Applying for Grants in South Africa: An Artist’s Nightmare
Applying for Grants in South Africa — An Artist’s Nightmare
As an independent artist studio, the socio-economic effects of the Covid-19 Pandemic have been absolutely devastating. Even in a very profitable family business with very low overheads, the financial burden of the pandemic cannot be resolved by any amount of hand holding or words of comfort. It requires urgent solid financial intervention and assistance for small businesses like ours to make it out of this sane, fed and with a new, sustainable business plan to keep the studio afloat in the face of possible future disruptions and lockdowns.
Thanks to the extreme and politically fraught lockdown, we were effectively shut down as a studio over the busiest season, unable to export works due to the closure of commercial postal and courier services (reinstated on 01 June, but subject to conditions that make it financially impossible to export work). Galleries and the art world shut their doors and no shipping was permitted, cutting our prime time for sales. Every year, galleries and artists plough all our energies and funds into preparation for the summer season which accounts for almost 80% of our annual sales, so the pandemic and fallout thereof has had a catastrophic economic impact.
Applying for the various abstruse funding programs offered by the South African government, it’s partners and the major banks, has been an exercise in futility and madness. With Cyril Ramaphosa’s promise of billions of rands of aid, this money has not been accessible to most grass-roots applicants. Sold to the South African public as “donations” and grants, it was later clarified that assistance would only be made available to businesses in the form of loans. This despite many private charities and individuals making huge donations with no promise of any repayment.
something that is given to a charity, especially a sum of money.
a thing that is borrowed, especially a sum of money that is expected to be paid back with interest.
It is left for us to speculate where all the smaller donations will go when the loans are repaid. Or has public generosity simply reduced the risk for private speculation here?
During the process of applying for the grants as I have set out below, it became unnervingly apparent that we were experiencing recurring themes in the various application processes. In Summary, these were (but not limited to):
Support for salaries was not offered unless the business and employee were registered for UIF: therefore not applicable to businesses who rely on freelancers even with full tax compliance and Chartered Accountant Confirmation of Earnings.
Funds were masqueraded as grants but mostly turned out to be well camouflaged loans. No real funding, no real grants, no real help, no real bailouts — but a devious and dangerous invitation to a rabbit hole of debt that no one would be sure they would be able to repay on the other side of this pandemic.
Assistance was available for registered businesses only: ie (PTY) Ltd or CC. Support for Sole Proprietors would only be available if the company had been registered with the Companies and Intellectual Property Commission prior to the lockdown.
No tangible or sustained financial support has been made available to informal businesses such as independent artists or the freelance/ casual labour they employ to run their businesses. Even with full Tax Compliance and Chartered Accountant Confirmation of Earnings. This despite these businesses making up an enormous proportion of the economy and primarily being owned by the most economically vulnerable. Support offered to informal businesses comes in the form of food and electricity vouchers which cannot obviously be used to pay employee salaries or pay rent.
Due to the lack of promised transparency, not only have millions in donor funding gone into the pockets of the upper and middle income management and intermediaries who didn’t get laid off, the funds are loans which must be repaid, meaning the wealthy creators and managers of the fund get wealthier by the generous donations intended for the poor. Coupled with the massive increase in layoffs this ensures that most of the money went to upper and middle management salaries for larger companies. It appears news of the destructive nature of “trickle down economics” has not yet reached South Africa’s bureaucracy
Set out below is a detailed description of grant and financial aid opportunities that we have applied for.
1.1 Covid-19 Payment relief plan
application process started via email (the email address provided on www.absa.co.za for applications: email@example.com & firstname.lastname@example.org
emails submitted bounced
application submitted via the ABSA website portal. Notifications that feedback would be received in 7 and 14 days respectfully. No feedback was received.
Going back and scrutinizing the website, I noticed that the email addresses for submission had changed. Applications resubmitted via email to email@example.com & firstname.lastname@example.org
Notification received for both emails with a further waiting period of 7 and 14 working days respectively. No feedback within the stipulated time period was received
Eventually, we were notified that Kim did not meet the criteria for debt relief. No explanation or reasoning was given. With a perfect credit history, full accounting records and perfect tax compliance, it is beyond me why ABSA was unable to provide any relief whatsoever. Needless to say all fees and interest are still being charged on all accounts with an increased interest rate.
