Melton Council is set to become the first local authority in the East Midlands, and only the third in the country, to launch its own online community lottery to benefit good causes.
The Melton Borough Local Lottery will raise money for local community and voluntary groups from a weekly draw, with the potential for players to win a £25,000 jackpot as well as a number of smaller prizes.
The scheme will work in a similar way to the National Lottery, however all funds raised will be spent in the Melton borough. It will see 58p in every pound spent on a lottery ticket go to good causes, compared to just 28p in the pound with the national draw.
Players will be able to choose a specific local community or voluntary cause they would like to receive 50p of the £1 spent on their ticket. They can also donate their winnings to their chosen cause if they wish.
In the case of no specified good causes being given, 58p per lottery ticket will go into a separate fund with the council deciding how it will be used to benefit the local community/good causes.
Draws will take place once a week. Unlike the National Lottery there will be no rollover if the £25,000 jackpot isn’t won.
It’s anticipated the lottery will be launched by November 30.
There are currently only two other local authorities which run similar lottery schemes - Aylesbury Vale District Council in Buckinghamshire and Portsmouth City Council.
It’s understood the Vale lottery, set up in 2015, is on track to raise £65,000 a year for good causes within its district.
Ronan Browne, Melton Council’s people and place manager, said the £25,000 jackpot (per winner) and smaller prizes will be covered by an insurance company, with pay-outs guaranteed no matter how many players buy tickets. Of the £1 ticket price, 20p will go towards this insurance.
Players will choose six numbers (0-9). To win the jackpot they must match both the numbers and sequence as drawn. Players can also win a prize if their ticket matches the sequence of the first or last two, three, four or five numbers drawn.
The prizes will be:
Six numbers (in sequence drawn): £25,000
Five numbers: £1,000
Four numbers: £250
Three numbers: £25
Two numbers: Three free tickets
The odds of winning the jackpot have been calculated at a million-to-one, with the overall odds of winning any prize at 50/1.
Multiple tickets can be bought and players can change their numbers week to week.
Melton Council is hoping that funding generated from the lottery will cushion the impact of a reduction in grant funding it is to receive from the Government over the next four years.
The authority is set to incur an overall loss of grant of £933,000 between the financial years 2015/16 to 2019/20, representing a 42 per cent cut.
The council currently supports the voluntary and community sector locally in revenue support of £100,000 per year. In light of the council’s funding cuts and any future austerity it’s hoped the income from the lottery will protect the money given to voluntary and community groups, if the council is unable provide grants, easing the financial strains on the authority as well as enabling good causes to raise funds.
Based on a borough population of about 50,000, the council estimates the lottery could generate gross takings of around £26,000 for good causes by its fourth year (figure based on four percent of population take-up).
Melton Council is now set to enter into a one-year contract with private company Gatherwell Limited, which operates the country’s only two other local authority lotteries. Out of every £1 ticket bought, 18p will go to Gatherwell. The Melton Borough Local Lottery will also have to be run under an operating licence issued by the Gambling Commission and comply with specific conditions and codes of practice.