Fixing the functioning of NGOs: Inputs Sought

NGOs in India keep coming in lime light regularly for the wrong reasons. Be it the recent honey trap case in Madhya Pradesh where contracts worth hundreds of crores were being awarded to NGOs in exchange for sexual favours or cases in Bihar where NGOs funded by the State Govt were found to be engaging in child abuse and harassment.

It is critical that effective accountability mechanisms be built before any Government funds are disbursed to any NGO.

Please share your experiences with NGOs and also share what should be done to fix the functioning of NGOs in India.

Below are the key issues, root causes and solutions for improving state of NGOs in India as identified in the circle. We will be putting together a set of recommendations for the Ministry of Corporate Affairs so this can be implemented.

We look forward to your inputs!

Improving NGO Functioning in India - Key Solutions

1.The transactions of the NGOs should be monitored seamlessly
2.NGOs should be forensically audited both financially and socially
3.Every NGO must be driven to follow prompt accounting system and the annual accounts shall be audited by the authorized Chartered Accountants and submit the Financial Statements to the Social/ Public Welfare Department of the Government concerned
4.If any irregularity is found, the auditors and verifying officials should be made accountable
5.Governments should not allow any NGO whether running with Indian or Foreign funds to take up Religious Expansion campaigns to prevent un-rest in the Nation
6.The NGOs should utilize the Land , Buildings and Funds only to the and for the purposes notified in their Memorandum and as specifically certified by the Government
7.No NGO should be allowed to collect more than the reasonably estimated Funds without the further licenced permission from the Government concerned
8.NGOs which do social good need to be promoted, while those which encourage agitations needs to be discouraged
9.NGOs permission must be for fixed duration of 5 years, subject to on-line renewal on showing audited statement of finance as well activities how effective they have been
10.The rules for the formation of the NGOs should be made stricter
11.Transgression of major acts covering NGOs should attract severe penal provisions imprisonment etc.
12.The implementation of the foreign Contribution (Regulation) Act should be made stricter
13.No Government grant to be given to NGOs run by politicians
14.All NGOs must use minimum 60% of the donated amount on capital and a record of the same should to be submitted in their annual report
15.All NGOs must be asked to register on single web portal where they should update their monthly activity with details of donation received
16.Local NGOs should be made to register with respective local circle and engage local community.

State of NGOs in India - Key Root Causes

1.Government supervision on NGOs is weak
2.No dedicated body to check the workings of the NGOs
3.Setting up an NGO is quite an easy process
4.Rules and regulations are not clear and NGOs often bend them in their favour
5.Many NGOs are run by big businessmen to off load their black money
6.Many NGOs are politically driven and supported
7.Many NGOs have been getting away with illegal/non-impactful work for decades
8.Policies make it easier to get funds/land from Government for NGOs
9.Many genuine NGOs lack the capability of raising funds
10.NGOs are not good paymasters and hence people do not like to work for them
11.Many NGOs depend on the community support for their livelihood
12.NGOs don’t do audits for years
13.There is a lack of transparency and accountability in the NGO system
14.Many NGOs bribe the authorities to keep their transactions going.

State of NGOs in India - Key Issues

1.Some NGOs are being used for money laundering
2.Most of the NGOs do not provide their source of funds
3.Many NGOs carry some hidden agenda
4.NGOs are not listed & categorized by their work
5.Most of the NGOs are working just to oppose Government’s developing projects
6.Some foreign countries are funding NGOs to spread their agenda
7.Many NGOs are being used for political purposes
8.Improper accounting system is being followed by NGOs
9.In many cases, NGOs are only set up to get funds/land from the Government
10.In many cases, NGOs pay bribes to secure funds from Government and then conduct fraud, inappropriate or illegal activities
11.Many NGOs are run by big companies with some vested interest
12.Many genuine NGOs are short of funds, while fake or fraud ones manage to get huge funds
13.Genuine NGOs are not able to attract good talent
14.In a lot of cases, the NGOs are not able to execute their plans
15.There is a lack of transparency in the working of most NGOs. more  

View all 108 comments Below 108 comments
MY INPUTS TO - Improving NGO Functioning in India - Key Solutions

