Expected R7 million cut in grants next year
The Community Chest has called an emergency meeting with its beneficiaries to warn them of an expected R7 million cut in grants next year.
They were told they needed to start making contingency plans.
The organisation provides funding to 487 recipients, with grants ranging from R18 000 to R1m a year, according to Community Chest chief executive Amelia Jones.
Last year it paid R16m to beneficiaries but expects this figure to drop to R9m in the 2011/12 financial year.
"How we are going to cut the cake will be our big challenge," a concerned Jones disclosed after yesterday's meeting.
Some of the organisations that receive funding cater to the elderly, homeless and physically and mentally disabled. The Community Chest also supports rehabilitation and community development projects.
Danie Digue, financial manager of the Helderberg Society for the Aged, said that without Community Chest funding the poor would suffer most.
The society runs two old-age homes and Digue said 50 percent of residents were unable to pay.
It also owns nine blocks of flats, three of which are occupied by pensioners who pay only R450 to R500 a month in rent.
The society runs community outreach programmes in Lwandle, Nomzamo, Garden Village and Chris Nissen Park where the elderly and disabled are taught various skills to encourage economic independence.
Digue said each of the components was running at an enormous loss.
If funding was lost, the outreach programmes would have to be closed down.
He said they had approached the private sector for financial help but without very much success. "Today old people are not a favourite. People just don't care about the aged any more."
Hassan Khan, chief executive of the Haven Night Shelter Welfare Organisation, said the Community Chest was an integral part of its operations.
Every month 13 of its shelters were granted R2 500 each. The Ceres and Swartland shelters, in particular, would be in serious trouble if they lost the grant.
He added, however, that they would have to relook at how much they leaned on the Community Chest for funding, and to see where they could cut back.
Khan said that there were beneficiaries - especially in the rural areas - that were completely dependent on their Community Chest grants.
All the bigger, more mature organisations had the responsibility to ensure they checked out all possibilities for funding so that they did not take away from beneficiaries in the rural areas.
Jones confirmed that many of the beneficiaries operated from hand to mouth and, in some cases, their operating grants were what enabled them to keep their doors open.
The future of these places was now in jeopardy.
Jones explained that the Community Chest had seen a 50 percent decrease in corporate and individual donations this year.
The Community Chest was largely funded by the private sector, and family trusts and legacies.
These donations were dependent on investments, and returns had been low because of the recession, Jones explained.
Another source of income was the Pay As You Earn initiative.
Those who donated in this way were mostly factory workers and people from other low-income groups.
Few high-level earners were involved in this initiative.
Fanzu Badenhorst, who works for Shape, a service provider to the Department of Social Development, also attended the meeting.
He said the onus was now on organisations to intensify fundraising efforts, but admitted it would be difficult in small, poorer towns.
His company would help organisations apply to other sources for funding.
"For the current year they will be okay. But 2011/12 is probably going to be a very difficult financial year," Badenhorst said.