Tumbling sales of scratch cards, Lotto tickets and Euromillions games have blown a fresh hole in the National Lottery's charity donations.
Operator Allwyn suffered a £118m fall in sales over the summer, further denting the amount that it hands over to so-called good causes. The setback meant the lottery generated £24m less for UK charities between July and September than in the previous three-month period.
The decline leaves Allwyn's optimistic targets for charitable donations looking even more unrealistic. The lottery's faltering performance also threatens to dent plans for a secondary stock market listing of the wider Allwyn group in either New York or London.
The move follows a recent €16bn (£14bn) merger with Greek gambling outfit OPAP.
Though the UK market is one part of a sprawling betting empire that stretches across Europe and into America, stewardship of the National Lottery comes with great scrutiny because of its status as the single biggest contributor to Britain's charity sector.
As part of its bid to run the National Lottery, Allwyn made a series of highly ambitious promises, including a pledge to more than double charitable donations from £17.9bn under predecessor Camelot to £38bn – equivalent to £3.8bn a year over the coming decade.
Allwyn, owned by Czech billionaire Karel Komarek, later revised its projections and instead pledged to double returns to good causes by the end of its licence from £30m to £60m a week – or nearly £3.2bn a year.
Yet the lottery has managed to deliver just £1.9bn for Good Causes in the last four financial quarters, according to the Gambling Commission.
A botched attempt to upgrade its IT systems and install more modern terminals in shops has had a serious impact on sales. Plans for new draw-based games and a range of new scratch cards have also failed to materialise.
The Commission attributed the most recent sales decline to a £99m fall in Euromillions sales. It also stated that sales of scratch cards and Lotto were down on the same period last year.
Separately, the Telegraph has learned that weekly scratchcard sales have dwindled to between £36m and £35m a week. By comparison, they were somewhere in the £44m to £45m region during the final months of the Camelot regime.
Allwyn said sales for lottery games always fluctuate.
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A spokesman said: "Returns to Good Causes are up £70m year-on-year on a like-for-like basis as a result of our ongoing transformation of The National Lottery.
"We are confident we will double the amount raised for Good Causes from £30m a week to £60m a week by the end of the current licence."
Allwyn's control of the lottery has also been overshadowed by a bitter legal battle between Richard Desmond and the Gambling Commission .
The media tycoon was outbid by Allwyn in his attempts to run the National Lottery and has claimed "manifest errors" were made in the way the process was run. He has asked for £1.3bn in damages. A ruling is expected in the New Year.
