The global financial crisis: experiences of and implications for community-based organizations providing health and social services in South Africa

The global financial crisis that began in 2008 with the collapse of the US real estate bubble is considered the worst economic turmoil since the Great Depression in the 1930s. While the crisis has negatively impacted the global economy and the flow of aid to Sub-Saharan African countries, little is known about the implications of the crisis for community-based organizations (CBOs) providing health-related services in marginalized communities. We conducted qualitative interviews with managers of 14 CBOs providing health and social services to marginalized communities in South Africa about their experiences of the crisis. CBOs reported experiencing a marked decrease in funding received from both international and local donors as a result of the global financial crisis. At the same time, they experienced difficulties in securing new funding. Organizations addressed the funding problems by conducting organizational restructuring and implementing austerity measures that led to the retrenchment of staff, reduction in benefits and incentives for staff and volunteers, reduction in the number of communities served and rationing of services provided to these communities. These measures had negative psychological impacts on paid staff and volunteers and contributed to absenteeism and attrition among volunteers, and some of the organizations eventually closed down. Our findings show that the global financial crisis has far-reaching implications for health, social and developmental services delivery and ravaging impacts on the economy of marginalized communities. Policy-makers should explore mechanisms for protecting CBOs from the effects of economic shocks to guarantee the provision of critical services to marginalized communities.