the Portfolio Committee on Sport and Recreation Presentation to the Portfolio Committee on Sport and Recreation 6 March 2012

Agenda OVERVIEW GOVERNANCE CONCLUDING REMARKS DISCUSSION Legislative Mandate Appointment of the Board National Lotteries Distribution Trust Fund (NLDTF) Appointment of Distributing Agencies Funding Regulations NLDTF Revenue & Disbursements: Strategic Focus of SRDA Funding Key trends: SRDA Disbursement GOVERNANCE CONCLUDING REMARKS DISCUSSION es

OVERVIEW

Legislative Mandate Protection of Players NLB is established through the Lotteries Act No. 57 of 1997 Key functions: Advise the Minister on the issuing of Licence/s on the percentages allocated to good causes on the efficacy of Legislation related to Lotteries Protection of Players Maximize proceeds to good causes Administer NLDTF Monitor & Regulate Other Lotteries

Appointment of the Board The Board of the NLB is appointed by the Minister following a transparent public nomination process in terms of section 3 The Minister is required to consult the Portfolio Committee on Trade and Industry in appointing the Chairperson of the Board in terms of section 3(3) The current Board of the NLB was appointed following a nomination process and public interviews by the Portfolio Committee on Trade and Industry The term of the current Board commenced effective from December 2009 and is for a period of 5 years

National Lotteries Distribution Trust Fund (NLDTF) Established through section 21(1) of Lotteries Act Fund shall vest in and be administered by the Board Fund shall be held in Trust by the Board for the purposes mentioned in chapter 3 of the Act Revenue of the Fund consists of: A percentage of Sales of Lottery products as specified in the Licence Interest derived from the investment of monies in the Fund Other money lawfully paid into the fund Fund shall be audited by the Auditor General and reported in the annual report of the Board

Categories of the NLDTF In terms of section 27-31 of the Act, the allocation of money in the NLDTF is limited to the following categories: Reconstruction and Development Programme (0%) Charities (45%) Sports and Recreation (22%) Arts, Culture and National Heritage (28%) Miscellaneous purposes (5%) These funds are distributed by Distributing Agencies following applications received from the public in response to a call for application issued The Reconstruction and Development Programme category has been inactive since the Act came into effect

Appointment of Distributing Agencies The Distributing Agencies are responsible for considering applications for grants in respect of the NLDTF categories The Distributing Agencies are appointed by the Minister in consultation with the Ministers responsible for: Social Development Sports and Recreation Arts, Culture, Science and Technology, and Environmental Affairs Minister of Finance after consulting with the Board The appointment of members of Distributing Agencies follows an open and public nomination process

Regulations…July 2010 Distribution of Funds Distributing Agencies (DA’s) shall take into account the following in determining distribution of funds: general development in the country, with special reference to the regional, economic, financial, social and moral interests Provincial and local interests (ticket sales, population & financial requirements of each province) Priorities for funding must inter alia contribute to developmental needs and the advancement of rural, underprivileged and poor communities

Regulations…July 2010 Regulation (3) (c) Of the total allocation available for distribution by a Distributing Agency at least 50% shall be directed towards the following priority areas:- “Development of sports and recreational facilities in the rural areas for talent development and increase accessibility to such facilities for all including disabled persons”

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

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

Strategic Objectives of SRDA Funding To promote Transformation & Development within the sports movement Improve accessibility of sport facilities within communities Develop capacity at all levels with the aim of promoting sport within the country

Beneficiary Categories Macro Body (SASCOC) National Federations Provincial Federations Regional Federations Municipalities

Beneficiary Categories…Cont. Tertiary Institutions Schools Clubs NGO’s/Recreational Organizations

Key trends in SRDA disbursement Total allocation as at 31/03/2011: R3,7 b Total cash disbursed as 31/03/2011: R2,6 b Allocations to National Federations: - 2008/9: R298,1m (50.4% of total allocation) - 2009/10: R126,7m (19.8%) - 2010/11: R125,9m (20.1%) - 2011/12: R105,9 m (28.1%)

