Gambling Commission Framework Document

Question 1

Introduction and background

Accepted Answer

1. Purpose of document

1.1. This framework document (the “framework document”) has been agreed between the Department for Digital, Culture, Media & Sport (“DCMS”) and the Gambling Commission (“the Commission”) in accordance with HM Treasury’s handbook Managing Public Money^{[footnote 1]} (“MPM”) (as updated from time to time) and has been approved by HM Treasury.

1.2. The framework document sets out the broad governance framework within which the Gambling Commission and DCMS operate. It sets out the Gambling Commission’s core responsibilities, describes the governance and accountability framework that applies between the roles of DCMS and the Gambling Commission, and sets out how the day-to-day relationship works in practice, including in relation to governance and financial matters.

1.3. The document does not convey any legal powers or responsibilities but both parties agree to operate within its terms.

1.4. References to the Gambling Commission include all its subsidiaries and joint ventures that are classified to the public sector and central government for national accounts purposes. If the Gambling Commission establishes a subsidiary or joint venture, there shall be a document setting out the arrangements between it and the Gambling Commission agreed with DCMS.

1.5. Copies of the document and any subsequent amendments have been placed in the libraries of both Houses of Parliament and made available to members of the public on the Gambling Commission website and GOV.UK.

1.6. This framework document should be reviewed and updated at least every 3 years unless there are exceptional reasons that render this inappropriate that have been agreed with HM Treasury and the Principal Accounting Officer of the sponsor department. The latest date for review and updating of this document is 1 September 2025.

2. Objectives, powers and duties

2.1. The Gambling Commission’s key statutory duty, as set out in the Gambling Act 2005, is:

to aim to permit gambling in so far as the Commission thinks it reasonably consistent with pursuit of the licensing objectives. These are:
1. preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime
2. ensuring that gambling is conducted in a fair and open way
3. protecting children and other vulnerable people from being harmed or exploited by gambling.

2.2. In addition, the Gambling Commission is responsible for regulation of the National Lottery by virtue of the National Lottery etc Act 1993. In this, the Commission’s objectives are:

to manage the lottery provider in a manner most likely to secure:
1. that the interests of all participants are protected
2. that the Lottery is run with all due propriety
3. that, subject to the objectives above, returns to good causes are maximised.

2.3. To achieve these objectives the Gambling Commission and DCMS will work together in recognition of each other’s roles and areas of expertise, providing an effective environment for the Commission to achieve its statutory objectives through the promotion of partnership and trust.

3. Classification

3.1. The Gambling Commission has been classified as a central government organisation by the ONS and HM Treasury Classifications Team.

3.2. It has been administratively classified by the Cabinet Office as a non-departmental public body (NDPB).

Question 2

Purposes, aims and duties

Accepted Answer

4. Purposes

4.1. The Gambling Commission was created by section 20 of the Gambling Act 2005 to regulate commercial gambling in Great Britain in partnership with licensing authorities. The Gambling Commission took over the National Lottery Commission’s functions on 1 October 2013 as a result of the Public Bodies (Merger of the Gambling Commission and the National Lottery Commission) Order 2013 coming into force. As a result, the Gambling Commission now regulates commercial gambling and the National Lottery.

5. Aims

5.1. The Gambling Commission’s areas of strategic focus as set out in its corporate strategy are:

Using data and analytics to make gambling regulation more effective
Enhancing our core operational functions
Setting clear evidence-based requirements for licensees
Being proactive and addressing issues at the earliest opportunity
Regulating a successful National Lottery

5.2. Nothing under this agreement shall prevent the Gambling Commission from carrying out its legal duties under its founding legislation or under any other legislation which impacts on its functions, activities or powers.

Question 3

Governance and accountability

Accepted Answer

6. Governance and accountability

6.1. The Gambling Commission shall operate corporate governance arrangements that, so far as practicable and in the light of the other provisions of this framework document or as otherwise may be mutually agreed, accord with good corporate governance practice and applicable regulatory requirements and expectations.

6.2. In particular (but without limitation), the Gambling Commission shall:

comply with the principles and provisions of the Corporate Governance in Central Government Departments Code of Good Practice^{[footnote 2]} (as amended and updated from time to time) to the extent appropriate and in line with its statutory duties or specify and explain any non-compliance in its annual report
comply with MPM
in line with MPM have regard to the relevant Functional Standards^{[footnote 3]} as appropriate and in particular those concerning Finance, Commercial and Counter Fraud
take into account the codes of good practice and guidance set out in Annex A of this framework document, as they apply to ALBs

6.3. In line with MPM Annex 3.1 the Commission shall provide an account of corporate governance in its annual governance statement including the Board’s assessment of its compliance with the Code with explanations of any material departures. To the extent that the Commission does intend to materially depart from the Code, the sponsor department should be notified in advance.

Question 4

Role of the department

Accepted Answer

7. The responsible Minister

7.1. The Secretary of State and other members of the DCMS ministerial team are accountable to Parliament for all matters concerning the Gambling Commission.

7.2. The relationship between Ministers and the Gambling Commission is set out in the Gambling Act 2005 and National Lottery etc. Act 1993. Ministers’ rights and powers include (but are not limited to): -

Gambling Act 2005 (section 23)

Under section 23, the Commission is obliged to prepare a statement setting out the principles to be applied by it in exercising its functions under the Act. Before issuing or revising such a statement the Commission must consult the Secretary of State.

Gambling Act 2005 (section 24)

Under section 24, the Commission is obliged to issue one or more codes of practice about the manner in which facilities for gambling are provided (whether by the holder of a licence under this Act or by another person). Before issuing or revising such a code the Commission must consult the Secretary of State.

Gambling Act 2005 (section 25)

Under section 25, the Commission is from time to time obliged to issue guidance to local authorities as to the manner in which they should exercise their functions under that Act. Before issuing any such guidance, the Commission must consult the Secretary of State.

