Home South African Minister says there will be ‘consequences’ for mismanagement of arts relief fund

Minister says there will be ‘consequences’ for mismanagement of arts relief fund

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Arts and Culture Minister Nathi Mthethwa says there will be “consequences” following the mismanagement of the R300m fund to help struggling artists.

Minister Nathi Mthethwa. Picture: Kopano Tlape/GCIS

ARTS and Culture Minister Nathi Mthethwa said there would be consequences for council members, senior management and staff implicated in the mismanagement of the Presidential Economic Stimulus Programme (Pesp) funds that were allocated by the National Arts Council (NAC) to help struggling artists.

The industry had been hard hit by the Covid-19 pandemic, prompting the government to institute relief.

Pesp consisted of R300 million for job creation and job retention, with 5% being retained by the NAC for administrative purposes.

To date, 1,309 applicants have benefited from the programme.

“Shortly after the money was given there were reports pointing to mismanagement of that fund and that necessitated that an investigation be done,” Mthethwa said.

“The most important thing out of this is that consequence management is going to be seen and felt by anybody who is involved because we cannot get the blame that we don’t take care of our artists when we avail resources and funds.”

On July 29, the NAC council members appointed an independent, international audit, tax and advisory firm, Mazars Forensics, to conduct the independent forensic investigation into the implementation of the Pesp.

The investigators discovered a number of administrative failures including failure to resource the Pesp project with competent staff and a lack of adequate oversight and review processes resulting in non-compliant projects being approved.

There was also a failure to meet timelines for delivery of the Pesp and to ensure accurate information in respect of approved applications were correctly captured in the grant management system.

The auditors found multiple governance and financial mismanagement actions that included contravention of S11(2) of the National Arts Council Act and failure to observe Council Resolutions; failure to take effective steps to prevent irregularities in the adjudication process, including irregular spending.

There was also failure to provide financial oversight regarding the implementation of the Pesp within the allocated budget of R285 million, resulting in over-commitment to the amount of R637,705.

The NAC said it would review all its financial management policies.

“The audit and risk committee has been requested to evaluate the areas of our internal control environment that require urgent attention. All findings related to council members will be dealt with by the Ministers Office. The new council will continue to prioritise restoring strong internal processes and controls to the NAC.”

The findings were welcomed by the South African Arts and Culture Youth Forum which represents around 40,000 members.

Founder, Romeo Ramuada said: “At least the ministry took responsibility and they didn’t just sit. Many of us thought they were not going to investigate and take decisive steps. We support them, especially the fact that people implicated are going to be held accountable.”

He said many artists still needed assistance with administration in terms of invoicing for their work etc.

The forum added that they also wanted more financial support from provincial departments.

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