Glimpses from Zakat Sector in Sub-Saharan Africa II

An organization is as good or as bad as its people at work. Zakat organizations across the globe have not been able to realize their full potential primary due to the low levels of efficiency and professionalism among their personnel. The problem is particularly severe in Sub-Saharan Africa where zakat management is largely in the hands of a few ulema or religiously minded people. Of course, countries like Sudan and Nigeria (a few provinces) have an established zakat management system created by the state. The collection and distribution of zakat is undertaken by state agencies, governed by a dedicated legal and regulatory framework. For the same reason, however, the Sudanese and Nigerian models are hardly expected to be relevant for most other countries where Muslims live as minorities (there may be good practices in these frameworks worth emulating though). The role model has to be in a country with Muslims as minorities, where people come from diverse backgrounds and cultures. It has to be in a country with a passive role for the state in religious matters. It has to be in a country with a zakat system that comprises non-state actors. It has to be in a country with a zakat system that is managed through institutionalized voluntarism and benevolence and is managed efficiently and effectively. It has to be in a country like South Africa.

South Africa has long been known for its vibrant Islamic community and its dynamic Islamic charities. Muslims in South Africa number under eight-hundred thousand, i.e. 1.5% of the estimated 52 million population of South Africa.[1] Most of them are descendants of the Malay community (brought in by the Dutch from Java in the 17th Century) and the Indian community (brought in by the British in the 19th Century). These two ethnic groups are followers of Shafii and Hanafi madhabs respectively. A directory of Muslim organisations in South Africa compiled by Murshid Davids in 1996 estimated that there were approximately 1328 Muslim organisations that collected and distributed zakat and provided a diverse number of services essential to the community. These included social welfare and relief giving agencies, community based organisations, and theological and humanitarian aid organisations focussing on local and international needs. Major organizations in terms of zakat collection include Jamiatul-Ulama and the various Darul-Ulooms (with Darul-Uloom Zakariyyah perhaps enjoying biggest share); international relief providers, such as, Islamic Relief SA; Gift of the Givers and Al-Imdaad Foundation; and of course, the South Africa National Zakat Foundation (SANZAF).

What is the potential of zakat in South African and how much is actually collected? Intelligent guesstimates by observers of the scene place the potential at about R1 billion or about USD100 million. The actual collection is believed to be around R500 million or USD50 million. Since financial information is not readily available at the portals of the major collectors (SANZAF being the notable exception), the estimates may be suffer from gross inaccuracy. However, given that SANZAF alone collected around R80 million in 2013, the estimate of total zakat collection in a country of over 1300 institutional collectors as above is rather conservative.

In a paper presented at the World Zakat Forum 2014, held in NYC recently, Hoosen Essof provides a brilliant account of the evolution, growth and current status of zakat organizations in South Africa in general and of SANZAF in particular.

The history of Islamic NGOs in South Africa that collect zakat dates back to the beginning of the 20th Century. The key actors were the ulema whose primary concern for Islamic education, burial societies, halaal services led them to establish Darul-Ulooms as abodes of Islamic teaching and scholarship. A parallel development took shape in the form of establishment of Islamic NGO’s by businesspersons. These focused primarily on serving the welfare needs of the Muslim community, including establishing orphanages and feeding programs. In an interesting observation Hoosen asserts “despite their differences and origins, Islamic NGOs were dependent on the same source for (zakah) resources to perform their work, i.e. the businessmen. The Ulema based NGO’s had more support because of their control over masjids[2] while the independent NGO’s were largely reliant on voluntary donations of like-minded individuals and didn’t always have access to large resources unless they were established and financed by a family backed business. This scenario still exists today.”

SANZAF owes its origin to the efforts of one man Dr  Shaukat Ali Thokan who was actively involved with the Muslim Youth Movement (MYM). Initially, mooted as a project of MYM, SANZAF began its operations in the year 1974. In 1976, SANZAF had collected and disbursed USD $1,400. A merger with the Cape Zakah Fund  in 1979 provided further strength to the organization. SANZAF was formally registered as a Section 21 Company in 1988. It registered as a Non-Profit Organization (NPO 007-160) with the Department of Social Development of the Government of South Africa in 1999 and then as a Public Benefit Organization (PBO 930001714) with the South African Revenue Services in 2005. The latter status allows donors to qualify for up to 10% deduction on their annual income tax against their Zakah.