Gambling Act 2005 (section 26)

The Gambling Commission has a duty to advise the Secretary of State about: -

the incidence of gambling,
the manner in which gambling is carried on,
the effects of gambling, and
the regulation of gambling.

Advice must be given: -

in response to a request from the Secretary of State, and
on such other occasions as the Commission thinks appropriate.

The Commission must send a copy of any advice to Scottish Ministers.

Gambling Act 2005 (other rights and powers)

Other relevant rights and powers in the 2005 Act feature in sections 32(2), 66(2), 121(8), 123, 156(3), 234, and paragraphs 5, 6, 11, 13 and 14 of Schedule 4.

National Lottery etc. Act 1993 (section 11)

In exercising its functions under sections 5 to 10A of the National Lottery etc. Act 1993, the Gambling Commission must comply with any directions that may be given to it by the Secretary of State.
Such directions may deal in particular: -

with the matters that the Commission should take into account in deciding whether or not to grant licences;
with the conditions that licences should contain.

National Lottery etc. Act 1993 (section 15)

The Commission must provide the Secretary of State with such information relating to the National Lottery or a lottery forming part of it as the Secretary of State directs.

7.3. Nothing in this document affects the rights, powers and duties conferred and imposed on Ministers and the Gambling Commission under the Gambling Act 2005 and the National Lottery etc Act 1993.

Appointments to the Board

7.4. The Chief Executive of the Gambling Commission is appointed by the Board under Schedule 4 of the Gambling Act 2005 in consultation with the responsible Minister and Principal Accounting Officer, as required. The Board’s appointment of a Chief Executive is subject to the Secretary of State’s consent as to the terms and conditions of employment. This appointment is subject to the Public Appointments Order in Council and as such must comply with the Governance Code on Public Appointments.

7.5. The Ministers shall have the following appointment and approval rights in relation to the Gambling Commission’s Board:

The chairperson and an appropriate number of non-executive members are appointed by the Secretary of State under Schedule 4 to the Gambling Act 2005. These appointments are subject to the Public Appointments Order in Council and as such must comply with the Governance Code on Public Appointments.
All such appointments should have regard to the principle that appointments should reflect the diversity of the society in which we live, and appointments should be made taking account of the need to appoint boards which include a balance of skills and backgrounds.

Other Ministerial powers and responsibilities

7.6. The Secretary of State is also responsible for:

the policy frameworks within which the Gambling Commission operates
setting the performance framework within which the Gambling Commission will operate
matters regarding spending approvals, acquisitions, disposals, and joint ventures in line with delegations as set out in the delegation letter
such other matters as may be appropriate and proportionate

The Secretary of State may delegate these functions to an appropriate junior Minister.

8. The Principal Accounting Officer

8.1. The Principal Accounting Officer (PAO) is the Permanent Secretary of the department.

PAO’s specific accountabilities and responsibilities

8.2. The PAO of DCMS designates the Chief Executive as the Gambling Commission’s Accounting Officer (AO) and ensures that they are fully aware of their responsibilities. The PAO issues a letter appointing the AO, setting out their responsibilities and delegated authorities.

8.3. The respective responsibilities of the PAO and AOs for ALBs are set out in Chapter 3 of MPM.

8.4. The PAO is accountable to Parliament for the issue of any grant-in-aid to the Gambling Commission.

8.5. The PAO is also responsible, usually via the sponsorship team, for advising the responsible Minister on:

an appropriate framework of objectives and targets for the Gambling Commission in the light of the department’s wider strategic aims and priorities
an appropriate budget for the Gambling Commission in the light of the sponsor department’s overall public expenditure priorities
how well the Gambling Commission is achieving its strategic objectives and whether it is delivering value for money
the exercise of the Minister’s statutory responsibilities concerning the Gambling Commission as outlined above

8.6\ The PAO via the sponsorship team is also responsible for ensuring arrangements are in place in order to:

monitor the Gambling Commission’s activities and performance
address significant problems at the Gambling Commission, making such interventions as are judged necessary
periodically and at such frequency as is proportionate to the level of risk carry out an assessment of the risks both to DCMS and the Gambling Commission’s objectives and activities in line with the wider departmental risk assessment process
inform the Gambling Commission of relevant government policy in a timely manner
bring ministerial or departmental concerns about the activities of the Gambling Commission to the full Gambling Commission board, and, as appropriate to the departmental Board, requiring explanations and assurances that appropriate action has been taken

9. The role of the sponsorship team

9.1. The Gambling Commission Sponsorship Lead in the department is the primary contact for the Gambling Commission. The responsible senior civil servant for this relationship is the Deputy Director for Gambling and Lotteries. They are the main source of advice to the responsible Minister on the discharge of their responsibilities in respect of the Gambling Commission. They also support the PAO on their responsibilities toward the Gambling Commission.

9.2. Officials of the Gambling Commission Sponsorship team in the sponsor department will liaise regularly with Gambling Commission officials to review performance against plans, achievement against targets and expenditure against its DEL and AME allocations. The Gambling Commission Sponsorship team will also take the opportunity to explain wider policy developments that might have an impact on the Gambling Commission.

10. Resolution of disputes between the Gambling Commission and department

10.1. Any disputes between the department and the Gambling Commission will be resolved in as timely a manner as possible. The department and the Gambling Commission will seek to resolve any disputes through an informal process in the first instance. If this is not possible, then a formal process, overseen by the senior sponsor, will be used to resolve the issue. Failing this, the senior sponsor will ask the relevant policy Director General to oversee the dispute. They may then choose to ask the Permanent Secretary to nominate a non-executive member of the department’s Board to review the dispute, mediate with both sides and reach an outcome, in consultation with the Secretary of State.

