Ian Clayton
Cash-strapped NGOs should not expect much assistance with their funding from the latest Katz commission report.
The commission’s proposals on donations to and possible tax deductions from NGOs are to be printed soon – but they are unlikely to result in any major changes.
Minister of Finance Trevor Manuel told Parliament this week the Katz report “does set out an approach which does take account of the important role that non-governmental organisations play”. But, he added, “it circumscribes how far we can go in providing a series of tax offsets for them”.
Manuel summed up the approach by saying “the maxim” that applied in this case is “don’t give away what you haven’t got”.
His comments, during a 15-minute interpellation debate in the National Assembly, indicate that NGOs are unlikely to get significant tax incentives to boost their dwindling finances.
With decreasing support from foreign donors, NGOs have pleaded with the government to be placed in a similar position to universities and other organisations where donations are tax deductible.
During the debate in Parliament, the Inkatha Freedom Party’s Farouk Cassim said NGOs in South Africa have proven their importance in South Africa, but the lifeblood that sustained them was being threatened.
“Many of these were dependent on overseas donations and overseas funding, but now that we are a country which has become a democracy on its own right, many of these NGOs will have to depend on the goodwill of local communities to support and to sustain them.
“If the NGOs diminish, if they do not have the funding to be able to continue with vital services, then the expenditure on the government’s side will increase substantially, because NGOs not only solicit funding from people, but also solicit expertise and assistance from those among the people of our country who can give it. They get double value,” Cassim said.
But both Manuel and the Democratic Party’s Ken Andrew, who is also the chair of the joint committee of public accounts, pleaded for caution, with Andrew asking: “Where does one start and where does one stop? Where does one draw the line?”
Manuel, who said the Katz report on corporate and individual giving would be printed soon, added: “With a number of these issues, there are many unintended consequences.
“One only has to drive down many of the main streets to recognise the fact that while there has been a good attempt to spawn micro- sized enterprises, a number of these people operating on sidewalks are not micro- enterprises in their own right, but are effectively branches of people who are much larger. The same thing happens in tax law.
“We must also avoid a situation where South Africa becomes a tax haven for all kinds of footloose individuals and quasi-industries,” Manuel said.
@Drive to get Africa in touch
Charlene Smith
In two weeks’ time, Minister of Posts, Telecommunications and Broadcasting Jay Naidoo will don a helmet, fasten his seat belt and set off from Bizerte, Tunisia, on a 16 000km rally to drive home his message to the world: Africa, a continent with 700- million people, has fewer telephones than New York or Tokyo. Fewer than 14-million people have access to telephones.
“This rally is not about driving, it is a rally to political leadership, investors and civil society to create an awareness of telecommunications and the need for it to drive Africa’s economic renaissance,” says Naidoo.
The minister, who will be doing all the driving, will take along state-of-the-art telecommunications. The rally will be covered by radio and television, and an Internet site with audio will map his route.
Naidoo hopes to raise some of the billions needed to upgrade Africa’s infrastructure.
The minister says that by 2003 every village in South Africa will have a telephone and the entire network will be digitalised. By that time Naidoo wants every home to have a telephone and an Internet address – “and, with that”, he says, “the potential to be linked to the outside world and the possibility of jobs”.
In terms of a scheme Naidoo devised last year, centres are being set up in villages and small towns around the country that allow the inhabitants access to telephones, faxes and the Internet.
Under the apartheid government, an average of 150 000 telephone lines were laid each year, but under Naidoo’s management 360 000 fixed lines were laid in 1997 and more than a million telephones were installed in rural areas last year. Telkom, however, reports that three out of four lines are disconnected each month because people in rural areas cannot afford to pay.
“But,” says Naidoo, “we are allowing those lines to still receive calls because each call generates revenue. And we are increasing call centres to communities that are battling to pay.
“Rural poverty doesn’t mean people don’t have the capacity to pay. When we allowed cellular operators into Transkei, they found it was the busiest area … with most calls made between 8am and 5pm, Monday to Friday. They were being used for business purposes. Research in Africa suggests the same will probably apply there.”
Naidoo says the capacity to communicate has to be extended to the continent for true job opportunities and an economic renaissance.
“Drive” is a word that peppers much of Naidoo’s conversation as he spins through his dreams for a “highway in the sky for Africa”.
“Those who first dreamed of a road from Cape to Cairo were colonialists, it was a road to enslave. We want to free the continent with technology and advance it toward economic liberation,” says Naidoo.
But why drive for 21 days on the world’s worst roads, in intense heat, through sandstorms and flies? Naidoo believes this is the only way to alert the world to Africa’s plight.
Vodacom, South African Airways and other big sponsors are contributing toward the costs of the rally. Naidoo is seeking other sponsors to fork out about R3-million to establish telecentres along the route. So far sponsors have come forward to erect six telecentres in different African countries.
The minister is also seeking sponsors to train people from the various countries in telecommunications and put money toward an African information technology education institute.
Naidoo’s vision of an Africa-wide telecommunications network flows from a meeting of African telecommunications ministers he convened last year. At the meeting he found that one of the biggest obstacles in the way of such a network is the lack of a coherent strategy and policy framework.
“Except for Nigeria, South Africa and Egypt, the remaining countries are too small for foreign investors to go into. Internationally, telecommunications are increasingly funded and driven by the private sector, they won’t go into any country where the rules are not clear.”
Naidoo’s drive is backed by the Cabinet, in particular Deputy President Thabo Mbeki, who noted that Africa has potentially the world’s biggest telecommunications market.