NPO told to pay back R9m

2015-07-22 08:59

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Pietermaritzburg - The High Court in Pietermaritzburg has ordered a registered non-profit organisation (NPO), Mpilonhle Project, to repay more than R9 million in public funds to the Department of Social Development in KwaZulu-Natal.

The head of the department, Nokuthula Khanyile, said the money was paid to the NPO (which is registered in Ladysmith) in terms of an agreement reached in April 2012 for the roll-out and implementation of early childhood development centres in the province.

The NPO later said it wanted to withdraw from the project and would refund the money, but failed to do so. Since then it tried to retract its withdrawal notice, but the department will not accept the retraction.

Khanyile said Mpilonhle Project was expected to establish and construct two early childhood centres in the Umkhanyakude District Municipal area and three others in Uthungula District Municipality.

The department agreed to provide funding of R9 052 373.29 for the project and the money was transferred electronically to Mpilonhle Project’s bank account on April 3, 2012.

However, in a letter dated November 18, 2013, the NPO’s executive director, NP Zwane, advised the department that it wished to withdraw from the project and undertook to refund the money, said Khanyile.

The money was to have been repaid by March 10, 2014. However, despite an e-mail from the department’s finance section, the NPO failed to pay back the funds.

Khanyile said five months later, on April 9, 2014 the department received a letter from a firm of attorneys (BK Ndlovu) representing the NPO, stating that the NPO wanted to retract its earlier withdrawal from the project. However, Khanyile said the department did not accept this retraction and wants its money back.

Judge Yvonne Mbatha on Tuesday granted the application, ordering Mpilonhle Project to pay back the money, plus interest calculated from March 10 last year, to the date of payment.

The NPO was also ordered to pay legal costs.

An almost identical application for the return of R10 862 847 from Bhekuzulu Self Sufficient Project (an NPO registered in Estcourt), was adjourned for an indefinite period pending service of documents on the NPO.

According to the court file, the organisation was also assigned to establish three early childhood development centres in Uthukela and aMajuba district municipalities.

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