11. Freedom of Information and Other Data Requests

11.1. Where a request for information is received by either party under the Freedom of Information Act 2000, or the Data Protection Act 1998 or 2018, the party receiving the request will consult with the other party prior to any disclosure of information that may affect the other party’s responsibilities.

12. Reporting on legal risk and litigation

12.1. The Gambling Commission shall provide a quarterly update to the sponsor on the existence of any active litigation and any threatened or reasonably anticipated litigation. The parties acknowledge the importance of ensuring that legal risks are communicated appropriately to the sponsor in a timely manner.

12.2. In respect of each substantial piece of litigation involving the Gambling Commission, the parties will agree a litigation protocol which will include specific provisions to ensure appropriate and timely reporting on the status of the litigation and the protection of legally privileged information transmitted to the sponsor to facilitate this. Until such time as a protocol is agreed, the parties will ensure that:

material developments in the litigation are communicated to the sponsor in an appropriate and timely manner
confidential or legally privileged documents and information are clearly marked as such
individual employees handling confidential or legally privileged documents are familiar with principles to which they must adhere to protect confidence and legal privilege
assessments regarding the likely success of litigation should follow government standards for such advice where appropriate; for example, the Attorney General’s Guidance on Legal Risk^{[footnote 4]}
circulation of confidential or legally privileged information within government occurs only as necessary

Question 5

The Gambling Commission governance structure

Accepted Answer

13. The Chief Executive

Responsibilities of the Gambling Commission’s Chief Executive as Accounting Officer

13.1. The Chief Executive as AO is personally responsible for safeguarding the public funds for which they have charge; for ensuring propriety, regularity, value for money and feasibility in the handling of those public funds; and for the day-to-day operations and management of the Gambling Commission. In addition, they should ensure that the Gambling Commission as a whole is run on the basis of the standards, in terms of governance, decision-making and financial management, that are set out in Box 3.1 of MPM. These responsibilities include the below and those that are set in the AO appointment letter issued by the PAO of the sponsor department.

Responsibilities for accounting to Parliament and the public

13.2. Responsibilities to Parliament and the public include:

signing the accounts and ensuring that proper records are kept relating to the accounts and that the accounts are properly prepared and presented in accordance with any directions issued by the Secretary of State
preparing and signing a Governance Statement covering corporate governance, risk management and oversight of any local responsibilities, for inclusion in the annual report and accounts
ensuring that effective procedures for handling complaints about the Gambling Commission in accordance with Parliamentary and Health Service Ombudsman’s Principles of Good Complaint Handling are established and made widely known within the Gambling Commission and published on the Gambling Commission’s website
acting in accordance with the terms of MPM and other instructions and guidance issued from time to time by the department, the Treasury and the Cabinet Office
ensuring that as part of the above compliance it is familiar with and acts in accordance with:
- any governing legislation
- this framework document
- any delegation letter issued to body as set out in paragraph [18.1]
- any elements of any settlement letter issued to the sponsor department that is relevant to the operation of the Gambling Commission
- any separate settlement letter that is issued to the Gambling Commission from the sponsor department
ensuring it has appropriate internal mechanisms for monitoring, governance and external reporting regarding non-compliance with any conditions arising from the above documents
giving evidence, normally with the PAO, when summoned before the PAC on the Gambling Commission’s stewardship of public funds

Responsibilities to DCMS

13.3. Responsibilities to DCMS include:

establishing the Gambling Commission’s corporate and business plans in the light of the department’s wider strategic aims and agreed priorities
informing the department of progress in helping to achieve the department’s policy objectives and in demonstrating how resources are being used to achieve those objectives
ensuring that timely forecasts and monitoring information on performance and finance are provided to the department; that the department is notified promptly if over or under-spends are likely and that corrective action is taken; and that any significant problems whether financial or otherwise, and whether detected by internal audit or by other means, are notified to the department in a timely fashion

Responsibilities to the board

13.4. The Chief Executive is responsible for:

advising the Board on the discharge of its responsibilities as set out in this document, in the founding legislation and in any other relevant instructions and guidance that may be issued from time to time
advising the Board on the Gambling Commission’s performance compared with its aims and objectives
ensuring that financial considerations are taken fully into account by the Board at all stages in reaching and executing its decisions, and that financial appraisal techniques are followed

Managing conflicts

13.5. The Chief Executive should follow the advice and direction of the Board, except in very exceptional circumstances with a clear cut and transparent rationale for not doing so.

13.6. If the Board, or its chairperson, is contemplating a course of action involving a transaction which the Chief Executive considers would infringe the requirements of propriety or regularity or does not represent prudent or economical administration, efficiency or effectiveness, is of questionable feasibility, or is unethical the Chief Executive in their role as AO should reject that course of action and ensure that the Board has a full opportunity to discuss the rationale for that rejection.

13.7. Such conflicts should be brought to the attention of the PAO and the responsible Minister as soon as possible.

13.8. Furthermore, and if agreed with the responsible Minister, the AO must write a letter of justification to the chair of the Board setting out the rationale for not following the advice and recommendation of the board and copy that letter to the Treasury Officer of Accounts.

13.9. If the responsible Minister agrees with the proposed course of action of the Board it may be appropriate for the Minister to the direct the AO in the manner as set out in MPM paragraph 3.6.6 onwards.

14. The Board

Composition of the Board

14.1. The Gambling Commission will have a board in line with good standards of corporate governance and as set out in in its establishing statute and in guidance as set out in Annex A. The role of the Board shall be to run the Gambling Commission, and to deliver the objectives, in accordance with the purposes as set out above, their statutory, regulatory, common law duties and their responsibilities under this framework document. Detailed responsibilities of the board shall be set out in the Board terms of reference. Remuneration of the Board will be disclosed in line with the guidance in the Government Financial Reporting manual (FReM).

