The Dark World of NGOs

Do you know that only about 10 per cent of the over 22 lakh NGOs file their annual income and expenditure statements with the authorities ? As per given Source- A total of Rs 13,051 crore foreign contribution was received by 17,616 NGOs in the country in 2013-14, Rs 11,527 crore by 20,497 NGOs in 2012-2013 and Rs 11,558 crore by 22,747 NGOs in 2011-2012. Also quoting another Source- The main change is that all NGOs will have to make public each foreign contribution received by them within a week of the receipt, on their official website or a website prescribed by the government.

Foreign Contribution Regulation Act (FCRA)is a regulatory tool that enables monitoring and control of foreign funding. It will be better to know about pros and cons of this tool before going in this debate. PMO has initiated exercise to tighten monitoring over NGOs in the country. Intelligence Bureau has given inputs to "improve oversight and increase transparency" in the working of the voluntary sector in India. The crux of the IB report lies that foreign-aided NGOs are actively stalling development project.The reputation of the NGOs is on thin ice due to corruption but one must look overall problem in context of current government policies.

The paranoia of foreign hands begins with former Prime Minister Indira Gandhi, who was extremely worried of NGOs that she assumed to be puppeteered by foreign agencies. The current saga began with the offloading of Greenpeace activist Priya Pillai and blocking fund of Ford Foundation. While Greenpeace is instrumental in raising voice over Kudankulam project, Ford Foundation came on scrutiny due to funding of human rights activist Teesta Setalvad’s NGO fighting for the rights of Gujarat riot-victim. The success story of Ford’s grant making programme in India are Arvind Kejriwal, Manish Sisodia, Yogendra Yadav, Kiran Bedi and Anna Hazare. In an exceptional situation, both Modi and Left see these foundations as the capitalist interests of the west for different reasons. PRIA has removed an article advocating Ford Foundation as model for philanthropic initiatives in India while maintaining the web link at twitter.

Before demonizing either government or NGO sector, let us look into this matter with open mind. There is surely shift in ole of government aid paradigm. Government of India is funding projects only for service delivery project to NGOs. NGO-isation of India's HIV/AIDS program has widened the field of non profit organizations participation in government programmes. The success of this apparatus is connected the episodic failures in service delivery and addressing HIV-related stigma comprehensively in the present due to lack of government extension staff. Also, the rights-based approach being adopted by state governments in their various Acts has no or little merit in practical realities. There are no funds available to monitor implementation of the rights based laws. The additional nail in the coffin for protesters is lack of fund for human rights, democracy and law enforcement. No organizations in India will go on the wrong side of state by giving funds to protesters (problem groups). This has led to the dependency on funds from foreign donors.

In 2014, the UN Special Rapporteur on the Rights to Freedom of Peaceful Assembly and of Association, Maina Kiai highlighted three general principles to protect civil space. The ability to seek, receive and spend money is one of them. Current government can't criminalize dissent but they are cleverly having a crackdown on foreign-funded dissent. Current laws fail to define anti national & political activities leading to mishandling of the protesters. And a thumb rule about power in India is that whenever interpretation of regulation is left completely up to the imagination of the state without any establishment of independent institution, the net result is nearly always discretionary and prohibitive.The roots of democracy lie not in the government but in social relations and freedom of speech. The means of protest in the state shows us the real power of citizens and voluntary sector. One must remember words of Vinoba Bhave - "What we should aim at is the creation of people power, which is opposed to the power of violence and is different from the coercive power of state."

But the news isn't good for voluntary sector itself.It will not be an understatement that funding to voluntary sector is largely decided by bribes and political affluence. NGOs are used as siphons to route black money by corrupt entities and individuals! The voluntary sector is a den of corruption and corrupt NGOs needs to be completely weeded out.They must make full and public disclosure of their funding and expenditure. They must also be made answerable under the RTI Act. The era of accountability and transparency has to began in the voluntary sector.

