NGOS: STATISTICS

  • India has possibly the largest number of active non-government, non-profit organizations in the world. There has been a sharp increase in the number of new NGOs in the past decade in India.
  • According to a government study, there were only 1.44 lakh registered societies till 1970. The maximum increase in the number of registrations happened after 2000. A recent study commissioned by the government showed that there are about 3.3 million NGOs in India by the end of 2009 i.e., one NGO for less than an average of 400 Indians. Even this staggering number may be less than the actual number of NGOs active in the country.
  • This is because the study, commissioned in 2008, took into consideration only those entities which were registered under the Societies Registration Act, 1860 or the Mumbai Public Trust Act and its variants in other states.
  • It can be noted that a great majority of the NGOs are small and about three-fourths of all NGOs are run entirely by volunteers. About 13 percent of the NGOs have between 2 to 5 employees; about 5 percent have between 6 to 10 employees and only about 8.5 percent NGOs employ more than 10 people.
  • According to a survey conducted by society for Participatory Research in Asia (PRIA), 73.4 percent of NGOs have one or no paid staff, although across the country, more than 19 million persons work as volunteers or paid staff at an NGO.
  • More often NGOs are registered as trusts, societies, or as private limited non-profit companies, under Section- 25 of Indian Companies Act, 1956. They also enjoy income tax exemption. Foreign contributions to non-profits are governed by Foreign Contribution Regulation Act (FCRA), 1976.

MANAGEMENT MODELS

  • Not-for-profit civil society organisations can provide public services, such as education and healthcare. They may also deliver charitable relief to people in distress. In delivering these services they can be effective partners of governments.
  • Scale and efficiency of delivery are required in these roles. Business management can provide good role models here, and it is not surprising that as civil society organisations ‘scale up’ to deliver they adopt business-like practices of management and governance.
  • The third role, catalysing development of societies with changes in their social and economic structures, requires very different capabilities as Gandhiji had pointed out. Mind-sets and organisational formats that business organisations and governments adopt for control of operations and delivery at scale are not appropriate for performing the role of a catalyst for the development of a community.
  • The governance of catalytic civil society organisations requires power-shifts and mind-shifts that leaders of historically control-oriented and charity-oriented organisations are finding hard; but they must make these shifts if they wish to serve society well.
  • The world is changing. The old order is passing. People everywhere want to take charge of their own lives and become responsible for the governance of their own affairs. They do not want to be considered as any other man’s burden.
  • International civil society organisations must introspect on their purpose, the roles they should perform, and the competencies they require. Their leaders are realising they would require a radical transformation to become effective, and acceptable, catalysts of change.