14.2. The Board will consist of a chairperson, together with an appropriate number of non-executive Commissioners that have a balance of skills and experience appropriate to overseeing the Gambling Commission’s business. The Board may include a Chief Executive. For the Gambling Commission there should be Commissioners who have experience of its business, operational delivery, corporate services such as HR, technology, property asset management, estate management, communications and performance management. There will be an appropriately qualified Finance Director as described in Annex 4.1 of MPM who will attend the Board. Other members of the Executive may attend the Board in a non-voting capacity.

Board Committees

14.3. The Board may set up such committees as necessary for it to fulfil its functions. As is detailed below at a minimum this should include an Audit and Risk Committee chaired by an independent and appropriately qualified non-executive member of the Board.

14.4. While the Board may make use of committees to assist its consideration of appointments, succession, audit, risk and remuneration it retains responsibility for, and endorses, final decisions in all of these areas. The Chair should ensure that sufficient time is allowed at the board for committees to report on the nature and content of discussion, on recommendations, and on actions to be taken.

14.5. Where there is disagreement between the relevant committee and the Board, adequate time should be made available for discussion of the issue with a view to resolving the disagreement. Where any such disagreement cannot be resolved, the committee concerned should have the right to report the issue to the sponsor team, PAO and responsible Minister. It may also seek to ensure the disagreement or concern is reflected as part of the report on its activities in the annual report.

14.6. The Chair should ensure board committees are properly structured with appropriate terms of reference. The terms of each committee should set out its responsibilities and the authority delegated to it by the Board. The Chair should ensure that committee membership is periodically refreshed and that individual independent non-executive directors are not over-burdened when deciding the chairs and membership of committees.

Duties of the Board

14.7. The Board is specifically responsible for:

establishing and taking forward the strategic aims and objectives of the Gambling Commission, consistent with its overall strategic direction and within the policy and resources framework determined by the Secretary of State
providing effective leadership of the Gambling Commission within a framework of prudent and effective controls which enables risk to be assessed and managed
ensuring the financial and human resources are in place for the Gambling Commission to meet its objectives
reviewing management performance
ensuring that the Board receives and reviews regular financial and management information concerning the management of the Gambling Commission
ensuring that it is kept informed of any changes which are likely to impact on its strategic direction or on the attainability of its targets, and determining the steps needed to deal with such changes and where appropriate bringing such matters to the attention of the responsible Minister and PAO via the executive team, sponsorship team or directly
ensuring that any statutory or administrative requirements for the use of public funds are complied with; that the Board operates within the limits of its statutory authority and any delegated authority agreed with the sponsor department, and in accordance with any other conditions relating to the use of public funds
ensuring that in reaching decisions, the Board takes into account guidance issued by the sponsor department
ensuring that as part of the above compliance they are familiar with:
- this framework document,
- any delegation letter issued to body as set out in paragraph [18.1]
- any elements of any settlement letter issued to the sponsor department that is relevant to the operation of the Gambling Commission
- any separate settlement letter that is issued to the Gambling Commission from the sponsor department
that they have appropriate internal mechanisms for the monitoring, governance and external reporting regarding any conditions arising from the above documents and ensure that the chief executive and the Gambling Commission as a whole act in accordance with their obligations under the above documents
demonstrating high standards of corporate governance at all times, including by using the independent audit committee to help the board to address key financial and other risks
appointing a Chief Executive and, in consultation with the department, set performance objectives and remuneration terms linked to these objectives for the Chief Executive which give due weight to the proper management and use and utilization of public resources
putting in place mechanisms for independent non-executives, to provide feedback to the responsible Minister on the performance of the Chair, taking into account the views of relevant stakeholders.
determining all such other things which the Board considers ancillary or conducive to the attainment or fulfilment by the Gambling Commission of its objectives

14.8. The Board should ensure that effective arrangements are in place to provide assurance on risk management, governance and internal control.

14.9. The Board should make a strategic choice about the style, shape and quality of risk management and should lead the assessment and management of opportunity and risk. The Board should ensure that effective arrangements are in place to provide assurance over the design and operation of risk management, governance and internal control in line with the Management of Risk – Principles and Concepts (The Orange Book)^{[footnote 5]}. The Board must set up an Audit and Risk Assurance Committee chaired by an independent and appropriately qualified non-executive member to provide independent advice and ensure that the department’s Audit and Risk Assurance Committee are provided with routine assurances with escalation of any significant limitations or concerns. The Board is expected to assure itself of the adequacy and effectiveness of the risk management framework and the operation of internal control.

15. The Chair’s role and responsibilities

15.1. The Chair is responsible for leading the board in the delivery of its responsibilities. Such responsibility should be exercised in the light of their duties and responsibilities as set out in their contract of employment/appointment letter, the priorities in the chair’s letter issued to them by the sponsor team, the statutory authority governing the Gambling Commission, this document and the documents and guidance referred to within this document.

15.2. Communications between the Gambling Commission’s Board and the responsible Minister should normally be through the Chair. The Chair’s performance will be reviewed annually, conducted by DCMS.

15.3. The Chair is bound by the Code of Conduct for Board Members of Public Bodies^{[footnote 6]}, which covers conduct in the role and includes the Nolan Principles of Public Life^{[footnote 7]}.

15.4. In addition, the Chair is responsible for:

ensuring including by monitoring and engaging with appropriate governance arrangements that the Gambling Commission’s affairs are conducted with probity
ensuring that policies and actions support the responsible Minister’s and where relevant other Ministers’ wider strategic policies and where appropriate, these policies and actions should be clearly communicated and disseminated throughout the Gambling Commission.

