Commentary

It’s important that NGOs are regulated

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By Jerry Kasamba

Posted  Thursday, May 29   2014 at  01:00

In Summary

With fat accounts, NGOs instead want untaxed services in the guise of being not-for-profit entities. To keep the State going and growing, government would rather put their fingers on businesses and not NGOs.

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In a market economy like ours, there is a strong case for government to regulate NGO work if they are to have any impact that should be captured within government data.

First, if all NGOs annual incomes in Uganda are summed up, it can run into trillions of shillings. Yet, the people who gain access to this data are their own self-appointed directors and donors.

Second, unlike private businesses that are financed through hard loans and profit re-investments, much public funding given to NGOs are in grants and donations. But interestingly, businesses have enormous ability to give more money to government through taxes than NGOs - with soft capital.

With fat accounts, NGOs instead want untaxed services in the guise of being not-for-profit entities. To keep the State going and growing, government would rather put their fingers on businesses and not NGOs.

Third, business impacts can easily be felt in the profits and taxes they generate; and the goods and services people need that they offer. NGOs on the other hand, find it difficult to effect large-scale impacts at national or community levels.

Their input-output-outcome chain of change measurement is painfully clumsy to measure and hard to isolate on individual human status.

Worse still, there is great inability to sum up benefits of different NGO interventions across programmes and population sub-groups; and to calculate their combined contribution to national GDP.

Fourth, if you take elections as an example, NGOs have played a smaller role in the organisation and conduct of State polity and elections. They have failed to fill the void left by weak political parties and trade unions.

Because of this, they have lost credibility and become politically inconsequential so much so that the disconnect between political society and civil society is nearly total.

NGOs see no benefit from participating in electoral process while political parties discern no electoral benefit from a disorganised and disoriented civic groups.

Because much public funding is given to NGOs by donors, government needs to regulate their activities to achieve higher standards of performance.

Without any strong law, NGOs are only a pass-through for donor resources operating under the watch and reporting controls of their own directors and set regulations.