Press Release:

Forum & Non Profit Consortium: Lottery Crisis - Impact for NGOs

3 April 2007 - In the past week, there has been much concern amongst civil society organisations about the impact of the appointment of the new lottery operator on grant disbursements for funded organisations. The main concerns raised have centred around whether existing grant agreements will be honoured, about the legitimacy of the recent call for proposals and what will happen to the existing pool of money earmarked for distribution but not yet distributed.

These concerns are legitimate, especially given the absence of a call for proposals in 2005 and other administrative delays in distributing funds to beneficiary organisations. Nonetheless, it is important to note that the appointment or selection of the lottery operator should not have an immediate short-term affect on the distribution of funds to civil society organisations (or NGOs as they are more commonly referred to). This is because the responsibility of distributing funds for good causes vests with the Distributing Agencies, which receives administrative support from the National Lotteries Board for this purpose.

The Act describes that main function of the distribution agencies as to “distribute the allocated sum(s) fairly and equitably amongst all persons who meet the prescribed requirements”.

As far as we can ascertain from the Lotteries Act (No.57 of 1997), there are no legitimate grounds or reasons for the functioning of the DA’s to cease nor are there any grounds for the administrative support functions of the Central Applications Office to cease.

Therefore it is safe to assume that existing grant agreements will be honoured, applications made within the current year will be adjudicated and civil society organisations will continue to receive the support of the funding available from the NLDTF. Failure to honour existing grant agreements would amount to a breach of contract. The distribution agencies can continue with their task of distributing money so long as there is sufficient funding in the NLDTF.

It is therefore not anticipated that there would be any direct impact in the immediate short-term. The impact in the longer-term would depend on a number of factors, including:

1. How long it would take to appoint the operator? The lack of income due to the lack of and operator would reduce the income to the NLDTF.
2. How much money is currently available to the different distribution agencies in the Fund? It has been reported that the Minister of Trade and Industry said there is a year's worth of reserve funding available.
3. How much funding has already been committed to organisations through the distribution process? The distributing agencies may have committed funds to organisations which are only transferred at a later time. These agreements will have to be honoured in the normal course of business.

Prepared and distributed by:
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it , The Forum
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it , NPC

---

Bookmark this article: