Distribution of funds & 2019/20 Quarter 3 performance: National Lotteries Commission briefing

Meeting report

Opening Remarks

The Chairperson welcomed Members of the Committee and the delegation form the National Lottery Commission (NLC).

The focus of the first briefing by the NLC would be on the distribution of funds, especially the proactive funds for good causes. The second presentation would look at the Third Quarter Financial and Non-Financial Report for 2019/20 as part of the Committee’s budgetary overview to ensure that the entity was meeting its mandate.

Introduction by the Chairman of the NLC

Prof Alfred Nevhutanda, Chairman, NLC, introduced the NLC team.

Prof Nevhutanda explained that the biggest function of the NLC was as regulator of the lottery. A second function was to distribute the funds. The NLC could distribute funds through distributing agencies. There was no law for proactive funding but the NLC had a policy that allowed it to take 10% of the available funds for proactive funding. That was as opposed to the application-based funding.

Prof Nevhutanda added that there had been talk from one media organisation about proactive funding. The previous year he had reported to the Committee that the information of the beneficiaries had been stolen and was being held in the US. The State Security Agency had been asked to look into the matter. The NLC was getting reports that the information was generating money for journalists. If a journalist wrote about the NLC, the journalist was paid. The NLC had compiled a portfolio of every media article about what the board or Commission had done. He would provide the Committee with the information. The Commission had invited every journalist to view the NLC projects because when the NLC funded a museum, it was funded according to the request. For example, if books were not requested, the NLC did not supply the books for a library/museum. For an ECD centre, the fund provided what it could, but it was up to the relevant department to provide all the equipment required to run an ECD centre.

Presentation on the funding model of the NLC

Mr Tsietsi Masewa, Head of Legal Services, NLC, briefed the Committee on the funding models of the NLC. The 2013 Amendment to the National Lotteries Funding Act allowed for a flexibility in funding. The primary model was the Application-Based Model.

Section 2A(3) of the National Lotteries Act stated that the Commission may, upon request by the Minister, board or on its own initiative in consultation with the board, conduct research on worthy good causes that may be funded without lodging an application prescribed in terms of this Act.

- Proactive Funding was based on research; could be initiated by the Minister, Board or Commission in consultation with the Board; and no application was required.

- Proactive Funding assisted the NLC to directly intervene in areas of need without having to wait for the public to apply through non-profit organisations or companies or public benefit trusts or where communities were not formalised and there were no community entities like NPOs that could assist the community to access funds.

- To ensure transparency and accountability, a proactive funding framework had been adopted. In terms of the law, at least 5% of the NLC funds had to be allocated to each province annually. Some provinces did not reach the 5% mark because of the number of qualifying entities in those provinces.

Mr Masewa presented the strategic funding framework for pro-active funding and the 2018/19 audited pro-active funding per sector for 2018/19. Agriculture had benefited most in the year with 38% of the funding. (It had been a year of drought.) A total of R 223 866 565 was allocated through pro-active funding in 2018/19.

Presentation on the 2019/20 NLC Third Quarter Report

Ms Thabang Mampane, Commissioner, NLC, presented the Third Quarter Report. The NLC had achieved 100% of its 15 targets for the third quarter.

The Commissioner noted that 80% of the work of the Commission focused on regulation, despite the popular view that the NLC was a primarily a grant funder.

As part of the NLC’s efforts to curb the scourge of illegal schemes, the collaborative arrangement with the provincial gambling boards had continued into the third quarter. As requested by the Committee, Memoranda of Understanding had been signed with all provincial Gambling Boards except those of the Western Cape and North West province.

• Participant Protection seminars were conducted in the Western Cape, Mpumalanga, Northern Cape, Gauteng and the North West, where information was shared on the rights and protection of National Lottery participants.

• The Grant Makers Programme was rolled-out in partnership with the University of Pretoria. The primary objective of the programme was to equip officials with information and knowledge that would assist them to improve the quality of assessment reports, interpretation of founding documents and financial records. The first group successfully completed the programme at the end of November 2019.