1.2 Application for extension of credit
In the meanwhile, Kim began exploring the option of extending her credit to be able to afford the running costs of the studio as well as paying me as her freelance studio manager for the duration of the lockdown.
This was a glaring demonstration of the ethical failure of ABSA as a financial institution. Kim received notification, a week before lockdown, that she had been preliminarily approved for an increase on her current credit facility. Kim began the application process online and saved the application to be completed later that week. Lockdown happened and, despite sms reminders to complete her application, Kim was denied access to her incomplete application. When a query/ complaint was lodged with ABSA, she was told that her application did not exist. Kim has fortunately kept records and screenshots of both the offer of increase as well as the sms’s from ABSA reminding her to complete her incomplete application. Confused fumbling and garbled communication from ABSA ensued.
Even as the complaints department continued to trip over their own words and avoid evidence, Kim was offered a Personal Loan at what can only be deemed a predatory interest rate of 22%. She kept screenshots and ensuing sms messages, as well as phone records of ABSA following up on the predatory loan, but very politely declined ABSA’s dodgy offer.
To date, all options explored for assistance from ABSA have proved fruitless and virtually no assistance has been received from ABSA.
2. SMME Relief Fund: Department of Small Business Development and The Solidarity Fund
Just three months after the funding was originally announced by the president, it is now completely depleted. The application process was extremely laborious and complicated -rife with a multitude of “technical difficulties”. The application process would have been entirely inaccessible to anyone without a high degree of management or bookkeeping experience, nevermind the necessity of access to unlimited airtime and data. According to www.dsbd.gov.za, only 1497 businesses have received assistance from the SMME relief program of which only 198 are in the Western Cape. R513 million / 1497 = R342 685.37 per applicant. This screenshot was captured from the Department of Small Business Development’s website on 24.06.2020.
The application process
02.04.2020 I submitted an email requesting assistance (as indicated on the website as a service offered to small businesses) to email@example.com. The email bounced. I also attempted to register on the website https://www.smmesa.gov.za/ several times. I never received any confirmation that we registered successfully. The site crashed and timed out constantly.
02.04.2020 A phone number was supplied to report technical difficulties. I phoned this number multiple times throughout the two month process, only managing to get through to an actual person ONCE. Soon after this, an automated voice message was set up to inform callers that the call centre had been shut down due to the new Level 5 lockdown regulations.
06.04.2020 I resubmitted the email requesting assistance (as indicated on the website as a service offered to small businesses) to firstname.lastname@example.org. The email bounced.
07.04.2020 I resubmitted the email requesting assistance (as indicated on the website as a service offered to small businesses) to email@example.com. The email bounced.
08.04.2020 I received an email including application form
09.04.2020 I submitted the completed application form and all supporting documents to firstname.lastname@example.org
10.04.2020 The email bounced
13.04.2020 I resubmitted the application and supporting documents. email@example.com
28.04.2020 received automated response indicating high volumes of applications
29.04.2020 received this response:
Thank you for your enquiry at the Department of Small Business Development.
Kindly note that the department is currently receiving a high volume of registrations on the SMME portal. Please try and register during off-peak hours or alternatively, reduce the information in the boxes from the questions you need to provide explanations.
DSBD Client Liaison
Hotline: 0860 7867”
At this point, I would like to highlight that the communication above requests that the amount of information submitted be reduced. Of course, this was not possible as the entire online platform, nevermind our application, was inaccessible.
12.05.2020 I received an email indicating unspecified missing documents.
17.05.2020 I resubmitted supporting documents and application to firstname.lastname@example.org
27.05.2020 An email was received indicating the following:
“Since the opening of the Scheme, sefa received an avalanche of applications and these comprised of both complete (where applicants submitted all relevant supporting documents) and incomplete (lacking minimum mandatory supporting documents) applications. Due to an oversubscription of this Scheme, the entire budget that was allocated towards the Debt Relief Scheme has been fully committed — with the unintended consequence that some of the pending applications will not be processed by sefa.
It was identified that most of the pending applications intended to use a large portion of the loan proceeds to cover their payrolls. In this regard, the DSBD has entered into an agreement with the Unemployment Insurance Fund (UIF) to ensure that SMMEs that previously did not qualify due to non-compliance can be covered by the UIF provided they agree to the terms and conditions under which UIF covers payroll benefits, which amongst others include an acknowledgement of debt as well as payment terms with the UIF.”
