fact there is a third one that I should have tabled but did not, but I shall mention the issue—because I want to challenge the Minister to ensure that current practice, and what might be done in the future in close connection with that, would remain within these criteria. I sought to insert the word ''equine'' after the word ''veterinary'' simply because, as a layman, I am not absolutely certain how far the term ''veterinary science'' goes in relation to the work that is currently being done.

Let me just explain to the Committee a couple of points. First, the Equine Fertility Unit in my constituency is significantly funded by the levy board and does a vast amount of research into horse reproduction. The Minister may be convinced that this is veterinary work as opposed to research, but it is an issue that needs to be clarified. There is also the issue of the work done by the Horse Racing Forensic Laboratory. I was interested to see in paragraph 48 on page 32 of the now oft-mentioned regulatory impact assessment that there is a distinction between ''veterinary'' and ''forensic'' work. It refers to levels of expenditure on integrity services including, in brackets, ''forensic technology'', and then refers separately to ''veterinary sciences''. The work of the Horse Racing Forensic Laboratory is central to the integrity of horse racing, as it concerns drug testing and ensuring that horses are—if I may use the expression—running cleanly. I am not entirely convinced that that is covered by the word ''veterinary'', and that is why I sought to introduce the word ''equine'' to make sure that all forms of equine science are covered, including those that some might not accept as directly veterinary science. It is almost a tautology, but it is a point that needs to be clarified.

I should have sought to insert the word ''equine'' between ''veterinary'' and ''education'' as well. I refer again to the work of the National Stud, one of the country's leading institutions in providing training and management development in equine activity and looking after horses—the sort of issues to which the hon. Member for Colne Valley referred earlier. I am not sure that equine education is the same as veterinary education. Although I have not tabled the amendment, I would be grateful if the Minister could confirm that educating people to look after and handle horses is covered by the terminology.

Amendment No. 22 seeks to add ''integrity'' after ''improvement''. It goes back to the work of the Horse Racing Forensic Laboratory, which is the world leader in developing the means of ensuring the integrity of racing and that, as with other sports in which drugs may be involved, everything is done fairly. One might argue that it is part of the improvement of horse racing, but I am not convinced. It would be helpful if the Bill made it clear that the integrity of horse racing forms part of the remit of the transfer scheme.

I accept that the levy board is already attending to such matters. One could argue that the board must be covered by those expressions because it will operate under this legislation. However, it is an opportunity to

review the terminology and to ensure that we have got it right, bearing in mind that we have had 35 years of development since the 1963 Act. The work of the levy board and of the various institutions to which I have referred has moved ahead considerably, and I would hate to think that the excellent work that they do could founder because, at some later stage, we find that the legislative definitions have not kept up with their work.

I seek the opportunity to ensure that the terminology is right not only for the present, but for what we foresee to be the development of the services provided through the levy board. I hope that the Minister understands my concerns and will at least get his dictionary out when he responds.

Richard Caborn (Labour, Sheffield Central)

Again, we had a very good discussion around my table last night about the words that should be included. The hon. Gentleman acknowledges that for the past 40 years the 1963 Act has worked pretty effectively, and that therefore so have we. It is well tried and tested and that is why we have lifted from the Act large chunks of the provisions that we are discussing and placed them in the Bill. The track record demonstrates that the levy board has acted responsibly and that the funding has been there. All the hon. Gentleman's points have been covered in the past 40 years.

On amendment No. 21, a large part of what might be termed equine science would be subsumed within veterinary science; that which is not would fall under the third category, which is the improvement of horse racing, at least to the extent that is relevant to the issues covered by the Bill.

On amendment No. 22, money spent on the integrity of horse racing would also fall under the category of improvement of horse racing in general. The levy board provided funds in the past to the vital areas, and therefore nothing in the Bill would prevent the future owners of the board's assets from doing likewise.

Both amendments are superfluous. The track record of the past 40 years and the fact that we have lifted the clause from the 1963 Act should both provide reassurance. It is better for continuity and a smooth transition from the current arrangements to the new ones if those who have understood and worked with them for the past 40 years continue to do so. There will then be no misunderstanding, and one would hope that it would be business as usual.

I hope that, with that explanation, the hon. Gentleman will seek to withdraw the amendment.

James Paice (Conservative, South East Cambridgeshire)

Certainly we all want business as usual and we want those activities to continue.

I do not dissent from what the Minister has said. I simply wanted to take the opportunity provided by the Bill to update the language of the legislation to ensure that we are properly covered. I think that some of us may have had a more enjoyable evening than the Minister last night, if he spent all evening poring over the dictionary. However, if he is reassured that the wording covers not only what has been done but current activities, I accept what he says. As I have said, the Committee gives us an opportunity to improve

legislation as well as to change it, and legislation that has been in place for 40 years does not necessarily meet today's needs. However, the Minister has assured me that the words are not necessary, so for that reason, if for no other, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 16 ordered to stand part of the Bill.

Schedule 3 agreed to.

Clause 17 ordered to stand part of the Bill.

Schedule 4 - Abolition of the Horserace Betting Levy System: Consequential Amendments

Kali Mountford (Labour, Colne Valley)

I beg to move amendment No. 55, in

schedule 4, page 34, line 24, at end insert—

'(ca) protecting animals from being harmed or exploited by betting'.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss amendment No. 56, in

schedule 4, page 35, line 7, leave out '(c)' and insert '(ca)'.

Kali Mountford (Labour, Colne Valley)

The amendment again probes the Minister's intentions. He offered us a pretty stout belt earlier today when we were discussing the welfare of animals, both at the track with vets and post-retirement.

The amendment would give the Gaming Board responsibility to monitor animal welfare at the track, including such aspects as the height and type of jump that the animal is asked to address, the type of stabling available at the track and the animal's welfare during the race. We would therefore be assured that the present good practice would continue well into the future.

I hope that the Minister will be able to tell me, as he did earlier, that the welfare of animals at the track is already assured, in which case I shall consider what he says. All members of the Committee have agreed today that the racing industry has greater concern for the welfare of animals than other sports have, but I want to see that carried through to the future. That is what the amendment seeks to achieve.

Nick Hawkins (Conservative, Surrey Heath)

Again, I shall be interested to hear what the Minister says in reply. I am glad that the hon. Lady raises welfare concerns, as she and my hon. Friend the Member for Loughborough did earlier.

Many of the animal welfare organisations, not only the RSPCA but organisations such as the International League for the Protection of Horses, do worthwhile welfare work, including in some cases arranging for the care of former racehorses. As I regularly find myself driving past the ILPH headquarters near Snetterton when visiting my farming family in Norfolk, I thought that this would be a useful opportunity to place on record the important work that some of those charities do. I see the hon. Lady nodding. I know that she is aware of the issues.

I look forward to hearing what the Minister says. I agree with the hon. Lady that racing has a good animal welfare record. This small group of amendments gives us a good opportunity to place on record the worthwhile work that racing, those connected with racing and reputable animal welfare charities do in this area.

Andrew Rosindell (Conservative, Romford)

I endorse the amendment. The welfare of animals should always be uppermost in the minds of people who take part in sporting activities. There is a greyhound stadium in my constituency, so I am concerned about the welfare of greyhounds. Of course, that is not encompassed by the Bill, but the same principle applies.

I hope that the Minister will take on board the concerns raised by the hon. Member for Colne Valley. It is vital that we ensure that the matter is dealt with by the Bill. In his response, would the Minister clarify any discussions he may have had with horse welfare organisations? I would particularly like to know whether he has had any discussions with the British Horse Society or other groups that take animal welfare to heart with regard to sporting activities.

Richard Caborn (Labour, Sheffield Central)

Amendments Nos. 55 and 56 would require the Gaming Board to consider animal welfare when deciding whether to approve a race course for betting purposes. Again, I understand and appreciate the good intentions of my hon. Friend the Member for Colne Valley, which lie behind her amendment. However, with respect, her amendment is a misjudgment of the purpose of the amendments we are making to section 13 of the 1963 Act.

The Gaming Board will be given the task of approving race courses for betting, and foremost in their consideration must be the three principles that we decided on the basis of good gambling regulation. To remind the Committee, those are: keeping betting crime-free, ensuring it is fair and open, and—very importantly—protecting children and the vulnerable. It would be inappropriate, therefore, for the Gaming Board to consider animal welfare matters alongside those. Animal welfare, although most important, is not strictly relevant to the orderly conduct of betting on the racecourse.

Adrian Sanders (Liberal Democrat, Torbay)

It strikes me that there is a connection between welfare, betting and potential corruption when a decision has to be taken on whether a race should take place because of weather conditions. Would that not mean that the consideration of animal welfare comes within the terms of reference that the Minister has given?

Richard Caborn (Labour, Sheffield Central)

No, it would not be a decision of the Gaming Board. The stewards would make a judgment on weather conditions, and we are talking about the legislation. The amendment would also place an unnecessary burden on the Gaming Board, which understands that it does not have expertise in this area. Many of those who know the members of the Gaming Board will know that they do their job very efficiently,

but they do not have the expertise in the area referred to by the amendment.

