Camelot to give extra pounds 1bn to good causes

Camelot's chances of retaining its National Lottery licence improved yesterday when it announced plans to hand over an extra pounds 1bn to good causes by 2001.

Announcing half-yearly profits of pounds 35m - up 10 per cent - and donations to good causes of pounds 696m - up 22 per cent - the lottery organiser faced none of the government anger that greeted its last half-yearly results. Then, there was a public outcry when it emerged that Camelot's profits and payments to good causes had fallen, but its directors' had been given bonuses of up to 90 per cent of their salaries. They resisted calls to return the money but agreed instead to make secret donations to charity last month.

Announcing the results, Camelot chairman Sir George Russell said the new midweek draw had resulted in a sales increase of 17.2 per cent.

"It is against this background of strong performance that we are able to revise our original forecast of pounds 9bn raised for the good causes to pounds 10bn by the end of our licence period, provided there are no substantial changes in the gaming market or our game development strategy," he said. "We ... look forward to the forthcoming National Lottery Reform Bill in the hope that it will allow us to continue to operate in a constructive partnership with the Government."

The Bill, which is expected to be published within weeks, will attempt to define Labour's commitment to a "not for profit" lottery, which will maximise returns to good causes while recognising the need for suitable remuneration for the operator.

At talks during the summer, Labour pressed Camelot to increase its payments to good causes by the amount announced yesterday by Sir George. The fact that it has publicly committed itself to the figure will do its chances no harm when the licence comes up for renewal in 2001, although officials were at pains to point out yesterday that Oflot, the lottery regulator, and not the Government, will choose the next operator.

Camelot's shareholders, GTech, Racal, De La Rue, Cadbury Schweppes and ICL were paid an interim dividend of pounds 20m.