1. The transactions of the NGOs should be monitored seamlessly.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting (integrated with HR, inventory, labour, PF, facilities, hospitality, travel documentation, succession plan, org structure, email and WhatsApp for business communication), receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
2. NGOs should be forensically audited both financially and socially
My Input: NGOs can be provided with an free cloud based accounting system (production quality, with DRS Disaster recovery system and fall back), to address their needs for accounting, receipt printing, and greater visibility to the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
3. Every NGO must be driven to follow prompt accounting system and the annual accounts shall be audited by the authorized Chartered Accountants and submit the Financial Statements to the Social/ Public Welfare Department of the Government concerned
My Input: NGOs can be provided with an free cloud based accounting system (production quality, with DRS Disaster recovery system and fall back), to address their needs for accounting, receipt printing, and greater visibility to the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.4.If any irregularity is found, the auditors and verifying officials should be made accountable
5. Governments should not allow any NGO whether running with Indian or Foreign funds to take up Religious Expansion campaigns to prevent un-rest in the Nation
6. The NGOs should utilize the Land , Buildings and Funds only to the and for the purposes notified in their Memorandum and as specifically certified by the Government.
My Input: This can cause red tape, graft and harassment.
7. No NGO should be allowed to collect more than the reasonably estimated Funds without the further licenced permission from the Government concerned.
My Input: This can cause red tape, graft and harassment.
8. NGOs which do social good need to be promoted, while those which encourage agitations needs to be discouraged
My Input: NGOs can be corrected by administration / upto local courts to correct their course by gently nudging te NGO, and by providing injuctive order.
9. NGOs permission must be for fixed duration of 5 years, subject to on-line renewal on showing audited statement of finance as well activities how effective they have been.
My Input: This can cause red tape, graft and harassment.
10. The rules for the formation of the NGOs should be made stricter.
My Input: This can cause red tape, graft and harassment.
11. Transgression of major acts covering NGOs should attract severe penal provisions imprisonment etc.
My Input: This can cause red tape, graft and harassment.
12. The implementation of the foreign Contribution (Regulation) Act should be made stricter.
My Input: This can cause red tape, graft and harassment.
13. No Government grant to be given to NGOs run by politicians.
My Input: This can cause red tape, graft and harassment.
14. All NGOs must use minimum 60% of the donated amount on capital and a record of the same should to be submitted in their annual report.
My Input: This can cause red tape, graft and harassment.
15. All NGOs must be asked to register on single web portal where they should update their monthly activity with details of donation received.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
16. Local NGOs should be made to register with respective local circle and engage local community.
My Input: This can cause red tape, graft and harassment.

MY INPUTS TO - State of NGOs in India - Key Root Causes

1. Government supervision on NGOs is weak.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government. NGOs need not be monitored.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
2. No dedicated body to check the workings of the NGOs.
My Input: NGOs need not be monitored by a dedicated body. NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
3. Setting up an NGO is quite an easy process.
My Input: It is good to have an easy process ( to setup anything).
4.Rules and regulations are not clear and NGOs often bend them in their favour.
My Input: It is good to have all parties follow the spirit, and not really the grammatical connotations and possibilities. Keep it simple. (Here's a global norm for simplicity : KISS - Keep It Simple Stupid).
5. Many NGOs are run by big businessmen to off load their black money.
My Input: It is an allegation. Build relationships with clear, crisp laws, communication and mutual trust.
6. Many NGOs are politically driven and supported.
My Input: It is an allegation. Build relationships with clear, crisp laws, communication and mutual trust.
7. Many NGOs have been getting away with illegal/non-impactful work for decades.
My Input: It is an allegation. Build relationships with clear, crisp laws, communication and mutual trust.
8. Policies make it easier to get funds/land from Government for NGOs.
My Input: It is an allegation. Build relationships with clear, crisp laws, communication and mutual trust.
9.Many genuine NGOs lack the capability of raising funds.
My Input: Support genuine NGO's from a dedication government agency by providing them with support and infrastructure nation-wide for marketing, sales, advertising, lobbying world wide. Build relationships with clear, crisp laws, communication and mutual trust.
10.NGOs are not good paymasters and hence people do not like to work for them.
My Input: It is an allegation. Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust.
11.Many NGOs depend on the community support for their livelihood.
My Input: It is an allegation. Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust.
12.NGOs don’t do audits for years
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government. NGOs need not be monitored.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
13.There is a lack of transparency and accountability in the NGO system
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government. NGOs need not be monitored.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
14.Many NGOs bribe the authorities to keep their transactions going.
My Input: Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust.

