Public Council of the Republic of Armenia
Committee on Civil Society Development
STRATEGY CONCEPT OF DEVELOPMENT OF CIVIL SOCIETY ORGANIZATIONS IN THE REPUBLIC OF ARMENIA
1. Argumentation (Introduction) ……………………………………..….4
2. General Clauses and Principles …………………………………………5
2.1. The Idea and Perception of Civil Society………………………….5
2.2. Civil Society in Armenia: Historical Review …………………….7
2.3. Civil Society Organizations and Government Bodies ……………9
2.4. Civil Society Organizations and Parties …………………………10
3. Institutional Viewpoints on the Development of Civil Society Organizations ………………………………………………………..10
3.1. Improvement of the Legislative Sphere and Institutional Atmosphere for Functioning of Non-Governmental Organizations ……………………………………………………………………10
3.1.1. Reduction of Legislative Restrictions on Names of Non-Governmental Organizations ……………………………………11
3.1.2. Facilitation of Registration of Non-Governmental Organizations12
3.1.3. Necessity and Accessibility of an Online Data Base of Non-Governmental Organizations ……………………………………12
3.1.4. Legislative Problems Connected with Liquidation of Non-Governmental Organizations ……………………………………13
3.1.5. Necessity to Enlarge Opportunities for Protecting Beneficiaries' Rights by Non-Governmental Organizations ……..………………14
3.1.6. Issues of Structure Units, Internal Democracy and Activities of Civil Society Organizations………………………………………15
3.1.7. Public Participation Processes. Mechanisms of CSOs Participation in Processes of Developing Current Policy, Making Decisions by Government Bodies in Armenia…………………………………..17
3.2. Reforms Concerning Charity Organizations …………………….19
3.3. Measures Aimed at Raising Awareness among Government Officials, Civil Servants ………………………………………….20
4. Formation of Mechanisms and Atmosphere of CSOs Financial Stability ………………………………………………………………21
4.1. Issues of Financial Viability and Stability of CSOs in Armenia…………………………………………………………….21
4.2. Improvement of Processes of State Funding of and Allocation of Grants for Civil Society Organizations in Armenia ……………..23
4.3. Necessity to Form a National Foundation for Support to the Civil Society ……………………………………………………………….25
4.4. Online Data Base of Government Grants ………………………26
4.5. Formation of the Tradition of Delegating to Non-Governmental Organizations Some Projects Intended for National and Local Self-Government Bodies ……………………………………………..26
4.6. COSs Endowment as a Tool for Financial Sustainability………27
4.7. Study of Issues of Forming Mechanisms for Financial Assistance to CSOs by Certain Allocations from Taxpayers’ Income Taxes and Giving Public Organizations the Right to Entrepreneurial Activity …………………………………………………………………………………………..27
5. Development of Human Potential ………………………………….28
5.1. Civil Society Organizations as a Factor to Overcome Passivity and to Direct Activeness ………………………………28
5.2. Regulation of the Voluntaryism Institute and Formation of an Encouraging Atmosphere……………………………………..30
5.3. Involvement of the Civic Educational Component at All Levels of Formal Education………………………………………31
5.4. Development of Mass Media and Deepening of Their Cooperation with Public Organizations …………………………31
6. External Cooperation ………………………………………………..32
6.1. Cooperation with Organizations of the Republic of Nagorno Karabakh …………………………………………………………32
6.2. Cooperation with Organizations of the Diaspora …………………32
6.3. Cooperation with Foreign and International Organizations ……….33
7. Summary/Conclusion ………………………………………………..34
7.1. Prerequisites for Developing the Concept ……………….……….34
7.2. Actions to Fulfill the Concept …………………………………….35
8. Abbreviations Used ………………………………………………….,.36
1. Argumentation (Introduction)
The development of the Republic of Armenia as a sovereign, democratic, social state governed by rule of law is unavoidably conditioned by the processes of formation of the civil society. The latter plays a key role in the processes of participatory democracy, enhancement of the rule of law, representation of interests of various social layers at the decision making level, which are crucial preconditions for steady development of any society.
The role of civil society in public administration and development is increasingly growing throughout the world. In the Republic of Armenia, during the independence years serious steps to form civil society institutions have been made with evident achievements. Relevant legal background is available. According to the data of October 2012 there are 3432 non-governmental organizations, more than 1200 mass media, 733 funds, 301 unions of legal persons registered in the RA. Some unregistered organizations, various movements, interest groups also function. Participation and influence of civil society organizations in social processes is becoming more and more significant.
However, there are still several problems demanding solutions in the spheres of improvement of the legal atmosphere of functioning of non-governmental organizations, development of institutional capabilities, formation of substructures complying with regulatory aims, provision of financial sustainability, promotion of civic consciousness development and participation, influence on social processes, participation in decision-making, formation of umbrella networks, deepening cooperation with the Diaspora and international structures.
The analysis of programs conducted by government bodies in the area of non-governmental organizations, mass media, and non-profit organizations; of some ineffective initiatives, legal obstacles and of the steps against them taken by CSOs reveals that a considerable part of the existing problems is conditioned by the absence of a single concept and strategy for policy and actions in the area.
“Strategy Concept of Development of Civil Society Organizations in the Republic of Armenia” aims to fulfill that gap, thus becoming a kind of guide for setting strategic aims of state policy in the area and for defining and resolving problems.
The main aim of the Concept is to define dominant directions of stable and long-term development of the civil society in the Republic of Armenia; to promote development of civil society organizations through reforms of the legislative-normative field and through constant activities of state authorities; to raise their role in human rights; to promote democratization of social life; to work out effective mechanisms for civil control over government decisions and activities.
The present Concept was drafted taking into consideration the definition of basic CS notions and the three main development directions of CSOs: institutional-functional capabilities, fiscal stability and strengthening of human resources.
