Sham behind lottery cheques for the arts

The National Lottery's millions of pounds for good causes could turn from being one of the Government's great pre-election boasts to a massive pre-election embarrassment.

The Independent has learned that numerous prestigious arts organisations may not now receive the money they have been promised.

It also emerges that the razzmatazz money give-away on prime time television every Saturday night is a gigantic fake. When a smiling Anthea Turner gave giant-sized cheques to ecstatic recipients, only Miss Turner's smile was genuine.

Voicing discontent about the procedure for the first time yesterday by a lottery money distributor, a spokeswoman for the Arts Council said: "We wish they would not hand over those cheques on television. It is utterly misleading. No money is actually changing hands."

Those cheques are void. None of the good causes receives their lottery millions in one tranche. Indeed, those that have won the money for rebuilding and redevelopment have to get the work done first then present invoices. Their business and artistic plans are continually monitored. If at any stage they fail to satisfy the Arts Council (the distributor for the arts) the promise to deliver the money will not be honoured.

For example, the Royal Opera House's award of pounds 55m has not yet been paid to the ROH. Only pounds 9m has been handed over. The rest will be givenwhen the Royal Opera House satisfies the Arts Council that it can raise matching funding from private sources and deliver on its long-term business and artistic plans.

In the case of the Royal Opera House, Covent Garden, realising the award looks likely. Other organisations may not be so lucky. It is not just the problem of raising matching funding from private sources. If Virginia Bottomley, Secretary of State for National Heritage, fails to negotiate at least a standstill grant from the Treasury for the arts later this month, some high-profile organisations will not be able to deliver on artistic and business plans they promised the Arts Council.

The Government's published projection is for a pounds 3m cut for the arts. Mary Allen, the Arts Council secretary general, says she has heard rumours of a cut as high as pounds 10m. If this happens the lottery awards may not be paid because organisations will not be able to pay the staff to supervise redevelopment projects or mount the events in their new buildings.

An Arts Council spokeswoman said those who would be in trouble with less than a standstill grant and whose awards "might have to be reassessed" include Sir Simon Rattle's City of Birmingham Symphony Orchestra, the Royal Liverpool Philharmonic Society, the Salisbury Playhouse, Bolton Octagon, Cambridge Arts Theatre, and Yorkshire Dance Centre.

A spokesman for Virginia Bottomley at the National Heritage Department said: "It is technically a fact that lottery awards might not be paid if certain criteria are not met. But this is the first we have heard of this as a problem and it seems at the moment a little hypothetical."