UK lottery operator Camelot is planning a cost-cutting operation that will cost the jobs of 10% of its staff and two directors, press reports have said.

Most Sunday newspapers reported leaked plans from the firm to rein in expenditure, in light of the three-year slowdown in ticket sales.

The plan envisages the culling of 100 of Camelot's 950 staff, mainly from the Watford head office, and freezing staff bonuses group-wide.

In addition, deputy chief executive David Clark could start working part-time, while external affairs head Sue Slipman would leave.

Ms Slipman has been given a �200,000 pay-off, the Sunday Times reported.

Bored - and cynical

Although 60% of British adults still play the lottery on a regular basis, overall revenues have fallen from �5.5bn in 1998 to a likely �4.8bn this year.

Ms Slipman has reportedly been given a generous pay-off

Participation has been hit partly by boredom among consumers, but mainly by recurring controversy over just how much of the proceeds are passed on to appropriate good causes.

Camelot chief executive Dianne Thompson has set out to cut costs by 10% in a bid to ride out what seems likely to be continuing decline in sales, despite an expensive recent rebranding exercise.

But while changes are certainly under way, Camelot has refused officially to confirm the details of Sunday's newspaper reports, and a spokeswoman dismissed most stories as "speculation".

Money worries

Observers now believe that Camelot - owned by a consortium of firms including postal giant Consignia and drinks firm Cadbury Schweppes - may have to shift its branding still further.

Ms Thompson wants sweeping changes

Research has shown that gamblers will spend more if they approve of which charities will benefit from the money.

The lottery has so far raised �11.3bn for charities, but the money is distributed by the Community Fund, an independent agency.

The Fund has come in for repeated criticism for lavishing money on wasteful arts and leisure projects such as the Millennium Dome, while most ticket buyers would prefer to see money go to educational or healthcare charities.

Camelot, some observers have speculated, could attempt to have the law changed, in order to wrest from the Fund control of the disbursement of cash.