2. General Clauses and Principles
2.1. The Idea and Perception of Civil Society
The idea of civil society has developed and been amended during world history acquiring various interpretations, assessments. It is still an endless topic for specialists and researchers. Yet, these variable interpretations and perceptions share the same philosophical-methodological basis. Thus, civil society is a form of organization and government of social life where an individual-citizen, with own interests, needs and rights comprises the central value, the main functioning subject and final end . And non-governmental institutions and organizations are to satisfy these interests and needs.
In interpretations of institutional-structural peculiarities of a civil society one can identify broad and narrow perceptions .
In the broader sense, political institutions like the state, parties, political movements, structures of the economic sector, as well as public non-political, non-profit organizations and movements, forms of self-formation, mass media fall under structures of civil society.
In the narrower sense, by civil society organizations one may mean the chains constituting the third sector (after the political and economic-commercial sectors), which, first of all, are non-political, non-commercial public organizations, and then also unions of legal persons, foundations and charity organizations. In other words, it is the “sphere beyond family, state and market and is formed by individual and collective actions, organizations and institutions to promote common interests” . The World Bank also widely applies this notion of CSOs .
Within this Concept the term civil society organization is implemented in the narrower sense (the third sector). It refers to non-governmental, not-for profit organizations, foundations, societies of legal persons, artistic unions, charity organizations, civil movements and forms of activism.
Lawful state and democracy, necessary to guarantee political and civil freedoms, to protect citizens’ rights, to secure legal and social fairness, constitute the legal and political basis of civil society.
The economic basis of civil society is variability of forms of ownership, economic independence of citizens and free competition of economic subjects.
The informative basis of civil society comprises the mass media securing accessibility of publicity, transparency of events and information on them.
The major basis of civil society is informed citizen and hi/her active and significant involvement in in social processes.
The main values and principles of fortifying a civil society are citizen activeness; participation; predisposition for mutual respect and social collaboration between the political, economic and civil sectors; responsibility/accountability; political independence of civic initiatives (disallowance of directions and political order in case of support for civic initiatives from government budget, foundations); equal opportunities for citizens’ participation in public life.
2.2. Civil Society in Armenia: Historical Review
Depending on the interpretations of “civil society”, the history of relevant institutions and traditions in Armenia can be considered both old and new.
If viewed in the broader sense, it should be noted that the civil society traditions in Armenia are rich in history. The first government formations in the Armenian civilizations date back to the third millennium B.C.
In the narrower sense (as a set of non-governmental organizations formed on voluntary basis, aimed at the interests of their members and at the solution of public significance issues) civil society organizations are in no case a novelty in Armenian reality. Losing its sovereignty and state institutions (although they were partly preserved in historical Artsakh) in the 14th century, the Armenian society continued to survive, to develop its culture, science and education just through self-organizing mechanisms, through non-governmental organizations and structures in the modern sense – from communities, traditional families, Apostolic Church to benevolent organizations, defense and national liberation movement detachments. Reconsideration of these traditions could serve as a basis for the development of contemporary civil society structures.
During the Soviet years, however, those traditions faded away significantly. In that period non-governmental organizations were chiefly attachments of government structures and the party in power. As to alternative no-formal organizations and movements, as a rule, they were politically and legally repressed and persecuted.
In their contemporary sense, civil society organizations – as a major link of civic participation and democratic governance – began to emerge during the years of national revival in the late 1980s and after Armenia’s becoming independent, when legal guarantees of multiparty system, plurality of ownership forms, freedoms of speech and other civic freedoms were formed.
Currently, the CSO field is regulated by certain laws, specifically by: the Civil Code of the RA, 1998; Law on Public Organizations, 2001; Law on Foundations, 2002; Law on Charity, 2002; Law on the Dissemination of Mass Information, 2003; Law on Freedom of Information, 2003; Law on Parties, 2002; Law on Television and Radio Broadcasting, 2000; Law on State Registration of Legal Entities, 2001, by other legal acts adopted by government bodies, as well as by international agreements the Republic of Armenia has joined.
The analysis of the data on functioning organizations, printed and electronic mass media, foundations, legal entities registered in the RA Ministry of Justice; the existence of not registered organizations, movements, interest groups; gradual increase in the indices of their participation and influence witness significant development of civil society organizations in the structural sense. However, there are major problems to be solved in improving the legal sphere; in the formation of internal substructures of organizations; in securing financial stability and transparency of activities; in network structures; in developing mechanisms for social partnership.
From functional position civil society organizations demonstrate less development in their impact on public processes; in participation in decision-making processes; in mastering technologies of social influence; in consolidating civil potential to solve various problems and in efficient functioning.
2.3. Civil Society Organizations and Government Bodies
Development of a constitutional state and democracy is conditioned by the existence of active and influential civil society organizations. Meanwhile, their functioning heavily relies on the guarantees by state bodies, effective policy conducted in the civil institution sector.
The state guarantees its citizens’ rights and freedoms of free expression, of establishing organizations and forming movements to fulfill their interests, of fighting for their own interests.
The development of a constitutional state supposes a democratically governed political system, active dialogue and cooperation between civil society organizations and government bodies. The state forms the legal sphere of civil society organizations, develops strategic plans and mechanisms of their material support, control and cooperation with them. CSOs turn to government bodies with various initiatives, remarks, proposals to join projects under way, and for support. The authorities study civil initiatives, support or reject them, allocate means to back them.
The section of civil organizations not only supports political authorities, but also functions as checks and balances. To fulfill that mission it has certain means: active participation in electoral processes and referenda; opportunities to form public opinion; organization of support or opposition campaigns for government undertakings.
Civil society organizations, through integrating interests, needs and demands, through recruiting citizens and making them active participants, offer ideas, projects and plans, as well as specialists mastering certain organizational skills and aware of public issues to government bodies for its “outgoing” functions.
Assuming the wide spectrum of relations between the state and CSOs and also the possibility of various models in this respect, the preferred option of interrelations between them partnership, mutual control and interconnectedness should be considered. In this case representatives of public organizations are involved in various authority structures and when representatives of state authorities are involved in the activities of civil organizations. This model allows overcoming the alienation, polarity and conflict situations in civil society organizations-state relations, thus promoting efficient dialogue and cooperation.