The job of NGOs, whistle-blowers and the media is to keep the entire government apparatus humble and they have a universal responsibility for the protection of innocents even that means wrath of state. Corruption in any form must be curbed if we wish to become a developed society' . Robert Klitgaard, a world famous authority on corruption, famously declared that corruption is equal to monopoly plus discretion minus accountability (C=M+D-A ). Both government officials and NGOs have looted funds in the name of poor, disabled, women and minorities. It is important to handle matters of the state and voluntary sector with transparency and accountability. There are tough questions for us citizens to answer now. Do NGOs really know the interest of donors while protesting before government ? Can government go ahead with any “development project” as a rhetorical national interest without consulting all stakeholders? If any citizen disagree with govt and take to the streets, should the IB keep a tab on the concerned citizen? The debate is much recommended, even if it will raise more questions than it can probably answer.

*Please also read articles of Jay Mazoomdaar in Firstpost, Harsh Mander in Scroll & Samanth Subramanian in The Guardian dissecting the dark world of NGOs.

Livelihoods Asia Summit 2015

Livelihoods Asia Summit 2015 was being held on December 10 and 11 at New Delhi, India. The Summit sessions were around topics like skill development, impacts of climate change on livelihoods, inclusive value chains, policy innovations, and private sector partnerships among the approaches that offer a pathway out of poverty. The summit has more than hundred delegates working as sector specialists, practitioner and advocates in the livelihood sector. Panel sessions and other live events are great — especially the Q&A ranges from absurd to tricky.

There was focus on policies, programs, private players and potential in poor during the sessions. There was emphasis by panelist to think of poverty as a dynamic and multidimensional phenomenon. There are so many policy level talks on SHG and FPO but the dialogues on next generation of institution was lacking in the summit. The summit also ignored rights-based approaches to livelihood development while there is a strong body of literature exists showing the correlation between empowerment and economic productivity.

There are two school of thoughts emerging in usage of poverty alleviation fund. One views the establishment of the community institution through participation of the civil society organizations while other pitches for direct benefit transfers to the beneficiaries. Government official from Rural development ministry pointed success of universal primary education and connectivity to rural areas through PMGSY. The welcome part was an eye opening session on the impact of climate change on livelihood of ultra poor. Experts suggested that the people need risk transfers and insurance protection for livelihood recovery post disaster.

I enjoyed much of the time in the summit.  As much I got out of the conference, I know there is still more to learn and more to share. Yet, I have always wondered about these summits where every leader talks about what needs to be done! But they are the ones who should be doing it ! The underline of the summit - No one organization can eradicate hunger and reduce poverty alone, only in partnerships with a broad range of stakeholders can all of us achieve the goals.

Inclusive Finance India Summit 2015

ACCESS has hosted the Inclusive Finance India Summit from December 8th to 9th, 2015 at in New Delhi, India. The summit has gained recognition and the Inclusive Finance India Report has been quoted extensively in the Malegam Committee, and working report for the Microfinance Bill. The Summit has facilitated discourse on issues like-policy environment, data analytics in financial inclusion, mobile wallets, BC model, customer protection, impact of JAM, and innovations in the sector. I attended the summit as the delegate of ACCESS team.

The Summit began with release of the Sector report 2015 was followed by several sessions on microfinance and financial inclusion in the country. The buzz of the sessions were around Mudra bank, Payment banks, cash less economy and Small Finance Banks. Eight out of 10 Small Finance Banks which have been given in-principle nod by RBI are microfinance institution (MFIs).  Sector experts are hopeful that Small Finance Banks  fill the "missing middle" in reaching the bottom of the pyramid.

India is an interesting scenario as there is rapid updates in telecom infrastructure, IT services and progressive government spending on digital infrastructure. I was really impressed from a particular session  on use of data in digital financial services.  The main issues were  hurdles faced in data sharing and cashless transactions.  Big Data, Small Credit is a good report quoted by a speaker on the impact of the digital revolution on the emerging markets.  I was impressed with a start up company - Lenddo. They use users online social connections to build their creditworthiness and access local financial services. 

Also, one act in a stupid way while confronting a hero. I was glad to have seat next to Prof Malcolm Harper and was literally at the loss of the words required for having a meaningful dialogue. I am already looking forward to next year’s conference with the hope I can attend again. After coming home from the summit  put on by ACCESS, I am feeling renewed, and energized. 