Nevertheless, I take note of the underlying concerns that have prompted the amendments relating to welfare. I shall make sure that my officials bring the matter to the attention of my colleagues in DEFRA who have responsibility for animal welfare. As an aside, I would say in answer to the question raised about relationships with industry that I work closely with DEFRA on several issues relating to horses, and this is one of them. We have responsibility for racing and gambling, but my colleagues have much wider responsibilities as far as horses, and animal welfare, are concerned. We work closely with that Department on an official and at a political level, which has been shown recently in several Government initiatives that have operated across Departments. With that, I hope that my hon. Friend will withdraw her amendment, but I shall raise the issue with my colleagues in DEFRA.

Kali Mountford (Labour, Colne Valley)

I am grateful to my right hon. Friend, and I have listened carefully to his reply. I am concerned that the welfare of animals should be considered during betting. Certainly an animal's known condition during a race is a betting issue. That might be covered if we dealt with criminality in racing, to which my right hon. Friend has alluded. It could also be argued that this part of the schedule meets some of my concerns—for example, about race fixing that involves the fences. However, I have wider concerns. My right hon. Friend rightly cited the useful work done by DEFRA, but I am still worried about the design of the course and the stabling of animals. Perhaps I can take up those issues later when I have had discussions with DEFRA.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 4 agreed to.

Clause 18 - Tax

Richard Caborn (Labour, Sheffield Central)

I beg to move amendment No. 43, in

clause 18, page 11, line 38, after 'providing', insert '—

(a)'.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss Government amendments Nos. 44, 45 and 46.

Richard Caborn (Labour, Sheffield Central)

It has always been the Government's intention to waive any tax windfall that arises from the transfer of the levy board's assets. We also want to ensure that the levy board and any recipient would not face a tax disadvantage as a consequence of the transfer. The assets have to be used for specified purposes that benefit racing, and they will continue to be used in that way after the transfer.

The amendments, which add a reference in the clause to stamp duty land tax and elaborate the clause in other ways, will allow Treasury regulations to be made so that the transfer can take place without any unintended tax consequences.

Amendment agreed to.

Amendments made: No. 44, in

clause 18, page 11, line 40, at end insert—

'(b) for anything done under or in consequence of a transfer scheme to have or not have a specified consequence, or to be treated in a specified way, for the purposes of a tax provision;

(c) for anything done in connection with, or done by a person with rights in connection with, anything that was at any time transferred under a transfer scheme, to have or not have a specified consequence, or to be treated in a specified way, for the purposes of a tax provision;

(d) for a tax provision not to apply, or to apply with modifications, in respect of anything transferred under a transfer scheme;

(e) for anything transferred under a transfer scheme to be treated in a specified way for the purposes of a tax provision;

(f) for the withdrawal of relief (whether or not granted by virtue of the regulations), and the charging of tax, in connection with anything done under or in consequence of a transfer scheme where a specified event occurs, or specified conditions are satisfied, whether on or after the commencement of the scheme;

(g) for a power under this Part, or anything done in exercise of a power under this Part, to have or not have a specified consequence, or to be treated in a specified way, for the purposes of a tax provision.'.

No. 45, in

clause 18, page 11, line 42, leave out 'or'.

No. 46, in

clause 18, page 11, line 43, at end insert

'or stamp duty reserve tax'.—[Mr. Caborn.]

Clause 18, as amended, ordered to stand part of the Bill.

Clauses 19 and 20 ordered to stand part of the Bill.

Further consideration adjourned.—[Mr. Kemp.]

Adjourned accordingly at eight minutes past Eleven o'clock till this day at half-past Two o'clock.

Standing Committee D

Horserace Betting and Olympic Lottery Bill

Nick Hawkins (Conservative, Surrey Heath)

On a point of order, Mr. Illsley. I raise this not in a spirit of confrontation, but as a way of helping not only members of the Committee, but members of future Committees.

With the permission of my hon. Friend the Member for South-East Cambridgeshire (Mr. Paice), I have been borrowing his copy of the regulatory impact assessment. I had hoped to get my own copy after we rose before lunch, thinking as one normally does, as either a Front Bencher or a Back Bencher, that I would be able to get one from the Vote Office in the Members' Lobby. When I spoke to the Clerk there, he said that the Vote Office had never had a copy of the regulatory impact assessment. I understand from my hon. Friend that he did not get his copy from the Vote Office either. I asked the Vote Office in the Members' Lobby to see whether it could get hold of one for me over lunchtime, but it was unable to do so.

I have raised with other members of the Chairmen's Panel who chair other Committees—including the hon. Member for Bootle (Mr. Benton), my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) and the hon. Member for Bridgend (Mr. Griffiths)—the fact that Government papers are sometimes not in order. However, I have to be fair to the Minister and say that I have not really raised the matter in relation to the Department for Culture, Media and Sport. That has normally been a problem with Home Office documents.

I stress that Members of Parliament should be able to rely on finding all the papers relating to a Bill. The regulatory impact assessment should be in the Vote Office, as well as the Bill and the explanatory notes, which have been available. The Clerks in the Vote Office told me that they have the regulatory impact assessments for most Bills, so this is an aberration. However, they also said that they rely entirely on Departments. Clearly, the Government have been able to put copies in the Library, but it is important that we have copies in the Vote Office.

I hope that you, Mr. Illsley, and other members of the Chairmen's Panel encourage Departments to ensure that, for all Bills, the Bill itself, the explanatory notes and the regulatory impact assessment are available together in the Vote Office in the Members' Lobby.

Eric Illsley (Labour, Barnsley Central)

I take on board what the hon. Gentleman says. I am assured by the Government that the regulatory impact assessment was published, that copies were left in the Library and that it was published on the Department's website. I am not

sure why it has not been made available in the Vote Office, but I will investigate and try to give him better information when we next meet.

Clause 21 - Licensing of Olympic Lotteries

Nick Hawkins (Conservative, Surrey Heath)

I beg to move amendment No. 57, in

clause 21, page 12, line 14, at end insert

'and this lottery shall commence to coincide with the beginning of the Athens Olympics in 2004'.

We come to part 3, which deals with the proposed Olympic lottery. Before turning to the specifics of the amendment, I want to make it clear at the outset that the Conservatives fully support the bid for the 2012 Olympics to come to London. As members of the Committee and you will know, Mr. Illsley, I am a particularly passionate supporter of the London bid, because I am a lifelong sports fan. I am delighted to have the honour of being the shadow sports spokesman in the Commons when such crucial matters are being debated.

My noble Friend Lord Moynihan, the distinguished Olympian and former Conservative Minister for Sport when he sat in the Commons, and I genuinely want to improve the Bill if we can. Working not only with my hon. Friends who sit as members of the Committee, but with my hon. Friend the Member for Bromsgrove (Miss Kirkbride), my right hon. Friend the Member for Haltemprice and Howden (David Davis) and the others members of the shadow team, I want to raise three major issues relating to improving the Bill, which were foreshadowed on Second Reading, and a number of more minor but nevertheless important issues.

I was delighted to be at the successful launch of the London 2012 bid document at the Royal Opera House last Friday. All who were there, from all parties, would, I am sure, want to wish the London 2012 bid team every success. A number of us are wearing our London 2012 bid badges, which we were given last Friday.

The detail of the amendment covers one of the big issues and I make no apology for spending a bit of time setting out the background to it, because this is all connected with when the Olympic lottery game should start. To some extent, the issue is also linked to amendment No. 23, which is in the next group, although that relates to the next clause. If we have a significant debate now, the debates on the next group, and some others, may be a little shorter. I will also seek a very short stand part debate to cover an issue unrelated to the amendment. I make that clear even though I anticipate a fairly extensive discussion on the specifics of the timing of the lottery.

On Second Reading, we made it clear that to ensure the success of the new Olympic lottery game in the UK it ought to start at a time of maximum public interest in sporting and, in particular, Olympic matters. There are excellent reasons why the new lottery should commence at the time of the Olympics and Paralympics in Athens this summer.

We are aware that one likely objection that the Minister might have, as advised by his officials, is that

to start the new lottery game before London is, as we all hope, declared the bid winner in 2005 might be to contravene International Olympic Committee rules. We are not at all convinced that enough thought or effort has gone into trying to ensure that the game could be launched to coincide with the Athens Olympics and Paralympics. It may not be that the idea of starting the game early has been tried and found wanting. Rather, it may be that it was found to be difficult and therefore not tried.

I make no secret of my fervent desire to get as much money from all sources—private and public—into all kinds of sport in this country. That was one point that I made strongly in my winding-up speech on Second Reading. The need to obtain more money for sport was one of my motivations for becoming a Member of the House—it had not received enough political attention or support over the previous 30 or more years.

The feeling that we must do more for sport is shared by Members on both sides of the House, not least the hon. Member for Loughborough (Mr. Reed), with whom I have been glad to work cross-party on the all-party sports group of which I have been the Conservative vice-chairman for many years. He is also the Lords and Commons rugby team's answer to Jonny Wilkinson at fly half.

