Showdown at the Lotto shops

HUNDREDS of family-run newsagents are to lose their Lotto terminals because they are not selling enough tickets.

Camelot has decided to get tough with its outlets as ticket sales continue to plummet. It says there are plenty of stores crying out for the opportunity to get in on the game.

But the small retailers feel they are being scapegoated because an expensive rebranding of the game has failed to boost sales.

The National Lottery was renamed the Lotto and a £ 72m advertising campaign was launched, fronted by Billy Connolly. But the marketing drive has made little difference.

Ticket sales on some Saturdays are as low as £40m, compared to £70m when the National Lottery began seven years ago. Three years ago, Saturday lottery jackpots averaged nearly £8m. They now average about £6m.

The big losers are the charities and community projects that depend on the lottery for funding.

The newsagents that face the axe are those selling less than 1,400 tickets a week.

They will not only lose the 5% commission on every ticket or scratchcard sold, but also the extra revenue from customers who come in for the lottery and buy other items while they are there.

Lotto retailers make about £7,500 a year extra in sales of other items. Camelot has 580 outlets on its list of poor performers, but 1,000 rural retailers have been exempted from the terminal removal programme.

The company's director of external affairs, Sue Slipman, said: 'The National Lottery has been a godsend to retailers. It has given them every opportunity to get people in. Lots of other people are desperate to have a terminal because they want that opportunity too.'

Camelot estimates that 80,000 outlets would like to sell tickets. But it has strict controls on how many can operate in each locality.

The organisation reported in May that annual ticket sales had fallen to £4.83bn from just over £4.98bn the previous year, although sales of instant scratchcards rose.

Camelot believes the fall can partly be explained by people being distracted by the Queen Mother's funeral, the Golden Jubilee and the World Cup. But sales were not helped earlier this year when the company's chief executive, Dianne Thompson, appeared to rubbish players' chances of winning big money, saying most 'would be lucky to win a tenner'.

One of the biggest problems with the current system is that players who get three correct numbers win only £10, while even the prize for matching four numbers is likely to be only £50 to £60.

Camelot is addressing this with its new 'HotPicks' game. Players may pick two, three or four numbers. The prize for matching two is £40, matching three wins £450 and all four £7,000.

The company is under severe pressure to turn its fortunes around from the Culture Secretary Tessa Jowell. Recently, she said: 'The Government does not accept that what has been termed lottery fatigue - a gradual but remorseless decline in public interest and sales - is inevitable or irreversible.'