2.4. Civil Society Organizations and Parties
In their relations with political parties and associations, CSOs fulfill the functions of checks and balances, critics, as well as of support, enlargement of the social basis, partnership, program, and enrichment of cadre potential.
For interactions between parties and non-government organizations the “consolidating” model can be preferable and perspective in the Armenian reality. In this model CSOs are “classified” not according to social and political layers, thus becoming attachments or party-born structures, but pursue goals that consolidate representatives of various social layers and groups with different political-ideological orientations. In the public system such a distribution of CSOs promotes the dialogue and cooperation between variable social layers, ironing out the differences and conflicting situations between political organizations, formation of negotiating atmosphere.
It is essential that government bodies and donor organizations dealing with the policy of and support for non-governmental organizations, while conducting their programs, give preference to the “consolidating” model of civil society.
3. Institutional Viewpoints on the Development of Civil Society Organizations
The legislation regulating the sphere of civil society in the RA mainly formed in 1998-2003. Since then a number of problems have occurred demanding amendments in the legislative and legal-normative area.
3.1. Improvement of the Legislative Area and Institutional Atmosphere for Functioning of Public Organizations
Non-governmental public organizations have a key role among civil society institutions. They perform essential functions in the processes of forming active position and participation; of revealing public potential and directing it; of integrating and editing the interests and needs of different social groups and presenting them at the decision-making level; of public self-organizing; of controlling programs conducted by the authorities.
Improvement of the legislative-normative sphere regulating public organizations is of major importance from the position of development and enhancement of civil society.
On the whole considering the opportunities granted by the RA ''Law on Public Organizations'' in use since 2001 satisfactory, nevertheless, it should be noted that a number of problems evolved in the sphere of functioning of public organizations suppose amendments in the legislative field and actions in the development of institutional structures.
3.1.1. Reduction of Legislative Restrictions on the Titles of Public Organizations
To avoid confusion with other legal structures, the RA ''Law on Public Organizations'' bans usage of words "foundation", "fund", "cooperative", "company", "branch", "representation", as well as "union" and "association" in the titles of public organizations.
But, taking into account the fact that both before and after adopting the RA “Law on Public Organizations” several public organizations function in Armenia with titles comprising the word “union” (trade, art, patriotic unions) and that the use of that word cannot cause confusion of these public organizations with other legal entities, it is necessary to remove the ban on the use of the word “union” in the titles of public organizations in the “Law on Public Organizations”.
Also, taking into consideration that many NGOs functioning in the RA bear the word “association” in their titles (Armenian Sociological Association, Association of Women with University Education, Human Rights Helsinki Association, Armenian Marketing Association, Association of Accountants, etc.) the expedience of the legislative ban on using the word “association” in titles of NGOs should also be reviewed. Instead, the rare businesses with names comprising the word “association” could legislatively be offered to implement the word “company”.
Decrease of legislative restrictions on the titles of public organizations will allow many public organizations to function within the law, thus avoiding the difficulties connected with changing their names.
3.1.2. Facilitation of Registration of Public Organizations
The centralized system of registration of public organizations comprises certain difficulties for the registration of organizations forming in far-away settlements, for informing about changes in their names, address, board, for registering their regulatory amendments. The problem becomes even sharper when it is necessary to pay some additional visits to the registrar’s office to present some extra documents, to clarify the title or regulations of the organization.
To facilitate the process of registration of public organizations and dealing with the authorized body, it is necessary to empower district subdivisions registering legal entities with authority to register public organizations; to fix information about them; to accept reports set by law.
The main step in facilitating the above noted functions is to develop and enhance the system of electronic registration and fulfillment of official functions by organizations via electronic means.
3.1.3. Necessity and Accessibility of an Online Data Base of Non-Governmental Organizations
During the process of registration of public organizations, to facilitate the choice of name and to avoid protractions; to promote formation of partnership contacts and networks among public organizations; to guarantee publicity and accessibility of program and financial activities of non-governmental organizations, and to guarantee accessibility of statistical data necessary for research projects of analysis of the public organization area the information on main directions of activities of public organizations and their names should be made accessible for the public.
To that end, an online data base of CSOs should be created where information on CSOs, main directions of their activities, contact data, board, membership shall be installed free of charge, where links will be available to other sites with information about fulfilled projects and annual reports to government bodies.
3.1.4. Legislative Problems Connected with Liquidation of Non-Governmental Organizations
The current legislation (“RA Law on Public Organizations”, Article 20, “RA Civil Code”, Articles 67; 71, “RA Law on Bankruptcy”, Article 2) defines legal basis and motivations for liquidation of organizations. One of the reasons for liquidation of a public organization is bankruptcy (“RA Law on Public Organizations”, Article 21, p. 3). The “Law on Bankruptcy” offers no differentiations between entrepreneurship legal entities and non-profit organizations; although it defines that for insolvency and bankruptcy proceedings with involvement, in the capacity of a debtor, of a charity or non-governmental organization, the law may define rules other than those defined by this Law (Article 2, p. 2). Actually, according to the current law the same rules of bankruptcy proceedings of entrepreneurship legal entities are applied to non-profit public organizations.
It is preferable, however, taking into account legal peculiarities of public organizations, that specific rules be developed for insolvency and bankruptcy proceedings with their involvement, in the capacity of a debtor. It is also important that opportunities to implement financial recovery plans are given to public organizations just the way that is done in case of entrepreneurship organizations, individual entrepreneurs and natural persons. It is hard to define the fact of bankruptcy of a public organization, especially because most of them have no property or financial means, no employees and are mainly based on the principle of voluntaryism.
The clause of the RA “Law on Public Organizations” needs clarification, according to which “numerous and gross violations of law”, “gross violations or breaches of law” (Article 21, sub-points 2 and 3 of p. 1) may serve as ground for compulsory dissolution of an organization. These formulations comprise the opportunity for subjective and arbitrary interpretations and need final clarification.