I say to the Minister and to the Government, in what I hope will be regarded as a constructive spirit, that we might be able to revise our view if he will during consideration of the Bill in the House, but not necessarily today, provide the Opposition with his chapter and verse considerations, as well as those of his officials, and copies of all internal DCMS discussion papers to show that launching the Olympic lottery game to coincide with the Athens Olympics and Paralympics has been fully explored. We will wait and see what he says today, however.

Before I move on to the next part of the issue, it is important to consider what has happened to lottery sales in recent years, and especially the effect of declining sales and the reduction in money provided for sport. Many people who have held senior roles in sport—not least the former chairman of Sport England, Trevor Brooking, who is now, I am happy to say, in a very senior position in English football—have felt that sport's legitimate expectations in the early years of the lottery have been disappointed. To some extent, we regard the disappointment, as do others, as resulting from the Government's changes in lottery policy.

To understand why the UK Olympic lottery game must have the best possible start, one must consider how the money that previously went to sport as one of the original good causes when John Major's Conservative Government established the lottery has diminished. We suggest that the most likely way to avoid breaking IOC rules, while recognising that it is important to keep strictly within them, is to launch a new lottery game in which all the money—I will come to the tax take later—goes to help elite sportsmen and

women who are probably future Olympic and Paralympic athletes.

If the Olympic lottery were to start in 2004 to coincide with the Athens Olympics and Paralympics, it could be relaunched in 2005, which might further boost ticket sales. In so far as I have followed the history of lotteries in other countries and looked at the various papers that Camelot has produced, lottery operators say that every so often they have to launch a new game, relaunch or rebrand old ones, or bring out fresh advertising to boost ticket sales. Therefore, a launch this summer and a relaunch when, as we hope, the UK wins the Olympic bid in 2005 would help.

It so happened that I was in Sydney, Australia, on the day many years ago when it was announced that Sydney had won its Olympic bid. On that day and for some days and weeks afterwards, there was the same enthusiasm that we all saw when the games themselves took place and, later, when Australia hosted the rugby World cup—of course, Australia was a very successful host, but we won it.

I do not wish to rehash all the arguments that other shadow Ministers and I have made on various occasions about how the Government have detracted from the lottery's appeal to many ordinary voters and players. As recently as Monday this week in a debate in this very Room on a statutory instrument relating to the New Opportunities Fund, I had the chance to put some of our arguments on the lottery to the Minister's colleague, the Minister for the Arts. We feel strongly that sport has lost out because of the Government's breach of what has come to be known as the principle of no substitution or additionality, which many Labour Back Benchers were keen to stress in Opposition.

That principle says that lottery funds should not be substituted for normal taxpayer funding in respect of expenditures such as health and education. In the delegated legislation Committee on Monday, the hon. Member for Liverpool, Walton (Mr. Kilfoyle) said that he had not supported the lottery at the time and had not changed his view. He added that he had been one of the Labour Back Benchers who considered the original lottery legislation who said that no Government, whether Labour or Conservative, should ever use lottery money for things such as health and education, which ought to be paid for through taxpayer funding. The one point on which he and I agreed was that that had subsequently happened.

The Government's regulatory impact assessment and the Library's excellent briefing cover, to some extent, the reasons for the decline in lottery ticket sales. The briefing states on page 36:

''Some have linked the fall in sales to some controversial lottery decisions in recent years. For example, in 1998 and 2002, the Community Fund made grants to the National Coalition of Anti-Deportation Campaigns, an organisation which provides help and advice to people appealing against deportation. This received hostile media coverage and was criticised in a report by the National Audit Office in April 2003.''

One reason that I have a particular recollection of that NAO report and the subsequent media coverage is that, as one of the shadow Ministers, I was interviewed by the media fairly extensively at the

time. There was criticism from Opposition Front Benchers and, strikingly, from no less a person than the Home Secretary himself, who said that lottery money should not go to such people.

I was also involved in media coverage of another controversial lottery grant to an organisation that was campaigning to prevent any child, however badly they behaved, from ever being excluded from school. On that occasion, I was supported by Ministers in the Department for Education and Skills, who said that that was a wrong use of lottery money. Not only Opposition shadow Ministers, but Ministers themselves, have made such points.

Andy Reed (Labour/Co-operative, Loughborough)

Does the hon. Gentleman agree that the rot started with the controversy over the Churchill papers a number of years ago, which impacted on people's perception of the lottery? In particular, will he acknowledge on the record that there are thousands of very good projects around the country and that it has taken the lottery operators, organisers and distributors some time to put across that positive message?

Nick Hawkins (Conservative, Surrey Heath)

I entirely agree with the hon. Gentleman's second point. As he knows, I have worked hard with a number of lottery bids for sport, as he has done in his constituency. That is something that we all care about passionately. Unlike the hon. Member for Liverpool, Walton, to whom I referred earlier, I have always been a supporter of the lottery. My concern has been that the legitimate expectations of sport, which were fulfilled in the early years of the lottery, have been reduced.

I do not agree with the hon. Gentleman's first point. The Library highlights the same issues that I would highlight about when lottery sales started to decline. That was linked to some of the recent controversial decisions that have been criticised by both the Government and the Opposition.

Brian White (Labour, North East Milton Keynes)

Is the hon. Gentleman saying that local distributors should never award a lottery grant to a controversial project? Is he saying that there should be political input to those decisions, as he implies that the Home Secretary and those on the Opposition Front Bench would like?

Nick Hawkins (Conservative, Surrey Heath)

I am saying that because of the sensitivity that members of the public and those who pay to play the lottery—I am one of them; millions of people play the lottery every week—will have about the way in which lottery money is spent, the distributory bodies need to bear in mind what lottery players will think about how the money is used. Those bodies have made some mistakes in the past. Where Her Majesty's Government and Her Majesty's loyal Opposition agree—a rare event, as the hon. Gentleman will acknowledge—that such a mistake has been made, it suggests that the lottery distributing body might not have thought the issue through enough.

No lottery distributory body would be wise to make a grant to any organisation whose remit is specifically to put itself in the way of Government policy. That was the case both in terms of what the Home Secretary said about the anti-deportation group and what the gentleman who was benefiting from lottery funding said about it being his raison d'être to stop any child being excluded from any school, however badly they had behaved. It is not sensible for a distributory body to be giving money to such causes.

I want to come back to the amendment, because you, Mr. Illsley, will otherwise rule me out of order. By virtue of amendment No. 57, the Government have an opportunity to do something about the damage that has been caused to the lottery in the past. Even though I am not putting my hand on my heart, I hope the Minister will accept that I am entirely sincere in asking whether we can please try to work on a cross-party and all-party basis to try to find a way in which we can start the Olympic lottery earlier without breaking the IOC rules.

Whatever the Minister may stand up and say, he must recognise in his heart of hearts that a good way of giving a new Olympic lottery game a flying start would be to establish it to coincide with the Athens Olympics and Paralympics, as the amendment seeks to do. That is the time when millions of people in this country will be watching the TV coverage, listening to the radio and reading the papers—and it will all be about the Olympics. That will be the big sporting event of the coming summer. I hope that he will understand that we want to contribute, and that the amendment is a genuine attempt to improve the Bill.

My final point is about the way in which we hope that the change can happen and the risks that will arise if it does not. As all our constituents and the media frequently remind us, whichever party we represent, people in this country are very law abiding. We have a habit of handicapping ourselves by trying to observe every dot and comma of every rule and regulation, whether it comes from the European Union, the European Commission or any other international body, while many other countries that are our partners in international organisations do not do so. One thinks of examples such as when our fishermen were handicapped because fishing inspectors were in every port insisting that every dot and comma of fishing regulations was observed. At one time, Spain had six fisheries inspectors, and they were all based in Madrid; none of them was supervising the Spanish trawlermen at all. That situation did enormous damage to the way in which our partnership within the EU was perceived, particularly by those in the fishing communities.

In many other countries, people say ''What is good for our country must come first''. We have to find a way of steering around the regulations and turning a blind eye to a breach of those regulations for the sake of our country. I do not know the details concerning lotteries in New York or America in general, Paris or France in general or Rio de Janeiro or Brazil in general, but I point out that there will be huge concern in sport and among sports fans in this country if Her Majesty's Government tell us that they cannot

contemplate launching a sports lottery to coincide with the Athens Olympics and Paralympics this summer. We might then find that Paris, New York or Rio de Janeiro have found a way of launching a sports lottery to coincide with the Olympics and Paralympics. Will the Minister at least consider that issue? It would do damage if we did not launch such a lottery because we were observing every dot and comma of the regulations, while one of our rival bidding countries did so.

Brian White (Labour, North East Milton Keynes)

Is not the hon. Gentleman advocating the kind of sentiment that led Salt Lake City—a number of Olympic bidding cities in the past have done the same thing—to take the view that it came first and to bend every rule to get the games, which has caused major problems for the Olympic movement?

Nick Hawkins (Conservative, Surrey Heath)

I think that the hon. Gentleman is slightly misunderstanding the point. I am not suggesting that we bend the rules.

Brian White (Labour, North East Milton Keynes)

That is what you said.

