Tuesday, February 13, 2007

Donors and their donations

I had reread my post on why Bloom is not an NGO and decided I should clarify what I meant. I think for sure there are NGOs that do good work. These are very clear about their mission and very transparent about what they do with donations. An example is Riverkids (www.riverkidsproject.org). The project aims to stop child trafficking in Cambodia and you can see where all you money goes on this website (Disclosure: I am a trustee of the project, which is in the midst of being registered in Singapore as an NGO. In fact, I agreed to be a trustee because I know Jimmy and Dale, the couple who run RK, very well and know them to be extremely honest and genuine).

However, there are many, many, charities, NGOs and the like that are not what they appear to be. Singaporeans have found this out, to our disappointment and detriment, only in recent times. The National Kidney Foundation, the most successful fund-raiser amongst charities in Singapore, got into a lot of trouble and various heads are now being sued for misusing the charity’s funds. In short, Singaporeans are a very generous lot, and have donated millions to the NKF, only to find out in the last year or so that the NKF gave its CEO an annual SGD600,000 paycheck, or about USD390,000 (an amount the wife of former Prime Minister Goh Chok Tong called “peanuts”—one wonders what world she lives in when this is “peanuts”), first class airline tickets and other excesses. We were also deceived as to the percentage that actually went to supporting kidney patients.

(As an interesting aside, the only reason we now know about the NKF is because the CEO, TT Durai was dumb enough to try to sue Singapore Press Holdings, the publisher of the Straits Times, Singapore’s main newspaper. The suit was over a report that mentioned, among other things, gold-plated taps in an NKF bathroom. One wonders how long Durai would have got away with things if he had not sued SPH, as he had previously won lawsuits over an ex-employee and volunteer).

When in Singapore, I read in the news another charity was under scrutiny. Youth Challenge had declared its executive president’s salary to be under SGD60,000 a year but he in fact, had received over SGD20,000 a month. Vincent Lam also had a country club membership and housing loan subsidy. His salary accounted for more than half the total funds, SGD442,287 raised by the charity in 2005. Vincent Lam has since resigned.

Are you outraged? Good, do something about it then. The first thing you should do is, at the very least, please—if you are going to donate to a charity, do some research. Ask questions. Find out where your money is going. Is the charity or NGO audited? Does the charity exist for staff or for the group it is supposed to help? By that I mean, how much are staff salaries? How much, especially, is the president or CEO, or MD paid? How much are local people working at the NGO paid? How much money actually goes to the cause?

I’ve found to my horror, that some NGOs in Cambodia, are no different from MNCs back in Singapore and Hong Kong. The top guys, usually expat, get fat salaries and perks, while local staff are paid according to local salary scales. It’s more forgiveable, if you really want to be charitable, for an private company to remunerate its managers this way, but my opinion is that its complete bullshit to say NGOs and charities need to pay this kind of money to attract talent. That is exactly the argument used in defense of Durai and Lam—that they were good at their jobs, that the organisation needed to attract and keep people like them.

People who enter into the NGO or charity sector should do it because their hearts’ are in the right place, and not for the money. It’s the same argument as politics. People should enter politics, be MPs and PMs because they want to make a difference, because they want to do something for their countrymen, and not because they want to further their careers and earn a big salary and an even bigger retirement package.

(It was hard to find any recent report on Singapore ministers’ salaries on the Net, but here is Hong Kong’s South China Morning Post 2003 report: “Even after the cuts in 2001, the [Singapore] prime minister still earns a reported gross salary of about S$1,030,000 per year, and that is before the variable component is taken into account. The Singapore pay rate compares favourably with that received by United States President George W. Bush, (US$400,000 per year), and Britain's Tony Blair (US$262,000). They also leave in the shade the remuneration reportedly received by Thailand's Thaksin Shinawatra (US$32,000) and Malaysian leader Mahathir Mohamad (US$65,000).” Meanwhile, the average Singaporean salary is about USD 27,000 annually, or SGD 3,444 per month, according to the Singapore ministry of manpower.)

Of course, as we all now know, many enter into the charity sector precisely for the money, because there are so many mugs out there—irresponsible people who just want to give away money so they themselves feel good, and not because they really care that what they do makes a difference. I say “irresponsible” because such behaviour is not without consequences: you’re propping up an organisation and the people behind it even as they exploit other people for their own end.

In the context of Cambodia, it is even more important you know what your money is doing because NGOs are prevalent and corruption is rampant. According to Human Rights Watch, foreign aid accounts for about half of Cambodia’s national budget. Last year, donors increased their annual pledge in 2006 to USD601 million, from USD504 million in 2005. Cambodia’s largest donors included the European Union, Japan, the United States, France, Australia, Sweden, the United Kingdom, and Germany. Here is the latest article I found on Cambodia and foreign aid.

EU increasingly impatient with Cambodia over anti-corruption law
dpa German Press Agency
Published: Tuesday January 23, 2007

Phnom Penh- International donors are increasingly impatient with delays in implementation of a long-awaited anti-corruption law, German Ambassador to Cambodia Pius Fischer said Tuesday. Fischer, who is the acting European Union (EU) president, called it an important issue for EU policy in Cambodia and could not be sidestepped. 

"We strongly advocate the fight against corruption and the early adoption of an anti-corruption law in Cambodia," he said after addressing a seminar on EU-Cambodian relations in Phnom Penh. "We cannot debate any longer. For 10 years the royal Cambodian government has discussed a law against corruption. Now is the time to act and implement that law." Fischer also warned that implementation was as important as the law itself, and donors would be happy with no less than a politically independent anti-corruption body which can "locate, integrate and develop cases against corruption." 

Endemic corruption has consistently been cited as a major hurdle to Cambodia's development. Last November, Berlin-based Transparency International ranked Cambodia at 151 out of 163 countries in its 2006 corruption perceptions index survey. 
The group made its ranking on a definition of corruption as "the abuse of public office for private gain." Cambodia scored just 2.1 points out of 10, earning it the second lowest position in Asia, ahead of only Myanmar.

Donors have repeatedly threatened to withhold funds from aid-dependent Cambodia if it continues to delay adopting the law. The government promised a new law by the end of last year but later announced that it needed to make changes to the penal code first. 

As well as being an important donor to Cambodia, the EU is also a powerful trading partner, ranking as Cambodia's second most-important destination for exports and its sixth leading source of imports, according to 2005 trade statistics, with Germany at the top of the list.

© 2006 dpa German Press Agency

So please, don't be lazy. Make you and your money count for something.


sscott said...

Excellent post illustrating problems with many NGOs in Cambodia. If you want transparent finances, check out planetbiodiesel.org--I volunteered with them and they are the real deal.

Diana Saw said...

Hi Steve,

I checked planetbiodiesel and i think it's great! I'll visit you when I next go to Sihanoukville. Actually, we are planning to move there next year. I'm also keen to learn more about recycling and how we can reuse many of the things Cambodians throw away. Do drop me an email so we can keep in touch.



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