• During the Third Quarter, a total of 739 site visits were conducted, 1757 jobs were created, comprising of 1353 permanent jobs and 404 temporary jobs. A total of 1038 people benefitted from skills development interventions including 2 ECD practitioners who received NQF level 4 to 7 training. Lastly, over 44096 vulnerable secondary beneficiaries were reached in Quarter 3.

 

Ms Xolile Ntuli, CFO, NLC, presented the Third Quarter National Lottery Development Trust Fund disbursements as at the end of December 2019. An allocation of grants amounting to R1.098 billion against a target of R1.066 billion had been made. Revenue from share of ticket sales as at the end of 30 December 2019 is R1.196 billion (December 2018: R1.098 billion) against a budget of R1.162 billion.

 

Litigation matters

 

Lottostar – This is a matter initiated by the Commission enforcing provisions of the Lotteries Act No 57 of 1997 (as amended). The Company is a bookmaker and part of its business operations includes taking bets on the outcome of lottery results which is an offence in terms of the Act and the provisions of the Constitution (Schedule 4 – Act 108 of 1996). Their activities have a negative implication on the business interest of the operator as well. Case was heard on 13 December 2018. Judgment was delivered on 15 May 2019. The court decided that the Intergovernmental Relations Framework Act be fully exhausted before the matter is referred to court. Ithuba has filed an appeal. The NLC also filed an appeal on 06 June 2019.

 

The Alpha Omega Youth Outreach had taken the NLC to court for being too rigid and taking a dogmatic approach when declining an application. The judgement agreed that the decision had been too technical and dogmatic. Yothela Media had also taken the NLC to court for declining an application for a grant based on defective annual statements. The matter was continuing.

 

Regarding the third lottery licencee, the Commissioner could say that the operator had done well.

 

Media issue

Mr Masewa reported that it was common cause that the NLC had, in the previous year, faced negative publicity, especially in relation to the pro-actively funded projects, and had faced allegations of nepotism, corruption and conflict of interest. Generally, when such allegations surfaced, the NLC would follow its own processes and then report to the Minister. However, the allegations had continued last year, and so the projects had been identified. In February 2020, the Commission had decided to do things differently. All media reports of nepotism and corruption as well as conflict of interest had been identified and a communication was issued to the public regarding the investigation. An independent external company was engaged and the public was given to the end of April 2020 to make submissions regarding any of the articles or any other matter. The process was currently underway and the company would report back to the Commission by the end of May 2020, at which time the NLC would report to the Committee.

 

(See full presentation)

 

Discussion

Mr M Cuthbert (DA) said that the NLC Chairperson’s opening comments sounded like something coming out of a Bell Pottinger playbook. The conspiracy theory that information was being stolen and used for financial purposes was something he could not believe. He asked why the Committee had not been provided with the full beneficiary list for the past financial year, despite the Committee making several requests. Could the Members be provided with the terms of reference for the investigation? He requested the information in writing so that Members could use that as a reference document. What audits had been done on the projects that had been raised in the media as not having been completed and where were the funds allegedly given to friends and family of the COO of the NLC? What was the current status of the COO? Why had the NLC resorted to threatening journalists instead of dealing with corruption in its own house? It was a convenient strategy to attack the media when one knew that one was at fault.

 

Mr Cuthbert asked if the chairman of the NLC had considered resigning in the light of the ongoing scandals in the NLC?  He should be prepared to fall on his sword when he crossed the bridge and then he could put his PhDs and the credentials on his CV to good use rather than sitting at the NLC. Had any criminal charges been laid to date after the Minister had requested so in 2019 following the Denzhe scandal? Mr Cuthbert said he had the case number from a private perspective but whether or not anything had been done by the South African Police Services (SAPS) or the National Prosecuting Authority (NPA), was another question.  He had been informed that the Proactive Funding was not recorded on any payment lists or on the systems report, so where were the payments being hidden?

