After country graduates to middle income from the least developed countries group

Tashi Dema

The National Assembly members emphasised the importance of Civil Society Organisations (CSOs) and highlighted that the CSO (Amendment) Bill 2021 should facilitate its working environment and not be restrictive.

The chairperson of the human rights and foreign relations committee, Bartsham-Shongphu’s member of parliament (MP) Passang Dorji (PhD) said CSO has the opportunity to help the government when Bhutan graduates from least developed country to middle-income country in 2023.

The committee reviewed the Bill after the National Council (NC) forwarded it to the house in the last session.

Health Minister Dechen Wangmo said CSOs promote a compassionate society, which is one of the main objectives of gross national happiness.

However, MPs also raised the concerns of some CSO founders or promoters managing it for generations or becoming an executive director (ED) hereditarily.

MP Passang Dorji said that CSOs are public organisation once registered. “The board members and executive director should be selected through fair and open competition.”

He said that CSO members are concerned some founders and promoters would manage it for generations. “Board members and executive director should be competent and capable.”

The existing Act states that the board should select and appoint the executive director and any other needed personnel in accordance with fair and objective hiring practices but the committee changed to fair and open competition.

Finance Minister Namgay Tshering said CSOs are new in the country and some CSO promoters and founders might manage it for generations. “That could happen because board members are selected by the CSO. There is a direct conflict of interest.”

He said the rules and regulations should specify that an official from labour ministry should monitor the recruitment.

Wangduphodrang’s Athang-Thedtso MP, Kinley Wangchuk, said there are many CSOs where the founders are managing it for generations. “The Bill does not specify the term of the board members and the executive director. Some members stay throughout their lives.”

He said that founders should not have any attachments to CSOs as it is established to benefit people. “The rules and regulations should have the term either as five years or 10 years.”

Khatoe-Laya MP Tenzin, who is a committee member, said they ensured CSOs should not be considered a family business. “However, the particular CSO should have the authority to decide how long its board members or executive director should serve.”

Health Minister Dechen Wangmo, who claimed she started two or three CSOs, said CSOs are not started with an objective to make profit, but to help people. “While I support the need for open and objective recruitment, it will be difficult practically for small CSOs.”

She said that CSO board members and executive directors do not have much power or authority. “CSOs do not have working capital unlike other organisations.”

Speaker Wangchuk Namgyel said it is important to differentiate the founder and executive director.

After deliberating extensively, NA also decided that the CSO Authority (CSOA) should determine endowment fund for CSOs from time to time and not the limit of the endowment fund as per the existing Act.

Opposition Leader Dorji Wangdi raised the concerns of briefcase CSOs in the region and the need for the endowment fund to register a CSO. “It is important to specify the minimum endowment fund.”

Foreign Minister Dr Tandi Dorji also explained that the endowment fund is for registration. “The endowment fund is needed for registration of mutual benefit organisations in the existing Act and not for public benefit organisations.”

An executive director of a CSO commented on the live deliberation that there is confusion on the prescription of the endowment fund as the CSOA explained it is for the registration of CSO and not for registered CSOs.

One of the major changes of the Bill was on tax exemption where CSOs tax exemption shall be in accordance with the taxation laws of the country.

The existing Act had tax exemptions to the CSOs on a case-by-case basis.

NA also decided that any competent person could become a board member of a CSO even if they have been convicted by a court of law after ‘cooling off’ period.

This is a major change from the existing law which states that people terminated from public service, removed from any office for misconduct or mismanagement in administration, convicted for a criminal offence and sentenced to imprisonment, found be in arrears of taxes or hold any senior office or position in a government-controlled company or organisation and disqualified by any law cannot become a board member.

MP Passang Dorji justified that to have competent people on board, it is necessary to remove the existing criteria. “The cooling period for those convicted of first-degree felony is four years, three for a second-degree felony, two for third-degree felony and one year for a fourth-degree felony.”

Although the committee proposed not to have people with tax arrears as board members, the house did away with the tax arrear through a show of hands.

Drametse-Ngatsang MP Ugyen Wangdi said there are many people with a criminal record and it is necessary to do away with the criteria to have competent people on board. “Many people are convicted of breaching Covid-19 protocols and going by the existing criteria, they cannot become board members.”

He said since board members only serve the people as CSO members.

MP Kinley Wangchuk said conviction is for correcting a person and their experience would benefit a CSO.

Bongo-Chapcha MP Tshewang Lhamo suggested doing away with the ‘cooling period’, justifying prison term should serve as punishment for a person. “Once a person comes out of prison, his or her sentencing is complete.”

She said cooling period has forced many people to regress. “No Act in the country mandates a cooling period.”

However, Tsirangtoe-Sergithang MP Garja Man Rai said a person with a criminal record might commit the crime even as board member of a CSOA.

NA also endorsed a new provision in the Bill whereby a small-scale CSO does not have to be formally registered but shall be allowed to legally operate after obtaining written permission from CSOA as per the rules and regulations framed by the authority.

MP Passang Dorji said the new provision is to allow capable Bhutanese to serve Bhutanese people. “CSOA faced problem to regulate informal CSO.”

Meanwhile, NA decided that the government should provide adequate human resources and financial provisions to the CSOA.

There are 15 MBOs and 49 PBOs in the country today.