Pakistan’s philanthropic potential

In an era of fluctuating foreign aid and volatile economic growth rates, it is important to tap the potential of indigenous philanthropy to help improve important social indicators, which in turn are necessary for ensuring the future development of Pakistan.

Subsequent to a seminal study on indigenous philanthropy conducted by the Aga Khan Development Network nearly 20 years ago, the Pakistan Centre for Philanthropy (PCP) has been trying to raise awareness about philanthropic giving in Pakistan and how it can help achieve development goals. With similar objectives, the State of Individual Philanthropy in Pakistan study, conducted by PCP in 2016, helps shed light on the patterns and motivations of household contribution behaviour across Pakistan. This study is based on a nationally representative survey of approximately 10,000 households and qualitative interviews with relevant stakeholders related to philanthropic giving practices.

The study revealed that the total estimated magnitude of household level giving in Pakistan was nearly Rs240 billion during 2014, which was thrice the amount of contributions estimated for 1998. Philanthropy in Pakistan includes giving of time as well as money. Much of this is channelled towards needy individuals. When it comes to organisations, the principal beneficiaries of philanthropy are mosques or madrassas. This reveals how charity in Pakistan is largely impelled by religious reasons, where faith supplements conventional ideas of accountability or transparency.

However, other factors such as compassion and reciprocity also matter in terms of motivating philanthropic contributions. The principle of reciprocity serves as an informal insurance mechanism, where people give their time and money to help people in their immediate circle in the hope of being lent similar assistance in their time of need.

It is significant that philanthropy in Pakistan is nearly universal, since nearly 98% households reported giving in some form or the other. Such high levels of individual philanthropy provide evident opportunity for resource constrained development organisations, such as NGOs, to tap into this source of financial giving and volunteering. Yet, besides the visibility of some prominent entities like the Edhi Foundation, Pakistanis generally remain unaware of the range of issues their local development organisations are working on, since these are more concerned with reporting their outcomes to donors abroad.

A more conducive policy environment could help harness philanthropic giving towards development organisations. For instance, many respondents of the study stated they would donate more to development organisations, if there are greater tax incentives in return for their contributions. Another promising avenue for increasing donations to organisations involves making information accessible about the registered entities qualified to receive zakat.

However, experts on harnessing local philanthropy rightly caution that any policy which seeks to bring a shift in giving patterns towards organisations at the cost of individuals must proceed with caution. Despite the well-known advantages of organisational giving, such as long-term effects and higher value for money, philanthropic giving to individuals and the value of informal safety nets are critical in improving living conditions and meeting the basic needs of many people across Pakistan. Before trying to nudge philanthropic giving to development organisations instead, these establishments need to demonstrate their commitment of efficiency and transparency regarding the use of provided funds, and more accountability to people in their immediate vicinity.

Given that a major proportion of Pakistanis live in multidimensional poverty, local philanthropy offers enormous opportunities to supplement state-run social programmes to reach out to poor areas. Instead of pursuing vindictive and unproductive campaigns against NGOs and accusing them of working on foreign agendas, the government needs to focus on the above identified issues, which can help local development organisations overcome their dependence on foreign donors, and help them secure more indigenous sources of funds.

Published in The Express Tribune, July 21^st, 2017.

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