 

Mr F Mulder (FF+) would have thought that there would have been a formal report to the Committee in the light of the serious allegation of corruption and nepotism and not only a briefing. He had wanted a proper presentation on the issue at the current point in time, and not only at end of the process.

 

Ms Y Yako (EFF) asked about proactive funding which the NLC said was always determined in consultation with the board. How did the board mitigate political interference from the Minister? What if the Minister wanted funding to go to a particular project without going through processes?  How did the board protect itself and determine whether the Minister’s involvement was politically motivated or not?

 

Ms Yako asked what the NLC’s regulatory powers were when it came to lotteries scamming people. What was the Minister’s involvement as she understood that only a licensed provider could use the words “lotto” or “lottery”? How was the NLC escalating the Minister’s involvement in that situation? She noted that 1% of proactive funding had been given to the abuse of women and children, culture and religion and 2% to animal abuse. Personally, she was very unhappy with the distribution of funds to abused women and children. It should be prioritised. The police were not helping and the women could not go to shelters. It would be a great initiative to help to build shelters for women in each and every province.

 

Ms Yako noted that applications were made available in priority areas. It took almost a year for someone to get a grant. Surely, one requested a grant because one needed the money. Why did it take seven months from the application until approval of a grant?

 

Ms M Motaung (ANC) asked why there was a lot of noise with journalists. The clean audits were very good, but had the Auditor-General visited some provincial offices during audit process? How was the NLC protecting the beneficiaries? According to the NLC policy, it had a right to protect the beneficiaries. On the Annual Report, there were areas of priority for funding. What were the areas and how were the priorities determined? What guidelines were being used? The Report indicated the criteria for proactive funding, but how was the Commission appointing beneficiaries of proactive funding?

 

The Commission was doing well on performances but now that the NLC was achieving all targets, she thought that the targets should be increased in respect of the provinces. She wanted to see better results in respect of the provinces.

 

Mr S Mbuyane (ANC) asked what the NLC had done to make the media follow the NLC for the past two years. Only one journalist, from GroundUp, had been following the NLC for 2 years. Was he working for other forces? There was an element of a third force in the situation. Had the media and that journalist been a beneficiary of lotto funding? He asked for clarity about the information that had been hacked. What had NLC done about it and what was the way forward?

 

Mr Mbuyane asked why there was such a fight over the proactive funding? Who benefitted most and what was the criteria? He said that a journalist had been funded non-stop for a period of 10 years. And since that funding had stopped, all hell had broken lose. What was going on? There was a clean audit but there were allegations of corruption. What were the terms of reference for the investigation? Could the proactive funding not be formalised through legislation or regulation?

 

He saw that 5% had been given to provinces and 1% for abuse of women and children but 2% for animals. He did not understand why the NLC funded animals more than women and children? What informed the distribution to provinces? Were people aware of how to apply? Was an education process necessary at provincial level?

 

Mr Mbuyane asked about the LottoStar matter. Were there other bookmakers doing the same thing? What was the Gambling Board doing? One side of government was pulling against the other in the matter. It could not be left to court. What was contained in the MoU with the provincial boards? Did it deal with illegal lotteries in the provinces?

 

Ms R Moatshe (ANC) thanked the NLC for launching 12 ECDs in her constituency in Waterberg in Limpopo on 28 February 2020. What was the view of NLC on the theft of information? Members had learnt that the journalist in question had been an NLC beneficiary. Was that true or not?

 

Ms J Hermans (ANC) said that it was encouraging to listen to an entity that had overachieved in its mandate and addressed the plight of the poor. She supported Ms Yako in requesting more funds be put to Gender-Based Violence, given the priorities of the country and the efforts of the President to fight the scourge. That target needed to be re-visited. If the NLC was achieving all the targets, should the targets not be raised?