The issues on ownership of a public organization’s property after its dissolution also need clarification. Point 5 of Article 20 of the “Law on Public Organizations” sets that after the dissolution of the organization the property, which remains after satisfying the creditors’ debts, shall be used for achievement of the organization’s statutory goals and if this is not possible the property shall be transferred to the state budget. But neither the Law nor any other legal act defines how this transfer to the state budget should be made, how the state is going to accept and possess it, whether the state shall keep it or give to anyone else.
The logic to assist civil society organizations suggests that it would be preferable to allocate these means to other non-governmental organizations as assistance in the projects conducted by them. For this end and also to coordinate the state financial support policy of civil society organizations, it is rather important to form a civil society support foundation, whose expediency is discussed in Part 4.3. of the present Concept.
The RA “Law on Dissolution of Organizations and Removal from Register of Individual Entrepreneurs not Having Submitted Tax Reports by January 1 2008” (2011) grants the State Register Agency of the Ministry of Justice (MJ) with the right to dissolve the activities of organizations that have not submitted tax reports (Article 4). Meanwhile, the RA Law on Public Organizations defines that a decision on compulsory dissolution of an organization can be made only by the court at the request of a state authorized body and only in case grounds meeting the demands of the law exist (Article 20, p. 3). Thus, a corresponding amendment should be made in the RA “Law on Dissolution of Organizations and Removal from Register of Individual Entrepreneurs not Having Submitted Tax Reports by January 1 2008” in order to remove the disharmony in the legal acts.
3.1.5. Necessity to Enlarge Opportunities for Protecting Beneficiaries' Rights by Non-Governmental Organizations
Public organizations, as major actors of a civil society, pursue protection of human and civil rights and freedoms of their members and beneficiaries in government, local self-government bodies, courts, other institutions; they pursue effective solution of the problems facing the society. The Law on Public Organizations sets the right of public organizations to defend its and its members’ rights and legal interests in court (Article 15, p. 1, sub-point 3), however, it lacks clauses about the right to present beneficiaries at court or to protect their interests judicially.
The right of a public organization to protect its members’ and beneficiaries’ rights judicially is limited by Article 40 of the RA Civil Code and by Article 5 of the RA “Law on Advocacy”, which set that one has the right to be presented at court by a representative if the latter is an advocate. And the means of a public organization are too limited to resort to a lawyer’s service and to pay.
To develop democracy and civil society; to give public organizations the opportunity to fulfill their functions; to make their public control over government and local self-government bodies more effective further legislative amendments should take the route of tackling the noted problems.
3.1.6. Issues of Structure Units, Internal Democracy and Activities of Civil Society Organizations
CSOs, as major subjects of democracy, are to develop an exemplary level of internal democracy, transparency of activities and accountability.
Research held by various international and national organizations testifies that quite often CSOs in Armenia are centralized around an individual who usually is either the head or chairperson of the organization . (With certain reservations, the same could be said about some political parties.) The first figure usually acts as the only representative of the organization and makes most decisions. According to the data of a survey held by “Caucasus” Social Research Center in 2010 the opportunities of members of public organizations and parties to impact the decision-making process in their respective organizations, by their own estimations are rather limited, amounting to 2.1 and 2.0 out of 5 points .
The existence of relevant substructures (presidium, board of directors and trustees, oversight committee, etc.) is a major guarantee for internal democracy of CSOs. Although most CSOs have presidiums, boards of trustees or directors according to their statutes, in most cases these are either of quite symbolic nature or are involved in the executive activities of the organization's staff thus being unable to fully conduct their duties.
In the next few years it should become one of the main directions of developing strength of CSOs to confer vital meaning to internal democratic and participatory mechanisms and to raise the level of accountability and transparency for their own members and beneficiaries.
CSOs receiving funds and grants from donor organizations submit relevant and detailed reports about their activities and use of financial means. Regular quarterly and annual reports are also submitted to the tax bodies.
Although the Law on Public Organizations sets that an organization must submit to its general meeting reports on its activities and on utilization of its property not less than once every two years, “guaranteeing publicity of these report”, it doesn't define the structure of these reports and the method of providing publicity. In result, though Armenian CSOs submit regular and detailed reports “up” – to donors and government bodies, they still fail in presenting reports “down” – to their own members and beneficiaries, which may endanger transparency and authority of CSOs .
Within the framework of reforms to be implemented in the sphere of activities of public organizations it is necessary to work out such a system of accountability that will provide the state and public with all the necessary information without putting any additional technical, bureaucratic and financial burden on NGOs. Efforts of government bodies interested in the reports of NGOs should be consolidated to work out a single format for the reports to be submitted, so that NGOs do not have to amend their reports depending on what agency they are submitting it to.
3.1.7. Public Participation Processes. Mechanisms of CSOs Participation in Processes of Developing Current Policy, Making Decisions by Government Bodies
The formation of the Public Council of the RA in 2009, in 12 field commissions of which more than 2000 representatives of 1200 CSOs with state registration enlisted, made a breakthrough on the way of institutionalizing CSOs participation in the processes of developing policy for government bodies and decision making in Armenia. The activities of the Public Council during four years; its participation in the discussion and amendment of various legislative initiatives, concepts; organization of concerned hearings on issues of public importance and suggested solutions; feedback on the raised issues in citizens' letters witness about the vitality of this structure and the need for strengthening it.
RA President's Order NoՆԿ-36-Ն of March 11 2009, PC Statute approved by it, temporary regulations adopted by the PC constitute the legal basis of the Public Council. The concern to further institutionalize growth of the role of the Public Council as an individual consultative body in the system of public administration; of identifying and fortifying its status; of rooting traditions of social partnership; of participation of civil society organizations in the processes of developing policy by government bodies and public supervision by CSOs supposes adoption of a law on the Public Council. Taking into account progressive international experience and local peculiarities, it is to set the status and structure of the Public Council; its functions in legislative initiatives, in expertise of draft government decisions; in holding hearings on issues of public importance; in coming up with proposals and guarantees based on those hearings; in conducting monitoring and control over programs held by government bodies; in proposing concept projects of the development of different public spheres; in the dialogue between parties with conflicting interests; in social partnership initiatives and others. It will also set the area and ways of cooperation of the Public Council with the Government and the National Assembly.
