UKGC Data Gap on External Lottery Manager Dominance
Regulator unable to provide figures on how many small and local lotteries are run by third-party commercial operators.
A Freedom of Information request has revealed the UK Gambling Commission does not provide data on the prevalence of third-party operators running small and local lotteries. This information gap means consumers cannot easily see how much of their stake goes to commercial managers versus the good cause itself. The regulator pointed to data that explicitly excludes the requested information.
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A Freedom of Information (FOI) request has highlighted a significant gap in the UK Gambling Commission's (UKGC) publicly available data, revealing the regulator is unable to state what proportion of small and local authority lotteries are run by commercial third-party companies.
On 19 May 2023, a request was made to the UKGC asking for the proportion of local authority and small society lotteries attributable to External Lottery Managers (ELMs) rather than being organised directly by the societies or councils themselves.
This information is crucial for consumer transparency, as it determines how much of a lottery ticket purchase supports a good cause versus the profits and fees of a commercial operator.
The UKGC's Response
The Gambling Commission declined to provide a direct answer. It invoked Section 21 of the Freedom of Information Act, which exempts public bodies from providing information if it is reasonably accessible elsewhere.
The regulator directed the requester to its November 2022 Industry Statistics report. However, the UKGC's response itself noted a critical flaw in this data source concerning the request. It stated: "the figures do not include data for the National Lottery or for Small Society Lottery data."
This means the specific information requested—concerning small society and local authority lotteries—is not present in the documents the UKGC cited. While the industry statistics provide some data on ELM involvement in large society lottery sales, they leave consumers and researchers in the dark about the two specific sectors queried in the FOI request.
What are External Lottery Managers?
External Lottery Managers are professional, commercial organisations that are licensed by the Gambling Commission to run lotteries on behalf of charities, non-profits, and local authorities. They handle the marketing, sales, and administration of the lottery, taking a percentage of the proceeds as payment for their services.
While ELMs enable many smaller organisations to raise funds they otherwise couldn't, their involvement means that a portion of the money raised from ticket sales goes to a for-profit company rather than directly to the good cause.
Significance of the Data Gap
The inability of the UKGC to provide this data, or the lack of its collection in the first place, is significant for two key reasons:
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Consumer Transparency: Consumers playing a local council or small charity lottery may assume their entire stake (minus prizes and essential costs) is going to the good cause. Without clear data on ELM prevalence, it is difficult to assess how much of the sector's revenue is being retained by commercial operators.
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Regulatory Oversight: This data gap raises questions about the extent of regulatory oversight into the growing influence of ELMs in the society lottery sector. Understanding the market share and penetration of these commercial entities is fundamental to ensuring the principle of "good cause" fundraising is not eroded.
Saferwager will continue to monitor UKGC publications for any future data that sheds light on the role of External Lottery Managers in the UK's charitable gambling sector.