SA’s NGO economy takes strain under covid-19

by Leah Wilson | Dec 26, 2020 | Indepth2020_Economy

The economic effects of covid-19 on South Africa’s NGO landscape have resulted in community collaborations across Gauteng to overcome the challenges of the national lockdown.

Situated in the rolling hills of Lanseria, the NGO, a Christian community called Hands of Compassion (HOC), is aptly perched like the  haven  it is to many. The surrounding area is a mix of lush wedding venues, squatter camps and wide-open pastures. Although the  poverty  may be isolated in  clusters,  the need remains glaringly obvious to HOC staff.  They  service the  Diepsloot, Cosmo City, Lanseria, Malachi and Lion Park communities  with a Wednesday soup kitchen that draws 70 to100 people.   

Then comes the lockdown 

Feeding the hungry has, in recent months, not been HOC’s only burden. Slowing the spread of coronavirus became a priority for South Africans after the implementation of level–five  lockdown on March 27.  The nation’s unexpected exposure to a highly infectious respiratory virus was going to result in many economic challenges for various sectors of the economy. Restaurants, schools and businesses  prepared  to close, and by the beginning of October, Statistics South Africa reported that 648 000 formal sector jobs had been lost during the covid-19 lockdown.   

  According to the  National Income Dynamics  Study – Coronavirus Rapid Mobile Survey (NIDS-CRAM), conducted  between May 7 and June 27,  two out of five adults reported that their household had lost its main source of income. Of 7 025 interviewees, 42% said they had run out of money to buy food by April.  The survey made it clear food security in South Africa  was threatened by shocking  changes to household–incomes. 

Food insecurity  was already having an impact on six million South Africans,  according to health journalism publication Bhekisisa. With a further loss of income came a greater dependence on government and NGOs for food security and grants, to stand in the gap and address people’s needs.   

With widespread economic hardship following in the wake of the covid lockdown, HOC  experienced a drop in its monthly debit order donations after its onset.  Not only were the Wednesday soup kitchens at stake, but more than 60 others across Gauteng too. The HOC children’s home, young mothers’ home and rehabilitation programme, which are all situated at the main HOC complex, had to be maintained somehow.   

 Pantry stock and human touch at risk — generosity and technology save the day

Pastor  McCauley  told  Wits Vuvuzela  they lost many faithful givers whose donations had been the backbone of the organisation’s budget.  Congregants from the home church, Rhema Bible Church, who had committed to monthly increments, were unable to  fulfil  those obligations.  Although the church may be perceived by many of the public to be for the middle to upper class, with  a well-off  congregation,  the financial effects of lockdown were  nevertheless  evident, although  it  is difficult to pinpoint what exactly disrupted the flow of monthly donations.     

 Thankfully, the  initial panic of not meeting budget was eased by an unexpected spike in once-off donations. This  supplemented HOC’s pantry stock losses  that were substantial due to  two local Woolworths stores not being able to donate as much of their sell-by goods as they had prior to lockdown. This  resulted  in a drop of up to 50% of stock in HOC’s pantry.  Mccauley describes their survival despite such lockdown blows by saying, ‘‘Again, I see God’s hand helping us through this period”. 

The side of the Hands of Compassion hall where their children’s village residents are able to read, relax and access computers. 4 November 2020. PHOTO: Leah Wilson.

 Financial woes aside, the human connection aspect of NGO work was also jeopardised. As the  soup kitchen model had to be revolutionised  to adapt to social distancing measures,  people could not be given prepared meals. HOC decided to  send e-vouchers to the 70-100 people who would ordinarily collect Wednesday meals. This meant they would be able to purchase whatever they needed, on their own.   

 Two weeks before national lockdown,  McCauley instructed her staff to  write down  the details of all  those who regularly attended:  “When I heard that this thing  [covid-19]  was coming, I said to my staff,  ‘You take their ID or passport  numbers.  You take their  cellphone  numbers and explain that we want to continue giving, but we must do it via  their  cellphone’,” the pastor said.  