Nick Hawkins (Conservative, Surrey Heath)

No, that is not what I said, as the record will show. I said that other countries had tended in the past to bend regulations for their purposes. I want the Minister to keep an open mind and enter into all-party discussions to see whether there is a way of sticking within the rules and yet launching a bid this summer when interest in the Olympics is at its height. The reason why I want him to do so is my worry that there will otherwise be huge concern in sport and in the country in general, particularly if somebody else does indeed find a way to proceed along those lines.

I hope that the Minister will bear my warning in mind when he responds to the debate. I hope that he will recognise that the amendment is a genuine attempt to improve the Bill, and that we think that it could boost funds for sport and for the Olympics by ensuring that the new game is launched at the earliest sensible moment to coincide with the Athens Olympics and Paralympics.

Don Foster (Liberal Democrat, Bath)

Like the hon. Gentleman, I wish to make it absolutely clear at the outset that we fully support the Olympic bid, and we are keen to ensure that the current all-party consensus on the issue continues. The Committee will be aware that, on Second Reading, I expressed a number of concerns about the introduction of a special Olympic lottery game. First, there was concern that it represented further Government interference in determining how lottery money was used. Secondly, I referred to the impact that it would have on other good causes. I went on to say, however, that we need to make exceptions to a rule from time to time. Winning the Olympic bid is of significant importance to this country. I made it clear that, as the Olympic lottery game would be part of the package that would demonstrate to the IOC that we had robust finances in place to fund the bid, we were prepared to make an exception to our more general concerns about the lottery.

We, too, wondered whether there was merit in starting an Olympic lottery earlier, and we will certainly be interested to know what discussions the Government have had on that issue. We are well aware that the IOC has said that it would not sanction such an operation; indeed, it has gone further and said that we certainly would not be able to use the Olympic logo in respect of any such lottery activity. It is not the Minister whom we would have to persuade, but the IOC, which has already made it clear that it is not going to support that proposal. I hope that it will make that equally clear to all the rival bidders as well, so that there will be a level playing field.

The hon. Member for Surrey Heath (Mr. Hawkins) was right to ask the Minister to tell us what consideration the Government have given to the matter. I, too, am somewhat confused about their position. My confusion is based on a report that appeared in The Independent on 10 December last year. It stated:

''A special Olympic lottery game which would help fund a 2012 Games in London will not be launched until it is known whether the bid is successful. The original plan was to launch Olympic Lottery games next spring but following a ruling by the International Olympic Committee, these will now only take place if London is declared the host city in July 2005.''

This is the cause of my confusion:

''A spokesman for the Department of Culture, Media and Sport confirmed yesterday that bid organisers had initially planned an earlier launch but that it was now accepted that they would have to wait until a decision is made. '' 'It has always been our intention to launch the games off the back of winning the bid,' he said.''

While the organisers were looking at the possibility of adopting the proposal made in the amendment, that comment seems to indicate that the Government have never intended to do so, regardless of the IOC ruling. I should be grateful for clarification.

I say to the hon. Gentleman that, although there has been a fair degree of agreement on the Opposition side of the Committee on most issues—in fact, there has been agreement on both sides—I must disappoint him on this one. Having considered the possibility before us, we do not believe that it is a sensible way forward. I have already pointed out one reason: it is not that we would have to persuade the Government, but that we would have to persuade the IOC, which has already made its view clear. We would be banging our heads against a brick wall by going down that track.

Even if that were not the case, there are a number of other reasons why we cannot support the proposal. First, the presumed intention of having an earlier game is that it would help to fund the bid preparation work, but the reality is that there is no possibility of the Bill receiving Royal Assent until July, when we shall be halfway into the bid process. The final decision will be made one year after that. The bid work would be well under way and the measure would come too late in the day to be helpful.

We are also conscious that a sound structure is already in place for funding the bid process. We know that the Department and the London Development Agency will make a contribution and that there will be private and commercial support in cash or in kind.

Nick Hawkins (Conservative, Surrey Heath)

Surely the hon. Gentleman recognises that, if we want to give the Olympic lottery game the best possible start, there will be advantages in conducting a launch when the public's mind is focused on the Olympics. I realise that I shall not persuade him about the IOC, but if he acknowledges that position and accepts the fact that whenever the Bill receives Royal Assent the money could go not just to the bid, but to sport—a whole group of our amendments would achieve that aim—can he not see the benefit?

Don Foster (Liberal Democrat, Bath)

I can see some benefit, and the Minister has told us that we should consider the totality and make a judgment. There are arguments in favour of what the hon. Gentleman says, but my point is that the disadvantages outweigh those arguments. I shall come to his point about funding for sport shortly. We are concerned that the measure would come too late to help the bid process. We have an alternative robust funding mechanism for the money to prepare the bid and I see little point in attempting to alienate the IOC now. We are all conscious that, sadly, the Prime Minister upset it with his early remarks at the Commonwealth summit.

Richard Caborn (Labour, Sheffield Central)

That is totally untrue. We were reported to the IOC. The IOC received that report and nothing has happened. Hon. Members must realise that what we read in the newspapers is what people write who report my right hon. Friend the Prime Minister. He told the Commonwealth conference how good the Commonwealth games in Manchester were and he used that as a springboard to say to many people in the Commonwealth ''We have run the biggest multi-sporting event in the last two or three years. We are very capable of running the Olympics.'' That should be welcomed, rather than criticised. I want to put the record straight: we have not been reprimanded by anybody. We were reported, but nothing happened.

Don Foster (Liberal Democrat, Bath)

I am delighted to hear that and delighted that the Minister had the opportunity to place firmly on the record his comments about our successful running of those games. I am also delighted that we have not upset anybody, if that is the case. Let us not upset anybody. If we have not done so so far, let us keep a clean sheet for as long as we can.

My other concern is the one that I raised at the start. I am conscious that Olympic lottery games will have an impact on the other good causes. The document to which we all refer, but which appears to be so difficult for hon. Members to get hold of—the regulatory impact assessment—is honest about that. Nobody disputes that there will be a knock-on effect on the other good causes. It will be appropriate to accept that knock-on effect after we have won the bid, if we do, but launching the Olympic lottery early in the way suggested by the hon. Member for Surrey Heath would not have much popular support.

According to the regulatory impact assessment, the arts, sport and heritage are each expected to lose £11 million a year, so significant losses would occur. I am as keen as the hon. Gentleman is to see as much

money as possible going into sport, but in the seven years during which we hope to raise the £750 million for the Olympics from the new lottery games, about £1.4 billion will go separately into sport from the remaining sports element of the lottery. Therefore, there will continue to be significant funding for sport.

I believe that the case has not been made. Commencing the lottery early would damage our bid because of the problems that that would create with the IOC, and in any case the IOC has said that we cannot do it. Even if we could persuade the IOC, it would be too late, because of the date of Royal Assent. Finally, it will damage other good causes. The public might accept such damage once we have been successful in getting the bid, but not before.

Nick Hawkins (Conservative, Surrey Heath)

Does the hon. Gentleman accept that if it were possible to raise a significant extra amount for sport by launching a game this summer to coincide with the Athens Olympics and Paralympics, which became the full Olympic lottery when, as we hope, the UK wins the bid, the shortfalls to which the regulatory impact assessment refers might not occur? We might find that the sports lottery fund did not have to be raided, and the arts might benefit. That is the kind of extra benefit that might arise from running the game for an extra year.

Don Foster (Liberal Democrat, Bath)

The hon. Gentleman's argument is that refreshing the lottery by whatever means from time to time is a good thing, and I hope that Camelot will take that on board. Indeed, it seems to have introduced so many new games of late that I am totally confused when I go into a lottery distributor as to what is a national lottery activity and what is not. However, others who are more expert in these matters tell me that I am one of very few, that everybody else fully understands the lottery and that it is a jolly good thing. If that is right, so be it; I am prepared to be the odd one out. I understand the hon. Gentleman's argument, but he would acknowledge that putting it into practice would mean an earlier loss to some of the other good causes. I think that the public would understand, once we had won the bid, but there would be a lot of resistance if we did that earlier. As I have said, there are other good reasons why we should not.

In conclusion, I am absolutely delighted about the Government's clear commitment to ensure that the new lottery distribution body dealing with the Olympic bid will be a lean organisation, significantly reducing the bureaucratic costs, and I welcome that very much. For the reasons that I have given, we shall be unable on this rare occasion to support the hon. Gentleman and his colleagues.

Andy Reed (Labour/Co-operative, Loughborough)

I apologise to the Minister: I shall be very brief. The amendment looks seductive. As a member of the all-party Olympic committee I note that when we first met Barbara Cassani and her support team, the idea of launching the Olympic lottery on the back of the Olympics 2004 seemed a good one. Those of us who are passionate about sport recognise that mega television events generate a great deal of interest, and one has only to look at the success of the rugby World cup to see that. I am grateful to the hon. Member for Surrey Heath for giving me an opportunity to talk the Minister through the try I scored last weekend, as I did

in the debate on grass-roots sport in Westminster Hall. Unfortunately, I did not score this weekend so we shall leave that subject.