15.5. The Chair has the following leadership responsibilities:

formulating the Board’s strategy for discharging its statutory duties
ensuring that the Board, in reaching decisions, takes proper account of guidance provided by the responsible Minister or the department
supporting the Accounting Officer in promoting the efficient and effective use of staff and other resources
supporting the Accounting Officer in delivering high standards of regularity and propriety
representing the views of the board to the general public

15.6. The Chair also has an obligation to ensure that:

the work of the Board and its members is reviewed and is working effectively including ongoing assessment of the performance of individual board members with a formal annual evaluation and more in-depth assessments of the performance of individual board members when being considered for re-appointment
in conducting assessments that the view of relevant stakeholders including employees and the sponsorship team are sought and considered
the Board has a balance of skills appropriate to directing the Gambling Commission’s business, and that all directors including the Chair and Chief Executive continually update their skills, knowledge and familiarity with the Gambling Commission to fulfil their role both on the Board and committees. This will include but not be limited to skills and training in relation to financial management and reporting requirements, risk management and the requirements of board membership within the public sector
board members are fully briefed on terms of appointment, duties, rights and responsibilities
the Chair, together with the other board members, receives appropriate training on financial management and reporting requirements and on any differences that may exist between private and public sector practice
the responsible Minister is advised of the Gambling Commission’s needs when board vacancies arise
there is a Board Operating Framework in place setting out the role and responsibilities of the board consistent with the Government Code of Good Practice for Corporate Governance
there is a code of practice for board members in place, consistent with the Cabinet Office Code of Conduct for Board Members of Public Bodies

16. Individual board members’ responsibilities

16.1. Individual board members should:

comply at all times with the Code of Conduct for Board Members of Public Bodies, which covers conduct in the role and includes the Nolan Principles of Public Life as well as rules relating to the use of public funds and to conflicts of interest
demonstrate adherence to the 12 Principles of Governance for all Public Body Non-Executive Directors as appropriate^{[footnote 8]}
not misuse information gained in the course of their public service for personal gain or for political profit, nor seek to use the opportunity of public service to promote their private interests or those of connected persons or organisations
comply with the Board’s rules on the acceptance of gifts and hospitality, and of business appointments
act in good faith and in the best interests of the Gambling Commission
ensure they are familiar with any applicable guidance on the role of public sector non-executive directors and boards that may be issued from time to time by the Cabinet Office, HM Treasury or wider government

Question 6

Management and financial responsibilities and controls

Accepted Answer

17. Delegated authorities

17.1. The Gambling Commission’s delegated authorities are set out in the delegation letter attached to this framework document. This delegation letter may be updated and superseded by later versions which may be issued by the sponsor department in agreement with HM Treasury.

17.2. In line with MPM Annex 2.2 these delegations must be reviewed on an annual basis.

17.3. The Gambling Commission shall obtain the department’s and where appropriate HM Treasury’s prior written approval before:

entering into any undertaking to incur any expenditure that falls outside the delegations or which is not provided for in the Gambling Commission’s annual budget as approved by the department
incurring expenditure for any purpose that is or might be considered novel or contentious, or which has or could have significant future cost implications
making any significant change in the scale of operation or funding of any initiative or particular scheme previously approved by the department
making any change of policy or practice which has wider financial implications that might prove repercussive or which might significantly affect the future level of resources required
carrying out policies that go against the principles, rules, guidance and advice in MPM

18. Spending authority

18.1. Once the budget has been approved by the sponsor department and subject to any restrictions imposed by statute, the responsible Minister’s instructions, this document, HM Treasury settlement or delegation letters, the Gambling Commission has authority to incur expenditure approved in the budget without further reference to the sponsor department, on the following conditions:

the Gambling Commission must comply with the delegations set out in the delegation letter. These delegations may not be altered without the prior agreement of the sponsor department and as agreed by HM Treasury and Cabinet Office as appropriate
the Gambling Commission must comply with MPM regarding novel, contentious or repercussive proposals
inclusion of any planned and approved expenditure in the budget shall not remove the need to seek formal departmental approval where any proposed expenditure is outside the delegated limits or is for new schemes not previously agreed
the Gambling Commission must provide the sponsor department with such information about its operations, performance, individual projects or other expenditure as the sponsor department may reasonably require.

19. Banking and managing cash

19.1. The Gambling Commission must maximise the use of publicly procured banking services (accounts with central government commercial banks managed centrally by Government Banking).

19.2. The Gambling Commission should only hold money outside Government Banking Service accounts where a good business case can made for doing so and HM Treasury consent is required for each account to be established. Only commercial banks which are members of relevant UK clearing bodies may be considered for this purpose.

19.3. Commercial accounts where approved should be operated in line with the principles as set out in MPM.

19.4. The AO is responsible for ensuring the Gambling Commission has a banking policy as set out in MPM and ensuring that policy is complied with.

20. Procurement

20.1. The Gambling Commission shall ensure that its procurement policies are aligned with and comply with any relevant UK or other international procurement rules and in particular the Public Contracts Regulations 2015.

20.1. The Gambling Commission shall establish its procurement policies and document these in a Procurement Policy and Procedures Manual.

20.3. In procurement cases where the Gambling Commission is likely to exceed its delegated authority limit, procurement strategy approval for the specific planned purchase must be sought from the department’s sponsor team.

20.4. Goods, services, and works should be acquired by competition. Proposals to let single-tender or restricted contracts shall be limited and exceptional and a quarterly report explaining those exceptions should be sent to the department.

20.5. Procurement by the Gambling Commission of works, equipment, goods, and services shall be based on a full option appraisal and value for money (VfM), i.e. the optimum combination and whole life costs and quality (fitness for purpose).

20.6. The Gambling Commission shall:

engage fully with department and government wide procurement initiatives that seek to achieve VfM from collaborative projects
comply with all relevant Procurement Policy Notes issued by Cabinet Office
co-operate fully with initiatives to improve the availability of procurement data to facilitate the achievement of VfM

20.7. The Gambling Commission shall comply with the requirements set out in Annex A.

21. Disposal of Assets

21.1. The Gambling Commission requires the Secretary of State’s approval for any disposal of land regardless of value.

21.2. The Commission should seek approval from DCMS for the disposal of all other assets (excluding fixtures and fittings) above the maximum value as defined in their annual delegation letter.

