Gambling on Culture:
State Lotteries as a source of funding
for culture - the arts and heritage
QUESTIONNIRE RESULTS ANALYSIS.
This presentation has been designed to compliment the introduction and
overview of the survey results that you can find in the conference reader.
I would like to start this
presentation by discussing the context and scope of cultural lotteries.
CIRCLE members, representing 29 countries in Europe have responded to the
questionnaire and first indications are that many more countries than
originally anticipated have state lotteries which use a share of their
national lotteries as a way of financing culture.
Andorra Lithuania
To be precise, our data suggests that 26 of the respondent countries have some sort of state regulated lottery (only Andorra, Lithuania and Russia provided a reply that they had no state controlled lottery).
Andorra Lithuania
Of the 26 countries that have a state or national lottery, 16 replied that
some revenues were dedicated to funding for culture - the arts and/or
heritage. You can see them
highlighted here.
Austria Netherlands
Although not all countries were able to complete the
full questionnaire we were interested to learn about arguments for and
against state lotteries for culture and so, before we discard the
countries without a state lottery or without a state lottery that provides
funding for culture, we should note that several of these have experienced
some sort of public debate in recent times on the subject or are in the
process of implementing a lottery.
This is, for example, the case of Croatia which has recently passed
new legislation allowing revenue from state lotteries to be used for the
funding of culture and the case of Poland which is waiting for similar
legislation to be passed.
Replies from all countries are interesting, many
reflecting the current political and historical climate of the respective
country and therefore they have been included in the conference reader.
One of the most interesting replies came in the form of a paper discussing
the former lottery in Hungary; the only known country to have had a
state lottery which provided money for culture and then to have disbanded
it.
Stability of cultural funding
We can see from the survey replies that 11 countries confirmed that no
identifiable measures were in place to ensure the stability of cultural
funding. Only the Netherlands,
Sweden and the Slovak
Republic claimed to have measures to protect cultural funding
levels.
Other countries such as Finland
indicated that the state provided fill up grants to meet shortfalls.
But other than this the only identifiable measure for protecting cultural
funding levels (at least, provided by the questionnaire replies) is the
fixing of a sum for culture and the setting up of a reserve fund for
emergency cases.
Italy provided such a case where a
fixed sum for heritage has been met annually, however, it is interesting
that this fixed sum represents a ceiling amount (restricting percentage
increases) rather than a measure to protect cultural expenditure levels
from dropping. Some
respondents expressed scepticism as to how far measures were necessary
given that also state budgets were subject to fluctuation.
Operating and Management Framework
The questionnaire aimed to identify the way in which institutional
frameworks operate and manage lotteries. 10 country respondents reported
that public operators handled the lottery however, a number of these
respondents also acknowledged that the actual management work was farmed
out to companies.
5 respondents noted that private companies conducted the management and
operation of their respective lotteries however the implication in
some cases, being that the companies operated under strict guidelines set
by the respective Ministries. Germanys
federal structure allowed for multiple models to be applied.
Public Private
Bulgaria Ireland
Germany
Norway
Slovak Republic
More
indepth informationon the allocation and distribution of lottery
resources, can be found in the conference reader.
Suffice to say that 8 countries admitted that restrictions were
placed on the allocation of cultural funding but the examples cited had
more to do with setting criteria for eligibility within funding programmes
i.e. the decision to only support heritage projects and/or capital
projects or projects that must ensure public access etc.
And these of course are peculiar to each country.
The share for culture in the allocation of lottery
revenue
In most countries culture gets a small share of the lottery revenue. The
Danish and Finnish lotteries both give generously to culture, 64% and 55%
respectively. Few countries made the distinction between culture, arts and
heritage and so in this chart, I have blocked these three categories
together under the broad heading culture so the percentage share of
lottery revenues for culture per country looks like this:
As a quick aside, other sectors benefiting from
lottery revenue included typcially welfare, health, science, developing
aid, education, sport, youth and recreation.
Types of expenditure
Only 5 countries were able to give estimates on the
types of expenditure provided in the fiscal year 2000.