We do have a golden opportunity, but I am sure that the hon. Gentleman recognises that we have had a great deal of briefing from the British Olympic Association and the bid team on the need—this is where I entirely agree with the hon. Member for Bath (Mr. Foster)—to ensure that we are playing within the rules of the game. Because of all the difficulties that my hon. Friend the Member for Milton Keynes, North-East (Brian White) mentioned concerning past bids, the IOC needs to be seen to be whiter than white in the bid process. Anything that we did to step out of the boundaries of the rules may jeopardise the entire bid. It is one that we all want to see succeed. I passionately want to see it succeed, and I do not want anything to be put in its way. I am interested to see what the Minister has to say, because if there is a glimmer of an opportunity to do something on the back of the Athens Olympics that is totally within the IOC rules, I would like to know if we could follow that through.

I share some of the concerns of other hon. Members who are interested in grass-roots sports that there might be some siphoning off of sports moneys during this period. If we could start a year earlier and get to the £750 million mark by generating an extra year's worth of funding, that would be attractive, but it would have to take place totally within the IOC rules.

Nick Hawkins (Conservative, Surrey Heath)

As the hon. Gentleman knows, and as I made clear in my initial remarks, I share his views on many of the issues. We have worked together on the all-party sports group and the all-party Olympics group. I am glad to have his qualified support, subject to what the Minister has to say. Would he agree that both of us, in our respective roles in all-party groups, have received many submissions from small grass-roots organisations expressing concern that the money that there was for sport in the early years of the lottery has not been there of late? There is particular concern about that, and we are trying to recognise that concern.

Andy Reed (Labour/Co-operative, Loughborough)

It goes without saying that from a high point of £250 million a year, the lottery funding of sport now stands at about £170 million. There are questions about how we spent money during period. We spent £1.6 billion on sport, but participation rates have risen by only 0.3 per cent. It is not just a matter of the total amount, but how it is spent.

I am delighted that there has been a shift in emphasis, and we are going to spend money on driving up participation rates in grass-roots sport because that is where it will make an enormous difference. I partially agree that there has been a decline, and people will clearly be worried about that. I totally support the Olympic bid, and the idea of an Olympic lottery, but with the caveat that we have to watch carefully the impact on sport in general.

However, we have to be really positive and recognise that the impact of the London Olympic bid will be nationwide. Even though Loughborough will

not be one of the major Olympic sites, I hope that it will benefit by hosting one of the major teams at its excellent facilities—the £35 million elite sports facilities that have been funded by the lottery at Loughborough university.

Khalid Mahmood (Labour, Birmingham, Perry Barr)

Alexandra athletics stadium is in my constituency, and I am sure that it is one site that will be considered by the British Olympic Association.

Andy Reed (Labour/Co-operative, Loughborough)

I fear that I may have started something, but I must give way to the hon. Member for Bath.

Don Foster (Liberal Democrat, Bath)

I am very grateful to the hon. Gentleman. Does he agree that the similarly costing facilities in Bath would make an excellent venue?

Andy Reed (Labour/Co-operative, Loughborough)

I feared that I had started something. I have visited the facilities at Bath. A friend of mine has a house that backs on to the university, and one Sunday afternoon, before Loughborough's 50 m swimming pool had been built, I went to see Bath's pool. It is a shame that it is now the second best pool in the UK, but that is always the benefit of having the newest facilities.

Right across the country, places such as Bath, Loughborough and Birmingham will benefit from the Olympics because major teams will be based in our areas in the same way that the British team based itself on the Gold coast in Australia, which, it is estimated, generated £1 million or £2 million worth of local business income. We will all benefit, so I hope that we will not see a reduction in sport funding and that we will consider the matter very carefully. I look forward to the Minister's response.

Richard Caborn (Labour, Sheffield Central)

I know that the matter relates to amendment No. 57, and I will return to it; however, we seem to be having a general debate on clause 21 and clause 22.

I do not disagree with putting more money into sport. By that I mean sport in its totality; not only one section, but all. Funding comes not only from the lottery and the sport section; the New Opportunities Fund has contributed £750 million to sports facilities through local education authorities. When we announced the UK bid, the fund contributed another £100 million to sports facilities, which has now been carried through by the new regional sports boards. They are looking for partnerships in the public or private sector and from universities such as Bath and Loughborough.

We have announced a mandatory relief on rates that have been required for the past 30 years. I am a little disappointed that despite all the publicity given to the reasons why we should provide the relief—I argued very forcibly in Whitehall for it—only 550 out of 110,000 clubs had applied for it by 31 December 2003.

We have also introduced community amateur sports clubs. In the past two and a half years, the amount of lottery and Exchequer money that has gone into sport from the grass roots all the way through has been significant. Some £60 million of capital modernisation funds is being put into clubs and schools—a very important factor in the development of sport. We have given that money to the four main

governing bodies of rugby, tennis, cricket and football, with £9.3 million to each over the next three years, alongside £40 million to athletics. So if anybody thinks that the Government do not believe that investment in sport is important, they have missed the facts.

I know that we are just discussing the lottery, but much bigger funding streams are being put in place within the lottery and outside of it.

Brian White (Labour, North East Milton Keynes)

On the very welcome resources going into sport, one perception is that women's sport always loses out to men's. Will my right hon. Friend assure us that it is Government policy to ensure that women's sport—particularly as it is currently so successful in athletics—receives its fair share of the money?

Eric Illsley (Labour, Barnsley Central)

Order. Before the hon. Gentleman answers that, I should say that, in deference to the hon. Member for Surrey Heath, I agreed without saying so to a wide-ranging debate on amendments Nos. 21 and 22 on the timing and licensing of the lottery game, but we are in danger of spreading the discussion too widely and debating sport in general. I will allow some leeway because we are making good progress with the Bill, but I do not want to stray too far from the legislation and its amendments.

Richard Caborn (Labour, Sheffield Central)

I hear what you are saying, Mr. Illsley, and you are probably right to bring us back to order, but I just wanted to put on the record what is being funded.

To return to the core of the discussion, the IOC has made it clear to all the countries that are bidding that lottery money cannot be used for staging the Olympics until the city in question is the host. That is clear in the rules of the IOC. We believe that it would be wrong to start the lottery earlier. Why do we believe that? The IOC would permit an earlier lottery for other Olympic causes—Team GB, the British Olympic Association or the British Paralympic Association, for example. No one would doubt that those are worthy causes, but can we justify the hypothecation of lottery money to a small section of sport such as Team GB or the Paralympics? That would be hard.

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the Minister for clarifying the Government's understanding of the IOC rules. He has confirmed what the Conservatives thought, which is that there would be a way of doing what we want. I would be grateful if he commented on my personal feeling that it would strengthen our bid prospects if it were seen that Her Majesty's Government had launched a lottery that was committed to helping Team GB and the Paralympics, and if that money were coming in for a whole year before the bid process was decided. Does he not recognise that that is a possible way of interpreting what would be allowed within the rules?

Richard Caborn (Labour, Sheffield Central)

I do not think that that would be the case. I am talking about displacement from other good causes. If the proposal were taken to its logical conclusion, we could well find that the reduction in the take from the lottery for other good causes would mean a reduction in the sports lottery element. The

grass-roots part of that could well be used to finance the British Olympic and Paralympic teams. Many people involved in sports at grass-roots level would not welcome that. They would say that the investment was yet again going to the elite element of sports.

When lottery money is divided, there must be a balance between elite and grass-roots sports. We must consider that balance and keep revisiting it. The proposals would mean funding a special group of people through legislation. Money displaced from sport and other good causes would go directly to Team GB.

Nick Hawkins (Conservative, Surrey Heath)

Is it possible for the Government and Camelot, working in tandem, to at least carry out an assessment? I recognise the importance of the Minister's point about displacement, but, as we have already seen, some studies on displacement have been carried out. The regulatory impact assessment and the House of Commons research paper refer to that.

I think we all agree that, in terms of public interest, it would be good to launch the game at the time of the Athens Olympics and Paralympics. Before the Government finally close their mind to that, will they at least contemplate carrying out a study to see whether the displacement that the Minister is worried about—I understand all the good reasons for worrying about it—would happen? We might find that we were making the whole cake bigger, rather than taking one slice away. If the study showed that the whole cake was bigger, that could benefit sport and other lottery causes. Is that not worth looking into?

Richard Caborn (Labour, Sheffield Central)

In a sense we have already done that, with Camelot and the National Lottery Commission. They say that more than half the new Olympic lottery sales might represent sales diverted from existing games. In layman's terms, that would equate to a loss of income of approximately 5 per cent. in relation to each of the other good causes—£64 million on average per year. That is what the professionals tell us. Using that model, they say that that would be the displacement factor.

We are talking about a judgment, and it obviously depends on what is fed into the model. There are those on the optimistic side, who say that the proposal would not just revive things in relation to the Olympic games, but could give a boost to the lottery per se. There is an argument about people getting into the habit of doing a lottery—that is true. Refreshing lotteries is always a problem, and the interest has to be kept. Once there is that interest, people may continue to play the other lottery games as well. There is a judgment involved here, but the advice I am given is that there will be the displacement I have referred to.

