Charlotte Mathews
The South African Red Cross, the largest humanitarian organisation in the country, is struggling with a financial crisis that it hopes can be resolved within the next few weeks. If not, a wide range of aid projects will be jeopardised.
Mandisa Kalako-Williams, vice-president of the Red Cross, said the organisation’s fixed assets were in excess of its liabilities and it could call on its branch offices around the country, each of which operate autonomously, to assist with cash. The Red Cross also holds some investments in trust that will mature in July.
In addition, various foreign donors, working through the International Red Cross Federation, had pledged R3,7-million on condition that the local organisation was able to raise R1-million to R1,5-million.
However, the national organisation was besieged by local creditors, the largest of whom was Standard Bank, where the Red Cross was holding a significant overdraft built up over the years.
The ideal solution to the financial crisis, Kalako-Williams said, would be for the organisation to reach a satisfactory agreement with Standard Bank. Simultaneously, the Red Cross could embark on various fundraising activities but this in turn would generate further costs.
Sources said the organisation has been experiencing a financial squeeze for more than a decade and in the past few years has been implementing a recovery plan, including an audit that is currently under way.
Funding has been shrinking at the same time as demands on the organisation have been increasing. It assists with disaster relief, for example, when fires destroy informal settlements; it has been assisting with the cholera outbreak in KwaZulu-Natal; and one of its core programmes is an HIV/Aids health care programe.
Kalako-Williams said that although the suspension of individual charities’ ability to raise funds by the introduction of a national lottery was not the main cause of the Red Cross’s difficulties, it had also played a part.
The Red Cross in the Western Cape had been the first welfare organisation in the country to raise funds through scratch cards and in the early 1990s they were beneficiaries of Ithuba, until that was closed down by the nationalisation of the lottery.
The Red Cross has applied for funds from the proceeds of the national lottery, but it is uncertain when these will be released.
This week the Anglican Bishops of Southern Africa said despite a moral dilemma and deep concern at the level of private profiteering within the gaming industry, they agreed to assist the Minister of Trade and Industry Alec Erwin with the distribution of charity funds generated by the lottery.