The move to Level three of the nation-wide lockdown is
an immense step forward for our economy as approximately 15 million people returned
to work. While many businesses are happy to open their doors, others will unfortunately
remain closed.

Consequently, the economy, already in recession, will keep
plummeting. Before the Covid-19 pandemic, South Africa had an unemployment rate
of 29,1{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} and the Chamber of Commerce predicts it could rise to 50{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}. As the
lockdown continued over the last 60-plus days, there were growing signs of
discontent and calls to end the lockdown as it is causing economic and social
issues. It is suggested that 34{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} of South Africans have gone hungry during the
lockdown. As a result, we have recently seen a spike in protests and people are
asking for action.

Fortunately, several food banks have been established
in poor communities and funds have been made available to expand these services. Non-profit organisations (NPOs), in particular, have
played their part in alleviating the plight of millions of South Africans.  Even though their efforts sometimes go
unnoticed, the over 220 000 NPOs registered with the Department of Social
Development play a vital role in many different industries and communities.

Attending to the crisis

The crucial contribution of NPOs is underscored by Dr
Armand Bam, Head of Social Impact at the University of Stellenbosch Business
School (USB), who stated recently in a blog post that “What is worth
considering is that NPOs act in communities where government and businesses are
not able to reach. They are accessible and agile to attend to the current
crises and need our support.”

Highlighting their
precarious situation, Bam said that “while government can rely on our
taxes to stay operational and well-resourced businesses tap into financial
reserves, NPOs primarily rely on donations and personal fundraising to ensure
service delivery. Many of these organisations are now facing the threat of
downsizing and retrenching staff while the need for their services increases.”

The last 60-plus days have proved how important these organisations
are in our society as they continue helping those in need while their own resources
dwindle. Due to a lack of support, many NPOs are now facing closure which will result
in more job losses. While the government has put in place a R500 billion
bailout plan, no financial support has been set aside specifically for NPOs. Having
some of these organisations close their doors would be terrible for the
communities they serve. The support
they get from various donors is often not enough. Just when they’re needed most
during the Covid-19 pandemic some NPOs have lost their donor support.

In an interview I had with
people at an NPO, one person said, “It is a frustrating time for NPOs,
because in all their efforts they [NPOs] are still not a recognised sector
unless connected. We still continue to persevere to ensure our beneficiaries
get help during these stressful times because we made an oath and we take it
seriously.” Another indicated that donors are
reluctant to donate to NPOs during the Covid-19 lockdown and they rather donate
to the Solidarity Fund. The efforts of the Solidarity Fund are not dismissed,
but smaller NPOs do not have the time to apply for funds.

A much-needed sector lacking support

For them it is merely about survival and they operate
from day to day to deliver much-needed services to their beneficiaries. It is
here where society’s comprehension of the social economy breaks down. This is a
much-needed sector that provides services to a large part to our society;
however, they lack the proper support from both the public and private sector.
This leads to a vicious circle: with the lack of proper resources and funds, an
NPO cannot grow and become more professionalised, and without becoming more
professionalised, they rarely receive more donations.

It
is, however, not all doom and gloom when it comes to funding in these trying
times. There are resources that NPOs can access that could help them to
continue providing vital services to suffering communities. Some of these
resources include the Gap Fund established by the Investment Group Mergon,
the Charities
Aid Foundation Southern Africa
and the Forgood Blog.

The social economy is a very complex phenomenon in
South Africa as it is extremely vital for delivering crucial services to a vast
majority of our country. Unfortunately, it is overlooked by government and not
always taken seriously by donors. This leaves NPOs to fend for themselves. However,
these organisations thrive on their mission, commitment and compassion which
make them highly efficient and resilient amidst the Covid-19 pandemic. Our
situation would be much more precarious without them.

*Anika
Berning is a lecturer in the Department of Business Management at Stellenbosch
University. She is busy with her PhD focusing on management systems and
strategy in NPOs. Views expressed are her own. 

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