Help VWOs in financial difficulty, not punish them
When a voluntary welfare organisation (VWO) is in financial difficulty, what it needs is more help, not withdrawal of IPC status. -TNP
Leong Sze Hian
Thu, Sep 27, 2012
The New Paper
I refer to the closure of the Singapore Action Group of Elders (Sage), leaving wages and bills unpaid.
In 2006, it lost its Institutions of a Public Character (IPC) status, which allows donations to be tax-deductible.
The reason, according to the Ministry of Community Development, Youth and Sports, was that it faced recurring deficits, negative accumulating funds and outstanding debts.
When a voluntary welfare organisation (VWO) is in financial difficulty, what it needs is more help, not withdrawal of IPC status.
The latter may be akin to the final nail in the coffin as it is much harder to raise funds when donations are no longer tax-deductible.
I would like to suggest that a listing of VWOs in funding difficulties be made public yearly, so that the public can consider channelling donations to those that may need them more than others.
Increasing competition
VWOs should be assessed on the good that they do, and not on their fund-raising abilities, for them to survive in an environment of increasing competition for the charity dollar.
Is it not ironic that a 35-year-old VWO like Sage that has been serving the elderly has to close while other VWOs can accumulate hundreds of millions in their reserves?