Lottery grant backlog builds up because Minister has not filled vacancies

About a third of money from Lottery ticket sales is supposed to go to good causes but the National Lotteries Commission is battling to distribute its funds.

• The National Lotteries Commission (NLC) is battling to distribute grants for worthy causes.
• This is because every grant application must be approved by the NLC’s distributing agency but the agency has too few members.
• The Minister of Trade, Industry and Competition was supposed to make further appointments but according to a source we spoke to, it has been a struggle to find suitable people.
• Meanwhile over 3,000 grant applications have not been evaluated within the 150-calendar-day stipulated period.

The NLC is struggling to clear a major logjam of 3,400 funding applications submitted by non-profit organisations during the previous financial year, because of a critical lack of people to handle the job.

The NLC says it “anticipates” that the backlog will only be sorted out by the end of September.

The problem is that there are too few people serving on the NLC’s distributing agency, which is responsible for evaluating and adjudicating applications for grants or recommendations of funding of worthy causes.

Traditionally there have been up to 12 distributing agency members, spread across the various sectors funded by the NLC. They are responsible for assessing grant applications.

“With [only] three distributing agency members since the commencement of the 2023/2024 financial year until 30 June 2024, the capacity to adjudicate applications has been constrained,” the NLC said in response to questions from GroundUp.

This, the NLC said, had contributed to the inability to meet statutory timeframes, including adjudicating applications within 150 calendar days.

The unprecedented number of applications waiting to be assessed was caused by the expiry of the contracts of previous distributing agency members in 2023 and earlier this year. Several had had their contracts renewed several times.

Only three were retained on a 12-month contract when their terms ended earlier this year.

The contracts of Marjorie Letoaba, Fadila Lagadien and Thanduxolo Lungile were extended for 12 months until April 2025 by the previous Minister of Trade, Industry and Competition, Ebrahim Patel.

This was the fifth time that their contracts had been extended. All three are elderly and are struggling with the massive workload, a source with knowledge of the situation told GroundUp.

Their ranks were bolstered from 1 July when Patel appointed two new distributing agency members, Gabiba Gaidien and Thabo Manetsi, on 12-month contracts.

“The NLC needs at least nine distributing agency members to adjudicate applications,” a source with knowledge of how the agencies function told GroundUp. The NLC needed about “11 distributing agency members but this could be reduced to nine to cut costs”.

Distributing agency members are appointed by the Minister and are responsible for assessing applications across the four sectors that the lottery funds: Charities, Sport and Recreation, Arts, Culture and National Heritage, and Miscellaneous.

Vacancies for the distributing agency were advertised more than a year ago, in May 2023. But despite many responses, no new appointments were made by Patel until the two appointments at the beginning of July this year.

In a statement issued earlier this month, the NLC apologised for the delay to organisations that had applied for funding.

“The current limited number of distributing agency members within the NLC has led to significant delays in processing and adjudicating applications,” the NLC said. “This shortage has strained the Commission’s ability to function efficiently, resulting in prolonged waiting times for applicants.

“The NLC understands the frustration and sincerely apologises for the challenges these delays cause, particularly for organisations relying on these funds to support vital projects and initiatives. Please be assured that the NLC is highly aware of the situation and is actively working with the Department of Trade, Industry and Competition to address the issue.”

Although the NLC did not say who was responsible for the debacle, several sources blamed Patel.

“The truth is that the erstwhile Minister let the people down,” a source said. “The Act is too rigid … only the minister can make those appointments. He only appointed two people before leaving office.”

Because there had been corruption involving previous distributing agency members, the process of identifying people who applied or were recommended had been long and onerous, a source who was close to the process told GroundUp.

The source, who would only comment on condition of anonymity, said: “In the end, a group of seven to eight people were identified but they had to go through a last hurdle of background checks. Some were excluded because of issues that were identified.

“We also wanted younger people who could serve for an extended period without needing to be replaced. It was also important that we had a mix of men and women and different race groups distributed across all provinces, the source said.

“It was also important that we didn’t have all black men in Gauteng or all white men in the Western Cape.”

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