 

Ms Hermans asked about Mr Cuthbert’s request for the beneficiary list. She did not recall the Committee requesting the beneficiary list, especially given that the beneficiary list was subject to the regulations of the board. As far as the investigation into the COO was concerned, she did not understand why Mr Cuthbert was asking for information. She believed that the Committee should wait for the final report. Unless Mr Cuthbert was asking for an update but she did not believe that information would be available at that stage.

 

Ms Hermans stated that if the NLC was saying that it did not have the ability to act against those breaking the gambling law in SA, and that authority had to be devolved onto provinces, should there not be an NLC going forward that was able to act? It had come to her attention that the Minister was doing an independent investigation because of the noise around proactive funding. The Committee should be taken on board as far as that was concerned.

 

Ms P Mantashe (ANC) noted that most entities were locked in a crisis of non-performance but the NLC was an exception and there were no gaps in their achievements in the Third Quarter Report. She applauded the entity. She was not sure about the hullabaloo in the media as the NLC had performed well for the last five years. The allegations by the media and their supporters of fraud, corruption and nepotism in the Commission. She had heard that they were calling for heads to roll. What type of leave had the NLC granted the COO? Had there been an internal investigation into the COO? What was the name of the private investigator that the NLC had hired? She supported the request for the terms of reference. What costs had been incurred in the investigation?

 

She noted that the newly-formed organisations were not benefitting but the old organisations from before she had been born knew exactly how to access funding. She was very glad that the NLC was supporting new NGOs and NPOs. She was an accomplice of the NLC if it was trying to support new NGOs.

 

Ms Mantashe supported the call for more money for abused women as a result of the wave of femicide in the country. She had previously asked the NLC to visit the home for the elderly in her constituency. The home was in a terrible condition and was located in Dordrecht next to pigs, but the NLC had not visited the home. The old people were not her friends but people in dire need. She was pleased that the NLC had gone the extra mile to develop its own framework to help poor people. She could not praise the NLC enough.

 

Mr B Radebe (ANC) stated that he missed the Trade and Industry Committee as it was a Committee of action that transformed the lives of the ordinary people. He had felt compelled to visit the Committee because of what had happened in the media space. He had to give his two cents worth of what he knew had happened in the NLC.

 

Mr Radebe stated that he was very interested in proactive funding. What had happened in the past was that beneficiaries had to undergo very extensive processes to access funds. The Committee, ably chaired by Ms Fubbs, had sat down and asked what could be done by the NLC about the disasters in the country. One example was a bridge that had been washed away by floods in the Eastern Cape and children could not get to school. The community did not have three years of financial statements, nor did they have the capacity to apply for a grant.  How many communities had the NLC helped with the proactive funding in the different provinces, especially the Western Cape? The media did not cover those small rural communities that were struck by disasters and had received help from the NLC.

 

The Committee took a ten-minute break.

After the break, Mr Cuthbert asked to raise an issue in relation to the altercation that had taken place between the Chairman of NLC, journalists from GroundUp and others during the break, but he was told, very firmly, by the Chairperson that he should cease attempting to raise the issue. The Chairperson stated that his understanding was that the issue had been resolved and ruled that an incident that had occurred outside of the meeting should not be discussed in the meeting. The Chairperson informed Mr Cuthbert that he was continuing with the agenda.

The Chairperson noted that Members had posed questions and requested the Commission to respond. He also asked the NLC to explain what was meant by “good cause”. It might have to do with good impact. That might be an area on which the Committee might focus. He asked the Members not to put too much emphasis on the media. The reference to the media dislocated matters in the Committee. It affected the work that the Committee should do. When the Committee had conducted an oversight visit in Gauteng to visit the South African Bureau of Standards and the National Regulator for Compulsory Standards, he had tried to arrange a meeting with the NLC in Tshwane, but one of his colleagues in the Committee had raised a lot of procedural issues. He had been trying to get the whole board to meet with the Committee but there was a concern about how the Committee could engage outside of the parliamentary precinct. That was the basis for postponing.

