Funding social development overview

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The most widely known role of the National Lotteries Board (NLB) is its funding of non-profit organisations that play a role in the development of our society - through sport and recreation activities, through initiatives in the areas of arts, culture, national heritage and conservation, and through social services - including community health and literacy projects.

In the first decade of the National Lottery, the NLDTF has allocated more than R11 billion from the National Lottery Distribution Trust Fund (NLDTF) to non-profit organisations doing essential work in all of the above fields. At present, 34 percent of lottery ticket sales is transferred on a weekly basis into the NLDTF and this forms the pool of money from which good causes are funded.

Members of the NLB share the public perception that this contribution to the development of our nation is the heart of the Board's work and it gives depth of meaning to all our other activities.

However, it is also a particularly challenging aspect of the NLB's work because board members are trustees of the NLDTF. This means we are guardians of the money contributed by millions of Lottery players through ticket sales. Therefore we must balance the desire to help valuable and inspiring initiatives with our responsibility to ensure all monies allocated by the NLDTF meet the funding requirements and regulations, and are put to good use.

We are assisted in this by three committees, known as distributing agencies, which are appointed by the Minister of Trade and Industry to award grants from the NLDTF. They are selected for their expertise in the specific sector for which they allocate grants. These are:

• Charities, which includes a vast range of welfare and social development interventions.
• Arts, Culture and National Heritage, including our environmental heritage.
• Sport and Recreation.

The NLDTF also makes occasional grants for Miscellaneous Purposes. These are projects that might fall outside any of the above fields but meet requirements set by the Minister of Trade and Industry. The members of the NLB adjudicate these applications.

How sectors share the NLDTF funding pool

To be eligible for National Lottery funding, organisations must be non-profit entities - such as NPOs, NGOs, Section 21 companies, public benefit trusts, municipalities, and institutes of learning - and work for the public good.

The system of allocation is designed to safeguard against abuse and to bring elements of fairness and transparency into the process.

• Applications are adjudicated by distributing agencies, meaning that a committee rather than a single individual makes funding decisions.
• The total amount available for allocation in each funding sector is set down in regulations.
• The kinds of organisations and types of activities that qualify for funding are also specified in regulations.
• The application form and the documents that must accompany the application form are also prescribed in regulations.

Gradual growth in transfers to the NLDTF

Over the first decade of the National Lottery (financial years 2001 to 2010):

• The value of ticket sales has exceeded R36 billion.
• Close to R10 billion has been transferred to the NLDTF. This amount plus interest earned on the NLDTF account are available for allocation to good causes.
• More than R11 billion has been allocated to thousands of beneficiaries. Allocations from the fund have exceeded transfers into the fund because of the interest accrued and because some allocations are for multi-year projects and therefore project into the future.

Transfers to NLDTF from National Lottery revenue per financial year (R billion)