Building while we fly

The reading of the budget is an annual occasion in Caribbean countries that’s as much performance as anything. And what dudgeon the current leading man of ours is capable of. Yet it’s one of the few political rituals from Westminster governance I treasure. Many of us listen live only to find out what new patronage or taxation is being offered. Drivers line up to fill their tanks that morning, tune in eager to learn whether to feel slightly stupid or show-off-righteous they saved a whole $15. Because gas went up again.

But for a couple weeks each year “the budget” enrols the nation’s citizens and media in a magical—even if toothless—engagement with national policy and resource allocation. Now, thanks to a 2014 overhaul of parliamentary standing orders, the real budget debate isn’t the windy speechifying by obligatorily all 71 legislators from the floor. It’s the televised scrutiny line by line in the Finance Committee.

Fitting for budget season, I spent Thursday with NGO colleagues on the Lok Jack campus, talking over some troubling new policy research being updated by United Way about the patchwork legislative and policy framework governing the positioning of our “sector” in the national economy. It shows how badly our policy treatment of NGOs—the outcome, as one panellist, a senior tax accountant put it, of “cumulative fragmentation” in regulation—is in need of rationalisation. How unfavourably TT compares to smaller Caribbean countries like Barbados, Belize and Grenada.

In modern liberal economies, associations have emerged in an “arena outside of the family, the state, and the market,” as CIVICUS frames it, “to advance shared interests.” Third sector, social sector, civil society, non-profit sector are all used in overlapping ways to describe this. States can provide systematic rules of engagement with this sector, (eg, its inclusion in governance frameworks) but more importantly, states’ fiscal policies recognise groups committed to a social purpose, exempt them from various forms of taxation, provide further tax benefits to contributors to these groups, and in exchange regulate groups that can receive such benefits through corporate structural requirements, restrictions on certain activities, and reporting obligations.

In TT, the draft paper maps out, 1995 legislation allows groups to incorporate legally as non-profit companies but provides no automatic tax benefit. Groups talked about the ridiculousness of accountants’ measures for dealing with a surplus in a particular year (automatically rolled over to support work in the following) but technically liable for taxation. Just six per cent of these groups (under 500) have been granted charitable status. But even after undergoing the lengthy Board of Inland Revenue (BIR) application process (without transparent rules), they still remain subject to some forms of taxation, and corporate donors get a tax write-off for contributing to them only if they execute an archaic “deed of covenant.”

NGOs that choose to not become legal entities get the best deal—they can “register” with certain ministries, after a period of monitoring for good governance not done for non-profit companies. Such registration qualifies them for NGO funding from government and sometimes (though not always) other donors. But they aren’t liable for filing taxes or corporate reports other than to members and donors.

Almost nothing is systematic, there’s little articulation between the Registrar General and BIR, information about all of it is poorly documented and communicated by Government, and the non-profit company registration process is mind bogglingly picayune—staff are extremely dedicated to correcting the small details of handwritten entries on forms.

A CSOs for Good Governance group working, led by United Way, Veni Apwann, CANARI and others, is finalising recommendations for Government in an attempt to catch up with two legislative trains that have the potential to impact civil society organisations soon, and could fix much of this, or make it far worse, and where Government conductors aren’t yet listening to civil society on the track. To avoid further blacklisting by the international Financial Action Task Force, Government must demonstrate greater money laundering regulation of NGOs’ finances. And there’s the Revenue Authority looming.

I reminded my colleagues of our event next week where I’m bringing Jamaican human rights advocates and UN officers to share lessons with us here about how to be more effective in holding Government accountable. Jamaicans for Justice has built an effective NGO and used it to make real policy change. One of Thursday’s participants, Denyssa, told a story about two associates she’d maccoed debating differences between civil society action in their countries, TT and Jamaica.

I’ve been part of so many organisational efforts bogged down by drafting mission statements, perseverating over by-laws, then electing officers, in which time a year passed and no one had done anything. Denyssa’s Jamaican had the answer. “You Trinis want to build first,” he said. “But we build while we fly.” I’m going to hold on to that.