The second step for institutionalization of public participation in the development of policy of government bodies was formation of colleges adjacent to the RA ministers (consultative bodies). Its aim is to make the policy conducted by ministries more efficient and transparent, also to secure public participation in these processes. Nevertheless, there are still problems seeking solution in this field as well. The colleges adjacent to the RA ministers do not yet comprise enough CSOs, and according to 2012 data two of them do not include representatives of any public organizations. To make the work of colleges adjacent to ministers more efficient, it is incumbent to increase representation of CSOs, experts in them, thus defining the principles of selecting members of the colleges and promoting involvement of CSOs with institutional capabilities and relevant expertise.
It is important to form a body coordinating the work of the college; a working schedule; to design annual plan of work; to enlarge the powers of the college up to making its decision on certain issues incumbent or compulsory.
In the colleges adjacent to ministers the civil society is mainly represented by organizations from Yerevan, while activities of the colleges are nationwide. To fill this gap, also to make the activities of local self-government bodies more transparent, effective and more accessible for public participation, public councils (analogues of the Public Council or its district offices) should be formed adjacent to marzpets (governors).
In special cases it is advisable to form subdivisions in ministries dealing with contact and cooperation issues with CSOs, or to widen the functions of structures within them responsible for public relations.
Among the mechanisms of forming policy and public participation in the decision-making process, the practice of forming various councils involving CSOs and adjunct to government and local self-government bodies is of great importance. In that sense the memoranda concluded between the Business Support Council, National Council on Sustainable Development, Poverty Reduction Strategy Program Management Council, Anti-Corruption Council, National Youth Policy Council, Council on Women’s Affairs – all adjunct to the RA Prime Minister; RA National Assembly, Prosecutor General’s Office and CSOs Public Network are of interest. Local participatory institutions – students’, parents’, pupils’, neighbourhood and other committees and councils – may also play a major role.
Meanwhile, the analysis of the mentioned institutions has revealed that the procedures of forming those structures are not transparent enough; that definite professional and representative criteria for selection of CSO delegates are insufficient; that passive forms of participation overwhelm active forms.
Solution of these problems will promote formation and conduct of public policy; increase in the level of participation of public organizations in monitoring processes and civil activeness; improvement of efficiency indices of protecting interests and governance.
Parallel to economic development, it is incumbent to create conditions for strengthening trade unions and forming trilateral (state-employer-trade union) commissions aimed at tackling problems arising in the sphere of economic relations.
3.2. Reforms Concerning Charity Organizations
Several charity organizations are registered in the Republic of Armenia. Their functioning is very significant as they provide humanitarian aid to the survivors of the 1988 December earthquake; to the displaced people and refugees after the atrocities in Azerbaijan; to socially insecure groups in the post-war period .
The activities of charity organizations are regulated by the RA Law on Charity adopted in 2002. It defines the concepts “charity”, “charitable organization”, “charitable program” (Articles 3; 11; 13). The Law defines that only a special body – an authorized government commission – qualifies and registers a program as charitable (Article 13, p. 2), and only after that a program can get any tax and/or customs privileges. Actually, the Law distinguishes a definite type of organizations (“charitable”) with a definite circle of functions and restrictions, but a project under it is qualified (or is not) as “charitable” at the decision of a special commission. This dual degree system of qualifying charitable programs comprises additional bureaucratic procedures and ambiguity.
It is preferable that the law definitely excludes charity organizations’ right to conduct programs of other character and holds special control over such programs and regular audit based on the submitted reports so that the organizations do not have to have their programs qualified by the government commissions every time.
3.3. Measures Aimed at Raising Awareness among Government Officials, Civil Servants
To promote cooperation between bodies of national and local government, local self-government and civil society organizations projects aimed at raising awareness among officials concerning the civil society, issues of civic initiatives and participation, the principles of effective dialogue and cooperation between government bodies and CSOs matter a lot. Special attention should be paid to organizing trainings, seminar-discussions on the mentioned topics; to involving the academic component of these topics in the curriculum of retraining and qualification classes for government officials, civil servants; to compiling a manual/handbook for them on the civil society, civic activeness, initiatives and participation .
4. Formation of Mechanisms and Atmosphere of CSOs Financial Stability
4.1. Issues of Financial Viability and Stability of CSOs in Armenia
One of the primary issues in the development of CSOs in the Republic of Armenia is formation of mechanisms to provide their financial viability and stability . The problem is ultimately grave in the case of public organizations constituting the axis and main component of civil society institutions. Actually most of the Armenian public organizations are unable to function sustainably without the traditional dependence upon outer donor organizations. It is noteworthy that only a few of them have achieved a level of financial capability to afford permanent staff employees.
Under the RA legislation financial means of public organizations are formed from membership fees, donations, grants, other sources not prohibited by the law. Because of still high unemployment, low wages and unfavorable social-economic conditions the membership fees paid by members of the RA public organizations comprise an insignificant sum and cannot matter much for financial viability and promotion of projects. Donations from the business sector are random and limited because of lack of tax privileges, not enough trust for CSO sector among the businessmen, the legislative-normative complexities and bureaucratic difficulties on the way of realizing charity projects. The RA Law on Public Organizations prohibits NGOs from directly being involved in entrepreneurship, although it grants them with the right to establish such enterprises (Article 15, p. 1, sub-point 6). Grants remain the main source of funding for survival and activities of public organizations in Armenia. Most projects fulfilled by non-governmental organizations are held through the grants allocated by international donor organizations. Grants are allocated also from local sources, specifically from the state budget. However, that process is notable for the lack of systemized policy, definite and transparent procedures, for little accessibility of information about the projects conducted .
