The latter part of 2006 has seen much media coverage of civil society’s concerns with the National Lottery Distribution Trust Fund (NLDTF).  Much of the coverage centred on the issue of late or non-payments of funds to NGOs and the related risk that certain facilities and/or services to poor and marginalised people would be suspended.

The NLDTF has become an emotive and contentious issue for civil society in South Africa. The funds available for distribution to charities are public money – money earned from the sale of tickets that also gives LOTTO players the opportunity to win millions of Rand in prize money for as little as R2.50.

The NLDTF also provides a chance for a better life to those who don’t buy tickets, in other words, charities or NGOs. The NLDTF, through its Distributing Agencies (DA), allocates money to civil society organisations working in the fields of development, sports, religion, culture and the arts.

In the past few months there has been much media coverage and other civil society initiatives to hold the NLDTF accountable for its poor functioning. Examples of allegations against the NLDTF include its delay in appointing the Charities Distribution Agency, its failure to call for proposals from civil society in 2006 and its breach of contracts with funded organisations in failing to disburse payments as outlined in grant agreements.

Implications of Legal Action

In the past few weeks, events have progressed to calls by a number of actors within civil society to take the NLDTF to court over the late or non-payment of promised funds.

The aforementioned proposed course of action raises a number of questions. What constitutes the appropriate action in this situation? Do we as civil society leaders throw our weight behind an initiative to take the NLDTF to court on the basis of failing to deliver adequate administrative justice to grant recipients? What implications will this have for organisations that are solely funded by the NLDTF? What implications does this kind of action have on the unity of the sector? What will the impact of such action be on the ticket buying public? And finally, are there any other options to bring and hold the NLDTF accountable to civil society?

The prospect of a court challenge and mass public mobilisation along the lines of the TAC’s campaign of a few years ago can represent an appropriate strategy. However, we need to be more cautious and acknowledge that in this matter, the issue of public opinion can be a double edged sword that carries the risk of hurting the sector as much as hurting the NLDTF.

Public confidence in the NLDTF is paramount to its success. People need to believe that it is managed fairly and that there exists an honest chance to win a sizeable amount of money, which will give them financial independence and change their lives according to their desires. There is also the expectation that if one does not win the jackpot, that at least the money is going towards a good cause and to those less fortunate who need the support to maintain a certain level of human dignity.

Moves to paint the NLDTF in a poor light – as any court action will do, in the public mind at least – will ultimately undermine confidence to the point of reducing ticket sales and by consequence, the amount of money available for distribution to civil society.

Is this really the objective of civil society leaders that are pushing for court action against the NLDTF?

Civil society organisations also need to bear in mind that the application process and format for funding to the NLDTF are much easier than for most other local and foreign donors. The NLDTF does not set onerous conditions on grants and in general, it is one of the more operationally efficient donor agencies in the country, based on the amounts disbursed and the number of staff employed to perform these tasks.

Lobbying for Legislative Change

There are equally effective and less damaging means of bringing and holding the NLB and NLDTF accountable. Means that allow civil society activists to make use of the powers of parliamentary portfolio committees, mechanisms and channels that allow us to push for the creation of regulations that will govern the operational aspects of the NLB and NLDTF. If successful, this course of action will be instrumental in devising long-term solutions to the administration of the NLDTF, create systems that would ensure the appropriate functioning of the NLDTF and integrate civil society inputs into the NLDTF’s operations.

The NLB and NLDTF are essentially accountable to Parliament through the Department of Trade and Industry (DTI) and it is therefore possible to propose a motion for the creation of regulations that will address current civil society concerns about the NLDTF funding issue. The amendment or creation of regulations can enable the passage of stipulations requiring clear time-frames for an annual call for proposals, for the appointment of the DA’s, for acknowledgement of receipt of applications, as well as for a maximum time for grant review and approval. Regulations can also be put in place to have a defined appeal process and to even specify the maximum time frame for payment of approved grants.

It is therefore possible that current civil society concerns and frustrations over the operation of the NLDTF can be addressed without the need for a damaging and costly court action through utilising existing legislative and parliamentary processes at minimal cost and with outcomes that meet the needs of civil society and the people we serve.

The National Welfare Social Service and Development Forum (NWSSDF) is committed to a collaborative approach in this matter, an approach that meets the needs of civil society, an approach that engages the state in dialogue and an approach that engenders greater collaboration with other civil society organisations. Our combined individual and organisational skills, knowledge and expertise are required to make the right approach and achieve a positive outcome.

– Rajesh Latchman is national coordinator at National Welfare Social Service and Development Forum.

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Picture courtesy of Moore’s Law.

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