WHY EU FUNDING POLICY OF NGOs IS FLAWED ?

EU policy on NGO’s is flawed for a number of reasons that are set out here.

1. Bias against wealth creation

There is  an unequal distribution of funds among organisations pursuing different aims exists. NGO’s with humanitarian, social, or environmental purposes, representing 25.7% of all non-governmental organisations directly funded by the EU, receive 64.7% of all EU grants while NGO’s promoting industry, civil society, or research and representing 19.0% of EU funded NGO’s receive only 9.7% of the money.  In other words, NGO’s with mainly wealth-consuming missions (humanitarian, social, or environmental concerns) benefit five times as much as NGO’s with primarily wealth-creating aims.

2. Favouritism towards certain NGO’s

A clear inconsistency with the EU aims is the unequal distribution of funds among different organisations. If the EU aims to promote civil society, then all representatives of the same interest should be treated, at least to some extent, equally. However,the Commission funds particular organisations rather than the multiplicity of organisations.

3. Hindering rather than promoting Civil Society

The rationale of supporting NGO’s stems from the idea that freedom of association is an essential democratic right, which must not merely be guaranteed in principle, but be given the necessary means to be exercised. However, any endeavour to impose this idea centrally is inconsistent.

Firstly, public funding undermines civil participation rather than fostering it. More particularly, if NGO’s campaigns are funded with public money instead of voluntary private donations, then there is less need for them to seek support from wider society. EU grants, therefore, should be reduced so that NGO’s are forced to prove the legitimacy of their actions by being able to gather sufficient funds from private donations.

Secondly, by funding NGO’s the Commission promotes its own aims rather than those of NGO’s. Predefined aims are funded rather than the genuine aims of NGO’s. The only liberty NGO’s have is to adjust their aims to match those of the Commission or its politically decided budget. For example, an assessment of the EU’s environmental policy states " the objective of the programme is to support the activity of NGO’s working in areas of EU environmental policy which are relevant to the Commission’s work programme, and not to support their activity per se." The Commission claims to promote a bottom-up approach by predefining what bottom looks like. In this way NGO’s lose their independence.

NGO’s lose even more of their independence by receiving public funding when this funding constitutes a substantial amount of their budgets. For example, eight of the Green 10 (a coalition of ten of the largest European NGO’s) derive at least one-third of their income from the Commission and five of those derive more than half of their funding from the Commission. The loss of independence leads to the promotion of the EU’s agenda, rather than that of civil society. This raises the question whether publicly funded NGO’s actually promote the interests of citizens. If NGO’s are not funded mainly by private donations, then it is questionable whether their publicly funded aims relate to the actual interests of civil society. In other words,  taxpayers are forced to fund views they may seriously disagree with.

4. Goal displacement

Public funding and the loss of independence encourage NGO’s to put all their efforts towards managing EU or national agencies and not towards EU citizens, who should be the real clients for their services. The demand creates the supply. However, the demand is created not by the consumer / citizen, but by a third-party (EU officials). In the context of the EU, NGO’s are expected to foster citizens' autonomy and participation. However, by seeking public funding NGO’s become a means to implement the Commission's rather than citizens' priorities. EU funds are aimed at very specific aims and this leads to goal displacement or goal succession. In other words, in order to increase their resources NGO’s shift their emphasis away from the original goals to the goals of their donors.Consequently, NGO’s tend to be the Commission's subcontractors rather than the representatives of civil society. Projects are suggested, not because they are inherently good, but because they might get funding.

Moreover, in order to appear effective, NGO’s may aim for easily achievable aims rather than for more relevant or appropriate ones. The most appropriate action may be the hardest to fulfil or be too long-term to be funded. Therefore, the best way to achieve effectiveness is to aim for more easily achievable outcomes. Moreover, NGO’s tend to underemphasise the most challenging issues and focus on positive achievements. In order to obtain funding, NGO’s and their management processes have to adopt certain requirements. This leads to the specialisation and bureaucratisation of NGO’s, which is not desirable if NGO’s are to represent civil society. Funding conditions set what is considered as appropriate organisational models. With the purpose of promoting transparency, accountability and efficiency, NGO’s funded by the Commission apply bureaucratic constraints, sound management and New Public Management techniques. However, this may be at odds with participatory democracy. There is a trade-off between democracy and efficiency: the more expertise an organisation can offer, the less it will be able to represent its members. Activists and volunteers in such organisations are replaced by law and communication specialists, which often perceive NGO’s as a career path rather than a means to act for a cause. First, organisations acquire expertise to achieve their objectives and then the acquired expertise starts to shape the organisation's objectives. Moreover, smaller unspecialised NGO’s might be reluctant or unable to implement all the EU requirements and prefer even not to apply for funding.

5. Government self-legitimation

Much of the Commission's funding for NGO’s goes not to promote civil interests or provide some actual service, but to advertise and thus to legitimise the Commission's activities. NGO’s carry out activities in view of raising awareness of public and decision makers e.g. through campaigns, events and awards which often attract high press coverage, production and translation of information material raising awareness and promoting EU policy beyond EU borders. Hence, rather than communicating directly with citizens and taxpayers the Commission delegates some of the public relations and communication work to NGO’s. The Commission wastes taxpayers’ money to persuade the same taxpayers about its own virtue.

Arguably the Commission's outreach to civil society is primarily an effort to enhance its legitimacy. Government has an incentive to seek support through the third parties, because "voters regard almost anyone as being more trustworthy than politicians.

6. Lobbying for Funding, not Funding for Lobbying

An additional concern is that public funding of NGO’s is used by NGO’s not only to provide services, but also to promote and legitimise themselves. One of the tasks ascribed for NGO’s in EU policy-making is involvement in decision-making. Hence, the EU intentionally supports NGO’s for the purposes of lobbying. Given this, NGO’s have a direct financial interest in the EU's budget decisions. It should come of no surprise, for example, that many organisations funded by the Commission lobby against austerity measures in public policy, because austerity implies the reduction of funding for all third parties, including themselves.

It is notable that environmental, human rights and animal rights organisations are the most influential lobby groups in EU policy-making. For example, Green 10’s access to decision-making goes "beyond the dreams of any commercial lobbyist, including regular meetings with the Council and the Commissioner for Environment, as well as monthly meetings at the Director’s level not to mention the fact that politicians are typically more persuaded by arguments put forward by charities than by businesses. Given the scale of their influence and access to decision-making it is questionable whether NGO’s should be fostered even further with EU grants. Therefore NGO’s can use their power not only to guide the agenda but also to lobby for even greater funding for them.