Some of the problems in the current stage of development of public organizations are instability of the financial situation, dependence upon foreign donor organizations and scarcity and difficult access to the mechanisms of getting means from local sources.
According to the data of research held by Johns Hopkins University specialists in 36 countries throughout the world there are three main sources of funding for public organizations: payments for services (including from economic activities) – 53%; state funding – 34%; donations – 12% .
It is important that perspective steps for the solution of problems in financial viability of non-governmental organizations in the RA are developed based on international experience and national peculiarities.
On the way to solving these problems the main steps should be:
A) To systemize-regulate the processes of allocating grants and fiscal assistance to public organizations by the government, to form relevant policy and mechanisms for that end.
B) To establish the tradition that bodies of national and local government delegate some projects of public significance (social assistance, educational, research, monitoring of policy or projects under way, observation, etc.) to non-governmental organizations.
C) To form an online data base of state grants to public organizations.
D) To study the issue of establishing some mechanisms for financial assistance to public organizations by allocating certain part of taxpayers’ income taxes similar to the “Law of 1%” practiced in some Eastern European countries (Hungary, Slovakia, Lithuania, Poland, Romania).
E) To study the possibility to give NGOs the right to conduct economic activities, make investments.
4.2. Improvement of Processes of State Funding of and Allocation of Grants for Civil Society Organizations
Every year the RA Government allocates financial aid to NGOs to promote development of the public sector. In 2010 AMD 1.909.541.900 was allocated for “non-governmental (public) organizations as a donation” from the state budget, in 2011 it was AMD 1.986.069.900, and in 2012 budget it was AMD 2.063.965.600.
But, as studies of international and national organizations witness, the government has no consistent policy, no definite and transparent procedure that would decide what projects should be funded, through what mechanisms, and what sum should be allocated for NGOs. Besides, the information about processes in progress is not accessible to the public, which gives no opportunity to make any conclusion concerning the efficiency of grant allocation, thus giving way to corruption risks and abuses .
The process of allocating finance to NGOs from the state budget is not regulated by an individual law. The legal acts regulating that process (RA Law on State Budget, RA Law on Public Procurement, Order of Allocating Subsidies and Grants from the RA State Budget to Legal Persons (RA Government decision of December 24 2003 No1937-Ն), Order of Allocating the Means Given from the RA State Budget to the RA President’s Staff to Public Organizations as grants (ՆՀ-118-Ն, May 19 2008) make no difference between commercial, profit-making CSOs and those without such targets, which makes it hard for the latter to take part in research, educational, social, monitoring, consultative and similar programs. The same picture can be observed with the means of international organizations addressed to CSOs through government bodies (ministries, Project Implementation Units – PIUs).
NGOs receive assistance from the RA state budget under the articles “Donations to non-governmental organizations”, “Subsidies to non-governmental non-fiscal organizations”, “Other expenses” and “Reserve fund beyond the main divisions” (economic classification). By some expert estimations the total amount of the sum allocated to public organizations from the RA state budget during the recent years amounts to about USD ten million .
The biggest beneficiary of donations for non-governmental organizations is the RA Ministry for Sport and Youth Affairs (42.9%) that allocates most of the funds to sports federations, which are registered as public organizations. Several foundations established and/or managed by the state are also funded from the above mentioned articles . But both the sports federations and foundations established and/or managed by the state could hardly be considered CSOs as the state participation in them prevails. By the way, the mentioned organizations get means from the state budget also under the article “current grants to other strata of state sector”. Consequently, in one case the government considers CSOs and NGOs, in another case a part of the state sector.
In the coming years within the context of legislative reforms, the strategy and procedures of allocating financial assistance from the state budget to CSOs should be clarified and distinction should be made between them and procedures for profit-making organizations, thus making them more accessible for non-governmental organizations. It is desirable that allocations to CSOs from the state budget be made under a definite article, so that their addressees and efficiency are provided. The sum of allocations for CSOs in the state budget should be designed stemming from the priorities of conducted policy. Meanwhile, designation of the article on allocations for CSOs should be connected with planning the following year’s budget.
4.3. Necessity to Form a National Foundation for Support to the Civil Society
To coordinate the process of allocating grants and financial means to CSOs from government structures, to develop its policy and to administer that process effectively, establishment of “National Foundation for Support of the Civil Society” may be of great help. The means allocated for that aim from the state budget might accumulate and be distributed to CSOs from here. The Foundation can admit funds also from non-governmental organizations and individual benefactors and then distribute them for the development of the civil society. It is essential that the Foundation’s managing board comprise equal number of representatives of the Government and CSOs.
After processing and systemizing the applications and proposals from government bodies and CSOs, the Foundation will state the priorities for the following year, will set the list of events to be held in various spheres, the sum to be allocated for them, then, through commissions consisting of experts selected by the government body concerned and CSOs, will distribute the funds by open and transparent competitions .
4.4. Online Data Base of Government Grants
The online data base under the National Foundation for Support to the Civil Society could become an effective tool for control over allocation of state funds to CSOs. It would comprise information about the grants given, about the organization conducting a certain project, links to the web site with their annual reports. It would also involve announcements about grant programs to be held. This will allow CSOs to search not individual sites of ministries but find all the necessary information in one single place.
4.5. Formation of the Tradition of Delegating to Non-Governmental Organizations Some Projects Intended for National and Local Self-Government Bodies
One of the ways to improve the index of financial sustainability of CSOs, also to increase the efficiency of policy and projects conducted by government structures is to form and develop the tradition of delegating to public organizations, through competitions, certain processes of monitoring and control over projects in social aid, education, research .
Utilization of this model of cooperation guarantees reduction of financial expenses, meanwhile, it provides involvement of additional human, material and intellectual resources for the project implementation, publicity of projects under way; it sets quality standards for the work done; enhances the aspect of mutual work and control by government bodies and CSOs.
