The National Lotteries Commission (NLC) last year handed out R6‑million in funding to an obscure organisation in Lichtenburg in North West, which somehow made its way into the kitty of the Eastern Cape’s Buyel’Ekhaya music festival.
On closer inspection, the nonprofit organisation, the Thato Community Crisis Centre, was not asking for funding for itself. On its forms it stated that its email address was the same as Buyel’Ekhaya’s.
Yet its members had addresses in the North West and were requesting funding that would focus on women, children and the elderly in areas such as Duncan Village, Butterworth and Dutywa in the Eastern Cape.
A source close to the application process said the Thato centre was used to receive the funds as a way of circumventing new regulations that provided for a “cooling-off period” for Lotto beneficiaries.
The regulations, published by the department of trade and industry in 2015, state that National Lotteries Commission beneficiaries may not apply for another grant within 12 months of receiving a grant, irrespective of whether the new project is different from the one previously applied for.
The source said the Thato centre had never previously received funding from the National Lotteries Commission and, as a first-time grantee, should not have received more than R500 000. But the organisation was given more than 10 times that amount.
The Thato centre’s application was granted in August last year and, according to emails seen by the Mail & Guardian, the commission’s Gauteng office gave a directive to its Eastern Cape office that the funds must be transferred to the Thato centre.
“Kindly note that this project was being handled by Gauteng province as it is proactive funding and the amount exceeds the delegation. Kindly process for payment and request acting EMGF [executive manager of grant funding] to sign the payment instruction,” reads one email.
Another email demands clarification on why the payment has still not been made.
A National Lotteries Commission official in the Eastern Cape, Mzukisi Makatse, refused to process the funding. In emails, Makatse states that he cannot sign off a project flagged in Gauteng.
“This means whoever did all of these processes must do payment approval because they know for sure it’s a project to be paid. It can’t come to me at the end of the process for payment. I will never be able to account for such a decision,” the email reads.
He was suspended the very next day for failing to process the payment.
According to Tsietsi Maselwa, the commission’s legal head, Makatse is on suspension and the commission preferred to deal directly with him rather than through the media.
Maselwa said the Buyambo Cultural Organisation, which owns the Buyel’Ekhaya festival, received Lotto funding in 2015 and the Thato centre, which acted as a representative for Buyambo, was given funding in 2017.
There was no need for a cooling-off period to be observed for the Buyel’Ekhaya project to be funded through the Thato centre.
In contrast to Maselwa’s statement, meeting minutes dated September 2 2016 show that Buyel’Ekhaya would be funded in that year in line with a board-approved resolution that identified “flagship projects” such as the Mapungubwe Festival, the Macufe Festival and the National Arts Festival in Grahamstown.
Tish Loving, from Mazwai Communication on behalf Buyel’Ekhaya, agreed with the National Lotteries Commission minutes confirming that Buyel’Ekhaya had received R5‑million in 2016.
Loving said the only reason Buyel’Ekhaya applied for funding using another organisation and not its mother ship, Buyambo, was because of the new regulations, which were not fully understood.
“We were uncertain about the practical application of the cooling-off period — specifically, whether the cooling-off period applies from the date of the first tranche payment or that of the final tranche payment. We understand that the interpretation of the cooling-off period and how it is to be applied was only signed off by the minister of trade and industry towards the end of 2017, after the NLC sought clarification from the [department of trade and industry],” Loving said. “Buyel’Ekhaya is an annual flagship event, and we needed to ensure continuance. We looked for an organisation that did not share this predicament to ensure that funding is secured.”
According to the National Lotteries Commission’s own regulations, the Thato centre could only apply on behalf of Buyel’Ekhaya, as an agent representative, if the festival or organisation had only been in existence for six months or if there was a clear need for a project in a community that was not organised through a recognised legal entity.
In this case, Buyel’Ekhaya has been around since 2011 and has the capacity to bring in thousands of people from all over the country for a weekend of music and culture every December.
But Maselwa insisted that the centre’s applications had met all the requirements. He said that giving a small, never-before-funded organisation more than R6‑million was in line with “normal application processes”.
There are also discrepancies between the emails signed off by senior officials at the National Lotteries Commissionand the responses of its legal department.
The commission’s own records show that Buyel’Ekhaya was, in 2017, funded as a proactive funding project from Gauteng, it went through the proper processes and was a flagship project of the Eastern Cape.
When pressed as to why there are different reasons given for the funding of Buyel’Ekhaya using two different organisations, Maselwa said: “We reiterate that this was a flagship project.”