Social development calls for probe
Treasury asked to review NPO irregularities
PROVINCIAL treasury has been roped in to assist the troubled Eastern Cape social development department to properly monitor the millions of rands the department injects each year into non-profit organisations (NPOs).
Social development MEC Nancy Sihlwayi revealed to the Dispatch last week that some NPOs were illegally using common bank accounts, a system which she alleges affects the proper monitoring of the funds as required in auditing processes.
Sihlwayi said preliminary investigations suggest this practice was rife in areas such as Komani in the Chris Hani district, as well as Sarah Baartman.
It was discovered that some of the registered NPOs implicated in the scandal sourced funding on behalf of non-registered NPOs, and later distributed the funds to them even though they are not subjected to the department’s monitoring systems on how they do the trade.
“This led to a number of millions of rands being unaccountable for, and this reflected badly on our department,” Sihlwayi said.
The department’s acting head Ntombi Baart said a substantive review on the transfer of payments to the NGOs and NPOs was very critical in helping the directorate to be accountable.
“There’s a serious risk in dealing with the NPOs as many of these share one bank account. Improvement plans are key and we’ve responded to the provincial treasury on how to develop these plans,” Baart said.
Provincial treasury spokeswoman Pumelele Godongwana confirmed that social development had requested them to provide support.
“Following a request from social development, provincial treasury is providing support to the department in the form of a substantive review of their transfer payments to NPOs in an effort to tighten their systems.”
The department slashed budgets of registered NPOs in areas such as Buffalo City and Nelson Mandela Metro – organisations which house hundreds of vulnerable children and women.
Sihlwayi and Baart could not say whether these organisations had been implicated or not.
The Dispatch reported last month on the plight of these NPOs whose budgets were slashed by more than 1 000% compared to the previous financial year (2016-17).
Thanks to the expose, Sihlwayi instructed Baart to make a plan and source funding to undo the damage, as the NPOs, such as East London Child Welfare, had to close its doors temporarily for discussions with workers who were facing losing jobs.
Sihlwayi said the department had decided to call for provincial and National Treasury intervention in helping them with financial management, saying this will help identify the problematic areas.
“Working with these arms of government will help us to identify and save millions of rands that are intended for the poor people of this province.
“These funds end up in the wrong hands and some share the same bank accounts,” Sihlwayi said.
Social development spokesman Mzukisi Solani said the investigation was aimed at improving levels of good governance within the institution.
Some of the NPOs are referral points for the SAPS when they deal with cases of abused children. Other homes accommodate abused children and women.
Sihlwayi said these organisations play a pivotal role in communities.
“The department can’t reach a number of the areas and these nongovernmental and non-profit organisations assist us and intervene where we can’t, but if we have such challenges the intended recipient will suffer,” she said.
Baart said part of the plan was to have a separate NPO management directorate where senior people will be employed at the head office and regions.
“Accountability is important and that will help us achieve our goals.”
Baart added the department would also have to prioritise the filling of vacant critical posts.
“We need senior positions to be filled and to have our own audit committee.”