Zimbabwe is implementing the National Development Strategy (NDS) 1 and the National Vision “Towards an Upper Middle Economy by 2030”. To achieve this, a multi-stakeholder approach involving urban and rural populations as human capital is of vital importance. To achieve this, the government must engage in economic empowerment initiatives in both urban and rural areas. A key aspect of this strategy is to directly empower population groups previously marginalized in the mainstream economy and to redress imbalances in resource ownership. As Zimbabwe inherited a dual economy at independence, this structurally constructed discriminatory approach kept poverty in place on the basis of race, tribe and class. Only a selected elite group has been granted access to economic growth and development. Vision 2030 must address this if it can succeed and, according to the World Bank, the government provides less than US$100 million a year for social support programs that include health, education, water and energy. sanitation. This contribution must increase significantly for a middle-income economy to be realized.
To be successful, the NDS strategy must have very active implementation strategies starting at the rural levels. In Zimbabwe, the rural population is estimated to be around 70% practicing subsistence agriculture (Zimbabwe National Statistics Agency, 2015). They live in resource-rich areas in very simple conditions that can be described as conditions of abject poverty. Opportunities to exploit natural resources, vast minerals, wildlife and forest accrue to outsiders who extract this wealth often with employees from outside the local area. Zimbabwe’s economic empowerment policy should therefore include all Zimbabweans at their local level, in the mainstream economy. NDS 1 should also focus on providing appropriate infrastructure such as schools, roads, clinics, dams, rural green energy systems, irrigation systems and equity participation in companies exploiting natural resources throughout the country. Often the development of dams, the work of the extractive industry, commercial agriculture and the energy sector does not respect, protect and fulfill the rights of host communities to be part of their own development.
According to a recent report on the passage of the Private Voluntary Organizations (PVO) Amendment Bill, “The World Bank estimates that NGOs have contributed about US$800 million to social welfare, while the government paid only US$90 million. For example, according to the state of the national budget 2022, during the period from January to September 2021, the country received development assistance in the amount of 647.8 million dollars, of which 401.9 million dollars from bilateral partners and $245.9 million from multilateral partners. NGOs have contributed significantly to filling funding gaps/needs. Donor funding far exceeds government funding in all areas of health, education, food security and social protection. Health financing is dominated by donors, who contribute 35%”. The report asserts that “restriction of NGO activities will have serious consequences for the country’s already fragile economy”.
Therefore, the government’s plans to severely regulate will have far-reaching and negative effects through the PVO Amendment Bill. Worse still, the government did not conduct any consultation process before drafting the bill. One of the objectives of the bill is to streamline administrative procedures and enable efficient regulation and administration of PVOs. There is an attempt to expand the scope of the law
to cover persons, arrangements, bodies, associations or institutions that the Minister declares in regulations to be vulnerable to misuse by terrorist organizations, or at high risk of being misused by terrorist organizations . Persons, legal arrangements, organizations, etc. covered by a Ministerial Declaration will be required to register as a PVO under the Act and will be subject not only to the requirements and obligations set out in the Act, but also to any additional requirements that the Minister may specify in the regulations. .
The authors of this submission join other submissions from the NGO sector, but the content and purpose is to explore and push for common ground between PVOs/NPOs and trusts. Put forward your arguments and open the debate on the legislative framework and regional and international treaties. Specifically, the paper presents some perspectives on corporate social responsibility, community ownership trusts (CSOTs) based on the principles of indigenization. These could be revised and expanded to adopt a social enterprise (SE) structure where more revenue streams can open up beyond the donor community to the private sector. Legal professionals should advise whether these SEs can be incorporated into the PVO bill as a trust and exempt. Alternatively, indigenization and economic empowerment legislation could be amended to “house” social enterprises.