The data suggests no specific trends but rather a reflection of
cultural funding requirements identified by each respective government.
|
|
Project Based Funding |
Ongoing Operational
Costs |
Funding
for Capital Projects |
|
Estonia
|
80 |
0 |
20 |
|
Finland |
0 |
80 |
0 |
|
Italy |
0 |
0 |
100 |
|
Slovak
Republic |
0 |
50 |
50 |
|
United
Kingdom |
16 |
0 |
84 |
(-) Likewise only five
countries (this time Belgium, Italy, the Slovak Republic, the United
Kingdom and the NRW region in Germany) could
provide a breakdown of cultural sectors receiving lottery revenue.
I will not detail the results here, but I will say that although
they were limited, at least the results we received serve to show that
there is probably no set trend in lottery revenue destinations as far as
cultural sectors are concerned.
Additionality or substitution
The question of additionality or substitution needs to be monitored in
order for the cultural sector to respond to the possibility of precarious
movements in funding practices. The
questionnaire that we sent out was designed to try to establish some
trends in state support and lottery support for culture.
Unfortunately, many countries were unable to supply us with
comparable data over a long period of time but nevertheless the emerging
trend in some countries was that while state expenditure for culture is
increasing, the share of lottery revenue is increasing at a greater pace. In this case one can talk about additionality while in fact a
slow form of substitution can also be identified.
This is true in the case of Bulgaria
while in Bulgaria lottery revenue for culture is extremely marginal
the share of revenue for culture, provided by
lottery increased from the year 2000 2001 by 0,03%
It is also true of Finland where the percentage share of funding for culture coming from lotteries has increased yearly from 32,6% in 1990 to 71,4% in the year 2000.
1990 32,6%
1994 44,0%
1996 56,1%
1998 70,0%
The share of revenue from lottery has more than doubled in 10 years.
In real terms one can see government expenditure rising form 249,4 million in 1990 to 292,5 million in the year 2000 and of that figure lottery revenue was only 81,3 million in the year 1990 and rose to 208,8 million in the year 2000.
1990 2000
249,4 million 292,5 million
Finland - in real terms lottery revenue expenditure on culture is rising at a greater pace
1990 2000
81,3 million 208,8 million
Although
on a much less dramatic scale the same trend can be seen in the
Netherlands, rising from 6,4% in 1996 to 9,4% in the year 2000.
1996 6,4%
1998 8,5%
And in, Norway. Here you can see great fluctuations in the lottery revenue
share of support for culture but in fact the real figures show that these
fluctuations are caused by jumping levels of government support for
culture and that lottery funding has remained steady,
gradually increasing over the years.
1990 22,2%
1992 31,6%
1994 21,7%
1996 19,8%
1998 19,2%
2000 23,6%
Fluctuation caused by government spending as lottery revenue in real terms has steadily increased over the years.
And
the final example in this presentation, the United Kingdom (the lottery
share increasing from 19% in 1996 to 38% in the year 1999). In real terms lottery revenue increasing from 336
million
in 1996 to 494 million in 1999. While government
total expenditure on culture decreased from1741 million in 1996 to 1313million in 1999.
1996 19%
1998 58%
1999 38%
The Slovak Republic reported both decreased
government expenditure and lottery revenue in 2001. However, the
percentage lottery decrease was less than the percentage government
decrease thereby possibly following the same trend as the above mentioned
countries.
In Denmark, the same trend could be said to be true
from 1990 1998 but the latest figures for the year 2000 show increased
government spending and a drop in lottery revenue.
Countries that do not comply with the trend seen in
the abive examples, are Estonia and Italy
In Estonia government expenditure for culture increased significantly in
the year 2000, this was at the same time as lottery funding slightly
decreased in real terms.
And in Italy lottery revenue for heritage has a
fixed ceiling rate and therefore with increased government expenditure the
percentage lottery revenue can be said to be decreasing.
Impact of the Lottery
There
are few (if any) real impact studies on cultural revenue from lotteries in
Europe and respondents were reluctant to give
a decisive opinion. However,
generally the view of lotteries is a positive
one
at least in the immediate and short term.
Diane Dodd
Co-ordinator of CIRCLE