NGOs handling K500bn annually—NGO Board
Non-Governmental Organisations (NGO) Board of Malawi has embarked on NGO mapping exercise at Traditional Authority (T/A) level, a move which it believes will save money from being siphoned.
NGO-Board chief executive officer Voice Mhone told Mzimba District Executive Committee on Thursday that the exercise has started with Dowa District where 33 NGOs with an annual budget of K3.7 billion have been registered.
He said following the siphoning of huge sums of government money, known as Cashgate, most donors resorted to channeling their money into the country through NGOs.
“From the figures we have, NGOs are [collectively] handling not less than K500 billion a year,” Mhone said.
He said the mapping exercise will promote transparency in NGO operations.
“Our core mandate is to establish a database of NGOs in terms of what they are doing, how much they have, where they are working and where they are getting the money,” Mhone said.
“It is worrisome that there has been no proper mechanism to monitor their expenditures. NGOs handle a lot of money, more especially now that donors are funding NGOs instead of government.”
Mhone said every year, NGOs will be required to submit audit and technical reports to the board.
“You know transparency promotes confidence. The danger is that the trust of Malawians can be diluted if NGOs are not accountable,” he said.
Mhone added it was not right for NGOs to call for government to be accountable while they themselves are failing to do the same.
Mzimba District director of planning and development Precious Katsitsi commended the board for the development.
He said NGOs play a vital role in development and it was important that their operations be transparent.
The mapping exercise is expected to be completed by end of April in Mzimba, Mangochi and Chikwawa and by June 2018 nationwide.
In January this year, some NGOs accused the NGO-Board of stifling their operations after it hiked the annual fees by large margins which they said was unsustainable.
The move followed government’s argument that a lot of money is being channelled to NGOs following Cashgate and loss in trust of public finance management systems by donors but this is becoming increasingly difficult to trace.
Until January 1, 2018, the annual fees payable by NGOs was K50 000 and the registration fees was also K50 000. But according to the NGO (Fees) Regulations of 2017 gazetted effective January 1 2018, an NGO that used to pay K50 000 in annual fees will now be required to pay K1 million, an increase of 1 900 percent.
The fees are in four categories of levels of annual income and corresponding fees, as outlined in the Second Schedule.
Category A is for NGOs with annual incomes below K100 million who will be required to pay annual fee of K100 000; category B is for incomes above K100 million but below K500 million which will pay K250 000 fees while those with earnings above K500 million and below K2 billion will pay K1 million in annual fees.
An NGO with annual income above K2 billion, usually international organisations, will be paying a K2 million annual fee.
In an earlier interview, NGO Board chairperson Abigail Dzimadzi defended the new fees, arguing that only about 20 NGOs would be paying K2 million.
“We know that the majority of NGOs are below the K100 000 band which is an increase from K50 000. According to the information that we have, that is less than 20 NGOs. Only those NGOs whose programmes amount to above K2 billion are the ones that will be paying K2 million in fees,” she said.
Dzimadzi said the new fees would help improve NGO Board’s effectiveness in ensuring public and Malawi citizens benefit from NGO work.
The NGO Act requires NGOs to submit to the NGO Board annual audited financial statements within three months after the end of the financial year which includes cash donations and non-cash donations.