21.3. The sale or lease of assets at below market value is regarded as a gift. If the difference between the market value and the amount received (i.e. the gift) exceeds £300k, HMT approval is required.

21.4. Unless a specific delegation limit is awarded to the Commission, HMT approval is required for all retention of receipts arising from asset disposals regardless of value.

22. Risk management

22.1. The Gambling Commission shall ensure that the risks that it faces are dealt with in an appropriate manner, in accordance with relevant aspects of best practice in corporate governance, and develop a risk management strategy, in accordance with the Treasury guidance Management of Risk: Principles and Concepts^{[footnote 9]} .

23. Counter fraud and theft

23.1. The Gambling Commission must adopt and implement policies and practices to safeguard itself against fraud and theft.

23.2. The Gambling Commission must act in line with guidance as issued by the Counter Fraud Function and in compliance with the procedures and considerations as set in in MPM Annex 4.9 and the Counter Fraud Functional Standard^{[footnote 10]}. It must also take all reasonable steps to appraise the financial standing of any firm or other body with which it intends to enter a contract or to provide grant or grant-in-aid.

23.3. The Gambling Commission must keep records of and prepare and forward to the department an annual report on fraud and theft suffered by the Gambling Commission and notify the sponsor department of any unusual or major incidents as soon as possible. The Gambling Commission must also report detected loss from fraud, bribery, corruption and error, alongside associated recoveries and prevented losses, to the counter fraud centre of expertise in line with the agreed government definitions as set out in Counter Fraud Functional Standard.

24. Staff

Broad responsibilities for staff

24.1. Within the arrangements approved by the responsible Minister and the Treasury the Gambling Commission will have responsibility for the recruitment, retention and motivation of its staff. The broad responsibilities toward its staff are to ensure that:

the rules for recruitment and management of staff create an inclusive culture in which diversity is fully valued; appointment and advancement is based on merit; there is no discrimination against employees with protected characteristics under the Equality Act 2010
the level and structure of its staffing, including grading and staff numbers, are appropriate to its functions and the requirements of economy, efficiency and effectiveness
the performance of its staff at all levels is satisfactorily appraised and performance measurement systems are reviewed from time to time
its staff are encouraged to acquire the appropriate professional, management and other expertise necessary to achieve the Gambling Commission’s objectives
proper consultation with staff takes place on key issues affecting them
adequate grievance and disciplinary procedures are in place
whistle-blowing procedures consistent with the Public Interest Disclosure Act are in place
a code of conduct for staff is in place based on the Cabinet Office’s Model Code for Staff of Executive Non-departmental Public Bodies^{[footnote 11]}.

Staff costs

24.2. Subject to its delegated authorities, the Gambling Commission shall ensure that the creation of any additional posts does not incur forward commitments that will exceed its ability to pay for them.

Pay and conditions of service

24.3. The Gambling Commission’s staff are subject to levels of remuneration and terms and conditions of service (including pensions) within the general pay structure approved by the sponsor department and the Treasury. The Gambling Commission has no delegated power to amend these terms and conditions.

24.4. If civil service terms and conditions of service apply to the rates of pay and non-pay allowances paid to the staff and to any other party entitled to payment in respect of travel expenses or other allowances, payment shall be made in accordance with the Civil Service Management Code^{[footnote 12]} and the annual Civil Service Pay Remit Guidance, except where prior approval has been given by the department and HM Treasury to vary such rates.

24.5. Staff terms and conditions should be set out and provided to the department together with subsequent amendments.

24.6. The Gambling Commission shall abide by public sector pay controls, including the relevant approvals process dependent on the organisations classification as detailed in the Senior Pay Guidance^{[footnote 13]} and the Public Sector Pay and Terms Guidance^{[footnote 14]}.

24.7. The Gambling Commission shall operate a performance-related pay scheme that shall form part of the annual aggregate pay budget approved by the department, general pay structure approved by the department and the Treasury, where relevant with due regard to the Senior Pay Guidance.

24.8. The travel expenses of board members shall be tied to the rates allowed to senior staff of the Gambling Commission. Reasonable actual costs shall be reimbursed.

Pensions, redundancy and compensation

24.9. Compensation scheme rules and pension scheme rules should reflect legislative and HM Treasury guidance requirements regarding exit payments.

24.10. The Gambling Commission staff shall normally be eligible for a pension provided by PCSPS. Staff may opt out of the occupational pension scheme provided by the Gambling Commission, but that employers’ contribution to any personal pension arrangement, including stakeholder pension, shall normally be limited to the national insurance rebate level.

24.11. Any proposal by the Gambling Commission to move from the existing pension arrangements, or to pay any redundancy or compensation for loss of office, requires the prior approval of the department. Proposals on severance must comply with the rules in chapter 4 of MPM.

Business plans, financial reporting and management information

25. Corporate and business plans

25.1. The Gambling Commission shall submit annually to the sponsor department a draft of the corporate plan covering at least the year ahead. The draft should be submitted in such time as to allow meaningful consideration and feedback before final adoption by the Gambling Commission board. The Gambling Commission shall agree with the department the issues to be addressed in the plan and the timetable for its preparation. The plan shall reflect the Gambling Commission’s statutory and/or other duties and, within those duties, the priorities set from time to time by the responsible Minister (including decisions taken on policy and resources in the light of wider public expenditure decisions). The plan shall demonstrate how the Gambling Commission contributes to the achievement of the department’s medium-term plan and priorities and aligned performance metrics and milestones.

