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Events & Issues
New Delhi, 4 May 2015
NGO Accountability
ISSUES BEYOND
FINANCE
By Dr S Saraswathi
(Former Director,
ICSSR, New Delhi)
The NGO sector has been given a big jolt by the Government. In
a crackdown on foreign funding of NGOs, the Home Ministry has placed the Ford
Foundation of the US
on its watch list and ordered that all funds coming from international
organizations should be routed only with its approval due to “national security
reasons”. Every transaction involving foreign funding has to be cleared by the Finance
Ministry’s Department of Economic Affairs. A rude shock, indeed, whatever the
provocations!
This seems to be the response of the Union Government to a
complaint by the Gujarat Government that this reputed US Foundation was interfering
in India’s
internal affairs, and abetting communal disharmony. The complaint specifically
mentioned Sabrang Trust and Citizens for Justice and Peace, which were
receiving support from the Ford Foundation and were suspected to be indulging
in activities prejudicial to communal harmony.
Ford Foundation has been a major donor for many research and
social welfare projects in India.
A total of about 1,200 institutions have received funds from it since 1952.
The government has also suspended the registration of
Greenpeace India
for six months and froze all its accounts. This NGO had a record performance of
mobilizing over two-and-a-half lakh people from drought-affected areas to
protest against diversion of water meant for agriculture and drinking to other
purposes. It was a typical case of clash between NGO-headed popular movement
and government-driven development process.
According to press report
42,273 NGOs are now put under watch after intelligence agency reports claimed
that several charity organizations were diverting funds for purposes other than
the permitted use of foreign contributions. The list includes organizations
engaged in varied activities.
In October last year, over 10,000 NGOs were given show cause
notice for not filing their annual returns of foreign funds and asked to
justify why their licences should not be cancelled. Many of these have still
not responded. This has resulted in cancellation of licences of nearly 9,000
NGOs for violation of Foreign Contribution Regulation Act (FCRA). Evidently,
they have not taken their responsibility and accountability seriously to be
ready to comply with rules and regulations before being questioned. The
situation, however, by itself does not indicate any wrong doing.
These drastic steps are bound to affect local, national, and
international NGO activities in India.
The country has witnessed a mushroom growth of voluntary grassroots
organizations as well as global network organizations since the 1990s. Their
work has been found so useful and constructive that the Government of India
itself has been promoting and encouraging them to take active part in
implementing some of its schemes.
The 8th Five Year Plan, for instance,
acknowledged that NGO involvement would give great impetus to Family Welfare Programmes.
A Standing Committee for NGO projects was constituted to bring transparency and
speed in sanctioning NGO projects.
In UPA-I, representatives from NGOs were taken as members of
the National Advisory Council (NAC) headed by Congress President Sonia Gandhi. However,
in recent years, NGOs have been facing mixture of encouragement and
restrictions. Major political parties became serious about cultivating and
utilizing the services of their own NGOs. Indeed, not all NGOs are
non-political in spirit and substance.
In India,
the label NGO, as in many other countries, is liberally applied to denote any
non-governmental organization. Schools, hospitals, charitable trusts, cooperative
societies, religious associations, neighbourhood organizations are all deemed
to be NGOs and are registered as trusts, societies, and non-profit
organizations. CBI has estimated that there are over two million non-profit
organizations working in India,
i.e. one for every 600 people.
These have received about Rs.11,070 crore during 2013-14. On
top of the list of donors was the US
with donations of Rs.4,491 crore followed by the UK with Rs.1,347 crore. The policy
of the governments generally is not to solicit foreign funds, but at the same
time not to reject funds for bona fide welfare activities with prior permission
from the Centre.
In June 2014, the Centre banned direct foreign funding for
NGOs operating in India
unless they fulfilled prescribed regulatory norms and submitted compliance
reports. There is some similarity in the approach of the present and the
previous governments.
“There are NGOs, often funded by the US and Scandinavian
countries, which are not fully appreciative of development challenges that our
country faces”, observed then Prime Minister Manmohan Singh of UPA-II, in 2012 when
he faced opposition for genetically modified crops and the civil nuclear plant
at Koodankulam. The remark was resented by a strong NGO lobby as a “highly
inappropriate and misrepresentation of facts.”
With increasing instances of clash between NGOs and
development projects, the need for monitoring the activities of the NGOs arose.
Conducting an inquiry into the operations of NGOs started
long ago, when Indira Gandhi set up the Kudal Commission in 1982 shortly after
she returned to power after the period of Internal Emergency. It was a political move to clip the wings of
NGOs that were behind the rise of anti-Emergency movement and the downfall of
the Congress one-party rule. This enquiry raised questions regarding funding
and functioning of the NGOs in India.
Today, the issue is not limited to inter-party rivalry or to
funding alone. The role of NGOs has become relevant in the context of the
spread of popular protest movements against some development projects in the
garb of preventing forced eviction of people and obtaining just compensations. Such
movements prove fodder to extremist groups interested in destabilizing the
society.
Involvement of NGOs in money laundering business is
technically facilitated by unaccounted welfare activities. While these provide
sufficient reasons for a crackdown on NGOs to identify the good and bad ones,
lapses on the part of organizations to conform to the law of the land cannot be
condoned under any pretext. Whichever party is in power, it has to guard
against politicizing the move for controlling NGOs.
The government may like to tighten enforcement of regulating
fund flow for the NGOs. But, raising
funds is not illegal. Several cases of FCRA violations have been registered. Tightening
application of rules is a normal function of the government. But, we cannot
throw away the baby with the bathtub.
NGOs in many countries are facing several issues about their
roles and obligations, responsibilities, and accountability. Like public and
private sector, NGOs must be transparent in decision-making and implementation,
and must adopt a strict disciplinary code.
Good governance is as much needed for NGOs as for government. Less
bureaucracy is not to encourage arbitrariness. Leadership does not mean solo
decisions. Non-profit social welfare activity cannot cover up violation of
rules and laws. Voluntary work must also fulfil its commitments and should not
suffer from conflict of interest.
Most of the NGOs are run with donations and have specifically
targeted interests. They have a responsibility to their stakeholders.
A written code of ethics governing the functioning of NGOs
and imparting integrity, accountability, and transparency, rule-based financial
systems, etc. may be useful. Such a code enforced by self-discipline and peer
monitoring may act as a controller. But, in India, there has developed a
hierarchy among NGOs based on their financial position and political clout. Our
first task is to depoliticize NGOs. --- INFA
(Copyright,
India News and Feature Alliance)
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