Deregistering PBOs in one swoop kills trust, puts much needed jobs at risk

The Public Benefits Organisations Regulatory Authority 15-day notice to 2,802 PBOs to show cause why they should not be deregistered, unnecessarily summoned the ghosts of 2014-17 for many. That notice lapsed yesterday.

Does it mark the start of another season of conflict between civil society organisations and the state? Like most seasoned development workers, the December 5th gazette notice to deregister 2,802 NGOs caught my attention. It took me 23 minutes to quickly scan the endless list for mischief.

The gazette notice claimed that the organisations had defaulted on their legal obligations to submit annual financial reports either last year or going back as far as 2003. Presumably, these legal obligations would be under the NGO Coordination Act (1991), as the PBO Act was only operationalised in May 2024.

The last time such a substantial number of NGOs were deregistered en mass was six years ago under the Jubilee Administration. The NGO Coordination Board abruptly announced they had deregistered 980 NGOs for money laundering, corruption and financing terrorism with no opportunity for the organisations to respond.

Among them were Kenya Human Rights Commission and Ahadi Trust who, up to that moment, and I might add since, have only been known for “terrorising” human rights violators and jiggers respectively. The backlash was national and international. Under public pressure, Devolution Cabinet Secretary Anne Waiguru reversed the decision within hours. That moment marked one of the last outrageous acts of aggression against NGOs by the NGO Coordination Board.

A change in director from Fazul Mohamed to Mutuma Nkanata ushered in a decade of trust and collaboration between Kenya’s 40-year-old NGO sector and the state until the commencement of the PBO Act earlier in 2024.

This latest announcement cannot be seen outside of this painful history of shrinking civic space to restrict the sector’s ability to hold national government and the 47 county governments accountable. The announcement, also comes at a time the Interior Ministry is expected to deliver on the Presidential intention to bring all organisations providing public benefits and development services under one umbrella regulated by the PBO Act by April 2025.

The PBO Act states that registration is voluntary not mandatory. The incentive for organisations to register under this Act, and not the Companies Act for example, lies in the second schedule. For those that choose to remain a PBO or move from another of Kenya’s associative laws, a set of legal and taxation benefits await.

Given a major factor in the success of transiting to the PBO Act lies in raising trust levels between the sector and the state, the abrupt notice was clumsy and badly timed. Deregistering a quarter of registered PBOs in one gazette notice does not deepen confidence in the new Authority and Act. Technically, PBOs have only been in existence for eight months under the new Act.

They have not had the opportunity to file annual returns as required by March 2025. Furthermore, why, if we accept the argument that these PBOs were dormant, could they have not been weeded out in the full transition to the new Act expected by April 2025?

The Civic Freedoms Forum have raised specific concerns with the blanket notice, lack of individualised communication in writing to affected organisations, and clarity on the right to fair administrative action. Other options such as fines or suspension were not considered in the blanket ban.

In our low trust policy and political environment, administrative actions that affect a sector with over 12,000 registered PBOs, a combined revenue of billions of shillings mostly in foreign exchange and thousands of employees need to be taken with more care.

Kenya neither needs another boxing match between state and civil society or capital flight at a time when poverty is rising and our economy is limping. Let the demons of previous decade rest in peace, they will not uplift our nation or economy. [email protected]