NPO regulatory system

On Wednesday 11 May, the DPME shared  the findings of an implementation evaluation of the NPO regulatory system at a dialogue meeting with a small group of NPO leaders in Cape Town. 

One of the striking findings was the multiple requirements for registrations and compliance particularly for NPO’s providing the social services to the most vulnerable such as children, the elderly etc.  The requirements for registration and compliance are both confusing and costly.  

For example, it was presented that an ECD provider in rural Gauteng with an annual income of R200 000 could have estimated registration costs or R28 229 or 28.2% of income and this excludes the cost of compliance – that is the costs of reporting, bookkeeping, and audit costs.    

DSD funding for NPO’s from the different provinces carries with it additional compliance requirements:   In the Western Cape – a grant of over R200 000 requires the organisation to provide audited financial reports, whereas in Gauteng,  this is required for grants over R100 000!!   The cost of the audit is not insignificant and for many small NPO’s it is prohibitive.

On the one hand it is encouraging that this untenable situation has been revealed by this government DPME study,  but it is yet to be seen what changes will be proposed and finally implemented to create that the enabling environment for NPO’s,  which is governments  own stated policy objective.