CHALLENGES FACING NGOS

  • In view of the emergence of a new paradigm of scaling up, in which NGOs are seen as catalysts of policy innovations and social capital; as creators of programmatic knowledge that can be spun off and integrated into government and market institutions; and as builders of vibrant and diverse civil societies, it’s imperative to critically analyze the role of NGOs in the process of development and understanding the challenges facing the sector.
  • Transparency and accountabilityare key ingredients of Governance in the NGO Sector as these determine operational efficiencies and risk mitigation. Over the years, corporate sector has been able to recognize and implement best governance practices through appropriate institutional framework. However, the NGO sector is yet to evolve any institutionalized framework, which could potentially play an important role in overall development of the nation.
  • Of late, some of the local and national NGOs have been found involved in malpractices and acting irresponsibly, thus undermining the credibility of civil society. It’s a huge concern and poses a great challenge to the development movement spearheaded by NGOs in the country.
  • There is a huge flow of funds into the non-government organization sector and this requires prudence and good practices to maintain accountability and transparency to the benefit of all stakeholders.
  • Although NGOs do internal auditing but for more accountability and transparency, it is advisable to go through external auditing also, especially where public funds are involved. Hence, issues of internal control mechanisms, professionalism, accountability, transparency and financial managementmust be given impetus.
  • The challenge is multidimensional, and is compounded by the ‘unorganised’ nature of the sector, lack of regulatory frameworks and the fact that India boasts of more than a million NGOs of different roles, structures and sizes.
  • In particular, the Indian voluntary sector urgently needsself-regulatory guidelines and transparency mechanisms to increase the trust and awareness as to how the philanthropic funds are being utilised.
  • The general lack of transparency in the functioning of a large proportion of NGOs leads to aversion in donating funds for charitable causessince the general public is largely cynical about the ‘genuineness’ of the non-profit spirit of the sector.
  • The stringent governance standards of an NGO will facilitate the effective management and increase the accountability to its stakeholders including donors, the government and the community.
  • It is in the self-interest of the NGOs to realize the fact that to implement astructure of ‘corporate governance’ principles would provide the real value to the stakeholders. Also, this would enable to track the potentially dubious sources of funding coming in for the voluntary sector – an aspect which has gained impetus in the wake of the increased number of terror attacks and extremist activities.
  • Recently, the Union Home Ministry has identified some NGOs as security threat to the country.Such security considerations have underscored the rising need of improving the governance practices in the Indian NGOs and exercising better regulatory mechanisms, disclosure norms, and management processes including financial management and budgeting systems as well.

NGOS MISAPPROPRIATING FOREIGN FUNDS

  • There has been a cracking down on non-governmental organizations (NGOs) operating on its territory, alleging that thousands have misreported their foreign funding to Indian fiscal authorities.
  • In the year 2014, the Home Ministry has cancelled registrations of more than 13,000 NGOs for allegedly failing to file annual tax returns for three years since 2009, according to Indian media reports
  • Nearly two million home-grown or international NGOs – many of which are funded by foreign donors – work across India in the field of development.
  • The Caritas Internationalis, a Catholic charity based at the Vatican. The government accuses Caritas of violating India’s foreign funding laws by financing groups that were working “against the country” .The case was connected to Caritas’ funding of organizations that had protested against a nuclear plant in Tamil Nadu, in southern India, Caritas is among several high-profile international NGOs that government has accused of violating the Foreign Contribution Regulation Act (FCRA).
  • The Indian arm of global environmentalist group Greenpeace and the U.S.-based Ford Foundation also were placed on the government’s watch-list. Then with the intervention of Delhi High Court the govt had to unfreeze Greenpeace India’s access to bank accounts.

THE GOVERNMENTAL CRACKDOWN ON NGOS HAS ELICITED A MIXED RESPONSE. IS THE GOVERNMENT’S ACTIONS JUSTIFIED?

A) YES, it is justified (IN favour)

  • In their view, the targeted NGOs have failed to deliver any services to the people whom they are registered to serve. Others say this is a clear message from government that it won’t tolerate any activities deemed as “anti-state.”
  • In May 2014, a leaked report from India’s Intelligence Bureau accused NGOs such as Greenpeace, Cordaid, Amnesty, and Action Aid for reducing India’s GDP by 2-3% per year. It helped to legitimise the government’s actions against NGOs.
  • There has been mushroom growth of NGOs across the country over the years India’s disproportionate number of NGOs and the sector’s lack of transparency and accountability is clearly an issue that needs reforms. Nor should allegations of corruption against NGOs be ignored. In 2009, 883 NGOs were blacklisted after being found to have indulged in misappropriation of funds. In such cases, NGOs need to uphold probity in their work.
  • The government has the right to cancel registration of such groups which fail to file the annual returns and fulfil other legal requirements on their part. Only those groups that operate within the legal purview and in the interest of the people should be allowed to operate.

