The Treasury manages public spending within two ‘control totals’ of about equal size:
- departmental expenditure limits (DELs) – mostly covering spending on public services, grants and administration (collectively termed ‘resource’ spending) and investment (‘capital’ spending). These are items that can be planned over extended periods.
- annually managed expenditure (AME) – categories of spending less amenable to multi-year planning, such as social security spending and debt interest.
National Lottery spending as recorded in the National Accounts reflects money spent from the National Lottery Distribution Fund (NLDF) – a fund for good causes, overseen by the secretary of state for Digital, Culture, Media and Sport – and is included within AME. The money distributed by the NLDF is raised via a transfer from the National Lottery operator. As such, public sector receipts are boosted by the precise amount of the transfer, which is then allocated for spend on good causes. These receipts are separate to ‘Lottery duty’, which is a duty on taking a chance or ticket in a lottery promoted in the UK. All lawful lotteries are exempt from the duty, except the National Lottery.
In our latest forecast, we expect NLDF good cause income to amount to £1.6 billion in 2018-19 and expenditure to amount to £1.8 billion (with £1.3 billion of current spending and £0.5 billion of capital spending). That income would represent 0.2 per cent of total public sector receipts, and is equivalent to £60 per household and 0.1 per cent of national income. NLDF spending amounts to 0.2 per cent of total public spending, and is equivalent to £70 per household and 0.1 per cent of national income.