The Funding Practice Alliance (FPA) welcomes the investigation by the Public Protector into alleged irregularities at the National Lottery Board (NLB). Advocate Thuli Madonsela confirmed late last week that a probe was now underway following a formal complaint about the withdrawal of funding, alleged corruption and nepotism at the NLB.
The FPA – made up of prominent civil society organisations including Inyathelo, SCAT, REAP and the Community Development Resource Association – has repeatedly called for an urgent review and overhaul of the way the NLB manages and distributes billions of rands worth of public funds. Inyathelo Executive Director Shelagh Gastrow says there is a complete lack of accountability and transparency over the way the board operates. “The NLB needs to be called to account for its failure to fulfil its mandate to distribute funds appropriately to non-profit organisations and charities that are making a difference to the lives of all South Africans, especially the most vulnerable. It is outrageous that worthy organisations like those who educate and feed underprivileged children are being denied funding while the board sits on millions of rands of undistributed funds. The random decision making, poor management and inefficient administration at the NLB is having a devastating effect on the essential services provided by many worthy NGOs in South Africa,” insists Gastrow.
In March last year, the FPA released a research report on the National Lotteries and National Development Agency entitled “Meeting their Mandate?” The report questioned whether the agency was using its grant-making role in a fair and equitable manner. Funding Practice Alliance Advocacy Co-ordinator Joanne Harding says part of the problem is that the distribution agencies are only accountable to the Minister of Trade and Industry who appoints them. “They need to report directly to the NLB and the appointment process to these agencies should be more transparent. Although the public can nominate candidates, it is the Minister who decides on the actual appointments. Civil society members who have an understanding and experience of how NGOs are financed should also be represented on the NLB. This would go a long way towards tackling the lack of transparency,” says Harding.
The FPA has also called for the National Lotteries Act to be revised so that the purpose of the lottery funds can be clarified. Nomvula Dlamini from the Community Development Resource Association says the current Act is fatally flawed and unworkable. “Any grantmaker can tell you that if there is no purpose for a fund, there can be no logical criteria. The Act established the fund but it doesn’t explicitly claim to reduce poverty, build communities or support civil society, and therefore has no real framework within which to do its work. As a result, the administrative component of the lotteries only focuses on compliance. This helps explain how some of the most controversial grant decisions could have been made – the paperwork was in order and that was all that was required,” explains Dlamini.