Although the PVO bill is not very clear based on the continuation of other trusts not listed as exempt, it is necessary to assume that all other trusts may be subject to the registration process if they continue to receive foreign funding and/or get involved. in what are considered “political” or partisan activities. We note the following:
1. The majority of civil society organizations are registered as trusts, many are already seeking independence from foreign donor agencies as a mechanism for sustainability. Many of those who are also CBOs are rooted in their communities and it is this rootedness that positions them to be effective agents for development. Some pursue the creation of social enterprises to generate income for their mission. This sustainability approach means they cannot register as nonprofits. Some trusts currently generate income and ZIMRA classifies them as “for-profit” and taxes them heavily, compromising their ability to fund their “mission”. Section 2 of the Bill authorizes the Registrar (i.e. the Director of Social Welfare) to prohibit trusts which are registered with the High Court, but which are not registered PVOs, from collecting contributions from the public or from outside Zimbabwe for any of the purposes specified in the definition of “private voluntary organisation” (i.e. charitable, social welfare, legal and animal welfare). The Registrar will send a notice to the trustees of such a trust requiring them either to sign an affidavit that they will not collect contributions for these purposes or to register their trust as a PVO. Trustees will only be able to avoid doing so if they can convince the Registrar that the notice was made in error.
2. The PVO bill in its current format does not clarify the legality of Community Share Ownership Trusts (CSOTs). It appears that this could have been an omission or that lawmakers perceived CSOTs as being registered under the Indigenization and Economic Empowerment Act[Chapter14:33ThestatedpurposeoftheActistoprovidesupportmeasuresforthefurtherindigenizationoftheeconomy;’indigénisationetd’autonomisationéconomiqueainsiquesesfonctionsetsagestion;prévoirlacréationduFondsnationald’indigénisationetd’autonomisationéconomique;prévoirlaChartenationaled’indigénisationetd’autonomisation;etdepourvoirauxquestionsliéesouaccessoiresàcequiprécède[Chapter14:33ThestatedpurposeoftheActistoprovideforsupportmeasuresforthefurtherindigenisationoftheeconomy;toprovideforsupportmeasuresfortheeconomicempowermentofindigenousZimbabweans;toprovidefortheestablishmentoftheNationalIndigenisationandEconomicEmpowermentBoardanditsfunctionsandmanagement;toprovidefortheestablishmentoftheNationalIndigenisationandEconomicEmpowermentFund;toprovidefortheNationalIndigenisationandEmpowermentCharter;andtoprovideformattersconnectedwithorincidentaltotheforegoing[chapitre14:33L’objectifdéclarédelaloiestdeprévoirdesmesuresdesoutienpourlapoursuitedel’indigénisationdel’économie ;prévoirdesmesuresdesoutienpourl’autonomisationéconomiquedesZimbabwéensautochtones;prévoirlacréationduConseilnationald’indigénisationetd’autonomisationéconomiqueainsiquesesfonctionsetsagestion ;prévoirlacréationduFondsnationald’indigénisationetd’autonomisationéconomique;prévoirlaChartenationaled’indigénisationetd’autonomisation ;etdepourvoirauxquestionsliéesouaccessoiresàcequiprécède[Chapter14:33ThestatedpurposeoftheActistoprovideforsupportmeasuresforthefurtherindigenisationoftheeconomy;toprovideforsupportmeasuresfortheeconomicempowermentofindigenousZimbabweans;toprovidefortheestablishmentoftheNationalIndigenisationandEconomicEmpowermentBoardanditsfunctionsandmanagement;toprovidefortheestablishmentoftheNationalIndigenisationandEconomicEmpowermentFund;toprovidefortheNationalIndigenisationandEmpowermentCharter;andtoprovideformattersconnectedwithorincidentaltotheforegoing
3. There are concerns about the principles that should be present in PVO legislations such as transition mechanisms, registration process, right of appeal, access to justice. Women’s organizations are also lifting the veil on the language of the bill regarding the need for gender equity at the board level. Some women’s organizations need an all-female board of directors, as these organizations become vehicles for women’s empowerment.
Access the full submission here (1MB PDF)
- Lupane Women’s Development Trust (LWDT)
- Phathisani Community Organization
- Trinity Project (TP)
- Maranatha Orphan Care Trust (MOCT)
- Dinah Falala and Phoebe Sandi Foundation (DP Foundation)
- Sakhisizwe E&S Development
- Sibanye Animal Welfare and Conservancy Trust
- Renewable Energy for Sustainable Development (RESD) Trust
- Lupane Youth for Development Trust (LYDT)
- Tikobane Trust
- Inkhanyezi Development Trust (IDT)
- Nurturing Imvelo’s confidence
- Limpopo Basin Development Trust (LIBADE)