Bhutan - Flooded by CSOs?

Bhutan has 54 CSOs excluding many informal associations functioning like CSOs
The Civil Service Organization (CS0) Amendment Bill 2021 will be tabled in the forthcoming session of the National Assembly (NA). With 42 Public Benefit Organizations (PBOs) and 12 Mutual Benefit Organizations, registered with the CSO Authority, Bhutan has 54 CSOs, one CSO for 12,962 people approximately. Though CSOs are important and continue to play a significant role in assisting the government, questions people ask are about the sheer number of CSOs apart from many informal associations functioning like CSOs. Apart from becoming a country filled with CSOs, where objectives are hardly fulfilled, the dangers of CSOs and the informal associations becoming money laundering institutions are also voiced. People further say some CSOs have become business entities, who get subsidies and support from the government for being a CSO, and then engage in business activities. Politicization of CSOs is another concern. 
All CSOs in Bhutan function in accordance with the Civil Society Organizations Act of Bhutan 2007 to promote establishment and growth of Civil Society Organizations (CSO) in order to strengthen civil society, promote social welfare and improve the conditions and quality of life in Bhutan. Under the directives received from the government, the Ministry of Home and Cultural Affairs spearheaded the formation of the CSO Authority on 20th March 2009 as an appropriate regulatory agency to implement the CSO Act. 
“There are several requisitions for a CSO to be established and CSO’s have their share ‘of dos and don’ts’. We have seen how several CSOs have matured and now provide services at par with the government. But there are also CSOs, who do not seem to be doing anything and more than that, informal organizations, functioning like CSOs, without any source of fund. These are issues that need to be solved,” Tandin, a private employee said. 
When asked about the informal groups, Tandin said there are offices claiming to be branch offices of international CSOs and even individuals, who as philanthropists, are like a CSO. “They emerge from nowhere, buy land, construct houses and become social workers. I am not saying this is bad, but the government should find out their sources of income and even look into activities they conduct, as some may not be in the interest of the nation,” he said. 
The CSO ACT 2007 says CSO’s shall: not engage in any activities that are directly related to public elections; do anything to destroy the peace, stability and well-being of the nation … involved in political activity and compel any person to belong to another faith, by providing reward or inducement for a person to belong to another faith; and be organized or operated exclusively for financial gain.” Tandin says that the dire need of money could make CSOs indulge in the very activities mentioned above. 
Preamble of the CSO Act 2007 says, “WHEREAS, it is expedient to provide for the establishment and registration of Civil Society Organizations to strengthen civil society by developing human qualities and rendering humanitarian services;..”. In the words of a civil servant, it means that CSOs are not business entities. “If I am not mistaken there is a clause in the CSO Act 2007 saying CSOs will not engage in activities to make money.” “But today, we see CSOs getting government and municipal funds and support as they are CSOs and fully involved in commercial activities. The CSO Authority should seriously ensure that such things do not happen. I think the Royal Audit Authority (RAA) had also issued a memo, but nothing has been done,” he said. According to him, money is required and there are many avenues for CSOs to make money, other than doing business. “If business was their end, why did they even register to become a CSO,” he said.   
It is also mentioned that “donations, grants, subsidies, financial assistance and contributions, bequests and other transfers of funds or other property from foreign sources, whether public or private, shall be routed through an authorized Financial Institution (FIs) of Bhutan.” “Is this happening? If it is, authorized FIs should make the information public so that people know where the funds are actually coming from. 
Speaking about the risks of CSOs being politicized, he says it has already happened. “There are very few CSOs, which are well established and so require no political support. Moreover politicians will not be able to approach these CSOs. However, the small and medium ones are already politicized and during campaigns, political parties even meet these CSOs,” he said. While it may not be an important issue, if parties associated with some CSOs do not come to power, these CSOs will not get government support. On the contrary, these CSOs would try to act like the opposition, he said.  
In the CSO Amendment Bill 2021, a new subsection inserted says the Authority (CSOA) consisting of seven members will supervise all CSOs to ensure their compliance with the obligations under the Anti-Money Laundering and Countering of Financing of Terrorism Act of Bhutan. This, the civil servant said is very important. 
Reiterating what others had said, Sangay Dorji, a corporate worker said CSOs have done a lot. “There are a big and small CSOs and everyone has played a part. But what I see is duplication in mandates of CSOs, and some CSOs crossing their lines.” Some CSOs are stuck with issues concerning establishment and institutional strengthening and most have verbal support from the community but not much financial contributions, he said. “Dire need of funds could lead CSOs take measures that transgress the law,” he said.
Well established CSOs have changed the lives of people in isolated communities, brought women and youth to the forefront of development and provided services during emergencies. “But there are some CSOs whose activities are not seen at all,” he added.   
Meanwhile, CSOs are audited annually by the Royal Audit Authority. Public Benefit Organizations are bound to prepare a financial statement, in accordance with the guidelines issued by the Authority, containing at least: statement of activities showing the sum of all support and revenue received and expenses disbursed for the period covered by the annual report; statement of financial position for the period relating to period covered by the annual report; statement of cash flow representing the ability to generate cash and cash equivalent and its use during the accounting period. 
The question asked is if what is on paper is really practiced.