The UK Gambling Commission (UKGC) has published its annual financial report for FY2021, reporting it has made an operating loss of £19.3m due to rising costs associated with the Fourth National Lottery Licence competition.
The competition, set to come to a close later this year, has cost the Commission £14.83m as total expenditure reached £38.06m, a 1.39% increase on the previous year.
It comes shortly after the Commission was alleged to be interfering with an ongoing inquiry into its management of the National Lottery by Julian Knight MP.
Income for the year dropped by 5.18% from £19.9m to £18.87m, attributable to the COVID-19 pandemic, which forced retailers and betting shops to close for large parts of the year. Lottery revenues contributed to 7% of the commission’s income, compared to 64% coming from arcades.
Crucially, the total income figures do not include the £19.5m that the Commission receives from grant-in-aid funding in respect of the National Lottery functions which is transferred directly to reserves.
A statement from the Board of Directors read: “We have continued to strongly regulate the National Lottery which has had another successful year despite the challenges of the pandemic – whilst ensuring the operator protects players and maximises returns to good causes, especially after such a tough 12 months.
“A further £1.83bn going to good causes through the National Lottery over the past year is another excellent milestone and the financial support given to the arts, sports, heritage and charities was vital.”
The Fourth National Lottery licence competition is being contested by Camelot, Italy’s SISAL, India’s Sugal & Damani, and the Czech Republic’s SAZKA Group under the UK identity of Allwyn.
The Commission statement added: “The competition for the fourth National Lottery licence is now successfully underway and we plan to announce the winner within the current financial year following the fair and open contest we are currently overseeing.
“This follows a delay to the launch of the competition by three months which was due to the unique circumstances caused by the COVID-19 pandemic.”