NAC IS RIGHT ON CONTRACTUAL OBLIGATIONS

 

NAC Is Right. SAACYF Is Wrong on Contractual Obligations: Setting the Record Straight on PESP 6

Yesterday, confusion has escalated within the Cultural and Creative Industries following the SAACYF media statement dated 09 February 2026, which challenges the National Arts Council (NAC) on what it terms additional contractual demands placed on PESP 6 beneficiaries.

While the concerns raised speak to broader frustrations within the sector, 

The Creative Passport is compelled to state clearly and responsibly: on the issue of contractual obligations, the NAC is correct — and SAACYF’s interpretation is flawed.

This article is not written to undermine artists, practitioners, or representative bodies. It is written to protect beneficiaries from misinformation, and to remind the sector of a hard but necessary truth: a signed contract governs obligations, not selective readings, assumptions, or public sentiment.

                     Image Source: SAACYF

The Core Problem: Contracts Are Not Being Properly Read

One of the most uncomfortable realities in the Cultural and Creative Industries is that many practitioners sign contracts without reading them thoroughly. 

Others read selectively, focusing on payment schedules while overlooking compliance, monitoring, and reporting clauses.

There is also a worrying trend of:

- Rushing contract signing to trigger payments

- Treating public funding contracts as informal agreements

- Assuming guidelines override signed contracts

This is a dangerous practice — especially when dealing with public funds governed by the PFMA.

Once a contract is signed, it supersedes informal expectations and sector interpretations.

               Image Source: SA Government 

What the NAC Contract Actually Says

Contrary to the SAACYF statement, the PESP 6 beneficiary contract already empowers the NAC to request information, documentation, and material beyond what some beneficiaries believe to be “new demands”.

Clause 4: The Grant

Clause 4.2 clearly states:

- The NAC reserves the right to introduce any new requirements and/or additional conditions as pertain to the Programme/Project.

This clause alone dismantles the argument that the NAC is prohibited from introducing further requirements post-signature.

Beneficiaries agreed to this clause when they signed.

Clause 5: Acknowledgements and Obligations of Beneficiaries

Clause 5.2 states:

- The Beneficiary further understands that the provision of the grant is at the sole discretion of the NAC and consequent upon the NAC having verified and continuing to verify the validity of information and documents provided or which will be provided by the Beneficiary.

The words “continuing to verify” are critical. Verification is not a once-off event tied only to application stage.

Clause 5.3.10 further provides that:

- The NAC has the right to use the Beneficiary’s and/or Programme/Project’s name in its own publicity material.

Publicity and visibility are therefore explicit contractual rights of the NAC, not optional extras.

Clause 5.3.13 goes even further:

- The Beneficiary also undertakes on request from the NAC from time to time, to furnish the NAC with documented proof of expenditures and to provide such additional material including video material, photographs, posters and pamphlets as the NAC may reasonably require to confirm that the allocation has been utilised according to the original and/or revised Programme/Project Plan.

This clause directly contradicts SAACYF’s claim that requests for video material and documentation are “outside the contract”.

They are not.

They are explicitly anticipated.

Clause 7: Specific Obligations and Rights of the NAC

Clause 7.3 states:

- The NAC shall monitor the progress of the Programme/Project through site visits and verification of Programme/Project progress reports submitted by the Beneficiary.

Monitoring is active, ongoing, and evidence-based. It is not passive or optional.

Why Clause 10 on Breach and Termination Matters

Many beneficiaries appear unaware — or unwilling to engage with — Clause 10 on Breach & Termination.

This clause outlines:

- What constitutes non-compliance

- The consequences of failing to meet contractual obligations

- The NAC’s rights to suspend, terminate, or recover funds

Ignoring Clause 10 does not make it disappear. It only exposes beneficiaries to risk.

Where SAACYF Gets It Wrong

SAACYF argues that:

- New obligations cannot be introduced after signing

- Beneficiaries cannot be penalised for non-compliance

This argument might hold in private contracts, but fails in public funding agreements where:

- Discretionary funding applies

- Oversight is legally required

- Contracts explicitly allow evolving requirements

The assertion that additional reporting or promotional material constitutes “unlawful unilateral variation” ignores Clause 4.2 and Clause 5.3.13 entirely.

That omission is not insignificant — it is fundamental.

A Serious Concern: Representation Without Contractual Literacy

The Creative Passport is deeply concerned that:

- Beneficiaries may be misled into non-compliance

- Artists are being encouraged to resist lawful obligations

- Public statements are made without reference to actual contract clauses

Advocacy without contractual literacy does not protect artists — it exposes them.

A Necessary Reminder to Beneficiaries

Public funding is not charity.

It is regulated, conditional, and monitored.

Beneficiaries are urged to:

- Re-read their signed contracts in full

- Pay close attention to Clauses 4, 5, 7, and 10

- Seek legal or professional advice before rejecting compliance requests

- Understand that accountability is part of the funding exchange

        Image Source: The Creative Passport 

Conclusion: Accountability Is Not an Attack

The NAC’s requests for documentation, visibility material, and verification fall within the scope of the signed PESP 6 contract. 

While communication timelines and implementation sensitivity can always be improved, the legal basis for these requests is sound.

The real issue confronting the sector is not contractual overreach 

it is a culture of signing without reading and reacting without verifying.

If the Cultural and Creative Industries are to mature, protect public funding, and strengthen institutional trust, then contractual responsibility must be taken seriously — by everyone.

The Creative Passport will continue to prioritise clarity over noise, facts over sentiment, and sector education over misinformation.

The Creative Passport is an independent platform focused on Arts, Culture and the Creative Industries. Readers are encouraged to follow, comment and engage constructively.

                   

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