The effectiveness of the e-voucher scheme is yet to be evaluated by HOC staff. They plan to visit beneficiaries  soon,  to assess whether their circumstances have improved in terms of health, financial independence  and overall lifestyle. As the plan is to reassign funds,  should a family no longer need them, challenges remain  for this new way of resource distribution. Buying airtime and ensuring  new  beneficiaries have cellular devices that are charged, as well as access to a participating e-voucher supermarket, are hurdles yet to be overcome.   

There seems to be a trend towards making use of digital technologies to help people.  According to an  extensive report published by  South Africa’s Parliamentary Monitoring Group  (PMG)  on May  29,  the Department of Social Development  (DSD)  partnered with NGOs  to assist anyone who needed  to apply  for  the R350  disaster relief grant. This  collaboration was intended to help anyone without access to a phone or technological  means of applying.   

As reported in a Daily Maverick article on  September  30,  the  NIDS-CRAM  survey,  states that  this grant has reached  4.4 million South Africans, or 12% of the country’s adult population.  The article further reports that 62% of grant applicants were still unemployed by June.  These funds are  therefore  an important form of assistance to broad  swathes  of South African society.    

Couches in the Hands of Compassion common area are marked with social distancing signs. 4 November 2020. PHOTO: Leah Wilson.

Another organisation that seeks to support food security and future independence for beneficiaries is  Joint Aid Management (JAM).   Established in  1984,  as  a Christian-based organisation that heads up child–feeding programmes  for 120 000 people  in  nine  of South Africa’s  11  provinces, JAM  operates in Gauteng in Orange Farm, Soweto, the Johannesburg CBD,  Hammanskraal  and Pretoria. 

During this year, JAM also had to adjust its food distribution model as a result of South Africa’s lockdown regulations.  During the beginning of lockdown,  lines for food parcels would last for hours, sparking the idea to send SMS notifications to families  to collect their packages. These collections would happen at  local preschools, spaza shops and churches during a specific time window, with social–distancing measures in place.    

 “We said, ‘how do we build back into those communities, and how can we use the small spaza shop and the preschool as a distribution point?’ We would get the food to them and they would get paid for the distribution on our behalf, which put something back into the community bodies,’’ David Brown, JAM’s managing director, told Wits Vuvuzela. ‘’That improved things, so there was still some funding in that local economy rather than all going out of it and into the big wholesalers.”  

Brown notes that because of South Africa’s strong GDP per capita, emergency funding had been sourced within the country, as opposed to the disaster relief which  JAM has seen  occur in other African countries  such as  Rwanda  or Mozambique, which required international  funders.   

Hands of Compassion employee mops the dining hall floor in the background while signs imploring social distance can be seen on the front door. 4 November 2020. PHOTO: Leah Wilson.

 A change JAM anticipates going forward will be the branding of spaza shops under larger retailers, so that purchasing power and supply chains are brought into  lower–income communities. Brown says this process was  previously  under way, but it has been accelerated by covid-19.   Transparency with donors became a priority during this time.  

Managing the trust of the donors was of paramount importance, because they wanted to be assured their money was being used in the most effective ways.  Brown  said some donors allowed JAM to use donations at its own discretion, while others were particular about their donation being for a specific resource.  

“We  must  respect that we have to be transparent, because we  must  maintain  trust with people,’’ said Brown.  ‘The minute  that  breaks down , the chances are that the funding will be withdrawn and it’s going to be placed somewhere else where there is trust.”   JAM had to  repurpose  its funding to accommodate the disaster relief circumstances imposed on them during lockdown. This meant partnering with other organisations that were transporting food, rather than using the infrastructures they normally would.  