25.2. The first year of the corporate plan, amplified as necessary, shall form the business plan. The business plan shall be updated to include key targets and milestones for the year immediately ahead and shall be linked to budgeting information so that resources allocated to achieve specific objectives can readily be identified by the department. Subject to any commercial considerations, the corporate and business plans should be published by the Gambling Commission on its website and separately be made available to staff.

25.3. The following key matters should be included in the plans:

key objectives and associated key performance targets for the forward years, and the strategy for achieving those objectives
key non-financial performance targets
a review of performance in the preceding financial year, together with comparable outturns for the previous 2-5 years, and an estimate of performance in the current year
alternative scenarios and an assessment of the risk factors that may significantly affect the execution of the plan but that cannot be accurately forecast
other matters as agreed between the department and the Gambling Commission

26. Budgeting procedures

26.1. Each year, in the light of the updated draft corporate plan, the department will send to the Gambling Commission by May / June:

a formal statement of the annual budgetary provision allocated by the department in the light of competing priorities across the department and of any forecast income approved by the department
a statement of any planned change in policies affecting the Gambling Commission

26.2. The approved annual business plan will take account both of approved funding provision and any forecast receipts. It will include a budget of estimated payments and receipts together with a profile of expected expenditure and of draw-down of any departmental funding and/or other income over the year. These elements form part of the approved business plan for the year in question.

27. Fees, Grant-in-aid and any ring-fenced grants

27.1. The Gambling Commission will, for functions undertaken in relation to the Gambling Act 2005, and in accordance with that Act, operate on a net running costs basis under which fee income received by the Commission is used to fund its work directly, rather than surrendered to the Government. Fees to fund these functions will be determined on a full cost recovery basis in accordance with the Treasury’s Fees and Charges guidance. Any funds that are unused by the end of any given financial year require DCMS approval to be utilised in any following year. Forecasts should be provided by Commission that are taut, realistic and consistent, and consistent with MPM.

27.2. Subject to periodic review, the Commission may retain non-grant-in-aid income for spending in connection with the achievement of the Commission’s strategic aims. The Commission seeks to establish fees on a full cost recovery basis, taking one year with another where unforeseen surpluses or deficits occur, ensuring that fees remain appropriate and proportionate over the duration of the corporate strategy.

27.3. Review of the Gambling Commission’s fees is at the discretion of the Secretary of State, to be exercised in accordance with the principles of Managing Public Money. The Gambling Commission and DCMS will carry out an annual health check to determine whether fee levels remain appropriate or whether a further comprehensive review is required.

27.4. The annual check will consider any significant changes to legislation or the number/complexity of regulated operators. It will also take into account levels of inflation, efficiency savings made by the Commission and whether changes to industry structures or patterns of risk have significantly altered the focus of its regulatory effort. The outcome of this consideration will be recorded and signed off by the Director of Finance or the Head of Gambling and Lotteries in DCMS and by the Chief Executive or Chief Operating Officer of the Gambling Commission. The annual check may be brought forward and a comprehensive review of fees initiated by DCMS if it is clear that this will be required.

27.5. Grant-in-Aid is the amount payable by the DCMS to the Gambling Commission in each year, primarily in relation to National Lottery regulation, and is distinct from the budget.

27.6. Any grant-in-aid provided by the department for the year in question will be voted in the department’s Supply Estimate and be subject to parliamentary control.

27.7. The grant-in-aid will normally be paid in monthly instalments on the basis of written applications showing evidence of need. The Gambling Commission will comply with the general principle that there is no payment in advance of need. Cash balances accumulated during the course of the year from grant-in-aid or other Exchequer funds shall be kept to a minimum level consistent with the efficient operation of the Gambling Commission. Grant-in-aid not drawn down by the end of the financial year shall lapse. Subject to approval by Parliament of the relevant Estimates provision, where grant-in-aid is delayed to avoid excess cash balances at the year-end, the department will make available in the next financial year any such grant-in-aid that is required to meet any liabilities at the year end, such as creditors.

27.8. In the event that the department provides the Gambling Commission separate grants for specific (ring-fenced) purposes, it would issue the grant as and when the Gambling Commission needed it on the basis of a written request. The Gambling Commission would provide evidence that the grant was used for the purposes authorised by the department. The Gambling Commission shall not have uncommitted grant funds in hand, nor carry grant funds over to another financial year.

28. Annual report and accounts

28.1. The Gambling Commission Board must publish an annual report of its activities together with its audited accounts after the end of each financial year. A draft of the report should be submitted to the department two weeks before the proposed publication date. The Gambling Commission shall provide the department its finalised (audited) accounts by May / early June each year in order for the accounts to be consolidated within DCMS. The accounts should be prepared in accordance with the relevant statutes and specific accounts direction issued by the department as well as the Treasury’s Financial Reporting Manual (FReM).

28.2. The annual report must:

cover any corporate, subsidiary or joint ventures under its control
comply with the FreM and in particular have regard to the illustrative statements for an NDPB^{[footnote 15]}
outline main activities and performance during the previous financial year and set out in summary form forward plans.

28.3. Information on performance against key financial targets must be included within the annual report and made subject to the auditor’s consistency opinion. The report and accounts shall be laid in Parliament and made available on the Gambling Commission website, in accordance with the guidance in the FReM.

29. Reporting performance to the department

29.1. The Gambling Commission shall operate management, information and accounting systems that enable it to review in a timely and effective manner its financial and non-financial performance against the budgets and targets set out in the corporate and business plans.

29.2. The Gambling Commission shall inform the sponsor department of any changes that make achievement of objectives more or less difficult. It shall report financial and non-financial performance, including performance in helping to deliver Ministers’ policies, and the achievement of key objectives quarterly.