MY INPUTS TO - State of NGOs in India - Key Issues

1. Some NGOs are being used for money laundering.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
2. Most of the NGOs do not provide their source of funds.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting, receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
3. Many NGOs carry some hidden agenda.
My Input: Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support. Get each of their employees and partners, supporters, vendors to sign the 'Code of Conduct' on the web-based app such as TallyNGO.com.
4. NGOs are not listed & categorized by their work
5. Most of the NGOs are working just to oppose Government’s developing projects.
My Input: Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support. Get each of their employees and partners, supporters, vendors to sign the 'Code of Conduct' on the web-based app such as TallyNGO.com.
6. Some foreign countries are funding NGOs to spread their agenda.
My Input: Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support. Get each of their employees and partners, supporters, vendors to sign the 'Code of Conduct' on the web-based app such as TallyNGO.com.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
7. Many NGOs are being used for political purposes.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting (integrated with HR, inventory, labour, PF, facilities, hospitality, travel documentation, succession plan, org structure, email and WhatsApp for business communication), receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
8. Improper accounting system is being followed by NGOs.
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting (integrated with HR, inventory, labour, PF, facilities, hospitality, travel documentation, succession plan, org structure, email and WhatsApp for business communication), receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace.
9. In many cases, NGOs are only set up to get funds/land from the Government.
My Input: Support genuine NGO's from a dedication government agency by providing them with support and infrastructure nation-wide for marketing, sales, advertising, lobbying world wide. Build relationships with clear, crisp laws, communication and mutual trust.
10. In many cases, NGOs pay bribes to secure funds from Government and then conduct fraud, inappropriate or illegal activities
11. Many NGOs are run by big companies with some vested interest.
My Input: Support genuine NGO's from a dedication government agency by providing them with support and infrastructure nation-wide for marketing, sales, advertising, lobbying world wide. Build relationships with clear, crisp laws, communication and mutual trust. Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support. Get each of their employees and partners, supporters, vendors to sign the 'Code of Conduct' on the web-based app (for example TallyNGO.com).
12. Many genuine NGOs are short of funds, while fake or fraud ones manage to get huge funds
13. Genuine NGOs are not able to attract good talent.
My Input: Support genuine NGO's from a dedication government agency by providing them with support and infrastructure nation-wide for marketing, sales, advertising, lobbying world wide. Build relationships with clear, crisp laws, communication and mutual trust. Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support nation-building.
14. In a lot of cases, the NGOs are not able to execute their plans.
My Input: Support genuine NGO's from a dedication government agency by providing them with support and infrastructure nation-wide for marketing, sales, advertising, lobbying world wide. Build relationships with clear, crisp laws, communication and mutual trust. Build relationships with clear, crisp, simple and reduced number of laws, communication and mutual trust. NGOs are in a unique position to support. Get each of their employees and partners, supporters, vendors to sign the 'Code of Conduct' on the web-based app (for example TallyNGO.com).
15. There is a lack of transparency in the working of most NGOs..
My Input: NGOs can be provided with a free cloud based accounting system (production quality, with DRS Disaster recovery system and with fall back - similar to LocalCircles.com, say for example TallyNGO.com), to address their needs for accounting (integrated with HR, inventory, labour, PF, facilities, hospitality, travel documentation, succession plan, org structure, email and WhatsApp for business communication), receipt printing, and greater visibility to auditing, CAG, Auditors, and the government.
This avoids red tape, and encourages NGOs to support our vast and extended populace. more  
All dubious deposits in to all religious units of NGOs even minorities must be investigated and exposed .
The recent Kalki ashram in south is a example more  
Judiciary to realize and impose linkage of Aadhar to all IDs, All Bank A/cs, Phones and Voter Lists. National Interest and Security of Society, Economy shall not be left off. more  
You have listed good points regarding NGO functioning in India - Key Solutions. Please go ahead. more  
Auditors should give a report on the utilization of funds as per specifics of each donation received. more  
Thanks Csn for support. I would appeal to be serious consumer activist organisations to please do send in your views on my suggestions in order to regulator better the VCOs. thanks more  
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