International NGOs are obtaining more funds than they show to authorities, Auditor General’s office claims

International NGOs are obtaining more funds than they show to authorities, Auditor General’s office claims
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Global non-governmental organizations are found to have obtained nearly three times much more funds than what they demonstrated to the government agencies troubled in the past three fiscal years, the Office of the Auditor General states.

This, in accordance with the constitutional body, has increased queries over the transparency of funds received by the international NGOs.

According to the project agreement signed between INGOs and the Social Welfare Council, the government body responsible for regulating international and domestic non-government sectors, INGOs brought in Rs58.58 billion from abroad between fiscal years 2015-16 and 2017-18.

According to the data entered by the INGOs into the Aid Management Platform (AMP), a software handled by the Finance Ministry which keeps track of foreign aid received by the country from the government and non-government sectors, foreign NGOs brought in Rs51.87 billion in the three-year period.

However funds obtained by the organizations and deposited at commercial banks showed that they received Rs153.72 billion during the period, the OAG stated in its 56th annual report released on Friday.

According to the Social Welfare Act and its Regulations, INGOs can run the programme after signing a general agreement and a project agreement with the Social Welfare Council. According to Clause 17 of the Project Agreement Appraisal Guidelines of the council, the INGOs must offer data on financial assistance to the Social Welfare Council and Aid Management Platform of the Finance Ministry.

However, the auditor general’s report states that INGOs have received much more amounts than what they reported to the council and the Finance Ministry, going against the legal provision.

“The mobilisation of funds received by INGOs to implement the projects must be made transparent,” the report states. “Monitoring should be strengthened.”

In accordance with Finance Ministry officials, data available at the Social Welfare Council and the Aid Management Platform might not represent the exact amounts the INGOs received.

“All the INGOs are not affiliated to the Council. Aid Management Platform, although, is a platform where INGOs can report regarding their funding only on the voluntary basis,” claimed a senior official at the Finance Ministry requesting anonymity because he was not authorized to speak to the media. “But such a massive gap between their reporting to the government agencies and bank accounts certainly raises questions over the transparency of funds received by them.”

Officers at the council declared that INGOs which get funds from residential donor agencies generally don’t report regarding their source of funding to the council and that this could have resulted in discrepancies in funds between what they showed and what they actually received.

Shiva Kumar Basnet, spokesperson for the council, informed the Post that the INGOs that received funds from donor agencies having residential office here claim which they must not sign a separate agreement with

the council to implement the project after the donor agency signs an agreement with the government for the whole assistance.

“As per the existing laws related to the non-government sector, INGOs should be affiliated to the Social Welfare Council and work after signing an agreement with us, however, a number of INGOs are yet to be affiliated to us,” Basnet claimed.

Even though the government advocates that funds received in the form of official development assistance to Nepal should not be channelized through international non-governmental organizations, it has failed to stop the trend. In the fiscal year 2017-18, residential donors had provided as much as $134.33 to INGOs, according to the Development Cooperation Report-2018 published by the Finance Ministry. The amount constitutes around 10 percent of the total aid disbursed by the donors that year.

The USAID, the European Union, Australia, the World Food Programme, the United Nations Children’s Fund, the German Aid Agency (GIZ), Norway, and the Swiss Agency for Development and Cooperation are among the donors with residential offices in Nepal which contributed to INGOs in last fiscal year, based on the report.

In the earlier fiscal 2016-17, the residential donors had provided up to $147.45 million to INGOs.

Based on the Finance Ministry official, the fund ear-marked by donors for Nepal should not be provided to INGOs according to the Development Cooperation Policy of the country.

“The government’s position is that INGOs should bring funds with their very own efforts from abroad, however, this policy largely remains unimplemented,” the official stated.

When the Post asked Shibesh Chandra Regmi, chairperson of the Association of International NGOs in Nepal, about the issue raised by the auditor general’s report, he stated: “I am not aware of this matter. What I know is all INGO funds raised either from outside or inside the country should technically be reported in their project agreements with the Social Welfare Council.”

In line with the government’s position, the NGO Federation of Nepal, a group of local non-government organizations, during its ninth general convention in December last year demanded that INGOs operating in Nepal really should have absolutely no having access to funds from the United Nations and donor agencies having their offices in the country.

Local NGOs are of the view that mobilization of such funds to INGOs leads to higher administrative costs because of the high salary for INGO workers, leaving little fund for actual works on the ground.


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