29.3. The Gambling Commission’s performance shall be formally reviewed by the department four times a year.

29.4. The responsible Minister will meet the Chair once a year.

29.5. The PAO will meet the Chief Executive at least once a year.

30.1. The Gambling Commission will allow reasonable access by DCMS to GC records and personnel where this is necessary for the proper discharge of the Secretary of State’s responsibilities in respect of the Gambling Commission – except where they relate to access to specific documents/personnel that could compromise the ability of the Gambling Commission to exercise its functions independently of Government influence or interference.

30.2. The Gambling Commission shall provide the sponsor department with such information about its operations, performance, individual projects or other expenditure as the sponsor department may reasonably require.

30.3. The department and HM Treasury may request the sharing of data held by the Gambling Commission in such a manner as set out in central guidance except insofar as it is prohibited by law. This may include requiring the appointment of a senior official to be responsible for the data sharing relationship.

30.4. As a minimum, the Gambling Commission shall provide the department with information monthly that will enable the department satisfactorily to monitor:

the Gambling Commission’s cash management
its draw-down of grant-in-aid
forecast outturn by resource headings
other data required for the Online System for Central Accounting and Reporting (OSCAR)
data as required in respect of its compliance with any Cabinet Office Controls pipelines or required in order to meet any condition as set out in any settlement letter

Question 7

Audit

Accepted Answer

31. Internal audit

31.1. The Gambling Commission shall:

establish and maintain arrangements for internal audit
ensure that any arrangements for internal audit are in accordance with the Public Sector Internal Audit Standards (PSIAS) as adopted by HM Treasury^{[footnote 16]}
set up an audit committee of its board in accordance with the Code of Good Practice for Corporate Governance and the Audit and Risk Assurance Committee Handbook, or be represented on DCMS’ Audit Committee
forward the audit strategy, periodic audit plans and annual audit report, including the Gambling Commission’s Head of Internal Audit opinion on risk management, control and governance as soon as possible to the sponsor department
keep records of and prepare and forward to the department an annual report on fraud and theft suffered by the Gambling Commission and notify the sponsor department of any unusual or major incidents as soon as possible
share with the sponsor department information identified during the audit process and the Annual Audit Opinion Report (together with any other outputs) at the end of the audit, in particular on issues impacting on the department’s responsibilities in relation to financial systems within the Gambling Commission

32. External audit

32.1. The Comptroller & Auditor General (C&AG) audits the Gambling Commission’s annual accounts and lays them before Parliament, together with their report on those accounts.

32.2. In the event that the Gambling Commission has set up and controls subsidiary companies, the Gambling Commission will in the light of the provisions in the Companies Act 2006 ensure that the C&AG has the option to be appointed auditor of those company subsidiaries that it controls and/or whose accounts are consolidated within its own accounts. The Gambling Commission shall discuss with the sponsor department the procedures for appointing the C&AG as auditor of the companies.

32.3. The C&AG:

will consult the department and the Gambling Commission on whom – the NAO or a commercial auditor – shall undertake the audit(s) on his behalf, though the final decision rests with the C&AG
has a statutory right of access to relevant documents, including by virtue of section 25(8) of the Government Resources and Accounts Act 2000, held by another party in receipt of payments or grants from the Gambling Commission
will share with the sponsor department information identified during the audit process and the audit report (together with any other outputs) at the end of the audit, in particular on issues impacting on the Department's responsibilities in relation to financial systems within the Gambling Commission
will consider requests from departments and other relevant bodies to provide regulatory compliance reports and other similar reports at the commencement of the audit. Consistent with the C&AG’s independent status, the provision of such reports is entirely at the C&AG’s discretion

32.4. The C&AG may carry out examinations into the economy, efficiency and effectiveness with which the Gambling Commission has used its resources in discharging its functions. For the purpose of these examinations the C&AG has statutory access to documents as provided for under section 8 of the National Audit Act 1983. In addition, the Gambling Commission shall provide, in conditions to grants and contracts, for the C&AG to exercise such access to documents held by grant recipients and contractors and sub-contractors as may be required for these examinations; and shall use its best endeavours to secure access for the C&AG to any other documents required by the C&AG which are held by other bodies.

Question 8

Reviews and winding up arrangements

Accepted Answer

33. Review of the Gambling Commission’s status

33.1. The Gambling Commission will be reviewed as part of the wider Public Bodies Reviews programme, at a time determined by the department’s ministers and their PAO.

34. Arrangements in the event that the Gambling Commission is wound up

34.1. The sponsor department shall put in place arrangements to ensure the orderly winding up of the Gambling Commission. In particular it should ensure that the assets and liabilities of the Gambling Commission are passed to any successor organisation and accounted for properly. (In the event that there is no successor organisation, the assets and liabilities should revert to the sponsor department.) To this end, the department shall:

have regard to Cabinet Office guidance on winding up of ALBs^{[footnote 17]}
ensure that procedures are in place in the Gambling Commission to gain independent assurance on key transactions, financial commitments, cash flows and other information needed to handle the wind-up effectively and to maintain the momentum of work inherited by any residuary body
specify the basis for the valuation and accounting treatment of the Gambling Commission’s assets and liabilities
ensure that arrangements are in place to prepare closing accounts and pass to the C&AG for external audit, and that for non-Crown bodies funds are in place to pay for such audits. It shall be for the C&AG to lay the final accounts in Parliament, together with his report on the accounts
arrange for the most appropriate person to sign the closing accounts. In the event that another ALB takes on the role, responsibilities, assets and liabilities, the succeeding ALB AO should sign the closing accounts. In the event that the department inherits the role, responsibilities, assets and liabilities, the sponsor department’s AO should sign

34.2. The Gambling Commission shall provide the department with full details of all agreements where the Gambling Commission or its successors have a right to share in the financial gains of developers. It should also pass to the department details of any other forms of claw-back due to the Gambling Commission.

Signed

Polly Payne

6 December 2023

(On behalf of DCMS)