As at 31 March 2014, SANZAF had 29 offices in five provinces and over 120 full time paid staff. Its Board of Trustees comprises professionals who serve entirely on a voluntary basis. It emphasizes strong oversight at branch, regional and national level and seeks to implement good governance principles with monthly reports and regular meetings. It is independently audited and strives to produce Annual Report and Audited Financial Report within 90 days of year-end. All its financial data are freely available on the web. This has resulted in a high level of social acceptance and in a steady growth of funds collected as presented in the following table.

Table: Time Series of Zakat Collection by SANZAF

Year 2006 2007 2008 2009 2010 2011 2012 2013
Zakat 19 24.4 35 35.9 45 46.7 50.6 59.6
Non-Zakat 11.4 16.9 19 18.4 16.9 19.6 19.7 22.2
Total 30.4 41.4 54 54.3 61.9 66.3 70.3 81.8

The steady growth in zakat collection is also attributable to SANZAF’s creative public education and awareness campaigns involving tools, e.g. various publications including the Zakiyyah on Zakah Cartoon; Zakah Calculator CD and Mobile Zakah App (myZakahZA).

In the matter of distribution of zakah, SANZAF is committed to utilizing the bulk of our resources directly on and for the benefit of the poor and needy as opposed to operational and administration costs. While in the initial stages, priority was given to meeting the basic needs of beneficiaries, such as the provision of food and clothing, payments of rent, water etc. SANZAF has been seeking to reposition itself as a developmental organization aiming to make a permanent dent on poverty through education, training and economic empowerment. It is now committed to allocate at least 60 percent of its collections towards developmental initiatives. It now spends 25 percent of its income for education alone.

Confronted with donor preferences that were clearly in favor of provision for basis needs, SANZAF’s move towards economic empowerment initiatives was cautious. As Hoosen says: “FARD was the first serious initiative that SANZAF thought would help us break the dependency culture that our beneficiaries had become accustomed to. It sought to find a balance between the immediate and long-term needs of beneficiaries by providing them with their basic household needs if they commit to an empowerment programme. The FARD programme was cautiously adopted by most donors. However, as South Africa emerged from the isolation years of Apartheid (1990), so the Muslim professional class grow considerably. These new professionals were being exposed to community development experiences, both outside of the Muslim community and in other parts of the world and made it much easier to convince them of our development philosophy. Gradually, through education, donor attitudes towards the use of Zakah for empowerment changed for the better. SANZAF however, continues to provide assistance in the form of a monthly cash allowance and/or groceries and/or payments for rent/water/electricity to qualifying beneficiaries, specifically the elderly and sickly. Currently 50% of our beneficiaries are wholly dependent on some form of regular welfare assistance, either because they are not trainable (due to health reasons), or they do not qualify for government welfare grants due to age, etc.”

SANZAF aspires to be a leading faith-based NGO with operation excellence in transforming the lives of the communities it serves. Its vision is to become a model Muslim organization, serving with integrity and transparency; the premier Zakah collecting and distributing agency in South Africa; and deliver a service par excellence to our various constituencies. Its mission is to “facilitate the empowerment of needy families through the efficient collection and effective distribution of zakah and other sadaqat in a proactive and cost effective way through projects – with dignity, sincerity and a shared responsibility.” Its track record has been quite impressive so far as it consistently has managed to keep its costs low while expanding its portfolio of programs and activities. One hopes SANZAF would continue to scale new heights and become a role model for zakat institutions in the rest of the world.

[1] This is according to the Official Census 2011. The same is however, disputed by Muslim leaders who suggest that there are at least two million Muslims in South Africa.

[2] There are around 1000 masjids in South Africa currently.

Mohammed Obaidullah | June 06, 2014

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