KAMPALA — Uganda’s civil society sector could soon face one of its most significant regulatory shifts in years following the introduction of the NGO Funding Bill, 2026.
The draft legislation outlines a comprehensive legal regime governing the financing, taxation, and accountability of NGOs, with a strong emphasis on reducing foreign dependency and strengthening national oversight.
Balancing Development and National Interest
The Bill outlines several guiding principles, including transparency, accountability, promotion of education, and protection of lawful civil society activities. It also emphasizes safeguarding Uganda’s sovereignty from undue external influence.
One of its core objectives is to promote literacy and social development, particularly in underserved districts with high illiteracy rates. Lawmakers behind the proposal argue that NGOs should play a more structured role in advancing national development priorities.
Foreign Funding Under Closer Scrutiny
Under the proposed framework, NGOs must declare all foreign funding to the NGO Bureau within fourteen days of receipt. The disclosure must include detailed information about the donor, the amount received, and its intended use.
The Minister responsible for Internal Affairs would have authority to introduce regulations limiting the percentage of foreign funding an organization may access annually.
In addition, any foreign funding aimed at influencing political or electoral processes would be expressly prohibited.
Supporters say the provisions are intended to prevent external interference, while critics warn they may constrain legitimate advocacy and programming.
Incentives for Local Resource Mobilization
Beyond regulation, the Bill encourages NGOs to mobilize domestic resources and build local partnerships. Organizations would be required to demonstrate efforts toward financial sustainability during annual compliance reviews.
Analysts note that this shift could push NGOs to diversify funding streams, reduce reliance on international donors, and strengthen community ownership of development initiatives.
Increased Reporting Obligations
If enacted, the law would introduce monthly reporting requirements, compelling NGOs to submit detailed financial and expenditure records to the NGO Bureau.
The legislation would come into force on a date appointed by the Minister through a statutory instrument.
A Sector at a Crossroads
With NGOs playing a pivotal role in healthcare delivery, education, governance advocacy, and humanitarian assistance, the proposed reforms could reshape Uganda’s civil society landscape.
As Parliament prepares to consider the Bill, stakeholders across government and civil society are expected to engage in robust debate over its long-term implications.
