Construction of the iconic Kelpies in Falkirk were part funded by the Big Lottery Fund Scotland

​Fears UK government will seize £320m of Big Lottery Fund cash across the UK

Scotland’s Big Lottery Fund budget could be slashed by 40%, leaving thousands of third sector groups struggling to survive.

It is understood that government ministers in Westminster are set to raid the Big Lottery Fund (BLF) by a reported £320 million a year – meaning £30m from Scotland’s £70m could be cut.

A blog post by an organisation called Save Lottery Funding said the UK government’s Department for Culture, Media and Sport wants to mitigate cuts to arts and sports bodies and will take cash from the lottery to do so.

Similar tactics were used to fund the London Olympics in 2012 with a massive £638m “borrowed” by the government, a sum that it has yet to pay back.

Then the Scottish third sector mounted a rigorous defence in an attempt to stop the cash going to London. A similar campaign would be expected should the figures be confirmed when the comprehensive spending review is published on 25 November.

Charities are already struggling to meet increasing demands on their services - Ciaran Price

Sources say the reported changes risk breaching the "additionality principle" - a legal safeguard to ensure that Lottery funds are not used to substitute for government expenditure.

“Spending more Lottery funds on arts, sport and heritage at a time when expenditure on arts, sport and heritage is being cut demands independent scrutiny to ensure the additionality principle is not breached,” the blog post from the group said.

Many in the sector believe that if the raid goes ahead then it would be totally devastating for the sector in Scotland.

Thousands of third sector organisations across the country benefit from BLF cash from small community groups to larger national charities.

Small community groups have come to rely on the funding more heavily since local authorities slashed their budgets.

On its webpage Save Lottery Funding said: "The government plans to save face by cutting the share of 'good causes' money from the National Lottery going to the Big Lottery Fund and transferring it to arts, sport and heritage.

"These causes have celebrity backers and influence in high places that the people and communities most in need do not.”

The Scottish Council for Voluntary Organisations (SCVO) said lottery funding is meant to be additional and any changes which undermined this principle could have a negative impact on public attitudes.

Martin Sime, SCVO chief executive added: "We understand that Ministers in the devolved governments have not been consulted, which is disrespectful to their responsibilities.

"SCVO has long argued that Lottery good cause distribution should be entirely devolved in order to avoid this kind of mess."

Since 2004 £9 billion of BIG funding has gone to projects in the UK supporting health, education, environment and charitable purposes.

A spokeswoman for the Big Lottery Fund in Scotland said: "We have been alerted to the campaign on social media. We have no further information on this. This is a matter for the Department for Culture Media and Sport."

The DCMS said it would not comment on speculation ahead of the comprehensive spending review which will be published on 25 November.

Reacting to the crisis, BLF bosses initially suspended the announcement of its planned programme of spending for next year before back tracking - details will now be released on Thursday, 26 November.

Meanwhile, SCVO's Sime has written to Holyrood social justice secretary Alex Neil and Scottish secretary David Mundell MP, demanding a rethink and calling the government's stance "perverse".