4.6. COSs Endowment as a Tool for Financial Sustainability
Introduction of the institute of endowment could become an effective instrument for providing financial sustainability of civil society organizations. An endowment is the sum donated to a non-commercial organization as a charity, and only its “income” may be used, while the “principal” part remains intact. It is the owner’s sum given to the administering company to get income and to use according to the requirements of the endowment project. Yet, an endowment may be in the form of money assets, estate/property, stocks and other objects of value and can be used solely for passive investments. As a form of passive investment may serve bank deposits, investments in royal estate, rent of immovable, investments in government bonds, etc.
Introduction of endowment institute must be implemented following the criteria of CSOs financial sustainability, clarity of endowment targets, financial transparency and publicity of implemented projects.
The next step could be designation of tax privileges for the tax capital and donating individuals and organizations.
4.7. Study of Issues of Forming Mechanisms for Financial Assistance to CSOs by Certain Allocations from Taxpayers’ Income Taxes and Giving Public Organizations the Right to Entrepreneurial Activity
To solve the problem of financial sustainability of CSOs through local resources and to lessen their dependence on foreign donors the experience of Eastern European countries could be rather valuable. Most notable is the ''1% Law'' providing for taxpayers to designate 1% of their tax liability to qualified NGOs .
Discussions on this law in the Eastern European countries started in the early 1990s. It was adopted in Hungary in 1996, in Slovakia in 1999 (at first for 1%, then it became 2%), in Lithuania in 2002 (for 2%), in Poland and Romania in 2003.
In Armenia the allocations from taxpayers’ taxes can be given directly – through tax bodies, as well as through the National Foundation for Assistance to Civil Society. In both cases the mechanism of allocations from income taxes to CSOs will promote the growth of their financial viability; the reduction of dependence upon foreign donors; the development of charity traditions; improvement of accountability indices of CSOs before the public.
To improve financial capabilities of CSOs it is also noteworthy to study the issue of giving public organizations the right to entrepreneurial activity, which, however, needs additional study and analysis in Armenia.
5. Development of Human Potential
5.1. Civil Society Organizations as a Factor to Overcome Passivity and to Direct Activeness
In the development of a civil society, perhaps, the most important factor is active civic position, initiative and participation. However, a number of studies of recent years witness about passivity, apathy, sometimes even absenteeism characteristic of various layers of the Armenian society . Experts explain this phenomenon with “an ebb-tide” involving still existing attitudes of dissapointment; emigration of highly qualified specialists ; little trust in CSOs, political parties and government bodies; depressing social-economic conditions; growth of political and civic activeness, which has come to replace the disappointment in the imposed and formal activeness characteristic of the soviet times .
Political authorities and parties, as well as civil society organizations and mass media have serious task in overcoming public passivity and apathy. One of the options to overcome passivity and to encourage civic activeness is to do with methodologically argued and efficient functioning of civil institutions and enhancement of their networks.
Through successful functioning CSOs can not only encourage, give rise to activeness, but also involve human potential and lead it to public developments, thus providing targeted, stable process of public changes, and active participation in public administration processes by citizens. It is a major guarantee for successful flow of democratization processes and sustainable development of the public system.
5.2. Regulation of the Voluntaryism Institute and Formation of an Encouraging Atmosphere
Studies show that only a little part of CSOs (19.1%) possesses a stable base of human potential (which is estimated by the proportion of volunteers and employees) . Most of them rely on volunteering resources.
Volunteer work significantly fills in the lack of government efforts and the gap in the service market; to some extent it covers the budget deficit; reduces government expenditure; promotes decentralization and de-bureaucratization of producing services; has a positive effect on the economic situation on the whole.
Nevertheless, involvement of volunteers in projects of non-governmental organizations bears some problems needing solution. Firstly, volunteers often lack job experience and necessary qualifications. Secondly, absence of a law regulating the voluntaryism institute and faults of the legislation in force, specifically the clause about mandatory payments for social security restricts involvement of volunteers making it economically disadvantageous. Besides, it is not clear whether volunteers can be involved in non-charity companies to do work for public benefit or humanitarian work or anything like that.
Legislative amendments are required aimed at regulating and fostering the voluntaryism institute and relations, so that the legal aspects create no obstacles for voluntary work, and so that government bodies have no basis for irrelevantly keeping volunteers and organizations utilizing their work responsible without any arguments.
The Government should regulate voluntary processes defining actions of CSOs (the order of making declarations about voluntary work, ways of submitting reports, etc.), so that the volunteers engaged in their work are not considered illegal workers. The issues of volunteers’ social protection, opportunities for possible transfers (e.g. transportation fare, daily costs, etc.) should also be in the focus of legislative-normative amendments. Identification of these problems is essential from the position of removing obstacles in volunteer processes and for accounting records of a nonprofit organization.
To encourage and foster volunteer movement it is important to engage students of vocational schools as an alternative to acquiring professional skills and experience; to conduct training courses for volunteers; to create a tradition of certain events on Volunteer Day or during National Volunteer Week.
5.3. Involvement of the Civic Educational Component at All Levels of Formal Education
A significant factor in developing civic consciousness, in improving the quantitative and qualitative indices of civic activeness is inclusion of the civic education component at all levels of education system. It is necessary to enhance the current field of action of the civic education component, thus involving all levels of education – from pre-educational institutions to higher education. And this should include the essentials of legal, national, civil and political consciousness; the principles and value system of democracy, tolerance, patriotism, humanism, social justice and social partnership.
5.4. Development of Mass Media and Deepening of their Cooperation with Public Organizations
Development processes of the mass media, the principles of freedom of speech and information are conditioned by the pace of development of non-governmental public organizations. In the development of the sphere of mass information, in rooting and defending the principles of freedom of speech and information an essential role is played by public organizations of journalists, broadcasters, as well as CSOs-beneficiaries of the Mass Media and assistance to them. In the current development stage of the Mass Media the efforts aimed at designing and implementing rules of professional ethics are essential, which will be a mechanism for self-regulation based on the principle of responsibility for public consequences of professional activities.
