My Lords, I beg to move that the Commons amendment and reasons be now considered.

Moved accordingly, and, on Question, Motion agreed to.

[The page and line references are to HL Bill 67 as first printed for the Lords.]

1: Clause 7, page 5, line 13, leave out “prescribed”

The Commons disagree to this amendment for the following reason—

1A: Because it would not be appropriate to remove the power of the Secretary of State to prescribe descriptions of expenditure

2: Page 5, line 19, leave out subsection (3)

The Commons disagree to this amendment for the following reason—

2A: Because it would not be appropriate to remove the power of the Secretary of State to prescribe descriptions of expenditure

7: Clause 14, page 9, line 13, leave out “comply with” and insert “take account of”

The Commons disagree to this amendment, but propose Amendment No.7A in lieu—

7A: Page 9, line 17, leave out paragraphs (a) to (d) and insert “, specify matters to be taken into account in determining the persons to whom, the purposes for which and the conditions subject to which the Fund distributes money.”

My Lords, I beg tomove that the House do not insist on its Amendments Nos. 1 and 2, to which the Commons have disagreed for their reasons 1A and 2A; do not insist on its Amendment No. 7, and do agree with the Commons in their Amendment No. 7A in lieu.

The issue of prescribed expenditure has been debated fully during the passage of this Bill. For the reasons that we have previously explained in detail, we believe that the powers set out in Clause 7 are necessary. They serve an important purpose, given the exceptionally wide scope and large size of the Big Lottery Fund good cause. Covering as it doeshealth, education, the environment and charitable expenditure, the Big Lottery Fund good cause will be very different from the existing, much narrower arts, sport and heritage good causes.

We therefore need to be able to set out at thevery highest level—I emphasise this—the types of expenditure on which the Big Lottery Fund should focus. We are talking about broad areas of expenditure—not projects or programmes, not the split between the four parts of the good cause, not the split between the four countries of the UK, and certainly not specific grants. We feel very strongly that this should be done in a transparent and accountable way, and that there should be proper parliamentary scrutiny. That is why we are clear that it should be done by secondary legislation, subject to the affirmative resolution procedure. We have made available an illustrative order, demonstrating how the power to prescribe expenditure will be used in practice.

The ability to prescribe devolved expenditure is also central to achieving the greater devolution of decision-making to Scotland, Wales and Northern Ireland, which is the aim of this Bill. Amendment Nos. 1 and 2 would mean that the devolution arrangements in the Bill would not work. They would retain power for the Secretary of State where the Government’s intention is to devolve it. For that reason, we cannot accept Amendment Nos. 1 and 2 and I urge the House not to insist on them.

On Amendment No.7, I acknowledged at Third Reading that concerns about the perceived level of government control over the Big Lottery Fund were strongly and genuinely felt—both Front Benchers made these points substantially in debate. I did not accept that these concerns were entirely justified, but I undertook that the Government would amend the Bill to address them. That is what Amendment No. 7A does. We proposed our own amendment because Lords Amendment No. 7 would have put the Big Lottery Fund on a very different footing from that of all the other lottery distributors. It would have required the fund to “take into account” rather than “comply with” the important financial directions that we issue to all lottery distributors to ensure the proper use of public money. Amendment No. 7A brings the Big Lottery Fund into line with the other distributors in respect of both policy and financial directions.

I recognise that there has been some concern that our amendment maintains the power in new Section 36E(1) for the Secretary of State to issue any direction, which must be complied with. I emphasise that this is just not the case. The power to issue directions set out in new Section 36E(1) must beread together with the rest of that section, inparticular subsection (2). That subsection, under our amendment, provides that, where the Secretary of State intends to give directions under subsection (1) in relation to policy matters, her power to do so is restricted to giving directions specifying the matters to be taken into account by the Big Lottery Fund. The effect of new Section 36E is the same in relation to policy directions, despite the differences in drafting, as the effect of Section 26(1) of the National Lottery Act etc. 1993, which currently obtains. The Big Lottery Fund will be in the same position as all the other lottery distributors, a point on which we lay great emphasis.

I hope that the House will recognise that we have listened carefully to the views expressed during the passage of this Bill, and have been prepared to make changes where we believe that they are necessary. I therefore urge the House not to insist on their Amendment No. 7 but to agree with AmendmentNo. 7A.

Moved, That the House do not insist on its Amendments Nos. 1 and 2, to which the Commons have disagreed for their reasons 1A and 2A; do not insist on its Amendment No. 7, and do agree with the Commons in their Amendment No. 7A in lieu.—(Lord Davies of Oldham.)

My Lords, I am grateful to the Minister for his explanation. He listened to the concerns that we raised throughout the passage ofthe Bill in this House, and those concerns were largely addressed when the Bill went back to another place. That was extremely important, because we were concerned that the Big Lottery Fund, which, after all, is going to hand out 50 per cent of all the proceeds for distribution, was not going to operate on the same basis as the other distributing bodies. The Secretary of State’s power was greater than it was in relation to the other bodies and we felt that it should be the same. The Minister has made those changes.

More importantly, he has given us an assurance in writing that there is no possibility that the Secretary of State will be able to issue a direction under subsection (1) of new Section 36E to specify where lottery money is to be given. That is important because concerns have been expressed that, in the past, the principles of additionality have been broken by the distributing bodies. We had some clear examples of that as we went through the Bill, and the Minister's explanation has helped to assure us that it will not happen again. That is given greater strength by the amendments that the Minister acceptedat Third Reading, whereby under the Bill the distributing bodies will have to produce a report on additionality.

We welcome the Government's amendments and we thank the Government in this instance for being a listening Government. It does not happen very often but we must be very grateful when it does.

My Lords, I, too, thank the Minister for his exposition. We had an important debate on prescription and compliance and there was a difference of opinion, but the Government listened and took account of the views that were held. In terms of the subject matter and the thematic approach to lottery funding, there was no argument that at the high level it was right that there should be an element of specification. However, in the detail and at the project level, we all felt that there was potential for prescription and for forcing the Big Lottery Fund to comply, and we felt that the Bill was wrongly set out in that regard.

The Government subsequently agreed in spirit to the opposition amendments and they have brought back what they believe to be the right way of expressing this in the Bill. On some of these issues, this is wet towel time, but I regret that this is a somewhat convoluted way of giving the Government the ability in the Bill to force compliance with a direction, which then means that something has to be “taken into account”. It seems to me that this two-stage process was more elegantly put in the original amendment, but those are the strange ways of parliamentary draftsmen, and who are we mortals to argue in the circumstances? I agree with the noble Viscount that, ultimately, the Government have come up with an amendment that meets the case, convoluted though it may be.

My Lords, I am grateful to both noble Lords, who have contributed to our final debate on the Bill. The various stages of the Bill have been extremely fruitful and constructive. I cannot pretend to noble Lords who have not been privy to all our discussions that it has always been sweetness and light between the three sides, but we have recognised that noble Lords opposite have been keen to ensure that the most accurate representation of the position as they saw it has been effected within the broad principles and framework of the Bill. We have differed to a degree, but I am happy that we have reached agreement on these amendments.

On Question, Motion agreed to.