1. Presentation to the Select Committee on Trade and International Relations
12 September 2012

2. Presentation Outline Introduction and Overview Performance: Key Trends
Achievements
Allocations per Sector / Province
2012/13 Budget Allocation per Sector
Challenges
Corrective Measures
Lessons Learnt
Concluding Remarks
Discussion

3. DAs adjudicate applications and make grants in line with criteria
Introduction
Regulation
National Lottery: Operated by Gidani (34% of sales to NLDTF)
Other lotteries
Distribution
Process applications and make payments
Charities
45%
Arts
28%
Sports
22%
Miscellaneous 5%
DAs adjudicate applications and make grants in line with criteria

4. NLDTF Revenue & Disbursement 1st April 2000 to 31st March 2012(R million)
Revenue from Lottery Operator
13,981
Interest on investments
3,940
Total revenue
17,921
Cash Disbursed since inception
13,013
Spent on administration (2.7%)
434
Funds on hand
4,662
Less amounts already committed as at 31 March 2012
2,219
Cash available for allocations in 2012/2013
2,443

5. NLDTF Disbursement per Sector 1st April 2000 to 31st March 2012(R million)
AMOUNT
CHARITIES
6,623
ARTS & CULTURE
2,805
SPORT
3,324
MISCELLANEOUS
261
TOTAL
13,013

6. NLDTF Revenue & Disbursement 1st April 2000 to 31st March 2011(R million)

7. Surpluses
Surpluses are created by a mismatch between inflows and outflows
Inflows dependent on Sales are steady but not predictable
Outflows dependent on
Number of applications received
Number of applications that are compliant
Number of applications that are deserving
are also not predictable
A large portion of the funds in the trust is always committed to beneficiaries
In 2011/2012 demand was 40 times supply
NLDTF cannot disburse more than it receives 

8. Performance: Key Trends
Lottery sales:
Only source of funding.
Grown from R3.08bn in 2001 to R4.94bn in 2012
Significant dip in 2008 (R1.6bn)
Fund is only now beginning to recover at levels it was edging towards in 2006/7
Admin Ratio: 2.7% of all available funds on Administration since inception
One of the largest (if not the largest) funders of NPOs , CBOs in SA

9. Performance: Key Trends
Cash disbursements in the 4 most recent years:
2009: R0,9 billion
2010: R1,9 billion
2011: R3,6 billion
2012: R2,05 billion
This acceleration of disbursements (resulting in reduction in reserves) reflects improvements in the distribution process
The above plus the fact that income from ticket sales has remained more or less ‘static’ for same period, explains the difficulty that some stakeholders have to understand the ‘reduction’ in available funds

10. Achievements
More than 15 billion allocated for good causes between 2000 & 2012
More than R13 billion cash disbursed between 2000 and 2012
Applications received doubled in 2011/12 following Road shows/capacity building workshops
Provincial consultations and National Indaba during June 2011, attended by 1,500 delegates
Improved turnaround times over last 3 years: in particular post-adjudication phase

11. NLDTF Disbursement 1st April 2011 to 31st March 2012(R million)
SECTOR
AMOUNT
CHARITIES
791
ARTS & CULTURE
542
SPORT
673
MISCELLANEOUS 45
TOTAL
2,051

12. NLDTF Allocations Provincial Spread 2011/2012 (R million)
Arts
Charities
Sport
Miscellaneous
TOTAL
Eastern Cape
38 (8.1%)
61(7.6%)
14 (3.6%) -
113 (6.7%)
Free State
5(1.1%)
48 (6.0%)
15 (3.8%)
19 (40.4%)
87(5.1%)
Gauteng
167(36.4%)
238 (29.8%)
160 (41.1%)
22 (46.8%)
587 (34.7%)
KwaZulu Natal
112 (24.4%)
101 (12.6%)
30 (7.7%)
1 (2.1%)
244 (14.4%)
Limpopo
37 (8.1%)
106 (13.3%)
52 (13.4%)
195(11.5%)
Mpumalanga
11 (2.4%)
56 (7.0%)
82(4.8%)
Northern Cape
3 (0.7%)
22 (2.7%)
7 (1.8%)
32 (1.9%)
North West
50 (6.3%)
16 (4.1%)
77 (4.5%)
Western Cape
75 (16.3%)
116 (14.5%)
80 (20.6%)
5 (10.6%)
276 (16.3%)
459
798
389 47
1 693

14. NLDTF Allocations.. Provincial Spread Comparison
Province
2011/12
2010/11
2009/10
Eastern Cape 7% 9% 8%
Free State 5% 4%
Gauteng
35%
38%
26%
Kwazulu-Natal
14%
12% 3%
Limpopo 6%
Mpumalanga
Northern Cape 2%
North West
Western Cape
16%
19%
National Bodies
34%

15. Budget for 2012/2013 SECTOR AMOUNT IN RMILLION
Arts, Culture & National Heritage
684
Charities
1,099
Sport & Recreation
537
Miscellaneous Purposes
122
TOTAL
2,442

16. Current Status as at 31 Aug ’12 (R’000)
ARTS
CHARITIES
SPORT
MISCEL
TOTAL
BUDGET
684
1,099
537
122
2,442
ALLOCATED 91
431 65 37
624
BALANCE
593
668
472 85
1,818

17. Challenges Applications based funding model
Total dependence on NLDTF for existence of organisations
Expectation of recurrent and ‘permanent’ refunding effectively crowding out new entrants from being considered
Turnaround times

18. Challenges High rate of declines (due to non-compliance)
Fraudulent applications / fund use
Provincial allocation / spread inequities
Emotive publicized threats of downsizing operations and services or closure because of the NLDTF has not allocated a grant

19. Corrective Measures

20. Administrative Actions
Improve access to application documents (additional distribution points)
Introduction of helpdesks
Increase timeframe for Call for Applications to submission deadline (8-12 weeks)
Enhancement of NLB website (online tracking facility)
In-house scanning of all applications
Adjudication manual for DAs
Capping of allocations to facilitate more equitable distribution

21. Legislative Changes
Other challenges were as a result of gaps in legislation and review of the Act in process and is expected to address inter alia:
Responsibilities of the Minister, Board and Agencies
Improving efficiency in distribution of funds
Accountability of distributing agencies
Size of the Board
Composition of the distribution agencies
Enhanced conflict of interest measures
Proactive funding to complement application based funding
Possible extension of categories of areas to be funded
Provision of an appeals mechanism

22. Future Plans Roll-out of regional offices to all provinces
Increase service offerings at Provincial offices
Simplified application process for smaller grants
Online application submission facility
Impact study to inform strategic funding model

23. Lessons Learnt
Need to formulate a much clearer funding policy for the NLDTF with a focus on “impact” rather than “giving”
More proactive/strategic approach to communication-and stakeholder relations
More concerted effort to publicize funded projects and achieve a balanced view

24. Concluding Remarks
Appreciate the opportunity to account to and engage with the Select Committee as the elected representatives of the communities we are appointed to serve
Will appreciate
the advise and inputs of the Committee
An opportunity to provide more information at this or a subsequent meeting

25. Discussion