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5
The Johns Hopkins University International Comparative Study on Civil Society rated
South African Civil Society number 18 after Italy and as the leading country within Africa
and among other emerging growing economies because it has a relative sizeable civil
society sector that is worth R9.3 billion contributing 1.2 % to the country’s gross domestic
product in 1998
3
. A recently Business Day feature article, projected the economic value of
the sector to be R12, 5 billion of which national and other foreign governments contributes
a revenue of R10 billion
4
.
It is therefore commonly accepted that any democratic government should then create an
enabling legal environment for civil society to support and encourage the formation of
organisations. South Africa is therefore no exemption to this phenomenon. It has a legal
framework for civil society organisations that is rooted in the fundamental human rights
culture of the country’s Constitution. The right to freedom of religion, belief and opinion; of
expression and; of association as contained in the Bills of Rights is essential for the civil
society formations. This means that everyone has the right to associate with other people
and form organisations and express themselves in what ever way they choose provided
that this is done in compliance with the law.
Based on these fundamental principles of the Bills of Rights, the current legal framework
on civil society organisations serves mainly three purposes. Firstly, it enables
organisations to establish themselves as legal structures. Secondly, it regulates the way in
which such legal structures operate. Part of this includes the registration of a legal entity
with a government registration authority. Thirdly, it provides tax and other incentives for
the sector to financial and otherwise sustains itself. According to the report on the Impact
Assessment of the NPO Act, this compare fairly well with internationally accepted
principles for legislation relating to nonprofits
5
.
In the main, civil society organisations can pursue three different options to become a
legal entity within the current legal framework, namely:- Voluntary Associations; Trusts and
incorporating a Section 21 Company. Different pieces of legislation govern each of these
options and there is therefore a small difference in their governance structures.
Significantly within the legal framework is the Nonprofit Organisations Act 71 of 1997
(NPO Act) which attempts to mainstream the legislative framework for the registration of
organisations as it provides a voluntary registration facility for all the above mentioned
legal entities. Primarily, the purpose of the NPO Act is to create an enabling environment
in which NPOs can flourish and to establish an administrative and regulatory framework
within which organisations can conduct their affairs. Specifically the Act aimed at
encouraging NPOs to maintain adequate standards of governance, transparency and
accountability and to create an environment within which the public may have access to
information on registered organisations. The National Department of Social Development
is administrating this Act.
The NPO Act also makes provisions for the Department to establish a Directorate whose
main responsible is to facilitate the process of developing and implementing policy and
programs to support NPOs in their endeavour to register and to ensure that the standards
of governance within organisations are maintained and improved. In essence, the main
3
Salamon, L. el al (ibid)
4
Renee Bonochis article on BoE gives advice NGOs can bank on. Business Day, Monday, March 5 2007.
5
In 2005, the Department of the Social Development commissioned a study on the Impact Assessment of the NPO Act on the sector. The
design of this assessment focussed on determining the impact of the Act on NPOs, donor and other agencies working with the nonprofit
environment through a research process. The five objectives of the Act were used as the thematic focus areas for this research.