B) Not justified. (Against)

  • Many experts says that the government is going after NGOs that are working for people’s welfare.“The government’s action against these groups has directly affected the poor people in the country as they work for their welfare in multiple ways
    “With regard to closing down the operations of the groups, the government has acted in an arbitrary and highly selective manner,”
  • Even NGOs such as the Public Health Foundation of India, which has expertise in public health policy, and Navsarjan, which works for the protection of Dalit rights, have had their licences to receive foreign funding cancelled.
  • In recent decades, many NGOs in India have assisted the state to serve its citizens by pushing for laws including those on the right to information, food security, and rural employment.

NGOS: A THREAT TO TRADITIONAL POLITICS

  • The crackdown is being driven by a fear of the influence wielded by some NGOs in shaping public opinion, and how this might threaten the government’s political standing.
  • The world most celebrated one is a recent case in which anti-corruption crusade led by activist Anna Hazare where NGOs helped bring about a crushing defeat of  Congress party by the Aam Admi Party (AAP) in Delhi Legislative Assembly election.
  • There is a fear that the influence of NGOs can play a vital role in exposing the corrupt and fraudulent political parties and bring about regime shifts in state or central elections.

SUGGESTIONS

  • The implementation of astrategic framework is essentially important in the management of an NGO. The endorsement of such a framework brings in professionalism and internal control mechanisms, which further makes the organization’s performance more effective.
  • Developing strategies also include establishing a mechanism of consistent monitoringof whether they are being implemented and linking the results to the organization’s goals.
  • There is need to bolster public confidencein the voluntary sector by opening it up to greater public scrutiny.
  • The Government should encourage Central and State level agencies to introduce norms for filing basic documents in respect of NGOs, which have been receiving funding by Government agencies and placing them in the public domain (with easy access through the internet) in order to inculcate a spirit of public oversight.
  • Public donation is an important source of funds for the NGO sector and one that can and must increase substantially. Tax incentives play a positive role in this process. The Government could simplify and streamline the system for granting income tax exemption status to charitable projects under the Income Tax Act.
  • The Government may consider tightening administrative and penal proceduresto ensure that these incentives are not misused by paper charities for private financial gain.
  • The Government should encourage all relevant Central and State Government agencies to introducepre-service and in-service training modules on constructive relations with the voluntary sector. Such agencies need to introduce time bound procedures for dealing with the VOs. These could cover registration, income tax clearances, financial assistance, etc.
  • There must be a formal system for registering complaintsand for redressing grievances of NGOs.
  • The Government should encourage setting up of Joint Consultative Groups / Forums or Joint Machineriesof government and voluntary sector representatives, by relevant Central Departments and State Governments.
  • It also needs to encourage district administrations, district planning bodies, district rural development agencies, zila parishads and local governments to do so. These groups could be permanent forums with the explicit mandate to share ideas, views and information and to identify opportunities and mechanisms of working together.
  • The Government also might introduce suitable mechanismsfor involving a wide cross-section of the voluntary sector in these Groups/Forums.

CONCLUSION

  • We are entering into an important phase where there are many targets that the government intends to achieve with the active collaboration of VOs, in the 12th plan. Therefore, it is important to conduct an effective review or report card of the National Policy with specific recommendations.
  • These recommendations could become an agenda for all Voluntary Organizations, Planning Commission, state governments and national Ministries. Efforts are also needed to further disseminate the information about the policy and its intentions with small VOs as well as government functionaries.
  • There is a need to solicit commitment from state governments and national ministries. A systematic intervention is also needed to get National Policy approved and adopted by the Indian Parliament. The most serious challenge faced by India today is the conflict between violent and non-violent approach of development.
  • Needless to say that majority of population of India is still deprived of basic fruits of development, but rather than adopting the approach which is more inclusive and look for solutions within the constitution, India is faced by disturbances in many parts of the country. This not only hampers the development projects but also shrink the space for people’s participation to achieve their goals through peaceful means.
  • The voluntary sector being present in such locations faces the challenge of delivering the services and even mobilizing people on the development agenda. The need of the hour is to work closely with each other for the benefit of the marginalized people, as even today the dream of Mahatma Gandhi has not been achieved.

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