Let me say clearly that we have been commended for how we have approached the business plan of the games both up to the bid and beyond it to deliver the games. We have taken it very seriously indeed. As I think hon. Members know, the Secretary of State and I have gone round and considered the problems of staging the games—not just the run-up to the bidding, but their operation and what the exit strategies and legacies will be. We have learned a lot from that, and

we were commended by the president of the IOC for our approach.

The financial structure that we have put in place, which is very robust indeed, contains slightly more than £1 billion of contingencies, which nobody else had put in. We were advised, particularly by Sydney, to do so. Based on my experience in Manchester, I believe that we presented a financial structure that is robust and that will withstand any scrutiny or examination.

However, the hon. Member for Surrey Heath is asking the Government to consider starting the lottery earlier—I remind the Committee that there is a possibility that we might not get the Olympics—which would have a displacement factor. That could affect the grass roots of sport at the expense of the elite and, specifically, Team GB. There may be an argument that Team GB is great and incredibly well run. Nevertheless, the Government would see that as patently unfair. Therefore, I do not believe that it would withstand examination.

The other point that the hon. Gentleman made—about the time of launch—is interesting. He said that he was in Sydney when it won the bid and described the euphoria that was around. We should try to cast our minds forward: yes, there will be, I hope, a fantastic Olympics in Athens and there will be a European championships, but just imagine the run-up to 6 July in Singapore. We and somebody else will be head to head over who gets the Olympics. What more excitement could we want than coming back here the day after winning it, with all the bells ringing? We could say, ''Right, we are straight into the Olympic draw.'' The stage is set to launch that Olympic bid on the day we get the nod from the IOC—out of Singapore and away we go. It is important that we get the timing right here, and I think that when we get the nod from the IOC in July 2005 will be the time to do it.

The hon. Member for Bath obviously reads The Independent—a very good newspaper. An article dated 10 December 2003 says that the bid organisers—the hon. Gentleman could have included Camelot as well—wanted to run. They wanted to run for obvious reasons, but they are not the Government and they are not making a judgment about other good causes, or about what is fair. They have a job to do. They are bid companies and they are there to win the bid. They will do anything that would be advantageous. Camelot wants to refresh the lottery, and the Olympics would do that.

So, it is understandable that, according to The Independent on 10 December 2003, both the bid company and Camelot wanted to start the draw earlier than we propose. That is evident and obvious. There is no contradiction there, but we have made it clear from the outset that we want to start it immediately after we get the nod from the IOC, which, I hope, will be on 6 or 7 July.

I ask the hon. Member for Surrey Heath to withdraw the amendment, because it would restrict

Camelot from starting several lottery games. Camelot may want to run not one but a sequence of games for the Olympics and stagger their timing. The amendment would restrict its flexibility to maximise the Olympic draw in the manner it sees fit.

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the Minister, who has been generous not only in giving way, but in responding in detail to my questions. However, he has not covered one point. Can the research studies that he and his officials have done, as well as those from other sources to which he has had access, be made available to the other parties in the House? It would be helpful, as the debate goes on, if we could read those documents.

Richard Caborn (Labour, Sheffield Central)

The answer is yes. As the hon. Gentleman knows, we meet regularly and receive information regularly. I shall ensure that an item is put on the agenda of the next meeting of Ministers and Opposition spokespersons, and we will go through that.

Nick Hawkins (Conservative, Surrey Heath)

We have had a good debate and I am glad that several Back-Bench Labour Members participated, along with the Minister, the hon. Member for Bath and me, because that has enabled us to go through some wider lottery issues. Having had this lengthy debate, we should be able to take some subsequent groups more quickly.

I shall not press the matter to a Division today , but that is not from lack of faith in the arguments. It is because, according to the rules under which we operate, it would be better not to divide the Committee to leave scope for revisiting the issue. However, the Minister has been tremendously helpful in confirming that there would be a way, as Conservative Members had hoped, to launch a game without breaching the IOC rules.

Like my noble Friend Lord Moynihan, who has much longer experience than I of the Olympics and dealing with the IOC, I remain of the view that such a game would increase the size of the cake. The Minister has been very frank and helpful in saying that that is a judgment call. He and the Government made a judgment, but we would make a different one. We believe that an Olympic lottery game launched to coincide with the Athens Olympics and Paralympics would bring in money for sport. Then, if necessary, it could be relaunched with extra games or modifications when, as we hope, the UK wins the bid. That would increase the size of the cake, and grass-roots sport would benefit.

It is a mistake to think that grass-roots sport does not benefit from what helps the elite sportsmen and sportswomen and Paralympic athletes. One reason that young people in particular get involved in sports is that they are inspired by their sporting heroes. I did a great deal of competitive swimming when I was younger and I was much inspired by the fact that the captain of my swimming club, Brian Brinkley, led the British Olympic swimming team at the 1972 Munich Olympics. Three members of my club were also in that squad. I was not good enough to get into the Great Britain squad, but I did swim against Scotland and Wales.

Young people in every new generation need such inspiration. An Olympic lottery game that coincides with the Olympics would inspire many people. Many more would play a specific, dedicated Olympic lottery game. Whenever it starts—whether this summer to coincide with the 2004 games, as we hope, or in 2005—we will be able to see the figures. Until then, the studies that the Minister will kindly share with us remain only informed guesswork, or assessments. As he put it, they are judgment calls.

We shall return to the matter on Report and in another place, where my noble Friend Lord Moynihan will, no doubt, deploy further arguments. However, at this stage, we look forward to studying the papers that the Minister will give us, as they will inform future debate. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Nick Hawkins (Conservative, Surrey Heath)

I promised that I had only a small point to raise on the clause stand part debate, as you, Mr. Illsley, generously allowed a wide-ranging debate on amendment No. 57.

I want to probe the Government's intentions in relation to subsection (4)(a) and (b). The Bill says:

''(a) the Commission shall, after consulting the licensee, vary the licence so as to introduce provision of a kind specified in subsection (2)(a) or (b) above, and

(b) the variation shall take effect at such time as the commission shall specify''.

I shall understand if the Minister tells us that it is too early to say what the variations and timing might be, but I wanted to flag up the matter now. Otherwise, we would allow the provision to be introduced on the nod without even exploring that point. I was slightly puzzled by the phraseology about variation. If he can help us on that small point today, I should be grateful.

Richard Caborn (Labour, Sheffield Central)

In the time-honoured way, I suppose that in Yorkshire I could bullshit my way through this, but I shall not do that. I am sorry, I should not have said that—it was unparliamentary language. This is an important question and I shall give the hon. Gentleman a considered answer later in our proceedings.

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the Minister for indicating that he will write to me and other members of the Committee when he has a detailed answer. I am sorry to have put him on the spot, but I wanted to flag the matter up, as I was slightly puzzled.

Question put and agreed to.

Clause 21 ordered to stand part of the Bill.

Eric Illsley (Labour, Barnsley Central)

Order. Before we come to clause 22, I should say that we have made inquiries of the Deliverer of the Vote, who advises me that Departments are not obliged to lay regulatory impact assessments in the Vote Office. Indeed, many Departments do not do so; it would appear that it is a decision for the individual Department. I shall refer the matter to the Chairman of Ways and Means to see

whether it would be possible to have uniformity, because the present procedure is clearly unsatisfactory.

Nick Hawkins (Conservative, Surrey Heath)

On a point of order, Mr. Illsley. I am grateful to you for that message. Only five minutes ago, my pager went off to say that the Vote Office had, at 3.25 pm, managed to get a copy of the regulatory impact assessment. I have been helped by my hon. Friend the Member for South-East Cambridgeshire, whose copy I have been borrowing. Since the Committee rose earlier it has taken three or four hours for the Vote Office to get a copy. As the Clerk to the Vote Office said, many Departments supply the documents , but the DCMS and one or two others do not do so, so it would be helpful to all hon. Members if there were uniformity. I am grateful to you, Mr. Illsley, for saying that you will take the matter further.Clause 22 Timing

Clause 22 - Timing

Nick Hawkins (Conservative, Surrey Heath)

I beg to move amendment No. 23, in

clause 22, page 12, line 35, leave out subsection (2).

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss the following amendments:

No. 58, in

clause 22, page 12, line 39, leave out subsection (3).

No. 59, in

clause 22, page 13, line 5, leave out subsection (4).

No. 60, in

clause 22, page 13, line 11, leave out subsection (5).

Nick Hawkins (Conservative, Surrey Heath)

Because of the extent of our debate on amendment No. 57, which applied to clause 21, I can deal with these probing amendments quite briefly. Amendment No. 23 is linked to amendment No. 57 in seeking to delete the requirement that the UK would have to have won the bid in 2005 before the licence could commence. We hope at least to persuade the Government to adopt a version of amendment No. 57, perhaps in a Government amendment, before the Bill has finished its passage through both Houses and perhaps persuade them to launch a kind of Team GB-related lottery to coincide with the 2004 Athens Olympics and Paralympics. Clearly we do not know whether our arguments will be successful. It did not sound as if they would be a few minutes ago, but stranger things have been known.

