Political agenda may lie behind apparent state incompetence - Business Day, 4th February 2013.

In his fortnightly column in Business Day, the Institute's CEO, John Kane-Berman, questions whether the recent cancellation of several Non Profit Organisations' registration by the Department of Social Development really was accidental. In the light of envisioned legislation to put the country's NPOs under state control, the State could have had a more sinister agenda.

AFTER a public outcry, nonprofit organisations (NPOs) whose registrations were recently unlawfully cancelled by the Department of Social Development are to have them reinstated. What is not clear is whether the cancellations were part of a sinister agenda. Given that NPOs collect money from the public, registration is desirable, provided it is straightforward and is not abused by the government for political purposes.

Incompetence is so characteristic of so much of the government that it may indeed be the explanation for the arbitrary cancellations. But it would be wise to be vigilant, for the African National Congress (ANC) and the government have previously voiced antipathy to NPOs, and are now busy with plans to tighten control and impose racial policy.

Dating back at least to its conference in Mafikeng 1997, elements in the ANC, including Nelson Mandela and Thabo Mbeki, have expressed hostility to critical institutions in civil society. Politicians, including Jeff Radebe, Jeremy Cronin, and Blade Nzimande, have voiced criticism more recently, especially of organisations that seek to hold the state to account. The South African Democratic Teachers Union has accused them of eroding the national democratic revolution.

NPOs have played a leading role in exposing corruption and incompetence and holding the government to account, among others by taking it to court and by exposés in the media. Without their efforts, antiretrovirals would have been provided even later to people with HIV, there would be no commission of inquiry into the arms deal, legislation against the media might be more restrictive than it is, there would have been less of an outcry over toll roads and the failure to deliver school textbooks, and some in the ANC would still be inciting people to "kill the boer".

Along with the constitution, the judiciary, the media, the public protector, the auditor-general and opposition parties, civil society is one of the seven key checks and balances in our democratic system.

Two initiatives are now in progress to undermine NPOs. Although the Department of Trade and Industry denies it, one is to reduce the number of black economic empowerment points business donors will receive for grants to NPOs whose beneficiaries are not 100% black. This will force NPOs to discriminate against white beneficiaries — and make business complicit in this process.

The second is contained in a Department of Social Development discussion document on proposed amendments to the Nonprofit Organisations Act of 1997. Challenged by Chris Barron in the Sunday Times on January 20, the department’s acting director-general, Peter Netshipale, denied that there was any intention to subject NPOs to "random and selective audits" by a new supervisory organ.

Yet provision for precisely such audits is explicitly made on page 19 of the document. The envisaged new supervisory body will be called the South African Nonprofit Organisations Regulatory Authority, and there will further be a mediatory body called the South African Nonprofit Organisations Tribunal. Foreign nonprofit organisations will also be subject to the new regulatory regime, ostensibly to combat "money laundering and financing of terrorist activities".

According to Netshipale, these new bodies are needed to help build capacity among NPOs. Maybe some do need help, but that does not need state control. Moreover, it is doubtful that a government that has to spend billions on consultants to help itself can help build anyone’s capacity.

Netshipale provides a further pretext for regulation by suggesting that "somebody’s building himself a big house with the money" that is given to NPOs.

Never at a loss for acronyms, the document says confidence in the nonprofit sector will diminish as a result of misuse of funds and the emergence of "Briefcase NGOs (Bringos)".

Maybe. Donors and trustees obviously have a duty to stop misuse of funds. But it would be wiser to assume that the Department of Social Development’s insinuations of corruption are merely a smokescreen for another agenda, which is to subject the country’s 85,000 NPOs to control by regulatory bodies that are staffed by loyal cadres.

This article was first published in Business Day on 4th February 2013.