 

When the Chairperson had postponed the meeting, the journalist had asked him, why this was done. He had told the journalist that he was not a Member of his Committee so he did not need to respond to his question. It was rude and unbecoming of the journalist to question the Chairperson and to try to engage in issues that could not be proven. He asked that Members not to engage with the media as the Committee would lose control and they might end up with serious disagreements as there were no facts and no information.

 

The Chairperson acknowledged that the NLC records of finances had been expressed properly. The six clean audits showed that the NLC had fulfilled its mandate. The NLC could not be smart enough to put things past the Auditor-General The serious issue was the proactive funding.

 

Ms Yako rose on a point of order. She stated that as a Member of the opposition, she could have different opinions and they would not always agree. Her caucus had the right to go to the media and explain what had transpired and state that the party was unhappy with an issue. That did not infringe on the Committee. If she told lies about what had happened, then he, as Chairperson, had powers to deal with it. But, she had the right to state things as she saw them.

 

The Chairperson stated that he had not said that. The problem was that English was his second language and that in choosing his words, he may have miscommunicated. He agreed with Ms Yako that she has a right to air her views to the media. However, he took issue when Members of the Portfolio Committee referred journalists to him to provide a statement of outcomes of a caucus he was not a part of.

 

The Chairperson clarified to Ms Yako that his intentions were not to deny her the right to go to the media and that he supports her completely.

 

Ms Yako accepted the Chairperson’s clarification, and noted that she understands that English is a second language for many of the Members. She also noted that she will not withdraw any statements that she had made because according to her there was nothing wrong with what she said.

 

The Chairperson stated that the Member was in order in terms of what she had thought he was saying. He would continue in his second language, English, trying to get people to understand what he wanted to say.

 

He stated that the point that he wanted to raise was that proactive funding was only 10% of the funding available and 90% of the funding fell within the mandate of the NLC and the outcomes for the work of the Commission were positive. He would not condone people that undermined the entity with allegations of fraud of irregularities. The Committee would support the NLC to fight against that. He noted the investigation and supported it fully.

 

He informed Members that the previous evening, the Minister said that he was looking at an intervention by supporting the investigation by an independent forensic investigator. The communication by the Minister spoke to allegations of fraud and corruption as well as nepotism. The Minister had suggested that the board was quite capable of handling the investigation and he asked the Director-General of the Department of Trade and Industry to expedite the matter.

 

The Chairperson stated that the Committee supported the offer of support by the Minister. It was within its rights for the board to engage the DG and request that he expedite the investigation by an investigator. The timeline was the end of April. Urgent and important was the matter of the COO. He requested a quick, comprehensive process into the COO. The board should not cut corners, but one could not put a person on suspension for months. It should not take six months to resolve the matter of an employee. The investigation should be done professionally and competently so that the COO was not taken out of the system for many months without a sense of where the process was.

 

The Chairperson, and the Committee, believed it was critical to discuss proactive funding. He believed that linking the grant to research was very good. The work of the NLC was noted with thanks.

 

He did not want a discussion on irregularities. That should wait until the end of April. The NLC should not respond to the questions of allegations, etc. as that would be dealt with at the end of April.

 

He assured the NLC that even though it spent only 10% on proactive funding, it was an important function. Corruption was corruption regardless of the amount. Genuine projects impacted people’s lives and the resources had to go to the poor.

 

Discussion on interlude during the break

The Chairman of the NLC said that he was dismayed that an old man like him could be approached in Parliament, which should protect him, by someone that he had never met in his life and for that person to point at his eyes and say that it was him and that he was not going anywhere. He had not mentioned anyone’s name in his briefing. He had gone to school to remember what he had said! He had been approached in a belittling manner, which he regarded as an offence. He respected Parliament but he did not want to be taken as a useless person and he wanted the Chairperson to look into it, especially if there were cameras in the room as he would not take it lightly. He felt like not answering questions. He had been invited to Parliament and he knew the rules because he had been a parliamentarian and he would answer parliamentarians but not someone who had not hired him or given him a job. What the hell! Was that what SA had fought for? Was it his skin colour? Was it a sin to be black and “someone was white or Indian”? He rested his case.

