The concept of a lottery, in which lots were drawn to determine a winner, had been around for centuries before Queen Elizabeth I chartered a prize draw to raise money for the “reparation of the havens and strength of the Realme, and towardes such other publique good works”. The scheme itself was announced in 1566, at a time when England was seeking to expand its international trade. Income from the lottery was therefore used to fund improvements to the country’s coastal infrastructure and the construction of new ships.
Unlike most modern lotteries, which seek to produce a profit, the value of Elizabeth’s prize fund equalled the money raised through ticket sales. Each ticket was also guaranteed to win one of the available prizes, which ranged from silver plate and tapestries to a jackpot of £5,000. However, the fact that the draw didn’t take place until nearly three years after the scheme’s introduction effectively meant that the Crown benefited from a 3 year interest free loan.
400,000 tickets were put on sale at the cost of 10 shillings each, a cost that was far out of the reach of most ordinary people at the time, and which led to some forming syndicates in which they purchased a share of a single ticket. To entice purchases, all ticket holders were promised that they would be exonerated from any crimes they had committed other than murder, felonies, piracy or treason.
The draw itself was made outside the west wing of the old St Paul’s Cathedral in London. Sadly the name of the grand prize winner has been lost, but ultimately the lottery paid off for Elizabeth. She was able to invest heavily in her navy and coastal defences, which proved vital in 1588 and the successful defeat of the Spanish Armada.