Toxic cash: the risks of Russia’s “sovereign civil society” programme

By banning NGOs from receiving foreign funding, the Russian government has forced them to seek financial support at home. But state grants undermine civil society’s independence. RU

Andrey Kalikh
19 December 2017
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November 8: Fund of presidential grants in the discussions of the forum "Community" ("Soobschestvo"). Source: Fund of presidential grants / Vkontakte.The Kremlin recently announced the winners of the second Presidential Grant awards competition for 2017. According to the organisers, they had received more applications than ever before, and the overall sum allocated (4.5 billion roubles) was also the highest. In fact, the sum was double than that of the previous contest this past spring.

This NGO support programme was erroneously named (“presidential grants”) from the start. It is, needless to say, not funded out of Putin’s own pocket or some presidential foundation, but from the public purse. It only bears that name because the instruction to allocate the necessary cash is signed by Vladimir Putin. The name has stuck, making the Russian president the country’s chief philanthropist. In April 2017 this error was officially enshrined in the name of the new body responsible for state funding — The Presidential Grant Foundation for the Development of Civil Society (PGF). Grant winners are selected by Russia’s Presidential Administration.

The grant programme was created in 2006: the mid-2000s were the highpoint of the then First Deputy Chief of the Russian Presidential Administration Vladislav Surkov’s “sovereign democracy”. Russia’s updated Foreign Agent law did not exist yet, but the state controlled media were already actively trying to discredit human rights and environmental NGOs. The main premise of their smear campaign, which reflected Russia’s rulers’ perception of these organisations’ work, was already in place: if Russian NGOs receive funding from the west, that means they work for the west.

The world already saw Russia as a country that was rejecting democratic development and restricting its citizens’ freedoms, and the country needed to change its image. So the president took on board a bright idea suggested by public figures within the system — that if NGOs were given Russian funding, they would perform a U-turn and work for Russia.

The state giveth, and the state taketh away

Before 2017, a number of organisations were responsible for allocating presidential grants — last year there were nine of them. They all ran their own grant competitions and nominated their own winners as they liked. Some worked with patriotic organisations, others in the cultural and academic field; a third group looked after so-called GONGOs (the wonderfully named government-organised non-governmental organisations, designed as substitutes for NGOs); and a fourth actually managed to attract real human rights organisations. All these bodies had their own NGO “client base” and rarely came into contact with one another.

This April, however, Putin decided to put an end to this anarchy and created a single funding operator — the above-mentioned Presidential Grant Foundation — and a unified competition system. Seven of the nine former grant-giving bodies, however, have retained their key decision-making role: they are now PGF founder organisations and make up its highest authority, the Supervisory Council.

It was not easy to discover the PGF’s degree of independence: when I initially went on its website, I couldn’t find either its constitution or any indication of its legal status. It was only after I contacted it directly that the site suddenly offered public access to its constitution.

Judging by this document, the PGF is an independent NGO, although it answers for its activities to the Coordinating Committee for Civil Society Development Grant Competitions, headed by the current First Deputy Chief of the Russian Presidential Administration Sergey Kirienko, one function of which is to coordinate the list of NGOs to “win” presidential grants.

In other words, the presidential administration always has the last word on who is awarded a grant.


The Moscow office of the Golos (‘Voice’) association. The NGO was declared a “foreign agent”, becoming the first NGO with this status in accordance with the new law. (c) Aleksandr Vilf / RIA Novosti. All rights reserved.The nine previous grant giving bodies did not, of course, enjoy a high level of independence and all had more or less close relations with the Kremlin. But each of them did hold its own competitions and take its own decisions, based on relevant criteria, about who would receive a grant. And at least one of them, the Civil Dignity Foundation, attracted applications from, and awarded grants to, such well known NGOs as the Moscow Helsinki Group, the (now dissolved) Agora Association, the Golos Voter Rights movement, Memorial and Soldiers’ Mothers committees. Civil Dignity grants became particularly important after the Foreign Agent law was passed in 2012, cutting Russian NGOs off from outside funding on pain of fines and criminal prosecution.

But now, this limited freedom has been replaced by a single, non-independent structure regulated by Russia’s chief ideological organ — the presidential administration.

The Kremlin’s siren song

The aim of the administration’s spin doctors was clear: stronger control over grant allocation was necessary in order to prevent state funding falling into the hands of obvious “enemies” – i.e. independent human rights and environmental NGOs. Experience has shown that these organisations don’t change their ways after receiving a grant, but, to the bureaucrats’ great surprise, continue to criticise its giver.

The single grant giving operator was charged with solving this problem, and it has succeeded. If “foreign agents” used to take part in civil dignity grant competitions alongside everyone else, and indeed sometimes win them, now their number has fallen dramatically: only three groups on the “foreign agents” list made it to the final in the first contest of 2017, and none of the 16 grant applications from organisations on the list were even accepted for the second contest, despite the fact that some of them were very strong and experienced groups that were unlikely to put together weak applications.

Some independent human rights organisations that avoided foreign agent status made it onto the winners’ list, but they were few.

In other words, “dangerous” organisations have been cut off from both funding from abroad – the “foreign agents” law took care of that – and now are stuck without “home” funding as well. Some applied from presidential grants, but didn’t make the final; others refused to apply on principle.