The Chairperson said that the matter should be concluded. He had seen members of the public, Joseph and Tebogo Sethatu, although he had not seen the encounter with Prof Nevhutanda and he did not know who had started what. They were SAs who were there because they had an interest in the work that the Committee did but he did not want people to engage with each other in a way that was aggressive or violent. It was unacceptable. The Chairperson stated that it was his forum and it was his Committee.  The Professor should accept that he had declared that such behaviour would not be tolerated. He asked Joseph and Tebogo Sethatu not to create that kind of situation in that room again. Mr Cuthbert had raised the issue but he, as Chairperson, had blocked him because it was not in line with the agenda. He would keep the decorum of the House. Anyone who came to Parliament had to respect the processes, to support and to contribute. He was not suppressing Mr Cuthbert, but he did not want to have that discussion and interrogation. The Committee would end up having an inquiry and discussion that was not in line with the discussion. He asked the chairman of the board to accept his apology. He asked that such a thing not happen again.

Response by the NLC

Prof Nevhutanda noted that questions had been raised for the NLC to respond to. In response to the comment about him resigning, he could only ask on which grounds he should resign. When one resigned, there had to be grounds that he had done something wrong. The Member had said that he had a doctorate but he had two doctorates.

Parliament could not teach the NLC to break its own law and it did not matter if it was the opinion of another lawyer. It had to be tested in a court of law. It was the right of any South African to test a law in court. The NLC had not written the Act – Parliament had done that and he would not show the beneficiary list because others were making themselves rich by robbing those who had received money because the amounts of money that were shown on the list. The NLC was protecting those people.

Regarding proactive funding, in terms of the Act, the Minister could undertake research, as could the board or the Commission. A human being could be subjective. Even if one was objective, other people would see it as subjective, so people had to educate themselves until they could do some research that was objective. The NLC needed to look at the procedure for proactive funding, but all of the proactive projects were funded irrespective of political parties. During the water shortage in the Western Cape and during the fires in Cape Town, he had contacted Ms Zille and the other politicians and stated that NLC wished to support the people in the province. In the Northern Cape, they had found an old man, Dr Vusamazulu Credo Mutwa, who said that he was dying without being granted recognition so the NLC had built a museum, but the province had to buy the books.

Prof Nevhutanda responded to the question about the media noise that engulfed it and said that he was happy with the Chairperson’s conclusion that those things had to be investigated thoroughly and he would go on with that process. He had done nothing wrong. The NLC had given money and had saved people’s lives. There were different ways of looking at things. Just because he saw it from one side did not mean that he was wrong. Some saw it from the other side but they might have other objectives. He assured the Committee that the he was not hiding anything. Every funded project was in the system. He was not attempting to scare people. The beneficiary list never used to be a problem, but now the Commission had to protect the NLC’s information and the people’s information. He did not want the media to investigate. He did not investigate the media. His information and the information of his organisation had to be protected. The NLC official who had the information had been tied up in his house because people wanted the information from him. Was the NLC in a fight over proactive funding? The NLC was not as it was doing proactive funding according to the law. If the NLC was doing it wrongly, members should tell them how to do it better.

Mr Ndivhuho Mafela, Head of Marketing and Communications, NLC, addressed the question about whether the nation knew about the focus areas for grants. The strategy was rural-biased with the intention to advertise on community radio stations and community newspapers so that the NLC reached the furthest corners of the country. Currently the NLC was advertising the 2020/21 grants which would be available from April 2020. The provincial officials had been asked to seek out all the little community radio stations. The NLC had had a meeting with Media Development and Diversity Agency (MDDA) and Government Communication and Information System (GCIS) to obtain information about the small community stations that changed so frequently.