Richard Caborn (Labour, Sheffield Central)

You never know.

Nick Hawkins (Conservative, Surrey Heath)

Indeed. As I have said, we shall continue to pursue the matter.

I shall not seek to repeat the debate that we have just had on amendment No. 57; you would not allow me to do so, Mr. Illsley, even if I so wished. If the Government introduced a version of amendment No. 57, they would also be modifying subsections (3), (4) and (5) of clause 22, which Opposition amendments Nos. 58, 59 and 60 would delete. This group of amendments stands or falls with the decision on amendment No. 57. I am probing the same issue, however, and that is all I need to say at this stage. I shall listen to the Minister with interest. I am sure that his officials will have told him to point out that there are probably some drafting weaknesses in this group

of amendments, but his comments may inform our future debates.

Richard Caborn (Labour, Sheffield Central)

We have had the debate and I shall now give the technical reasons for rejecting the amendment.

Nick Hawkins (Conservative, Surrey Heath)

Briefly.

Richard Caborn (Labour, Sheffield Central)

I have three pages of brief.

Don Foster (Liberal Democrat, Bath)

The Minister has three pages of technical brief on why the hon. Member for Surrey Heath made a drafting error. As we are all in favour of adult and continuing education, perhaps he would agree to give a copy to the hon. Gentleman at the end of our proceedings so that he can learn some lessons. The rest of us have not made such mistakes, so we do not need to see a copy.

Richard Caborn (Labour, Sheffield Central)

In that case, I ask the hon. Gentleman to withdraw the amendment.

Nick Hawkins (Conservative, Surrey Heath)

I look forward to receiving the written tutorial of the Minister and his officials. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 22 ordered to stand part of the Bill

Clause 23 - The Fund

Nick Hawkins (Conservative, Surrey Heath)

I want briefly to raise one issue relating to clause 23. It seems to me that it might have been wiser for the Olympic lottery distribution fund to be under the control of the national Olympic committee and the national Paralympic committee jointly, or perhaps the British Olympic Association, rather than the Secretary of State. It did not seem appropriate to table an amendment on that issue, but I wanted to raise it and flag it up. The Minister may have good reasons for ensuring that the Secretary of State has control, but I thought that it was worth briefly raising the idea of taking the whole issue out of the political arena and putting the fund under the control of an Olympic body rather than a Secretary of State. It is not a hugely significant point—had it been so, I would have tabled an amendment—but it is worth asking the Minister to comment briefly on whether the Government have at least considered the possibility of having the fund under the control of an Olympic body rather than the Secretary of State.

Richard Caborn (Labour, Sheffield Central)

The answer is no, because we believe that it is necessary for the Secretary of State to have control, and that mirrors the arrangements for every other national distributor. There will be transparency.

We have indicated in the Bill that the distributing committee will be small, because we believe that that is necessary. The terms of reference are clear and precise—to stage the Olympics. We do not think that it is necessary to disturb the normal, well tried and tested lottery organisation.

Question put and agreed to.

Clause 23 ordered to stand part of the Bill.

Clause 24 ordered to stand part of the Bill.

Clause 25 - Payments into Fund from National Lottery Distribution Fund

Nick Hawkins (Conservative, Surrey Heath)

Again, I wish to raise a small point. It struck me, and it may have struck other Committee members, that the wording of subsection (1) is circular and slightly curious. It states:

''The Secretary of State may make an order permitting the Secretary of State to make payments from the National Lottery Distribution Fund''.

I had not come across this sort of circular drafting, and I wondered whether it was too circular to be necessary. I wonder whether the Minister might deal with that small point.

Subsection (3) requires the Secretary of State to consult each of the bodies currently mentioned in section 23 of the National Lottery Act. I have looked back at the Act as it was originally passed in 1993, and since then there have been some changes—new distributive bodies have been added, and the Government have announced that the New Opportunities Fund and the Community Fund will merge. What form will the consultation take in respect of the sporting distributive bodies under section 23 of the National Lottery Act?

Will the Government put on the record today that they will ensure that whatever consultation they have with sporting distributive bodies under the Act will take place in plenty of time? There have been occasions when concerns have been raised with me, as one of those in the House of Commons who regularly speaks on sport, that sometimes Government consultations with sporting bodies have been rather last minute, although I am not criticising this Minister personally because I know that he takes a personal interest in sport. Since subsection (3) introduces a need for consultation with all the distributive bodies, it would be helpful if the Minister were able to say on the record, so that it is in Hansard, that there will be full consultation with sporting bodies and others involved, in plenty of time.

Don Foster (Liberal Democrat, Bath)

I have similar questions to those of the hon. Gentleman. I shall not waste the Committee's time by repeating them, but I would like to ask the Minister one further question. The purpose of the clause is to enable payments to come from the main lottery into the special Olympic fund. We know that the Olympic lottery game will itself not raise the total amount of money that we are committed to taking from the national lottery. The clause enables the Secretary of State to determine how much will come from each of the separate lottery funding streams. Will the Minister briefly give us an indication of whether the allocation will be as indicated in the regulatory impact assessment, namely an equal amount from each of the existing funds, or whether there is some other formula that the Government might have in mind?

Richard Caborn (Labour, Sheffield Central)

There are three factors. The first is the formula, as is set out in the regulatory impact assessment. We would use that formula and there would be equal top-slicing on that. Secondly, we are mindful that there should be consultation and a proper time period for it, and I give assurances here that we will endeavour to make sure that those consultations take place.

Thirdly, regarding the circular nature of the draft of subsection (1), it brings in the affirmative resolution procedure, giving parliamentary control, which is the object of clause 24 (1).

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the Minister, particularly for that last point because, as he knows, I shall be putting forward some amendments seeking the use of the affirmative resolution procedure. It is helpful to know how that is achieved in the clause, and I welcome that.

Question put and agreed to.

Clause 25 ordered to stand part of the Bill.

Clause 26 - Payments out of Fund

Nick Hawkins (Conservative, Surrey Heath)

I beg to move amendment No. 61, in

clause 26, page 14, line 7, at end insert

'limited to matters directly connected with sport and for the promotion of London's bid for the 2012 Olympics'.

Eric Illsley (Labour, Barnsley Central)

With this it will be convenient to discuss the following:

Amendment No. 62, in

clause 26, page 14, line 10, at end insert

'limited to their work for sport and/or the promotion of London's bid for the 2012 Olympics'.

Amendment No. 63, in

clause 26, page 14, line 11, at end insert

'limited to matters directly connected with sport and/or the promotion of London's bid for the 2012 Olympics'.

Amendment No. 65, in

clause 26, page 14, line 15, at end insert—

(fa) to Sport England and its equivalent bodies in Scotland, Wales and Northern Ireland for the purposes of training future Olympic and Paralympic athletes and for connected sporting purposes'.

Amendment No. 66, in

clause 26, page 14, line 31, leave out subsection (6).

Amendment No. 71, in

clause 28, page 15, line 6, at end insert

'and then paid on to the Sports Lottery Fund for the purposes of distribution for the benefit of sport.'.

Amendment No. 73, in

clause 30, page 16, line 1, at beginning insert 'sporting,'.

Nick Hawkins (Conservative, Surrey Heath)

Many of the amendments would ensure that the money from the Olympic lottery goes towards sport and towards winning the bid for London 2012, to ensure that we do not run any risk of money being wasted on other matters such as bureaucracy administration or matters unconnected with sport. We felt that it was important to build some extra precautions into the Bill, which the amendments

are designed to do. Amendment No. 66 is particularly important, because it would delete subsection (6). Clause 26(2)(d) already makes it clear that money should go to the Greater London authority: we would amend that in order to restrict the purposes for which the GLA can use that money.

I know a number of excellent Conservative members of the GLA, and if those people were in complete control I would have enormous confidence that they would ensure that the money was spent wisely. I am suspicious of subsection (6) because I have grave doubts that the GLA will necessarily use an unfettered power—which subsection (6) would give it—just for the benefit of sport. As it stands, it is the blankest of blank cheques. To change languages, it would give the GLA carte blanche to do more or less whatever it likes with money.

If one combines amendment No. 66, which would delete subsection (6), with amendment No. 63, which would ensure that the purposes for which the GLA uses the money relate to sport or the promotion of the 2012 bid, there would be proper protection. If subsection (6) is allowed to remain, it would be a recipe for a subsequent National Audit Office investigation of how the money might not have been used for proper purposes because it had not been spent by the GLA on the things that it should have been spent on—sport and the 2012 bid. I urge the Minister to consider amendments Nos. 66 and 63 in that context.

Amendment No. 64 replaces amendment No. 24, which we originally introduced. It is rather different, but it deals with an important issue. It would use the words ''the National Paralympic Committee'', rather than the National Paralympic Association.

Eric Illsley (Labour, Barnsley Central)

Order. I think that the hon. Gentleman may have strayed on to the next group of amendments.

Nick Hawkins (Conservative, Surrey Heath)

I beg your pardon Mr. Illsley. I was jumping ahead of myself. Amendment No. 71, which would amend clause 28 but is rightly in this group, relates to what happens to the money on the winding-up of the fund. In the past, in all kinds of public, or joint public-private projects, no one has looked forward to what happens at the end of the process.

