NPOs to know their fate on GDSD funding applications

Amid the growing anxiety over the future and funding of NPOs in Gauteng, the Gauteng Department of Social Development (GDSD) announced that its newly established independent NPO evaluation and adjudication panel has finalised the NPO adjudication process.

Many NPOs dependent on funding from the department said they are increasingly worried about their future because of looming funding cuts, coupled with the delayed allocation of grants to organisations after GDSD started the process of establishing a new independent adjudication panel for grants and centralisation of the NPO funding process.

Previously, officials in the regional offices adjudicated grant applications. The changes have, however, left some NPOs worried about the status of their grant applications for the new financial year. Some organisations have closed down after failing to get funding.

These include the Greater Benoni Child Welfare. It was forced to temporarily suspend its services from April 1 until further notice due to the non-allocation of funds from the GDSD.
Meanwhile, the Greater Boksburg Child Welfare board told this publication that it resorted to running with a skeleton staff, as opposed to closure.

According to Themba Gadebe, the spokesperson for the social development MEC, the GDSD embarked on a rigorous NPO adjudication process and paved the way for reviewing and signing of service level agreements (SLAs) with complying and successful NPOs for the 2024/25 financial year.
“As per our commitment, successful NPOs are being contacted as of the first week of April 2024 to come into the head office to sign SLAs. NPOs will be contacted in various groupings to ensure efficiency in managing the many arrivals,” explained Gadebe.

Gadebe pointed out that over 1 732 applications were received, collectively tallying over R11.4b in financial requests, far greater than the department’s overall budget of R5.5b.
“This meant panellists had a gruelling task to stretch the budget far and wide in response to the needs presented by NPOs while realistically remaining within the confines of the budget available because it is impractical to fund the entire R11.4b.

“The process to invite eligible NPOs to sign the SLAs is underway and has been centralised to the DSD headquarters to be co-ordinated by the accounting officer.

“Previously, this process was decentralised to officials in regional offices. However, this was found to be in contravention of the Treasury guidelines for the delegation of powers.
“The contravention resulted in officials signing off millions outside their financial delegations, thereby affecting internal control systems. The department has reviewed all such delegations to align with existing Treasury guidelines.

“The financial delegations of the department have also been revised to ensure such contraventions to the Treasury guidelines are indeed corrected, and accountability for such processes rightfully restored with the required delegated authority within the department based on amounts of funding requested and awards decided upon.”

Gadebe said many considerations were made before the panellists could decide whether or not to award funding to applicant NPOs.
Among those were physical verification of the NPO at registered addresses, observations of services being rendered and verification of the compliance status with the National DSD database.
Other factors include NPOs flagged as non–compliant on the National DSD database, no access granted or invalid addresses upon site visit.

“In terms of Section 38(1)(j) of the PFMA, the following is contemplated: 38. General responsibilities of accounting officers —(1) The accounting officer for a department, trading entity or constitutional institution — ( j).
“Before transferring any funds (other than grants in terms of the annual Division of Revenue Act or to a constitutional institution) to an entity within or outside government, must obtain a written assurance from the entity, that entity implements effective, efficient and transparent financial management and internal control systems, or, if such written assurance is not or cannot be given, render the transfer of the funds subject to conditions and remedial measures requiring the entity to establish and implement effective, efficient and transparent financial management and internal control systems.
“Therefore, in the absence of the department receiving such written or other assurance from the NPOs, the department is not permitted to enter into any such funding arrangements with NPOs for the transfer of state funding.
“The department thanks all NPOs for exercising patience during the adjudication period, which took place amid a difficult climate of investigations and peddling of mistruths from those opposed to clean governance.”

Funding cuts
Early last month, the Gauteng Care Crisis Committee (GCCC), a network of over 50 organisations in the province, issued a statement describing the funding cuts in the 2024/24 budget.

The committee said GDSD had cut R223m from its 2024/25 budget for services to vulnerable persons.
It pointed out that the NPO discovered the details of the cut following the announcement by Gauteng Treasury of the budget for the province.

“With less than a month to go before the start of the new financial year, the GDSD has yet to inform the NPO sector where the axe will fall.
“We reject the cuts and condemn the GDSD for failing to communicate its decisions to NPOs,” said the GCCC in the statement.

“The cuts reflect a shocking disregard for vulnerable persons’ right to social care services. The way they are made also demonstrates no ethic of care. Because the GDSD has failed to communicate which NPOs’ services will be reduced or terminated, it has been impossible to plan responsible processes to ensure that children, women who have experienced GBV, older persons, and people with disabilities continue to receive services after April 1.
“NPO staff live with uncertainty daily, not knowing if they will still be employed when March ends.”

Also Read: UPDATE: Gauteng govt rubbishes NPOs budget cuts claims