Big lottery winners

Last week the organisation which awards money, generated from the massively popular UK National Lottery game, to good causes announced its priorities for the next three years. Given that BIG (the name of the grant-giving organisation) will have a cool £1.5bn to spend the potential to support good causes in Britain is immense. A lot of their priorities sound absolutely right – such as supporting good causes which focus on preventing expensive social problems in the first place. Yet, given the problems British society is struggling with at the moment (i.e. youth unemployment over a million) and the consequences communities absorb (i.e. the london riots) could there be the potential to do something game-changing with that substantial pot of money?

The way the money is spent is as important to society as what it is spent on and how much is spent. How does the money get from the hands of the lottery players to the good causes? Well at the moment 13% of every ticket cost is centrally collated and then distributed to a wide variety of good causes through the administrative organisation called BIG. State politicians traditionally have let BIG run their grant funding programs independent of government directions, which given the incentives for short-term popularist programs in the Westminster model is probably a good thing.

However, does the allocation of £1.5bn via appointed officials really engage society and strengthen the bonds and relationships within communities that we know are especially vital in times of economic hardship? Maybe, but I think there is a more effective way of allocating the money. Why not allocate the cash equally between the 150 top tier local administrations in the UK (equivalent of the 58 counties in California) for the next 3 years and then use it as a challenge fund for everybody aged under 25 to enhance their community? Rather than funds being allocated by officials, the local councillors together with local business partners could hold “dragon’s den” style sessions in the town halls to allocate the money.

JobCentrePlus and providers of the work programme together with local mentors from local businesses could encourage and support young people to develop pitches and implementation plans to put in front of the judging panel. Equally existing good cause organisations which currently rely of lottery grants may be forced to amend their business model so that they employ some more young people to make the pitch for them. Either way, there is real potential for the £1.5bn over the next 3 years to be focused on engaging and creates opportunities for young people to be active in the labour market through the spending system alone. Who knows maybe some young people will come forward with an awesome idea to ensure decent community support for the elderly living alone – a crisis that is now really biting across many local authorities in the UK as local service budgets become smaller.

Could state politicians make this happen? Yes, and it could be a popular move. However, the real question is is it likely to happen? The answer at the moment is no, due to path dependency. Many organisations are dependent of lottery grants – they do not want this funding stream disrupted when it is getting ever harder to raise money elsewhere. Equally one can’t imagine the grant-allocating officials themselves at BIG wanting to put themselves out of a job, regardless of whether the money could be allocated more effectively through a different mechanism – people have mortgages to pay first and foremost! Still, with a bit of imagination maybe the Executives at BIG could see an alternative business model where they act as on-call consultants with each council contracting an advisory service from them on the cost-effectiveness of local pitches and programs? Indeed, perhaps BIG should spin itself out as an employee-owned mutual and look to cash in on a potentially lucrative advisory service to lots of local administrations?!

 

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