In summary, the funds were depleted. The money for this fund had already been used, mostly to cover payroll for the formal sector. Given the huge number of layoffs, this most certainly included top and middle management but not a large proportion of workers. There was no money left. The only option would be to apply for debt relief funding via the Solidarity Fund through the banks (please refer to point 1) or through the Unemployment Insurance Fund. Both these options are not applicable to freelancers, informal businesses or independent artists, even with full Tax Compliance and Chartered Accountant Confirmation of Earnings.
3. Oppenheimer — The South Africa Future Trust
The purpose of this fund was to assist small enterprises in paying their employees salaries. Even with full Tax Compliance and Chartered Accountant Confirmation of Earnings, you could not register for support from this loan scheme unless you were registered for UIF. The trickle-down theory once again rears its poverty-inducing head. Applications for this fund were to be submitted through your bank (see point 1). No help for the independent artist, informal businesses, the freelancers or part-time labour they may be supporting. It is important to note that many press releases at the time stated that unlike “other” relief funds: this was actual relief donation and not a loan. Much emphasis was placed on the word “donation.” However funding was only accessible through the applicants bank account (ABSA, FNB, Nedbank and Standard bank) as a LOAN to be paid back.
To reiterate an earlier point, here are some concise definitions:
something that is given to a charity, especially a sum of money.
a thing that is borrowed, especially a sum of money that is expected to be paid back with interest.
4. Tourism Relief Fund — awaiting feedback/ pending
This fund is directed at businesses in the tourism sector who have been directly impacted financially due to the pandemic hitting our shores in the middle of our peak tourist season. As most of our sales and turnover are directly reliant by South Africa’s tourist season, we applied as follows:
08.04.2020 Application submitted
16.04.2020 Notification received requesting patience from applicants due to the massive influx of applications
23.04.2020 Follow up email sent
28.04.2020 Follow up email sent
29.04.2020 Email received confirming successful submission of application
05.05.2020 Email received requesting that online application via a portal was required. All email submissions were rendered invalid. All applications and supporting documents was to be resubmitted from scratch through a rigorous and time consuming process that required intricate file naming and uploading.
06.05.2020 All documents submitted via the online portal
25.05.2020 Email received indicating submission of incorrect BBEEE affidavit. It was never previously indicated that the generic and widely accepted BBEEE affidavit template would be unacceptable and that a specific Department of Tourism affidavit was required.
28.05.2020 Department of Tourism specific affidavit uploaded via the portal
To date, we have received no further communication from the Department of Tourism.
5. The Department of Sports and Culture Relief Program
This fund was supposedly created to assist artists, performing artists and the sports sector. Upon closer inspection, I uncovered that this fund was only directed at planned events such as cancelled sporting events or music concerts. It was also mainly a platform to assist the organisers of such events and to pay events management staff, with possible funds for the actual performing artists/ visual artists that were scheduled to perform. It was also required that the management would need to provide proof that such an event existed and was subsequently cancelled due to Covid-19. It was not in any way a fund to provide relief to individual or independent artists and seems to have mostly funded sports management. The following statement has been released on the Department of Sports and Cultures website:
“ARTS AND CULTURE
By the deadline of 6 April 23h59, the Department had received 6, 000 submissions. After processing the data, approximately 5, 000 were COVID-19 Relief Fund applications.
The adjudication process has overseen 1, 000 out of these 5, 000 applications.
Of these 1, 000 applications, 105 have been approved and are being processed for payment.
The Department, together with the adjudication committees, is devising mechanisms to fast track the process.
It is however important to note, with concern, that most of the applications did not meet the basic requirements, as stipulated in the criteria for application.
This ranges from lack of proof of cancellation of events, to outstanding basic personal information, et al…
The major concern about this is that most of these applicants are people who seem to be the hardest hit by the impact of COVID-19.
The Minister will give feedback on the outcomes of the adjudication process in the next few days.”
6. Vulnerable Artist Fund
This fund was focused on immediate and emergency aid for artists unable to buy food, electricity or pay for their accommodation. As our position up to this point has been circling the drain as opposed to down the tubes, this is not yet an option for us.
I would like to emphasise that word though: Yet.