Author: Binu S Thomas
Publication: Deccan Herald
Date: September 8, 2002
In recent months, companies have
come under growing public scrutiny for the transparency of their finances,
or rather the lack of it. Even more opaque than the corporate sector when
it comes to managing finances are the hundreds of charities that raise
billions of dollars worldwide to spend on the poor. India, with the world's
largest number of poor, is an obvious destination for these funds. It is
therefore perhaps appropriate that the finances of charities operating
in this country be subject to greater public scrutiny.
Some of the major foreign Non Governmental
Organisations (NGOs) operating in India include ActionAid, Save The Children,
Christian Children's Fund, Plan International and World Vision. These five
charities alone together spend over Rs 300 crores every year on 'community
development programmes'. Their operations in India are governed by the
Foreign Contributions Regulation Act (FCRA), which require them to submit
an annual report of the sources and deployment of their funds to the Home
Ministry in New Delhi. The main mechanism used by the five to raise funds
for their Indian operations is child sponsorship (see box). Worldwide charities
raise over a billion dollars every year through child sponsorship, where,
in exchange for periodic photos of the sponsored child and child letters,
money is given (often monthly) by the sponsor to the charity that acts
as the intermediary to be spent on the child and the community it lives
in.
In 1998, the Chicago Tribune ran
a lengthy expose of child sponsorship charities. The newspaper investigated
four major charities -- Save the Children, Childreach (part of Plan International),
Christian Children's Fund and Children International. The article "The
Miracle Merchants: Myths of Child Sponsorship" revealed that individual
children in whose name the money is raised receive few or no benefits.
The marketing hype, which projected benefits to individual children and
their families was found to be at great variance with the ground reality
of how the money was spent.
The Chicago Tribune -- whose journalists
even sponsored children for about three years as part of the investigation
and later visited their sponsored children -- reported that in some cases
sponsors continued to pay for children who had died, but who were kept
alive on paper by charities to continue to get funds.
The lack of accountability mainly
stems from how the money is spent. Most child sponsorship agencies, including
the earlier mentioned five in India, say they use the funds raised in the
name of the individual child, to primarily benefit the community in which
the child lives. Spending the funds on the individual child, they argue,
will lead to problems within the wider community.
Child sponsorship-based charities,
however, don't have a good answer for the obvious question: why not raise
money in the name of the community/village? Quietly they concede that children
have a more powerful effect unzipping the purses of sponsors than entire
communities. The ethical disconnect between raising funds in the name of
a child and spending it on the community is one of the reasons why some
charities have opted not to get into child sponsorship.
But more telling of the lack of
accountability in child sponsorship is the issue of how much of the money
that is raised actually goes to benefit the community in which the child
lives. Different charities give different figures for what they spend on
field work. Plan cites a figure of 77%, Save the Children 80% and ActionAid
in its website claims that 90% of the funds is "spent directly overseas."
But a Taking Stock Report (TSR)
commissioned by ActionAid three years ago, involving six independent international
experts, revealed that only 63% of the funds raised by it goes for development.
Further deductions from this figure such as the overheads of the local
NGO through which ActionAid channels funds means that less than 40% end
up being spent on the community. A substantial amount of money raised in
the name of poor children by child sponsorship-based charities goes to
support the huge salaries and flashy lifestyles of their senior staff,
some of whom have been corrupted by the easy availability of long term
funds. In recent times, at least two heads of child sponsorship-based foreign
charities operating in Bangalore have had corruption charges pressed against
them.
The ActionAid report also revealed
other problems with child sponsorship. According to the report, "The TSR
team encountered several instances where ActionAid staff (or ActionAid
partner staff) were dishonest in their explanations to families about why
their children's pictures were being taken. They would explain it by saying
the children were being tracked to know if they continued in school, or
because their nutritional status was to be followed up. Field staff explained
to us that they would not tell the whole truth to their families, otherwise
they would demand the money from the sponsor."
The deception continues even in
the case of child letters that the children supposedly write to sponsors.
What often happens in reality is that dozens of sponsored children in a
particular locality are asked to draw a particular picture. The teacher
then provides a written explanation of the drawing to the sponsor. A case
recounted in an ActionAid India sponsorship newsletter goes like this:
"Sangeeta Singh has drawn Moon and Stars in her drawing, which she sees
everyday when she sits in her courtyard and does the home work given by
her teacher. In India the moon is called Chanda Mama (maternal uncle) by
kids and this is what motivated her to draw. She also asks her teacher
why they are not visible during the day and the teacher explains to her
considering her tiny understanding. She has drawn with the help of the
teacher."
In some cases the child may not
even have drawn the picture shown against its name. The ActionAid sponsorship
newsletter quotes sponsor Lynne Berry of the UK who wrote: "I have sponsored
Suman for many years. but can't help wondering why Suman has not progressed
artistically by the age of 13 years. The last painting I received, supposedly
painted by her, was to my mind that of a young child of say 3 or 4 years
old. I would have hoped Suman would have progressed to drawings more fitting
for her age group." The newsletter, which is mainly meant for local NGOs
that ActionAid supports, then advises its partners to "ensure drawings/messages
are age appropriate."
Despite its obvious lack of accountability
to both the sponsor and the sponsored, child sponsorship is a booming business
for charities. ActionAid India alone announced plans to increase the number
of Indian children it places with sponsors overseas from 40,000 to 120,000.
Considering that each ActionAid sponsor provides roughly Rs one lakh over
an average eight year period supporting an Indian child, the sums involved
are staggering.
Not surprisingly even Indian charities
like CRY have child sponsorship as its principal fund raising mechanism,
while international agencies like World Vision have started using it to
raise funds from individual Indian sponsors. The long term nature of funding
support they receive under child sponsorship has also seduced many local
NGOs to not question the obvious shortcomings of this mechanism. But can
the Indian government choose to do likewise?
The author is a former journalist
and NGO officer (Contact Address: 25 Cubbon Road, Bangalore 1. Tel: 2867588,
2867464)
How It Works
Child sponsorship began some 60
years ago as an effort to support children made orphans by war. With the
dawn of the
development era in the 1960s, international
NGOs adopted this mechanism to fund development work in the Third World.
The disaster-prone nature of developing countries have made it easy for
these NGOs to provide a steady stream of pictures of drought hit or flood
ravaged children in need of long-term support.
Under child sponsorship, an individual
sponsor contributes a monthly sum, usually about $25 on average, in return
for which the charity provides the photo of a sponsored child and two or
more letters from the child every year to the sponsor. The success of child
sponsorship is said to be the emotional bond it builds between the child
and the sponsor over a period that could be as long as 10 years. Typically
children are chosen for sponsorship just as they enter school and are sponsored
till they complete their education.
The main advantage that a charity
gains from child sponsorship, as opposed to other forms of funding, is
the secure income it provides over a long period. In the case of ActionAid
for example, the average tenure a sponsor supports his/ her child is eight
years and during this period the charity will receive a sum of $2200 ($23
every month) or over Rs one lakh in the name of one child. Direct debits
every month from the bank account of the sponsor or through payroll giving
make the collection of the money a relatively painless and easy operation
for the charity.
