A senior Conservative MP has challenged the process by which Camelot is expected to be awarded a fourth successive licence to run the National Lottery, possibly as early as next week.

Julian Knight, chair of the House of Commons culture committee, has written to the Gambling Commission, which assesses the bids, to raise concerns that Camelot, as the incumbent, may have an unfair advantage over rivals for the lucrative contract.

In his letter, Knight asked the regulator to be transparent about the way it allocates “risk” to the different tenders. “I would like the Gambling Commission to make clear precisely its methodology and how much weight it gives to incumbency,” Knight told the FT.

“If you give so much weight to incumbency, you could end up giving Camelot a 10m start in a 100m race and that would raise the question of what the point is of the whole process?

“Given the scale of the contract — and if Camelot continues for many years to come — we need to be sure the methodology is used correctly. It’s beholden on the Gambling Commission to be clear.”

A document seen by the Financial Times showed that a 15 per cent “solution risk factor” is allocated to each bidders’ business plan. Last week,
Giles Watling, another member of the culture committee, said he was concerned the 15 per cent risk quotient would be more heavily loaded on to new applicants.

In response, the Gambling Commission said: “No aspect of our framework applies differentially to any class of applicant, whether new entrant or incumbent.”

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Industry insiders believe a judicial review will inevitably follow the awarding of the licence, and that they expect Camelot to be given a fourth term to run the competition, which raises billions of pounds for good causes.

Camelot has run the lottery since its inception in 1994 and if it secures a fourth term it would have been the operator for almost 40 years by the time the new licence expires. The new 10-year licence will be handed over in February 2024.

The competition is being contested by four bidders including Canadian-owned Camelot. The others in the running are Allwyn, the Czech lottery operator formerly known as Sazka; the Italian gambling group Sisal; and media mogul Richard Desmond’s Northern & Shell.

It is the most open tendering round since the inception of the lottery in 1994 and has been one of the most tightly controlled by the Gambling Commission following disputes in previous competitions.

Camelot said: “Returns for good causes are now £500mn more per year than they were at the start of the third licence back in 2009, while profit after tax is up by a far smaller £33.6mn.”

By info