Mid Day Meal (MDM) Program

Theda Skocpol, Professor of Government and Sociology at Harvard, notes that spending on education and family health care is especially likely to generate social and economic returns. Midday Meal (MDM) program is a school meal programme of the government of India designed to improve the nutritional status of school-age children nationwide. India's MDM program feeds 120 million children and employs 2 million women. It's an initiative that changes lives and provides human-capital investment in millions of children. 

The poorest of the poor are defined as those who can eat only when they get work and who lack shelter, proper clothing, social respect, and means to send their children to school. They have no land, live on daily wages, and need to send school-age children to work in times of crisis. They send children to government schools as this is the only way to ensure one time meal to their wards and the best chance for children to break the cycle of poverty. MDM scheme has many potential benefits: attracting children from disadvantaged sections (especially girls, Dalits and Adivasis) to school, improving regularity, nutritional benefits, socialisation benefits and income support to women .

An impact study has shown that the food stamps alternative or the direct income support is not feasible, for it may lead to adverse consumption choices by the targeted households. This would happen, particularly in countries like India, where educational and awareness levels of the targeted households are low.

Learn more in this animation designed by Rhitu Chatterjee and Mathilde Dratwa.

Livelihoods

What is Livelihood ? Nobody understands this word outside the cocoon of the development sector. The problem with the word livelihoods is that it has overtones of subsistence. It hints that poor people should only have enough just to live – not to prosper. As Kate Magro says : “Why is it that Westerners have careers, jobs, employment opportunities and everyone else has a livelihood?”

Livelihood is a convergence of multiple disciplines of profession leading to the cash flow in the household. Mostly the poor are engaged in a “diversified portfolio of subsistence activities” (DPSA) for earning their livelihoods. Hence, Understanding smallholders' financial needs will be the key step to understand livelihood scenario. A new survey of 1,800 banks conducted by the Initiative for Smallholder Finance reveals that the total amount of debt financing supplied by local banks to smallholder farmers in the developing world is approximately $9 billion.

The first step towards designing livelihood plan for the beneficiary will be to seek information on all of the income sources, various consumption and investments, interplay among cash flows, barter arrangements, credit sources and the financial tools in use throughout the year. Migration is a major livelihood strategy for the rural poor that must be included in the project design. That will give us ideas to better understand their needs, preferences, aspirations and behaviors. This information set must be shared with Donors, Government, Financial Institution and NGOs. The future programs designed to strengthen and develop rural livelihoods must grasp the whole range of vulnerabilities and risks faced by  an entrepreneur or farmer/ artisan.

To understand what NGOs are doing, it is important to understand what they are not doing. There have been various attempts to improve income of farmers & artisans in order to making the value chains more inclusive. While addressing the critical gaps in the respective value chains, the donors put more emphasis on the capacity building than market linkages.  The utter disdain for market forces by such initiatives and short planning without critically looking sustainability factor has led to massive failure till now. Sustainability parameter evaluates the likelihood of continuation of interventions initiated due the project by the community, scaling of pilot activities, leadership development in the community, institutional and financial arrangement in post project scenario. Hence, a livelihood intervention requires a critical first step in the process : Development of a livelihood project, as proof of concept and live workable model on the ground.

Micro Small and Medium Enterprises (MSME) sector has huge potential for growth in the semi urban and rural India. Throughout they also account for a disproportionately large share of new jobs in OECD countries. The rural entrepreneurs operating and managing the solar lighting enterprises at village level constitute the backbone of TERI’s Lighting a Billion Lives Campaign. There are successful cases  make us arrive at a conclusion that with a very little financial help and skill training, the villagers are able to be enterprising. The rural entrepreneur has been enrolled into skill development programs promoted by the government for livelihood enhancement. Now, there must be urgent focus on provision of soft loans and vulnerability reduction funds with  financial tools designed as per the cash flow of the occupation.

Any livelihood programs must build up the physical, financial and social assets of the rural poor using local resources. Empowering communities to take control of economic development is slow, patient work and even end as failure —and people funding or supporting development work need to take into account when designing livelihood programmes.