Background:
We are a foundation established 30 years back and working on health sector on Policy advocacy and knowledge dissemination with women’s right framework being the ultimate motive.
Issue:
As part of Policy advocacy, the foundation interacts with Government officials, select Members of Parliament (champions) and Industry leaders to advocate Family Planning issues and policies at the various meetings that they attend. To make this happen, constant meetings are done with various Government officials in Health Ministry both at Centre as well as State Government level to highlight various methods of Family Planning and also how the existing delivery mechanisms like ANM, ASHA etc. can be best used to increase reach. The Champions normally help the programme in bringing Government’s and people’s attention on Family planning issues at various levels whether it be at consultative committee meetings, forums, media interaction or public meetings. To this extent they are briefed about methods of Family Planning, indicators on FP, expenses committed by State and Central Government on FP and how this can be advocated to people at large.
Industry leaders also help in the same cause by speaking about Family Planning issues in various forums that they participate like various Chambers, public debates, discussions and conferences on Women’s right to delaying marriage, child delivery, spacing between children etc.
The foundation intends, as part of Policy Advocacy and other programmes, to organize a field visit to a foreign country where family planning methods like delayed marriage, spacing, availability of basket of contraceptives have been implemented in a successful manner. The visit would include meetings with development organizations, policy makers, field implementers etc.
The foundation would bear the cost of travel, stay, food and also pay per diem charges of the Government officials, Champions and also for its own staff. Intimation would be given in writing to Government department and MPs with a request to seek requisite approvals from the respective authorities.
Query
As per Section 3(1) of Foreign Contribution (Regulation) Act 2010, Government servants, member of any legislature inter alia are prohibited from accepting foreign contribution. But it does not clarify if an FC registered organization can spend “foreign contribution” on such persons.
The activity of the foundation is planned under the donor agreement and the cost would be borne out of FCRA grant(foreign contribution).
The following queries emerge:-
- Is it right to spend FCRA money on exposure tours?
- Can the foundation pay the per diem charges to the government officials and MPs? If so can we give them Dollars?
- Should the foundation seek copies of internal approvals of the Government for this tour to support our expenses?
- Are there any other precautions that the foundation needs to take so that no provision of FCRA is contravened?
Raam Kumar
Respected Sir/Madam.
our NGO Chaitantya rural development social service society,Kurnool. our NGO Functioning since 1995 at Kurnool District . We are working nearly 12 Mandals . OUR Society fcra account Opened in Indian overseas bank . FCRA Account opened in 2009 Deposited 1000/- FCRA Sanctioned 2009. But Bank Manger closed our society bank account in sufficient balance purpose . no foreign projects sanctioned. But present otf projects sanctioned bank account not functiong the amount go back . please give solution another bank account how can add fcra
I think comments above seem to be more of personal opinions rather than based on legal position. While S. 3 of FCRA Act does prohibit MPs, govt officials and several other categories from receiving the FC funds. However most of such persons are entitled to receive Foreign Hospitality with prior permission of the FCRA Dept. (See S. 6). Thus if a donor agency wishes to provide hospitality for MPs, etc. one could consider the same. However query does touch on several aspects which I give in seriatum.
1. FCRA funds can be spent for an exposure trip, if the donor requires the same. However the MPs would need to seek prior permission from the FCRA Dept. and once such permission has been accorded, NGO can spend the funds even on an exposure visit.
2. While Per diem is not mentioned per se in the section, however if the prior permission applied to the Dept and approval received includes this, then I do not see any legal obstacles in paying per diem. Let us not forget per diem is for meeting day to day expenses on visit and therefore must be reasonable. However this aspect is in the domain of FCRA Dept and they must have their own norms while allowing prior permission for such issues.
3. These permissions would be given to MPs applying for such prior permission and since you would be funding the visit, copy should be marked to you, but in any case to ensure that you comply with FCRA permission, copies of these permission should be given to you.
4. To be on safe side, once Foreign Hospitality approval is rec’d by the MPs, the NGO concerned should intimate the Dept. alongwith copies of the prior approval that it would be funding the foreign trip of MPs.
In addition to above, the NGO has to ensure that benefits of expenditure on foreign trip are accruing towards its objectives in India. This is to ensure compliance with S.11 (1)(a) of Income Tax Act.
My comments are in addition to what Mr. Satish Joshi, CA, has said.
Any FCRA funds spent on government officials for foreign trips means seeking favours from the government.
The foundation can spend FC as a part of Policy Advocacy and other programmes with the Indian government officials locally. Besides, the Indian Government is under obligation to implement programmes on family planning methods. It is not understood why the foundation needs Indian government officials in foreign country – to study the variety of practices there. I fail to understand the foundation’s intentions.
That the visits would include meetings with development organisations, policy makers, field implementers, etc., is not convincing. We have foreign missions abroad who could help the foundations in such manners. FC must not be used for such purposes.
1. How can MHA permit any expenditure that is prohibited under FCRA?
NGOs spending out of local funds on foreign travel by Indian Law makers and Government officials under necessary approvals by appropriate authorities is legally valid. But is it advisable! Indian policy advocacy (Health issue or Nuclear issue) by Indian NGOs should be on Indian soil.
2. If digression is permitted, one likes to suggest that Population Foundation of India may consider including, if not already included, abortion as a Right in cases of unwanted but not more than two months old pregnancies and in cases of rapes under their advocacy work.
Through FCRA regulations Government intend to keep track on trail of foreign fund. Purpose of introducing the legislation was to ensure that foreign money may not be used against the country. Thus every situation needs to be reviewed and dealt with in a rather conservative manner without adopting any convenient interpretation for obvious reasons.
Foreign money received by an approved organisation under any grant/project is always meant to be incurred in India, as stipulated. The indirect inclusion via an Indian agency may not be desired. The Indian agency may however recommend group/of eligible person(s) to its foreign counterpart and also facilitate the tour logistics.
A FCRA designated agency is under obligation to transfer the fund only to other FCRA designated agency. Once the fund received from an un-exempted foreign source its usage including the proposed foreign hospitality comes under the purview of Section 6 whereby restricted categories individuals will need prior approval from the Home Ministry. I believe that the Government Officials and Law makers are in any case requires approval in individual capacity even though local fund is involved. Once approved, the confirmation itself may substantiate the expenditure against disclosed budget.
A guideline available on the MHA/FCRA’s official website may further be referred or an advance ruling may be sought from the department if concern(s) remained.
Good questions! Requiring professionally appropriate application of mind.