Millions of South Africa’s poorest citizens continue to have their plight ignored because of the National Development Agency’s (NDA) ongoing inability to perform its central function, which is to channel money to non-profit organisations in their battle against poverty.
And some NDA board members are now under attack for abusing their positions to enrich and empower themselves, to the detriment of the NDA’s effective functioning.
An independent audit of NDA management last month produced a damning report that development specialists interpret as saying the NDA is no closer to effective operation now than when it opened its doors in April last year.
Accounting firm Ngubani & Co’s report identifies nine areas of chronic mismanagement, all closely related to the NDA’s core functions.
Some contracts between the NDA and organisations it is funding are unsigned or simply missing. There is inadequate or non-existent monitoring of funded projects; project assessment reports remain unfiled; records of NDA disbursements are not up to date; and the NDA continues to fund projects that do not meet its own conditions for receipt of funds. Overall, the audit doubts that the NDA can meet its objectives.
Mail & Guardian sources say too that millions of rands available to the NDA remain unused because of the agency’s chronic inability to meet the most basic of donor requirements.
European Union finance to the tune of R48-million remains undisbursed since August last year, for example, because the NDA is still unable to tell the EU how it intends to use this money. As result, a further R66-million the EU has committed is being withheld.
Darkening an already grim picture is the political buck-passing that seems to be going on. The 1998 Act of Parliament that established the NDA makes the agency accountable to the minister of finance.
But Trevor Manuel appears to have washed his hands of the agency and transferred the dirt to the Ministry of Social Development: it was Zola Skweyiya who earlier this month admitted to “problems” at the NDA. Neither minister responded to the M&G‘s faxed questions.
The Act established the NDA as “a key conduit” for funding from the government, foreign governments and other donors “for development work to be carried out by civil society organisations”. But despairing NGOs underfunded for years remain with their backs to the wall. Some NGO staff have received no salary increases for years. Many NGOs have simply died.
The areas the NDA is supposed to be funding range over the country’s highest priorities adult education (including literacy training), early childhood development, HIV/Aids awareness, domestic violence, land reform and agricultural development, among others.
In total, the NDA had about R360-million at its disposal in its first year of operation, but managed to disburse less than a tenth of that. The M&G reported in April that much of the blame for this dismal performance was being laid at the door of then CEO Dr Thoahlane Thoahlane, under whose leadership nearly a quarter of highly skilled but demoralised NDA staff resigned in less than a year.
But widespread relief in the development community when Thoahlane was ousted in April now appears to have been premature: some NDA board members are under scathing attack for their enthusiastic boarding of the gravy train while the NDA’s core functions continue to wither.
Thoahlane presented, in writing, a bitter litany of complaints at a special board meeting on March 14. He accused some board members of involving themselves in NDA operations; assuming the role of CEOs in the provinces; plunging the NDA into unauthorised expenditures; flying business class and not refunding the difference between that and economy, as is supposed to be NDA practice; and making unauthorised claims for payment to themselves claims that on occasion could not be supported.
By March this year, the board had overshot its budget by nearly R400 000, Thoahlane claimed. But his protests were soon muffled: on April 6, a board meeting, with Deputy Minister of Finance Mandisi Mphahlwa in attendance, resolved to get rid of Thoahlane. The M&G reported in May that he departed shortly thereafter with R2,5-million as his price for going quietly.
Board chairperson Delani Mthembu took over as acting CEO. Apparently attempting to polish the NDA’s public image, Mthembu retained TV personality Vuyo Mbuli as master of ceremonies for a press conference on May 22. But well-oiled presentation skills could not conceal an essentially unchanged and dismal scenario: R310-million approved for the funding of various projects but only R61-million disbursed.
Since then well-placed sources have repeatedly questioned board members’ activities. They say some regularly assign NDA work to themselves, especially in the provinces, and then invoice the NDA: one recently claimed R190 000 for four months’ work. A number of members have no other sources of significant income than the NDA, the M&G has been told.
One result of this is that the NDA now has an operational budget of R29-million a year some of which is being paid out of capital funds, when operational costs should all be covered by interest. NDA staff numbers fewer than 40 but there are six executive directors earning up to R450 000 each a year.
“Too many of the highly placed [NDA] people want to get their hands on a piece of the cake,” one M&G source says. “They’re not committed to communities. Board members are building empires for themselves in the provinces,” he says, referring to the NDA’s decentralising project scheduled to cost about R25-million. Development experts say this project is unnecessary and wasteful.
The M&G faxed 22 questions to Mthembu on Tuesday. His reply reads: “I refer to your letter dated 21 August 2001 and acknowledge your interest in the NDA. As you rightly referred to the public statement by the Minister of Social Development, I wish to confirm that the NDA is in a process of being transferred from the Ministry of Finance to the Ministry of Social Development and once this process is complete we will report accordingly.
“I would also like to draw your attention to the Media Conference that was held on 22 May 2001, which [the M&G] attended, at which most of your questions were addressed and documentation duly provided.”