Does the lottery add up?

There are some reasons to be grateful to the Eurovision Song Contest. Well, one, at any rate. Last Saturday it cut television's most truly excruciating show down to a mere 10 minutes. Not that you didn't get everything you needed in the short space of time allotted to We've Got Your Number. There was "Money, Money, Money" from the cast of the plotless Abba musical Mamma Mia, egregious enthusiasm from the homespun Carol Smillie, and the rolling of the balls from Guinevere in the 358th draw to date in Britain's National Lottery.

The TV vulgfest summed up all that is worst in our times, with its raucous celebration of glitz, celebrity and dumbed-down dreams not just of greed but, as the cliche enigmatically puts it, dreams beyond avarice. At odds of 14 million to one, a win is also beyond all reasonable probability. Yet how the audience whoop, in a bacchanalian ferment that combines cupidity and stupidity in equal amounts.

We've had nearly five years of it now, and next month the Lottery Commission - which has replaced the hapless regulator, Oflot - will invite applications for the next licence. The existing one runs out in 2001 and already the jostling has begun to secure the new one. The Post Office, Littlewoods Pools and Virgin's boss Richard Branson, who wants the lottery to be non- profit-making, have emerged as the leading challengers to Camelot for the contract. The fall in profits Camelot announced this week - down from pounds 5.5bn to a measly pounds 5.2bn - is hardly likely to deter the competition.

In a shrewd move Camelot has hired Sue Slipman to be a key player in its fight to retain the contract. She is something of a poacher-turned- gamekeeper. She made her name as the first woman president of the National Union of Students, and then ran the National Council for One-Parent Families and the Gas Consumers Council. Now she is Camelot's director for social responsibility.

She has a job and a half to do. The public may have taken the lottery to their bosom but they still don't like Camelot, what with its fat-cat bonuses and Richard Branson's claims that one of its members tried to bribe him. All of which was grist to the moan-mill of those who had said all along that the lottery was a tax on the poor, a thief of the income of small charities and a corrupter of the nation's moral fibre.

So, before I went to lunch with Ms Slipman I decided to find out what she was up against by talking to the chief protesters. The result was not quite what I had expected.

At the charity GamCare, which tries to help people control their gambling urges, its director Paul Bellringer said that the lottery had produced a significant change in society's attitude to gambling. Before it came along, 69 per cent of the population gambled; today it is 91 per cent. But the lottery is a relatively passive form of gambling - "its draw is not addictive in the way that fruit machines are," he said. "Our national helpline gets 50 per cent of calls about slot machines, and only 2 per cent about problems with scratchcards and 1 per cent with the lottery draw."

Opposition has dwindled in the churches, too. Even the dour Presbyterians of the Church of Scotland last year crumbled, and decided to allow its kirks to apply for lottery cash. Next month the Methodist Conference will consider making a similar move.

You still hear laments about what kind of nation can spend more than the equivalent of the entire income of Ethiopia every year on a lottery, but much of the other criticism has softened. "If we have to have a lottery, then Camelot aren't doing a bad job," says John Kennedy, political affairs secretary for the Methodist Church, which in the past has described the large lottery prizes as "obscene". "They understand the business, and we've listened to them. It is evident that you need big prizes to get people to play - and, from a moral point of view, pounds 1m can ruin you as easily as pounds 20m."

It's the same story with lobbyists on behalf of the poor. There are low- income individuals who spend more on the lottery than they should. But the average weekly spend today is pounds 3.37 a week, and poverty pressure groups - anxious to protect the dignity and autonomy of the poor - are reluctant to say how much is too much. "The poor can budget," one activist tells me. "Their problem is poverty, not the lottery."

And other charities agree. "Contrary to what many feared, we've not found any evidence to suggest that the lottery has adversely affected giving," says Vicki Pulman, of the Charities Aid Foundation, who is more worried about the fact that, though giving is on the increase, it is older people who are giving more, and charity is going out of fashion among the young. The lottery even adds stability. "It is now the largest single grant-making body in the UK, and has consistent criteria that are not prone to the whim or mood-swings of public opinion."

I do not tell Sue Slipman all this when we meet for lunch. Rather, I look at the woman I remember as a stalwart of the Communist Party when we were both on the student union council at Leeds. The long hair has been bobbed, the denim has given way to a long-collared lacy blouse with a smart blue jacket, and the strident tone has been replaced by one of brisk reasonableness. It has evidently been, I say, a slow decline into the heart of rampant capitalism.

"We're all capitalists now," she laughs. "Though I'm not so sure about the rampant. When Camelot approached me, I told them I've spent all my life in charitable and consumer organisations - I don't do spin; I work for social change. But I liked what I saw. It was a company that had moved in just five months from conception to being up and running, with no technical hitches and no hint of corruption - no one thinks the lottery's fiddled, and no one's run off with the money. And they were very open."

Perhaps its efficiency record might mean Camelot would make a better job than Richard Branson of running the West Coast trains. Even so, it has shown no capacity for dealing with being the public face of a national institution.

"It has taken some time to dawn on the company that Camelot lives all the time in a goldfish bowl," Sue Slipman admits. "And it therefore gets it in the neck for a whole load of things that aren't within its control.

"The lottery sits on every fault line in the British psyche - on what utilities should be public and what private; on what the state should pay for, now we're never again going to have a tax-and-spend government; on how much the vulnerable should be protected or allowed to make wrong decisions; on how far can self-regulation work; on whether companies behave decently - and how we can guarantee that wealth-creation is a morally- based pursuit."

It all sounds a bit grand. What, apart from that of 787 new millionaires, is the wealth that the lottery creates? "What this produces is dreams. It's entertainment. It's a social glue," she says. "This is quintessentially Third Way - using private wealth in order to help individuals and transform communities."

This is not the lottery we have come to know and loathe. It has set up its own charitable trust, the Camelot Foundation, to which it has given more than pounds 8m of its profits to projects for the disabled and disadvantaged. Its 750 staff have themselves raised pounds 1m for charity on the half-day off per month the company has given them.

It has modified its Foamy Finger of Fate advertising slogan from "It Could Be You" to "Maybe, just maybe", in a more honest recognition of the huge odds against winning the jackpot. It has even made the concession of saying that it will not oppose moves by lobbyists such as GamCare and the churches to get the playing age raised to 18. This came after an Oflot-commissioned report showed that the lottery was turning 20,000 under-age kids a year into problem gamblers.

Most radically, it has set in progress a comprehensive social audit. Everyone it touches is to be asked their views: the public, those who play and those who don't; the winners; employees; suppliers, present, past and those who failed to tender successfully; retailers, including those who applied and didn't get a terminal; shareholders; the churches and pressure groups. But what if they all give the wrong answers - and say they want a not-for-profit version?

"We'll publish it anyway, warts and all. We're committed to that," says Sue Slipman. But she suspects it won't be all bad news. "The process so far has already thrown up the fact that many people assume Camelot takes about 60 per cent in profit; when they find out the profit is only 1 per cent, they by and large think that's OK."

Maybe, just maybe, the odds on Camelot retaining the licence are higher than you might have suspected. Still, I wouldn't bet on it.

But whoever wins, you can be sure of one thing: the need for some demotic televisual frenzy, enshrining the right of the ordinary man and woman to dream, and creating a shared national rhythm that offers the possibility of escape from the humdrum at the end of each week, will continue.

And I certainly wouldn't put any money on the content improving.