Regulator slaps pay cap on NGO donor funds

NGOs Co-ordination Board Executive Director Fazul Mahamed Yusuf (center) briefs journalists at Co-operative House in Nairobi on December 16, 2014. Mr Mahamed has said that NGOs will not be allowed to spend more than 20 per cent of funding from donors on salaries. PHOTO | RAY OCHIENG | NATION MEDIA GROUP 

In Summary

• The directive came after it emerged that out of Sh140 billion that NGOs receive annually, about Sh70 billion goes to recurrent expenditure.
• For instance, the NGOs sector report for last year indicates that NGOs spent Sh10 billion on salaries, Sh26 billion on administrative costs, Sh2 billion on international staff salaries and Sh5 billion on other costs.
• Meanwhile, Cord co-principal Kalonzo Musyoka and Ahadi-Kenya Trust Chief Executive Stanley Kamau have gone to the board to clear their organisations.

By OUMA WANZALA
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Non-Governmental Organisations (NGOs) will not be allowed to spend more than 20 per cent of funding from donors on salaries, the regulator has said.

The directive came after it emerged that out of Sh140 billion that NGOs receive annually, about Sh70 billion goes to recurrent expenditure.

Non-Governmental Organisations Coordination Board Chief Executive Fazul Mahamed said the organisations spend almost equally on recurrent expenditure and development.

“We are preparing to cap the amount spent by NGOs on recurrent expenditure. For instance, we have an NGO official who earns a salary of about Sh2.3 million per month. If this amount were to be given to Kenyans it would be of much benefit,” said Mr Mahamed.

He said currently NGOs depend on donor regulations in terms of spending.

For instance, the NGOs sector report for last year indicates that NGOs spent Sh10 billion on salaries, Sh26 billion on administrative costs, Sh2 billion on international staff salaries and Sh5 billion on other costs.

14-DAY WINDOW
Meanwhile, Cord co-principal Kalonzo Musyoka and Ahadi-Kenya Trust Chief Executive Stanley Kamau have gone to the board to clear their organisations.

“Mr Musyoka, among others, brought the details we required to clear his organisation and once we are satisfied, we will remove Kalonzo Musyoka Foundation from the list,” said Mr Mahamed Friday.

Kalonzo Musyoka Foundation has not accounted for Sh64 million and is also accused of operating two parallel accounts without the authority of the board.

A total of 957 NGOs have been given 14 days to submit audited accounts or be deregistered.

Mr Mahamed added that the board had forwarded the list all the organisations to Central bank of Kenya and Kenya bankers association to freeze the bank accounts.

He said the board was also concerned with some NGOs, which in conjunction with certain banks open, operate and close bank accounts without the requisite approval.