He stated that the NLC was not in a fight with GroundUp but some people seemed to be fighting the NLC. When he had started in his position as a media relations person, he had met everyone who had an interest in the NLC and then he had received a message saying that the person wanted to know who he had been talking to about the NLC.  He had awoken one morning to find a bizarre story by GroundUp accusing him of bribing the media, but he had, in fact, placed advertorials as a right of reply. There were members of GroundUp who had been directors of NPOs that had been beneficiaries of NLC grants. The NLC was happy to make that information available.

Ms Mantashe asked that he repeat the last point.

Mr Mafela explained why all the allegations came from one media source. There was a history of a grant relationship with a person in the room that he did not want to mention. Some directorships had made applications for grants and had been historically funded but were no longer funded because a grant by the NLC was not a permanent arrangement. The NLC did not know if it was being cajoled to fund or not, so the NLC just carried on as it had always done. He reiterated that there had been a grant beneficiary relationship in the past.

He added that the NLC was going all out to inform people about the regulatory mandate and the grant making mandate. The NLC had questioned the model of sustainability once a grant had been made and the regulatory mandate allowed the NLC to give the NGOs some modes of survival. To do that, there had been a target of 20 awareness programmes per year but so far that year, the NLC had presented 182 programmes.

The Chairperson stated that the issue he wanted to discourage was the debate as social media and general media conveyed a lot of information and it was time wasting and insulting. Those who had been referred to directly, would have legal rights.  He did not want an engagement with the issue in the Committee meeting as it was not appropriate to use the meeting as a platform to get even, especially when the allegation had not been confirmed.

Mr Cuthbert stated that a decision had been taken in respect of Members, following the Chairperson’s discussion with Ms Yako, and he did not believe that the Chairperson should go back there again. They were opening the issue up to debate again. He believed that the Committee should stick with the agreement.

The Chairperson explained that he had been talking directly to the NLC Communications Manager when he had raised the issue. He had not been talking to the Committee Members. He apologised to Mr Cuthbert if he had been misunderstood.

Ms Mantashe stated that the points of order frequently levelled against the Chairperson were intended to undermine him and she was not happy about it. She suggested that the points of order were intended to disrupt the meeting and she did not believe that they should be entertained.

Ms Mampane responded to the comment that the allocation to fight GBV seemed very low. She assured the Committee that she, too, had been active in the space of fighting GBV. However, one would have to interrogate all the donations to find out how much was actually given to women. She apologised that animals received 2% compared to the 1% for women and children, culture and religion, but it had to do with proactive funding. The 1% had come about because the NLC had not had separate requests for funding for GBV so the NLC had given some funds in the proactive funding. Most women applied to charities and funds for women were part of many projects supported by NLC. The Commissioner promised to try and extract the data about the total amount given to, and for, women and children.

She explained that the target of 5% for a province was the minimum percentage for a province. That was clearly presented in the actual Quarterly Report which Members would see when they read the Report. All provinces initially received 5% and then, based on the needs of a province, additional funds were granted. Gauteng seemed to receive a larger proportion of funding but that was because many federations were housed in Gauteng.

The Commissioner promised to send the terms of reference for the investigation to the Committee the following day.

Education and awareness was legislated and it was on the Annual Performance Plan (APP) and had been reported on in the Quarterly Report but she would do more work in promoting requests to address GBV. NLC was going into a new strategic framework but the targets were supervised by the board and board members always demanded a stretching of targets. The new targets might be a challenge but the board always stretched the targets. She would not answer more questions on proactive funding.

In the Quarterly Report, Members would see a report on the impact of NLC funding. The Commissioner read an extract from the Quarterly Report, noting the impact of grants, including the number of additional jobs created for designated sectors, jobs retained, etc. Statistics were provided in the report as it was not only about the impact but also about jobs created, including the gender and disabilities of the persons employed. She noted that the CFO had talked about the procurement order that had been given to black business.

