In the name of NGOs, a flourishing racket

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In the name of NGOs, a flourishing racket

Monday, 25 January 2016 | Joginder Singh

Activists are supposed to espouse their causes through their NGOs. But the funds they receive are often misused. The Government must crack down on those engaging in such fraudulent activities

A non-governmental organisation is one that is neither a Government agency nor a conventional for-profit business. Usually set up by private citizens, NGOs may be funded by Governments, foundations, businesses or private persons. Some avoid formal funding altogether and are run primarily by volunteers. NGOs make for a highly diverse groups of organisations engaged in a wide range of activities, and take different forms in different parts of the world. Some may be charities while others may be registered for tax exemption based on recognition of social purposes. Still others may be fronts for political or religious groups.

The Central Bureau of Investigation, in an affidavit filed in the Supreme  Court in August 2015, said that there were 31 lakh NGOs in 26 States of India. Karnataka, Odisha and Telangana are still to adduce information about the number of NGOs, so the country-total will be more than 31 lakhs. Besides, more than 82,000 NGOs are registered in the seven Union Territories.

The total number of schools in the country is around 15 lakh, as per data compiled by the Planning Commission in 2011. The Commission had calculated the number of schools, classifying them as primary, upper primary, secondary, lower secondary and higher secondary. In March 2011, the total number of Government hospitals in the country was 11,993, with 7.84 lakh beds. Of these, 7,347 hospitals were in rural areas with 1.60 lakh beds and 4,146 hospitals in urban areas with 6.18 lakh beds. The number of NGOs also exceeds the strength of policemen in the country. According to the National Crime Records Bureau, there were 17.3 lakh policemen nationwide in 2014, as against a sanctioned strength of 21 lakh.

The Delhi High Court, in May 2013, had called for tightening the law for NGOs, observing that many of them were “frauds”. A Bench of the Delhi High Court said, “Most privately-run so-called philanthropic NGOs do not understand their social responsibilities. Ninety nine per cent of the existing NGOs are fraud and simply money-making devices. Only one out of every 100 NGOs serves the purpose they are set up for.” The court also added, “There is a need for toughening of licensing norms and legislature has to keep this in mind.”

The Supreme Court, in September 2015, directed the Centre and State Governments to shut down all children’s homes run by unregistered NGOs, saying many of these centres had become child-trafficking hubs.

The Bench set a deadline —December 31, 2015 — to have all unregistered homes closed. “Not a single unregistered NGO should be allowed to get custody of a child. You take State Governments on board and all necessary steps to close children’s homes ruin by unregistered NGOs”, said the Bench. “Child trafficking is a very serious offence against humanity. You better realise the gravity of the problem. Girls living in children’s homes are being sold as slaves and pushed into sex racket.”

This author has personal knowledge of at least some NGOs whose office-bearers have converted charity into a means of their livelihood. He attended an international conference in Germany when in Government service. Many NGOs, including some from India, were participating in the conference.

The author did not disclose to any delegate that he was in the Indian Police Service. Instead, he only said that he was the Director of Youth Services and an Ex- Officio Joint Secretary in the Government of Karnataka. He asked a young fellow Indian as to what the latter was doing at the conference. The young man said that most foreigners were fools and they would send him enough money to run the NGO on the basis of doctored reports. Few donors had the means to verify his reports. At that time, this writer thought that his co-delegate may have been an odd case. Now, when the Delhi High Court says, that most NGOs are frauds, there is no scope for such belief.

The Gujarat Government has filed an affidavit with the Supreme Court on the 2002 violence, exposing NGOs that defrauded and cheated victims and became a source of self-aggrandisement for its founder. The affidavit says that two trustees, a wife-and-husband team, collected crores of rupees for constructing a memorial for the victims. But the money was spent by the couple on personal expenses, ranging from wine and liquor to mobile phones to film CDs and romantic novels, to hair-styling and dining. Police investigation also revealed that the wife claimed reimbursement towards purchase of sanitary napkins in the name of medical expense, and surprisingly her husband too claimed reimbursement for the same expense!

The affidavit said 45 per cent of total funds received by the NGO between 2008 and 2013 went to the couple, either directly or through a limited company, which was fully owned by them. The affidavit also stated that the wife drew a salary of Rs8.75 lakh and flew 113 times in a year. There are many such NGOs.

Indeed, running an NGO has become big business and many  people live off it, while the cause for which they raise money through the NGO is ignored. The Union Minister of State for Home Affairs, while replying to a question in Parliament, noted that foreign contributions totaling Rs13,051 crore were donated to 17,616 NGOs recently. In 2012-2013, Rs11,527 crore donations were made to 20,497 NGOs.

NGOs are required to seek registration or prior permission under the Foreign Contribution Regulation Act, 2010, to receive foreign funds. The Government is equally guilty here for giving aid to NGOs for certain projects. Its 16 ministries give grant-in-aid to NGOs that often do the same work that they themselves do in-house. The Supreme Court had advised the Union Government of India to take steps against racketeering NGOs by December 31, 2015. However, the deadline has come and gone but little has happened.

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