By Simon Page BBC News Online

The Aln Valley Railway had a �3m bid turned down in 1997

Before an organisation can be considered for lottery funding, it must plough through a mountain of forms and produce costly technical reports. This is often a difficult and time-consuming task and the bidding process can sometimes leave a bidder worse off than when they started.

"The bid cost �100,000 to put together", said Stuart Manley, Chairman of the Aln Valley Railway Society(AVRS).

"Much of this was spent on things like assessing the technical feasibility of our plans and conducting environmental studies. The costs mount up. On a smaller scale, we sent out six applications and each one cost �12.60 just to post."

In 1999 AVRS wanted �6m to rebuild the branch line between Alnmouth and Alnwick in Northumberland. They applied to the Heritage Lottery Fund for half the amount, having secured �3m in match funding. However, the latter was dependent on receiving the former.

"We began the process in 1997 and it took two years to get the application together", said Mr Manley.

Treated 'unfairly'

"We brought in professional help and they went through the bid with a fine toothcomb. The Heritage Lottery Fund accepted it was one of the most professional applications they'd had.

"After we were turned down we spoke to Heritage Lottery. There were a number of things about the way we were treated which we were unhappy with. Overall we felt we weren't given a fair crack of the whip.

Application forms can be quite complicated. I've heard of people taking three months to fill in the forms. Richard Buxton Community Fund

"It took us two or three years to learn exactly how lottery funding and the bidding process worked, which makes me feel that decisions are not so much dependent on the project as on how well people know the system. I think in the end it comes down to luck."

This is a common complaint from those who bid for funding in the early days of the lottery, and one which David McNeill from the Arts Council recognises: "When the lottery was first introduced the rules were quite prohibitive.

"Nowadays applications are based on their individual merits but back then a first come, first served basis was operated. This tended to benefit established organisations and those who had access to professional help and contacts."

Although the way applications are viewed may have changed, the process itself can be daunting, particularly with large bids. Hence, the �100,000 AVRS spent.

Safeguarding the public purse

Richard Buxton, Chief Executive of the Community Fund, said: "One of the biggest problems people face is working out which distributor they should approach.

"You might have an application from a village hall which is used as a nursery group, a sports hall, an education facility, a social club and just happens to be a Grade II listed building. This makes it difficult to know which distributor is the correct one to apply to.

"The second hurdle is that application forms can be quite complicated. I've heard of people taking three months to fill in the forms.

The Heritage Lottery Fund prefer bidders to make early contact

"However, as custodians of public funds, we have to be thorough in our assessment of bids. A simpler application process is coming in next year, but at the moment the procedure can be quite cumbersome."

Another development has been funding for bids. Some distributors now give Stage I funding which helps organisations through the application process. But it seems early contact always pays.

Tim Jones from Birmingham City Council said: "From Birmingham's point of view, every bid we've put in has been judged on its merits and we've developed a strategy with Heritage Lottery to give us the best chance of achieving our goals.

"We've tried to establish a working relationship with Heritage Lottery officers. If we discuss our strategy and what we want to achieve, we can find out from them what's feasible in terms of funding.

"With projects which don't stand a chance of success, we can step back on them before we start spending money."

The changes in how lottery distributors view bids and engage with bidders may have come too late for the Aln Valley Railway. But in an attempt to spread the lottery net wider, even greater changes are around the corner.

Next: All Change. The future for lottery funding.