Gaming the Lottery

Lottery grants under investigation

The National Lottery Commission (NLC) gave a R22 million grant to a drug rehabilitation and sports centre without it being registered as a treatment centre with the Department of Social Development, a statuary requirement to operate such a facility.

MBOMBELA – Why the organisation was granted the large sum and how the Lotto ensures that the funds are spent correctly, remain unclear.

According to the head of the global Investigation into Lotteries for South Africa, Raymond Joseph, the “rehab” in Mbombela is one of at least three that the NLC has funded around South Africa to the tune of around R23 million each.

Another rehab near Pretoria is still unfinished, despite the NLC paying out R27 million. Roofs leak and doors and windows do not fit properly. A lapa on the property was converted into a “sports centre” at a cost of R5 million.

The grant for the centre on the Uitkyk Road was channelled via the South Africa Youth Movement (SAYM), a non-profit organisation (NPO). The organisation also has a sister body called the South Africa Youth Movement NPC (non-profit company). For both organisations have the same executive director, Alfred Muzwakhe Sigudhla.

He said his organisation had “gone through all the procedures” with the NLC. The grant consisted of R17 million for the rehabilitation centre and another R5 million for a sports centre on the same property.

Two years on, the area where the centre is being built is an overgrown, unfinished building site, despite the NLC saying in September that it was “70 per cent complete” and that R20 million of a R22 million grant had been paid out to SAYM.

“We have not spent all the money yet that the Lottery Commission granted us. It is still in our account,” Sigudhla said. He declined to provide the proof to Lowvelder.

In their financial statements for the NPO, salaries for 2016 were over R400 000. They increased to R9 million for 2017. Sigudhla stated that this was for their staff of over 200 people nationally, who are mostly builders they had to employ. “We are not just getting funding from the NLC. We are getting funding from the United Nations and we are busy with a R500 million project involving the Department of Cooperative Governance.”

Lowvelder requested the application documents for the NLC grant and received ones related to a centre in the Free State and Kuruman, Northern Cape.
Sigudhla said the Mpumalanga application was “confidential”.

The provincial Department of Social Development (DSD) confirmed that SAYM was not registered to provide substance abuse treatment services in Mpumalanga. The Prevention of and Treatment of Substance Abuse Act requires this.

By his own admission, Sigudhla received the Lottery money in 2016.

He only applied to be registered as a treatment centre in May 2017. He is still awaiting this.

Sigudhla admitted that he was also not registered as a treatment centre in any
other province.

He blamed the slow progress of the site to zoning issues. He purchased the property that September at a cost of R1,3 million, not knowing that it was zoned for agriculture. They started to build in October 2016. The municipality building inspector stopped the building in March 2017, due to the zoning problem.

Lowvelder visited the site. Neighbours confirmed that most of the structure and roof on the premises had already been built before the property was sold. Some rooms had been added and some new paint was seen on a few walls. But most of the buildings had no flooring and no water and electrical connections. Grass and plants had grown over the walls and foundations, giving them the appearance of ruins. In September the Mbombela Property Tribunal approved the rezoning, subject to certain conditions being met.

City spokesman Joseph Ngala said such cases took a long time. “It depends on the merit of each case. The matter can go back and forth between parties, which can take years until it is resolved.”

New building plans submitted by Sigudhla are now awaiting approval from the municipality, so that construction can begin again. He confirmed that he wanted the centre operational by February 2019.

Paul Schumann, the project architect, said Sigudhla’s “heart was in the right place” in attempting to do the project. But he was not prepared for all the red tape when it came to building a facility of this scale.

But while some organisations receive millions in grants from the Lottery, many which are registered and able to provide the services are struggling to get money.

SANCA Lowveld’s director, Marina Erasmus said while their organisation has a long-established facility, they struggled to get funding from the National Lottery Commission.

And once funding is granted, the recipient had to submit quarterly reports to prove how they were spending their grants.

“This usually accompanies a box or two of evidence of work being done on how we spend the money. Proof needs to be attached to that.”

Erasmus said the province was not in need of more treatment facilities, as government was already building new ones and extending others. “We are in dire need of halfway houses for recovering addicts.”

Thuli Masina, spokesman for the DSD, confirmed that their department had completed phase one of the Nkangala Inpatient Treatment Rehabilitation Centre in Ogies, which would accommodate

50 people. Once completed, the centre would accommodate 250 service users. “Phase one of the centre will not have a detoxification facility. However, the local hospital will provide the services.”

The Swartfontein Rehabilitation Treatment Centre between White River and Hazyview has also been extended and now accommodates 100 patients.