Two organizations that received grants totaling nearly R114 million from the Gauteng Department of Social Development in the past two years are currently under investigation as part of a broader probe into the department’s funding of non-profit organizations. The Beauty Hub Academy and Daracorp, awarded multimillion-rand grants, have sparked controversy, leading to the precautionary suspension of several department officials.
The investigation, initiated in October and scheduled to conclude in March, has already resulted in the suspension of four department officials, with additional individuals potentially implicated. While the probe extends beyond the mentioned organizations, the department has not disclosed further details.
Beauty Hub Academy, specializing in hairdressing and beauty therapy training, and Daracorp, focused on training small-scale rural and urban farmers, received grants of R30 million and over R26 million, respectively, for the 2023/24 financial year. In the previous financial year (2022/23), they were allocated R33.7 million and R23.9 million, respectively.
The sizable grants have raised concerns among other grantees, particularly amid budget cuts affecting key areas such as HIV, community care, older people, and poverty relief. Questions have been raised about the allocation of significant funds to subsidize training by these two organizations compared to others receiving less support.
Responding to the investigation, the department emphasized its commitment to addressing malpractices and questionable funding practices. The ongoing investigation prompted the creation of an independent Non-Profit Organization Evaluation and Adjudication panel, tasked with scrutinizing, evaluating, and adjudicating applications for funding. This panel will also conduct periodic monitoring and evaluation of funded non-profit organizations.
During the current financial year (2023/24), the department allocated grants exceeding R2.13 billion to organizations offering social services, solidifying its position as one of the sector’s largest funders. In the previous financial year, it awarded R2.36 billion. The department aims to maintain support for hardworking non-profit organizations while addressing maladministration through the ongoing investigation, according to Mbali Hlophe, Gauteng MEC for Social Development, Agriculture, and Rural Development.
