According to National Arts Festival chief executive Tony Lankester, a third of their funding comes from the national Lottery which has been assisting the festival since 2002.
The change implemented last year means that if an organisation receives a grant, as the festival did in 2016, they may only apply for a new grant the following year.
"In other words it’s a cooling-off period,” said Lankester. “My issue is with how badly this is being handled.
"The whole notion of cooling-off is not right. One size does not fit all.
"We are employing artists, and we’re creating a platform. It’s actually immoral,” he said.
The National Arts Festival receives R10 million from the national lottery and this year Eastern Cape Premier Phumulo Masualle had to step in to “bail out the festival to keep the lights on”.
Other funding comes from Standard Bank and the Department of Arts and Culture.
“How this happened was that there was a time when we got three-year grants, which made it easier, but with the new regulations it means effectively there is this hiatus.
"For 2018 once again we will be alright, but then it’s the same scenario,” said Lankester.
He said one possible reason for the new regulations is that large organisations have to be audited and that many had side-stepped this requirement by creating smaller organisations to apply for grants.
Lankester, who has been living in Grahamstown for the past 10 years, since he has been at the helm of the festival, added: “The lotto will turn around when criticised and say organisations shouldn’t be so dependent on them.
"But that’s why the lottery exists.
"The regulations are for everybody and we’re talking billions upon billions of rands.
"So actually the new regulations’ unintended consequence is extremely damaging.
"There will again be uncertainty in 2019, despite the fact that we will be fine for next year in terms of funding.”
The festival employs about 400 people, ranging from security officials to technicians to facilitators who together make sure it all runs smoothly for the hundreds of thousands who descend on the Eastern Cape for a brief but highly intense period, often generating some families’ sole income, if not for the whole year, for several months.
Unemployment in the Makana district is at about 70000 and thousands apply for the temporary jobs at the festival, but Lankester pointed out: “Unfortunately demand outstrips supply by at least 20%.”
While many festival lovers walk around the streets in a state of euphoria, it’s difficult not to notice the dozens of people begging on the streets and the countless times festival-goers are asked for food or to look after their cars for a tip.
Like those who are seeking official, albeit seasonal employment, the more indigent folk are also trying to make the most of the money outsiders bring in.
So there's a ripple effect from those who hold the purse strings at the lottery down to those who give out festival jobs, down to the last step of the ladder where those who are dependent on the few rand they score daily from the show-goers are.