Ms Ntuli informed the Committee that in the last audit, the Auditor-General had said that the organisation remained clean as it had competent people in key management positions and that the leadership was strong. There were no findings on compliance or performance information. The Auditor-General concluded that the assurance providers, i.e. the board audit committee and the board risk committee, were reasonable. The Auditor-General concluded that the viability of the NLC was good. During the 2018/19 audit, site visits had been made to proactive and application funded projects and the Auditor-General had not had any issues or findings.

Mr Masewa confirmed that LottoStar was important to the NLC. It was not only that LottoStar was taking bets on Lotto results but it also used aggressive marketing and was one of the biggest bookmakers betting on lotto results. The NLC was hoping that the court order would set a precedent for other bookmakers.

He said that the Lotteries Act was very clear. At a national level, it was a criminal offence to take bets on the Lotto, but at provincial levels, bookmakers were licenced to take bets on contingencies. The National Gambling Amendment Bill was intended to deal with the point but it had not gone through Parliament as yet. He added that the MoUs with provincial gambling boards were intended to deal with the issues of bookmakers, etc., where different entities of government interpreted laws differently. The MOUs created a platform of engagement of some sort.

Mr Masewa stated that the NLC had spent around R5 million on the investigation. On the release of the list of beneficiaries, he believed that it was a situation which would have to go to court to be resolved or it could be resolved when all parties had the correct understanding of the law, which he believed was the NLC interpretation. The 2001 Regulations dealt with beneficiary information. Clause 8 stated all grant information was confidential. Nobody should release the information unless it was a confidential disclosure to Parliament or the Minister, the Public Protector, the National Director of Public Prosecutions or if the person to whom the information belonged, and the board, consented to release the information. The law stated that it was a criminal offence to release the list of beneficiaries. The NLC wanted to be open and transparent but there was a regulation to be taken into account.

He added that the NLC always advised requesters for information to follow the PAIA route. In that case, the beneficiary was asked to consent to the release of the information and then the NLC could decide whether or not to give some information.

The Committee Chairperson stated that those who wanted the information on the beneficiary list would have to follow certain processes. Perhaps the Committee should make an application through PAIA, if the Committee wished to have the information. He trusted that there would be no further questions on the beneficiary lists.

He could not accept follow-up discussions but the questions would be noted.

Mr Mulder stated that he saw no mention in the report of the operational mandate and the performance of Ithuba - the Committee should have access to that information.

Mr Cuthbert stated that everyone spoke of six clean audits but there had not been six clean audits in the past six years. There were two financial years, 2014/15 and 2017/18, when clean audits had not been obtained. People should not make incorrect statements in the House. He noted that Mr Mafeka, the spokesperson, seemed to have said that the NLC had been breaking the law because he had stated that for the past four years, it had placed the beneficiary list on its website. He asked Mr Mafeka to clarify his statement. He asked for the response on the COO from the Commissioner.

The Chairperson stated that he had requested no further discussion on the beneficiary lists and he had also stated that the investigation was not to be discussed as the Committee would wait for the final report. On the clean audit, he apologised and withdrew his statement on this. He asked the CFO how many clean audits there had been at the NLC.

The CFO stated that the six years referred to 100% achievement of targets.

The Chairperson stated that a clean audit was different from achieving 100% of targets. That was corrected. He thanked Mr Cuthbert for pointing that out.

Prof Nevhutanda said the NLC had had six 100% performances and four clean audits.

Committee business

Second quarter programme

The Committee Secretary presented the Committee Programme for the Second Quarter and indicated why changes had been made. The term would conclude on 10 June 2020.

The joint meeting with the Portfolio Committee on Higher Education, Science and Technology had to be delayed until the third quarter. The Committee Strategic Planning Session would take place on 23/24 April 2020.

Ms Herman indicated that the strategic planning date might clash with party business.

The Committee adopted the proposed Committee Programme for the second quarter.

The Committee Secretary informed the meeting that the Minister would discuss the ferrochrome, steel and sugar industries on 18 March 2020.

The meeting was adjourned.