Meanwhile, non-governmental organizations need the support of the Mass Media in formation of public opinion; in public awareness of their activities and their results; in involvement of partners and volunteers to fulfill some projects. Consequently, it would be useful to organize trainings, common discussions and conferences for CSOs on the Mass Media and their methods of work, and for the representatives of the Mass Media – on the issues of civil society.
It is essential to form the legal-normative basis for the development of cooperation between the Mass Media and CSOs, particularly, to form mechanisms for the Public TV and Radio company that encourages policy, which promotes coverage of issues and activities of CSOs, development of civic consciousness and activeness; to establish legislative guarantees for exempt from VAT on social advertising.
6. External Cooperation
6.1. Cooperation with Organizations of the Republic of Nagorno Karabakh
Cooperation with non-governmental, nonprofit organizations of the NKR must be a major direction for Armenian CSOs. The structures conducting policy in the sphere must encourage joint projects fulfilled commonly by CSOs of the RA and NKR; representation of influential RA CSOs in the NKR and vice versa. RA CSOs must support membership and integration of NKR CSOs in international public organizations and their networks; implementation of publicr diplomacy in the process of NKR’s international recognition.
Cooperation of civil society structures of the RA and NKR must be a significant factor in the formation of a common public area between the two countries; in mutual integration of the two societies; in development of democracy and in solution of problems in the RA national security strategy concerning the NKR.
6.2. Cooperation with Organizations of the Diaspora
Non-governmental educational, charity, cultural, religious, youth, compatriotic organizations traditionally play a significant role in the life of a major part of the Armenian people – the Diaspora. These are productive, often irreplaceable mechanisms for self-organization of diaspora Armenian communities, for cooperation among various communities and with Armenia. These organizations are also important means and structures for involvement in the public, cultural and political life of a definite country. Being national, they still bear the civil, legal, political cultural and progressive experience of that very country.
After the 1988 December earthquake, during the years of national revival and Artsakh freedom war the link of public, humanitarian organizations of the Diaspora got a new impetus. That link acquired a new quality and has the perspective for new space. Currently Diaspora organizations are some of the major actors in the development of the civil society in Armenia.
Contacts and cooperation of non-governmental organizations of the Diaspora and Armenia is of great importance in the sense of consolidation of resources to solve nationwide problems; in developing civil society organizations in Armenia; enriching their activities with new technologies; improving international ties and increasing the authority of Armenia.
Armenian influential CSOs should be represented in the Diaspora communities, and Diaspora organizations should be represented in Armenia. Assistance to the cooperation between civil organizations of Armenia and Diaspora; promotion of nationwide educational-cultural, sport, vocational, humanitarian organizations should become a major component of the policy designed and conducted by the RA Ministries of Diaspora and Foreign Affairs. Organizations of the Diaspora can assume an important role for Armenian organizations in the issue of promoting membership in and developing cooperation with international organizations.
6.3. Cooperation with Foreign and International Organizations
Global processes give rise to an increase of cooperation between CSOs of various countries, formation of international structures and networks. That partnership develops around such universal problems as human rights, overcoming poverty, environment, the issues of humanitarian aid, education, science, culture, peace-keeping. Several international organizations function in Armenia that conduct projects assisting humanitarian, educational, consultative, informational, civil and democratic institutions.
Nevertheless, according to experts’ assessments the level of membership of CSOs of Armenia in international organizations and their networks is rather low. Instead, Armenian organizations are quite active in communicating with donors and in participating in international meetings and round-ups . Besides, international contacts are usually founded and developed by major CSOs of the capital, and not by those in the regions.
Cooperation with foreign and international organizations matters to Armenian CSOs for two main reasons. First, integration into international organizations and movements gives an opportunity to participate and influence global processes and projects conducted by international structures, while seeking one’s own interests and benefits. Second, this allows making the potential and positive experience of foreign, international organizations serve the aim of solving democratization, social-economic, cultural, educational, scientific, and other problems of our society.
Government agencies, in their programs assisting civil society organizations, should encourage CSOs membership in international organizations and networks and their projects of international cooperation. This should be done within cooperation framework with global organizations, countries of the European Union and Council of Europe, also within partnership with regional and CIS countries, taking into account the problems arising from democratization, interests of sustainable development and national security concept of our country.
7.1. Prerequisites for Developing the Concept
While developing the Concept the following have been taken into consideration:
• Basic ideas of a civil society, priorities and available resource for CS in the Republic of Armenia;
• The legal-normative field regulating functioning of civil society organizations in the Republic of Armenia, the legal atmosphere and international commitments concerning those issues;
• The historical legacy formed during Armenian history in the sense of functioning of self-organizing structures;
• The experience and issues formed in the sphere of functioning of civil society organizations during the independence of the RA;
• The positive experience of foreign countries in this area;
• Analysis and assessments of international organizations on the processes of development of civil society organizations in Armenia;
• The proposals and conclusions submitted by Armenian CSOs and their networks.
7.2. Actions to Fulfill the Concept
To fulfill the Strategy Concept of Development of Civil Society Organizations in the Republic of Armenia the RA Government:
• Together with the RA Public Council and representatives of civil society organizations shall draft a plan of actions for the period of 2013-2017 to fulfill the Concept;
• Shall draft a package of amendments of the legal-normative sphere regulating the area of civil society organizations and shall submit it to the RA National Assembly;
• Shall define the functions and circle of responsibilities for government agencies to conduct the actions required by the Concept;
• Through a panel involving representatives of the RA Government, the Public Council and civil society organizations shall hold control over the measures taken to fulfill the Concept.
8. Abbreviations Used
CIS Commonwealth of Independent States
CS Civil Society
CSI Civil Society Institution
CSO Civil Society Organization
NGO Non-Governmental Organization
NKR Nagorno Karabakh Republic
PIA Project Implementation Agency
RA Republic of Armenia
RA PC Public Council of the Republic of Armenia
USA United States of America