Tuesday, 25 May 2010

back-door progress

This blog began in response to the reluctance of 8 British international development NGOs to reveal what projects they fund.

In the last year we have seen the World Bank, DfID and other governmental and multilaterial donors opening up their data and providing detailed breakdowns of their expenditure.

But despite a lot of promises, NGOs have failed to follow suit.

Increasingly I think that NGOs will only release their data if they are made to do so by either governments or individual charity-givers. Without significant external pressure, they simply won't do it.

Now there is place that this pressure might come from: concern about terrorist financing.

In 2007 the Home Office and Treasury conducted a review of charity rules that called for more transparency. But the response from the sector was so ferocious that they took that line no further.

Now fast-forward to March 2009: the European Council has just published the 'Stockholm programme' which is all about anti-terrorism.

One of the measures is:

"promote increased transparency and responsibility for charitable organisations with a view to ensuring compatibility with Special Recommendation (SR) VIII of the Financial Action Task Force (FATF)"

The Financial Action Task Force is an intergovernmental organisation originally designed to stop drug trafficking and money laundering. After 9/11 it was charged with tackling international terrorist financing.

Its ominous-sounding Special Recommendation VIII includes:

"Non-profit organisations are particularly vulnerable, and countries should ensure that they cannot be misused...to conceal or obscure the clandestine diversion of funds intended for legitimate purposes to terrorist organisations"

Eurosceptics have been spooked. Statewatch have released a briefing expressing concern about NGO independence. It seems as if the idea of binding Europe-wide rules has been rejected.

It will be interesting to see if this goes any further. My hunch is that anti-terrorism measures have a life of their own. Despite his Euro-bashing, even David Cameron might adopt Recommendation VIII if there is another attack.

Then a step towards charity transparency would have been introduced by the back door.

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