Gayton McKenzie quiet on his department’s missing R146 million

Despite promises of a clampdown, Sports, Arts and Culture Minister Gayton McKenzie and his Department have kept tight-lipped about over R146 million in unaccounted-for COVID-19 relief fund payments.

In July 2024, the Department published the lists of names of the beneficiaries of the fund. The amount came to just under R89 million, short of the R235 million budgeted.

Members of Parliament (MPs) are saying that they are growing frustrated waiting for the “many announced forensic investigations that McKenzie seems to have taken a backslide from now.”

On 25 March 2020, then-Minister Nathi Mthethwa committed R150 million in relief funding for artists, athletes, and technical personnel affected by event cancellations during the pandemic lockdown.

This was later revised, and in the 2020 Special Adjustment Budget, R250 million was allocated for COVID-19 relief in the sector.

According to the Department’s 2020/21 annual report, R177 million went to the national Department, R58 million to provinces’ relief funding, and R10 million for libraries’ health and safety protocols.

The remaining R5 million was used for personal protective equipment (PPE) and decontamination at five DSAC sites. The Auditor General found “non-compliance on PPE procurement—hand sanitisers were procured at prices above the price list.”

Thus, R235 million (R177 million national and R58 million provincial) was directed for relief funding to support qualifying artists, athletes and technical persons in the sector.

Four agencies were tasked with disbursing funds: the Sports Trust, National Arts Council, Business and Arts South Africa, and the National Film and Video Foundation.

While thousands benefited, allegations of maladministration, double-dipping, and other problems marred the process.

When new Minister Gayton McKenzie took office in July 2024, he promised complete transparency by publishing a detailed list of beneficiaries from his department’s COVID-19 relief fund.

McKenzie said he was publishing the list for the sake of transparency and said there were really good well meaning people who received the funds.

He also said the list was not a shame list, but he wanted to dispel the notion that the DSAC did not support artists.

In July 2024, these beneficiaries and the amounts transferred were published, showing that payments were done in three “waves,” including:

• First Wave: R72.04 million for 3,962 beneficiaries;
• Second Wave: R4.11 million for 622 beneficiaries;
• Third Wave: R12.71 million for 2,059 beneficiaries.

The total reported payouts were just under R89 million for 6,643 beneficiaries – well short of the later-revised R235 million pool.

The Department and Minister’s office consistently ignored questions from journalists on the matter.

Then, in July, McKenzie took exception to an article published on BusinessTech about the matter, which portrayed him and his Department’s silence in a negative light.

“The agenda is very clear by some media, this was before my time, an impression is being created that I have something to do with the missing millions, I am the one uncovering and exposing this rot,” he claimed.

Newsday repeatedly sought updates from the Department and the Minister’s office over several weeks.

These offices ignored all requests, leaving questions and concerns about the missing R146 million of taxpayer funds unanswered.

Economic Freedom Fighters (EFF) MP and member of Parliament’s portfolio committee on SAC, Eugene Mthethwa, told Newsday that the committee is still awaiting the Minister’s “many announced forensic investigations that he seems to have taken a backslide from now.”

“There has not been any audit after his popular announcement of making public names of the beneficiaries. It was just a populist act from him with no intentions to get to the bottom of the lost taxpayers’ money,” said Mthethwa.

Auditor General raises red flags

According to the Auditor General of South Africa’s (AGSA’s) audit report on Covid-19 expenditure, there were several issues with the rollout.

At the get-go, the AGSA said that “the fund relief framework had certain internal control deficiencies that could negatively affect the overall effectiveness of the department‘s relief efforts.”

This “could result in the department not achieving the intended objective of providing relief funding to deserving beneficiaries in the sport, arts and culture sector.”

According to the AGSA, the progress of distributing the funds was slow, with a large number of applications initially being rejected and later re-evaluated.

They identified that the original criteria used to evaluate applications were not specific enough to prevent double-dipping and that subsequent amendments thereto could have resulted in an unfair process.

Design deficiencies in the system used to capture applications resulted in duplicate payments made to at least 72 beneficiaries and applications processed with key information not being captured.

In addition, the procurement process for digital solutions for this was found by the AG to be non-compliant, and the supplier who received the highest points was not appointed.

Inadequate validations by the system and a lack of reconciliations further increased the likelihood of invalid or inaccurate disbursements, noted the AG.

The AG also said that the Department did not differentiate between the management fee payable to the disbursing agents and the transfer amount to disbursing agents for relief beneficiaries, which resulted in a misclassification of the management fees.

“No willingness to hold anyone accountable,” says MP

Parliament’s Portfolio Committee on SAC chairperson Joseph McGluwa has said that many question marks remain.

McGluwa said that, given the concerns raised, including his engagements with the South African Performing Arts representatives who only received calls during COVID for support, but nothing further—a “thorough investigation is necessary.”

“Despite the department’s assurance that accounting for funds was within the rules, the committee has not been provided with figures or information on potential shortfalls, leaving questions about fairness and equality unanswered.”

Mthethwa noted that various programmes were cancelled by the minister after pronouncing investigations “because the department has been lying about the failures of its programmes.”

“It took this portfolio committee to highlight such failures, but the minister and generally government lacks consequence management.”

“There is no willingness to hold anyone accountable, which is what, as the committee, we must intensify. Open criminal cases where anyone is found wanting,” added the EFF MP.