Allocations to National Federations

Allocations to National Federations: Top Allocations: 2009/10 Financial year 2010/11 Financial year Athletics SA: R17,7m SA Tennis : R15,2m SA Hockey: R10,7m Cricket SA: R10,3m SA Equestrian: R9,5m SA Rugby: R7,1m Basketball SA: R6,9m Volleyball SA: R6,4m Cycling SA: R25,9m SA Hockey: R11,5m Cricket SA: R10m SA Football: R10m SA Tennis: R8,4m SA Wrestling: R7,2m Volleyball SA: R7,2m Squash SA: R7,1m

Allocations to National Federations: Top Allocations (2011/2012) SA Rugby: R35m SA Football: R8,5m Triathlon SA: R7,2m Softball SA: R5m University Sport SA: R5m Martial Arts: R3m Judo SA: R3m

Key trends in SRDA disbursement A 3 year allocation of R139,7m was made to SASCOC in 2010 that includes allocation for inter alia the following: Admin: R14,6 million Elite Athlete Development: R59m Commonwealth games: R12,2m All Africa Games (2011): R10,3m Hosting of IOC Congress (2011): R15m 2009 World Student Games: R8,7m

Key trends in SRDA disbursement: Allocations to SASCOC Olympic Games Paralympic Games 2008/9: R12m 2009/10: R14m 2010/11: R17m 2011/12: R10m (Preparation, Coordination, Presentation) 2008/9: R4m 2009/10: R5,5m 2010/11: R6,5m 2011/12: R7,5m (Preparation, Coordination, Presentation) 2011/12: R30m towards OPEX for 2012 Olympic & Paralympic Athletes

Allocations: 1Apr ‘11- 31 Jan ‘12 Province Provincial Spread (%) Provincial Spread (R)   Eastern Cape 4% 14,1m Free State 3% 12,8m Gauteng 42% 156,4m KZN Natal 8% 28,5m Limpopo 14% 51,5m Mpumalanga 15,2m Northern Cape 1% 4,9m North West 15,8m Western Cape 20% 77,3m  Total 100% 376,628,331

Allocations: 1 Apr ‘11- 31 Jan ‘12..sector spread Municipalities 21,1m 5% Schools 121,4m 32% Tertiary Institutions 18,7m NF 165,2m 44% PF+PSC 15,3m 4% Provincial Academies 1,8m 1% CLUBS & NGO'S 25,1m 7% SASCOC 8m 2% TOTAL R376,6m  100% NF: National Federation; PF: Provincial Federation; PSC: Provincial Sport Council

GOVERNANCE

Composition of SRDA Mr. Gideon Sam (Chairperson) Ms. Hajeera Kajee (Deputy Chairperson) Mr. Thulani Tshabalala Mrs. Keikabile Motlatsi Mr. Vinesh Maharaj Mrs. Celeste van Niekerk Mr. Raymond Mali Dr. Harold Adams Mr. Vernie Petersen (Late) Prof. Andre Travill Mr. Edwin Ncula

Legislative Changes Other challenges were as a result of gaps in legislation and review of the Act in process and will 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

Governance: Decision-Making Launch NLB whistle-blowing line (1 March 2012) Free Call No: 0800 012 013 E-mail: nlb@tip-offs.com Free fax number: 0800 007788 Tip-offs Anonymous®, FreePost KZN 138, Umhlanga Rocks, 4320, South Africa (no postage stamp necessary). Publicize declaration of interest (March 2012) Increase secretarial/administrative support to DA’s Consider requests from the public to attend adjudication sessions

Conclusion

Concluding Remarks The NLDTF has been the major source of funding for a number of sporting codes and SASCOC over the last couple of years In addition to substantial funding since inception to SASCOC (R344m), the NLDTF has pumped in millions into national-and provincial federations for elite athletes, infrastructure and development Appreciate the opportunity to engage with the Portfolio Committee as the elected representatives of the communities we are appointed to serve

Discussion