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Half of the National Arts Council’s PESP funding has gone to a connected 12%

Twelve percent of those who received the National Arts Council (NAC) of South Africa grant funding were collectively paid more than R128-million, which equates to 46% of the funding. In contrast the remaining 1142 recipients divided R150-million amongst themselves. 

A report into the NAC’s Presidential Employment Stimulus Programme (PESP) grant funding, compiled by the South African Roadies Association (Sara) has highlighted alleged conflicts of interest and maladministration in the awarding of the grants.

The report is titled NAC PESP Grant Funding Streams 1 and 2 Analysis — A Preliminary Report and has been handed over to the Hawks for investigation.

Included in the report is a list of the top 140 PESP funding recipients by amount of funding received, which is drawn from the data released by the NAC on its website.

At the time the list was compiled, the NAC released data to show that it had paid out R278-million in PESP funding, which included monies to current NAC council members Sipho Sithole, Kim Matthews, Bulelwa Margaret Malange and Madré Loubser, who were all part of successful PESP funding applications.

Two weeks ago when public protector Busisiwe Mkhwebane waded into the ongoing dispute between the NAC and the artists who applied for PESP funding with the offer of mediation, her press release stated that the artists had complained during their meeting that some of the current members of the council were beneficiaries of the PESP and therefore conflicted, a point she says had been denied by the minister of sport, arts and culture, Nathi Mthethwa, and the council the previous day.

The department of sport, arts and culture (DSAC) told the Mail & Guardian that it had sought a legal opinion from the office of the chief state law adviser, whose opinion is that there is no conflict of interest regarding these NAC council members’ applications.

When the M&G contacted NAC spokesperson Tsepho Mashiane last week, he said two separate processes of investigation needed to take place into the NAC PESP funding.

He said the NAC needed to conduct a forensic investigation into the process of awarding the grants, which was done by independent adjudicators, and that Mthethwa needed to conduct a separate forensic investigation into the fiduciary role of the NAC council in the PESP funding.

Mashiane agreed to respond to detailed questions from the M&G via email, but had not done so by the time of going to print.

According to the Sara  report, 20% of the top 140 recipients either are not registered on the Companies and Intellectual Property Commission (CIPC) database or the government’s nonprofit organisation (NPO) database or have been deregistered or are in the process of being deregistered and don’t have tax clearance certificates.

The NAC announced the call for PESP applications at the beginning of November last year, with applications closing three weeks later and adjudication taking place at the end of November.

The first successful grant applicants were announced from 1 December and the last batch of successful grant applicants were announced from 21 December.

The M&G has been able to verify through the CIPC database that a number of the companies that received grants were in a deregistration process during the period of the grant awards.

Tsonga musician Thomas Chauke, for example, who registered the Shinyori Investment Company in 2017, applied for PESP funding and received R522 960 for a “Dr Thomas Chauke Cultural Event”.

However CIPC records show that Chauke’s company has been in a deregistration process since October 2019 due to the failure to submit annual financial returns.

eThekwini-based Lethulwazi Trading, which trades as Lethulwazi Communications, received R1.1‑million for the “Harken! Lalela Theatre Production” despite being in a process of deregistration since September 2020.

This deregistration process was reversed at the end of March 2021.

The National Arts Council offices where artists staged a sit-in. (Fani Mahuntsi/Gallo)

The company’s website no longer works and none of the three telephone contact numbers the M&G found online is in use anymore.

The report alleges that there are also numerous examples where the same recipients were approved for multiple funding applications across multiple companies.

An example is musician Arthur Mafokate and various members of his family who, the report alleges, were involved in six separate companies and NPOs that received a total of R6.2-million.

Arthur Mafokate’s company Roadshow Marketing received R2-million for a project called “Youth Development in Events Management”, however from December 2020 to February 2021, this company was in a deregistration process.

Mafokate released a statement in March denying that anything untoward had gone on with his family’s many successful grant applications, claiming they were not given any “special treatment”.

“It has become suspiciously clear that there are personnel within the NAC that are playing a divisive role  … fuelling the fire and feeding into the fixed narrative that some of us are corrupt, and unlawfully benefitted from the scheme, without producing any irrefutable evidence,” reads Mafokate’s statement. 

According to the Sara  report, 39% of PESP funding went to companies that don’t even have a relationship with the arts and culture sector.

The report points to grants given to a grooming school, a modelling agency, a property company, public relations firms and a tourism company.

One example is the Lulutho Grooming School for Girls, which received R1.8-million for an “academy of arts and leadership”. Attempts to contact the school were unsuccessful, as the phones were never answered. 

Tourism company Mbombela Experience received R708 175 for the “Mbombela Theatre of the Mind Production”. Despite Mbombela Experience’s website clearly positioning it as a tourism company, director Netto Maluka told the M&G that he does some business in tourism, but works “mostly in the arts”. 

Maluka said the NAC funding was being used to record stories that educate local communities about “environmental awareness”. 

“We can’t do live shows because of Covid-19,” said Maluka. “So we record stories and broadcast them on community radio.”

Maluka said the project was partnered with Nelspruit community radio station K Radio, Voice of Hope and Barberton Community Radio.

The Sara  report also flagged grants that it alleged illustrated conflicts related to the arts department. Germinah Nkadimeng, whom the DSAC website still lists as a contact for the department’s performing arts sub-directorate and whose LinkedIn page still lists her as being employed as a deputy director at DSAC, successfully applied for just shy of R1-million for her company, Bounteous Events, and R653 700 for another company owned by her, namely the South African Exclusive Children’s Theatre.

When the M&G called DSAC to speak to Nkadimeng, it was informed by a colleague that she had left the department “sometime last year”. DSAC then told the M&G that Nkadimeng left the department in August 2019.

The report also highlights the applications of advisers to Mthethwa. Lara Foot, who completed a short stint as an adviser to the minister in March this year, and Theophilus Mpololo, a current adviser who was appointed in March, both received grant funding. 

Foot applied on behalf of Cape Town’s Baxter Theatre, receiving R2-million for the “Baxter Theatre Centre Employee Retention Project” and R326 850 for the “Baxter Project”. 

Mpololo received R544 750 for his company Linmo Communications and Management for the South African Afro Music Awards (Saafmas), with the third edition of the Saafmas set to take place on 22 May at Birchwood Hotel in Boksburg.

The department explained that both these individuals were appointed to the ministerial advisory team only after their respective entities were granted PESP funding.

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Lloyd Gedye
Lloyd Gedye
Lloyd Gedye is a freelance journalist and one of the founders of The Con.

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