“This  meant our vehicles were not running and we were not recovering the capital with fixed costs  that we would normally recover  from donor funding,” said Brown.  Brown emphasised that although emergency funding had compensated for any part of donations that did not come in, the possibility that this type of funding could dig into donor funds, and not match the needs of normal programming  costs,  remained.  

Tithes and offerings for public benefit 

 Public benefit organisations such as churches were not left out of the loop, as far as e-giving was concerned. Rhema Faith Life Church, based in  Bosmont, also  made the move to e-wallets.  Lead pastor Lester Holland told  Wits Vuvuzela  that because some congregants suffered retrenchment, salary cuts and other personal financial challenges,  25% of tithes and offerings fell away.  Families attending the church also needed sudden financial assistance and the church  was  able to support congregants with electronic payments.   

 The Citizen published an article  at the end of May  reporting that the South African Council of Churches, which unites 36-member organisations countrywide,  had requested financial assistance from government. As church income had been negatively affected,  salaries and other church expenses could not be met.   

Unfortunately, Rhema Faith Life church’s annual blanket drive was disrupted  because of  restricted mobility during lockdown and a smaller amount of funding.  Pastor Holland said, however, that Northcliff Spar donated food items to the church. Volunteers collected the items individually and distributed them from their homes. This was  a saving grace for those in need at the church and an unexpected solution to a lockdown curveball that hit them.  

 “For us personally,  we  know  we do not have any emergency fund. You know one thing about a church is that it is a public benefit organisation,’’ said Holland. ‘‘Whatever comes in always goes out to help people. There is more expenditure than what  is  coming in. Us having an account where we are setting aside finances that we would use for future, is definitely my thinking.”  

Holland told  Wits Vuvuzela  the staff of the church had to take a salary cut,  and he was not necessarily aware of any government assistance for employees involved in religious ministry.  

Crowdfunding and community-collaboration means light at the end of the tunnel 

 This highlights a point brought up in the text,  Adapting to Covid-19: Experiences of a Philanthropy Infrastructure Organisation,  by Gill Bates and Louise  Denysschen,  which states, “Moving funds during the pandemic also highlighted the gaps in current  compliance criteria, which excluded community-based organisations (CBOs) and small volunteer organisations and movements, which were clearly doing critical work on the ground, yet lacked the expertise, time, and resources to do the compliance work.”.  

 As the push towards digital technologies  plays a role in the NGO economy,  crowdfunding facilitator  BackaBuddy  told  Wits Vuvuzela  that  people were surprisingly generous during lockdown  and continued giving,  as more causes were registered on their website and more funds were paid into them.   

 “NGOs have turned to crowdfunding as another form of funding.  A lot of the charities used to rely on events for fundraising purposes, for example, the  Comrades/Argus etcetera, but with lockdown the events were cancelled or postponed,”  said  BackaBuddy’s  social media manager, Wanda  Zwane.    

Hands of Compassion chef, Thoko Mdluli, wearing her cloth mask while working in their kitchen. Photo: Leah Wilson

Navigating lockdown became a matter of survival at every level of life. Individuals, families, organisations and the country at large were moved by these adaptations. The concept of gathering funds together incrementally, to disperse for the benefit of others, is how the NGO economy has managed to survive. It is much less about the survival of organisations and more about those they serve.   

The social contact challenges presented by lockdown were fertile soil for NGOs to approach food security from an entirely new perspective. The e-voucher is a solution born out of the interesting collaboration between the  spirit of ubuntu,  the idea that  “I am, because you are”, and the saturation of  cellphone  technology, within even the poorest communities.   

 As buying power, technological advancement and financial autonomy  have the  potential  to  become  the new norm, it seems the NGO  economy  has found a way to create sustainable solutions. As seen in the examples cited here, this depends on preparedness, access to funding and an established relationship with communities as prerequisites for an effective covid-19 response.   

FEATURED IMAGE: Hands of Compassion chef, Thoko Mdluli, wearing her cloth mask while working in their kitchen. Photo: Leah Wilson.

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