Richard Desmond's Health Lottery comes under scrutiny

Culture secretary Jeremy Hunt has asked the gambling watchdog to look at Richard Desmond's controversial Health Lottery after complaints from various charity groups.

Speaking today at the Commons culture, media and sport select committee, Hunt said that the Gambling Commission would investigate whether the Channel 5 lottery was diverting money away from similar charitable lotteries.

Hunt told MPs: "I am worried about the Health Lottery because protecting the income for good causes is a very important responsibility this government has and the National Lottery was set up in a way which would generate money for good causes.

"Society lotteries are allowed on the basis they are local lotteries and I want to be sure - and we are doing some work - to look into what the impact of the health lottery may be on good cause revenues."

The Health Lottery, which airs a weekly £100,000 draw on Channel 5 on Saturday nights and aims to generate £50m per year for health-related charities, was branded a "disgrace" upon its launch last month.

Critics have pointed to the fact that the lottery, administered by Desmond's Northern & Shell group, donates just 20.34p per £1 ticket to charity, compared with 28p for every National Lottery ticket.

There has also been concern that the Health Lottery is operating as a group of 51 separate society lotteries, enabling it to sidestep strict gambling laws over the turnover of lottery schemes.

Yesterday, the chief executive of a Worcestershire hospice said that he was concerned about the impact of the Health Lottery on local fundraising

David Strudley, from the Acorns Children's Hospice, said that the charity's own local lottery initiative generates more money for good causes than the Health Lottery.

"Our contention is, first of all, we are a genuinely local lottery," he told BBC News.

"It is a source of income to us that we vitally need - £70,000 a year. The amount of money that actually comes to us from our own lottery arrangements is hugely greater than is being offered to us by the Health Lottery."

Asked by culture committee chairman John Whittingdale MP whether the Health Lottery was legal, department of culture civil servant Jonathan Stephens said that the Gambling Commission would decide.

Hunt added: "If they concluded what was happening was not legal, I would expect them to take robust action."

The Gambling Commission said that it would not comment on individual cases.