Obviously, we hope that the project will not have to wound up until after a very successful Olympics. However, the Bill contemplates the possibility that we might, sadly, not win the bid and that there might have to be an earlier winding up. Amendment No. 71 would ensure that the money would go to sport. We hope that the Minister will agree—even if he cannot agree with some of the others—that amendment No. 71 will strengthen clause 28 and will provide a clear indication in the Bill that any net receipts at the end of the process should go towards sport.

Amendment No. 73 is important because it adds the word ''sporting'' to the beginning of clause 30(4)(b). It should not just be a matter of spending money on cultural matters associated with the bid, which is why the word ''sporting'' should be included. That is what those amendments would do, and I hope that the

Minister will reply in particular detail to the points raised by amendments Nos. 66 and 63, and 71 and 73.

Richard Caborn (Labour, Sheffield Central)

I will go through each amendment and give our reasons for recommending that the hon. Gentleman withdraw them.

Amendment No. 61 proposes that an addition be made to subsection (2)(a). It would require payments from the Olympic lottery distribution fund to the Secretary of State to cover only those expenses incurred in connection with the matters directly with sport and the London 2012 Olympics.

This amendment is unnecessary. Subsection (2)(a) already includes the provision that expenses should be connected with only that part of the Bill. It is already restricted to matters arising in relation to Olympic lotteries. The drafting mirrors the arrangement in existence for the other national lottery distribution funds.

Amendment No. 62 proposes a change to subsection (2)(c) to ensure that any payment from the Olympic lottery draw fund to the national lottery distribution fund goes to sports good causes only. It would not be sensible to specify that all money from the Olympic fund to the distribution fund should always be paid out in connection with sport.

There may be circumstances in which we want Olympic fund money to go to the general distribution funds. For example, in the event of the Olympic lottery games generating a surplus—the hon. Member for Surrey, Heath has argued very forcibly that that might be the case—it may be desirable to transfer funds for the benefit of all good causes, particularly as the income going to the Olympic cause will at least in part represent a sales diversion from the existing good causes.

Another example would be if a transfer of funds had been made in the other direction—from the national lottery distribution funds to the Olympic lottery distribution fund under clause 25. We might wish to make a payment to the national lottery distribution fund that is not directed to sport alone.

Subsections (4)(b) and (5) already enable the Secretary of State to allocate money to the sports good cause, in proportions that she would determine. The reason for the provision is that at some point it may be desirable to recompense the sport lottery distributors for contributions to the costs of staging the Olympics at the expense of other sports projects.

With the existing provision it would be possible to ensure that the sports distribution bodies that contribute most from their own lottery funds for the staging of the Olympics could benefit accordingly.

Amendment No. 63 amends subsection (2)(d) to limit payments made from the Olympic fund to the Greater London authority to matters directly related to sport. We resist the amendment on the basis that the subsection was carefully drafted in keeping with arrangements for public funding for 2012, which, as the hon. Gentleman knows, are set out in the memorandum of understanding between Government and the Mayor of London.

In managing the overall flow of Olympic funds, the GLA may be required to spend its own money, which had been earmarked for other non-sport and non-Olympic purposes, on an immediate Olympic need. In such a case, and if any money were then repaid from the Olympic fund to the GLA, the GLA should not be restricted to spending that money directly on sport or Olympic matters. The subsection reflects the need for flexibility in managing Olympic income and expenditure.

Nick Hawkins (Conservative, Surrey Heath)

I understand the importance of the point that the Minister makes about the memorandum of understanding. Following my points, would he and his advisers consider rewording subsection (6) by Government amendment? I am asking them to look at the matter. Its terms are astonishingly wide, and if the reasons why one needs a certain breadth of operation—because of the memorandum and the reasons he has just set out—were in the Bill, we would be a great deal happier. Would he be prepared to consider whether it is possible to incorporate some of his brief into a modified version of subsection (6)?

Richard Caborn (Labour, Sheffield Central)

I am trying to explain—obviously not very well—that the clause provides the flexibility within the context of sport to ensure that the memorandum of understanding is carried out and that we can move moneys from the GLA and from the Mayor's office. The flexibility might exist when we pay upfront but when we repay we cannot have that flexibility. The consequence could be that the GLA would not be persuaded to put money up front, because the money that was returned would be earmarked, ring-fenced and restricted. I do not believe that that is a good way of moving forward and having a successful Olympic games. We must trust people in the context of the memorandum of understanding and the clause. We need that flexibility and if we do not have it, the consequence could be that we will not get things funded at the necessary time.

The GLA is specifically listed to reflect the fact that it is the other main source of public funding, and that in delivering the overall package it may at some point be necessary to reimburse it for expenditure incurred. That ought to be on the record. To date, the political parties are at one, and the BOA, the Mayor's office, the GLA and the Government are working closely together to achieve the objectives. To start writing mistrust in at this stage would be fundamentally wrong and would send out all the wrong signals. Agreeing the amendment could well be interpreted in that way.

Amendment No. 65 would enable the Secretary of State to make regulations permitting payments to the four sports councils in the UK. It specifies that those payments would be for the purpose of training future Olympic and Paralympic athletes. However, funding is already available for those purposes through the normal sports lottery funding stream.

Amendment No. 71 seeks to amend clause 28 so that any money paid to the NLDF from the OLDF, on the winding up of the latter, is allocated solely to sports good causes. We have already explained why we should retain flexibility over payments to the NLDF. Those arrangements also apply in winding up the Olympic lottery distributor. We need to retain that

flexibility because it is impossible to say in advance how much, if anything, would remain in the OLDF, and whether it would be more appropriate to use the remaining OLDF moneys to benefit all good causes, or just sports good causes.

Don Foster (Liberal Democrat, Bath)

The Minister made it clear that the take from the other causes would be identical and that the share would be the same. Will he give a similar assurance that if money goes back to the good causes, it will go back in the same way, and that the share will be equal so that each of the good causes gets back at least a proportion of the money that it had to give up?

Richard Caborn (Labour, Sheffield Central)

We are pushing into the future. As the hon. Gentleman knows, we are already in the process of changing the lottery. There has been wide consultation so there could be all sort of movement on how the lottery is distributed in the future. We are trying to retain flexibility and fairness. That judgment will be made at the time. To tie that down into proportions would not be wise at this stage. That flexibility must be retained, and I am trying to make things fair, as well.

The clause allows the Secretary of State to make that decision at the time of the winding up of the Olympic lottery draw. Only then will she have the benefit of knowing how much is left in the Olympic draw, what payments, if any, have been made from the NLDF to the OLDF, and the extent of the contribution of the various sports distributors to the staging of the Olympics.

Amendment No. 73 would add ''sporting'' events to the ''cultural and other'' events for which the Olympic draw may make grants and loans in clause 30(4)(b). We do not believe that that is necessary, as

''other events held in accordance with . . . the Olympic Charter''

or an agreement with the IOC could already encompass sporting events. The amendment does not expand the provision.

I ask the hon. Member for Surrey Heath to withdraw the amendment in the light of the assurances that I have given about what the clause is intended to achieve.

Nick Hawkins (Conservative, Surrey Heath)

I am grateful to the Minister for responding in some detail. On that last point, on amendment No. 73, we return to the kind of discussion that the Minister had with my hon. Friend the

Member for South-East Cambridgeshire (Mr. Paice) this morning. It would do no harm to add the word ''sporting'' before ''cultural and other events'' and would at least put sporting matters into the Bill. I hope that the Minister will accept that adding one more word will not lead his officials to send him another note like the one they sent him this morning saying ''Too many words'', and that he will think about it again. I should be delighted if, at a later stage, he were to insert the word ''sporting'' into clause 30(4)(b) through a Government amendment. It is a small point, but it would send all the right signals.

I understand the Minister's point about the memorandum of understanding, as I made clear in my intervention. I do not want to spoil the good working relationships by injecting a sense of mistrust, as the Minister suggested we might be doing, but there could be some middle ground, a way in which subsection (6) does not need to be open-ended. The Bill could refer to the memorandum of understanding.

In the light of what the Minister has helpfully said, Lord Moynihan and I will consider whether it is possible to table a modified version of our amendment on Report or in another place. However, because I want the flexibility to return to some of those issues later in the passage of the Bill, I shall not pursue them to a vote as a point of principle this afternoon. We are making a genuine attempt to improve the Bill.

I am still concerned about what happens when the fund is wound up. I accept, as the Minister said to the hon. Member for Bath, that we are looking a number of years into the future. The hon. Gentleman had a helpful thought when he said that we could at least put something in the Bill that said that the good causes received money back in the same proportion as they had contributed. That might be another way of approaching what I was seeking to do when I said, ''Let's make sure it all goes back to sport''.

We do not want to fight the matter tooth and nail; we were making a genuine attempt to improve the Bill. Therefore, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Further consideration adjourned.—[Mr. Kemp.]

Adjourned accordingly at two minutes past Four o'clock till Tuesday 27 January at half-past Nine o'clock.