THE GOOD, THE SCARY & THE UNCLEARProposed amendments to the NPO Act

Sophie Hobbs | MARCH 2013

Change is coming…

THE FEAR!

THE NPO ACT

• Non Profit Organisations Act of 1997 replaced the Fundraising Act of 1978.

• Registration facility managed by the DSD’s Directorate of Non-Profit Organisations.

• Legal framework for regulating non profits.

• It is voluntary – no longer required by SARS

BUT

Enabling environment

“Within the limits prescribed by law, every organ of state must determine and coordinate the implementation of its policies and measures in a manner designed to promote, support and enhance the capacity of NPOs to perform their functions.”

Why now?• Resource, compliance and capacity challenges • Ministerial Provincial Dialogues June-July 2012 • National Summit 15-17 August 2012 • Funding resolution at Mangaung• Policy Framework issued by DSD on 31 July 2012:

PROPOSED AMENDMENTS TO THE NONPROFIT ORGANISATIONS ACT, ACT 71 OF 1997

A DISCUSSSION DOCUMENT

According to the Policy Framework:

2010 2011 20120

20000

40000

60000

80000

100000

120000

Registered NPOs are growing

Over 80% are voluntary associations

THE GOOD• Transparency, accountability, good governance

-“without onerous requirements”• Recognises vital role of NPOs • Not a “one size fits all” solution• Acknowledges challenges of Directorate• Proposes an efficient, automated and integrated

registration facility.• “Fundamental freedoms”

Access to Information

VOLUNTARY ASSOCIATIONS TRUSTS NON PROFIT

COMPANIES

NON-PROFIT ORGANISATIONS

Awareness & Education

Investigation & EnforcementRegistration

SANPORASouth African Nonprofit Organisations Regulatory Authority

Mediation

Mediation?

Arbitration

TECHNICAL ADVISORY COMMITTEE

SANPOTRISouth African Nonprofit Organisations Tribunal

THE SCARY• Investigation, enforcement and “blacklisting” • No mention of integration with SARS or

relationship with other departments• Providing organisational data to the public • Serious capacity issues but still recommends

turning the NPO Directorate into SANPORA• Remains within public service• Consultation – what consultation?

THE UNCLEAR

• “Risk-based” approach based on size and income. • Standards of good governance – whose standards?• Self-regulation – is it enough or isn’t it?• International benchmarks – what are these?• Funding and reporting – Section 10 of the PSA?• Tribunal, Advisory Committee – “constantly review

legislation”

WHAT NEXT?Regulatory Reform on Nonprofit Organisations:1. Consultation and finalisation of policy framework2. Drafting a memorandum based on the policy

document3. Drafting, publication and consultation on new

legislation

• National Summit of nonprofit organisations• Interim review of legislation and feasibility study• Transformation of NPO Directorate

BUT ALSO…

WHAT CAN WE DO?

• Get onto the tribunal• Attend national summit and any consultation

events• Stay on top of developments• Write to the Minister• When the draft legislation is published….

Watch developments

• SANGONet - ngopulse.org • New NPO Directorate - npo.gov.za • Inyathelo - inyathelo.org.za• CAF Southern Africa - cafsouthernafrica.org • GreaterGood SA – myggsa.co.za