The aim of presidential funding was to make NGOs dependent on state funding and thus tame them and turn them from critics into collaborators

This doesn’t bother the Kremlin spin doctors. Presidential funding is not there to support civil society as a functional and independent replacement for western finance. Its role is to make NGOs dependent on state funding and thus turn them from critics into collaborators. Those who wouldn’t play ball would be cut off from any legal means of support and bled dry by fines and court cases. Ideally, they would then go into voluntary liquidation.

To encourage this outcome, an extra wodge of documents was appended to the “foreign agents” law, considerably complicating the lives of NGOs, civil activists and Russians in general. For example, in 2012 the definition of treason in Russia’s Criminal Code became broader and less defined. Now Article 275 covers “spying and the passing of documents containing state secrets to any foreign state or international or foreign organisation… or the provision of financial, material-technical, consultative or other support to any foreign state or international or foreign organisation or their representatives that is detrimental to the security of the Russian Federation.”

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The Russian Ministry of Justice's Foreign Agent register. Source: Ministry of Justice.In the previous wording of the article, the word “external” stood before “security of the Russian Federation”. It has now been dropped, so Russia’s security can be understood to mean anything you want: a question of financial security, for example, might mean that any contact with a foreign bank could be construed as treasonable. Or the security of Russia’s energy industry — a foreign company’s vehicle refuelling at a Russian motorway service station could also fall under the definition. Or then there is the passing of information, in which case the fact of my writing this article for openDemocracy could be seen as a threat to Russia’s security.

In fact, amendments to Article 275 make every Russian citizen who has any contact with any international or foreign organisation a potential traitor.

You can’t trust someone whose status is obviously illegitimate to be a legitimate source of finance

A 2015 law on “undesirable organisations” has created an even thicker fog of confusion. In this context, “undesirable” refers to international or foreign legal entities that “present a threat to the foundations of Russia’s constitutional order, defence capabilities or state security”. Again, there is no clarification of these terms, although we can work it out for ourselves: the list of “undesirable organisations”, for the moment at least, includes only those structures that have supported Russia’s civil society: the National Endowment for Democracy, George Soros’ Open Society Foundations and so on.            

Any foreign organisation included in the “undesirables” list must halt any activity in Russia, on pain of a fine of up to half a million roubles or a prison sentence of up to six years for its staff. And if financial transactions with an “undesirable organisation” are discovered in a Russian NGO’s bank accounts, the relevant sums will be immediately frozen and turned over to the government. Russian citizens can also be fined up to 15,000 roubles for having any contact with one of these organisations.

An alternative theoretically exists in the shape of state funding — presidential, regional or municipal grants — and many organisations see these as the only way out: the vast majority of active Russian NGOs are now taking this road. They are, however, under a harmful and dangerous illusion, something akin to the singing of the sirens in the Odyssey, luring sailors to their doom. The question of the neutrality of state funding in an authoritarian society is of crucial importance here.     

Offers you can’t refuse

Any Russian NGO that receives material help from abroad is liable to be compulsorily registered on the “foreign agent” list and subject to fines, cancellation of any cooperation with state bodies and attacks from the local or national propaganda machine. Nevertheless, most organisations on the list have survived and are continuing to function successfully: providing services for the public, defending victims of rights and freedoms infringements and running environmental campaigns — and enjoying public support for their activities.

The reason why the “foreign agent” law hasn’t broken civil society is evidently the fact that the main element of the law, the one the Kremlin was relying on — defamation — has been totally ineffective.

The government has been able to drive yet another wedge between people and add fuel to the fire of Russian citizens’ mutual hatred towards one another. But the NGOs themselves have not been compromised. Indeed, their international standing has only risen, as everyone has seen the amount of pressure these highly professional campaigners have been subjected to. Despite government aggression and the howling of the propagandist hordes, inclusion on the “foreign agent” list can be seen as a kind of compliment: if they’re persecuting you, you must be doing something right. The list now includes the names of the most authoritative and respected human rights and environmental NGOs, so some campaigners feel it’s an honour to be in such company.

The presidential grants are a different matter. This money is regarded as dangerous or “toxic”, because handling it has unforeseen consequences: the government may give it to you but still see it as its own. NGOs that have received government or municipal finance often become victims of manipulation and pressure and are much more likely to fall into dependence on state structures than organisations that get funding from abroad.

It’s impossible to go into all the details of the recent Transparency International–Russia report on state financing as an instrument of public control, but it’s worth quoting its introduction:

“State financing can be used to turn political pressure into prosecution for economic or corruption-related offences. An object of political pressure is seen as a victim, but if they are portrayed as a thief or corrupt figure, people will see them as such and go along with their punishment. In short, the government has been taking systematic steps to, firstly, restrict external financial support to independent NGOs, and then to make state funding an effective means of exerting influence on their activity.”

In other words, you can’t trust government money in Russia’s current conditions. You also can’t trust someone whose status is obviously illegitimate to be a legitimate source of finance. So, while taking all the possible risks and consequences into account, foreign funding of Russian NGOs (even in this age of “foreign agents”) still appears to be less dangerous and more neutral than the proverbial carrot from the state.

Translated by Liz Barnes.


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