Government Urges Cash-Strapped NGOs in Uganda to Embrace Social Enterprises

The Ugandan government has urged Non-Governmental Organizations operating in the country to urgently explore internal revenue-generation strategies and transition into social enterprises to survive ongoing financial shocks.

Speaking at the NGO Risk, Compliance, and Resilience Conference 2026 in Kampala, Dr. Stephen Okello, the Executive Director of the National Bureau for NGOs, pointed out that international donor funding has drastically dried up. He noted that although the 2016 NGO Act empowered civil society organizations to establish income-generating business components, fewer than 1 percent of registered groups have taken advantage of the provision.

According to Dr. Okello, heavy reliance on foreign donors leaves local organizations financially vulnerable and forces them to accept unfavorable funding conditions. The civil society sector has faced severe financial turbulence over the past six years, triggered by pandemic-related budget cuts, the exit of the Democratic Governance Facility, and sharp reductions in global assistance programs.

Dr. Okello also criticized weak governance structures within many NGOs, highlighting issues such as failure to charge meaningful membership subscription fees and relying on boards composed of friends instead of qualified professionals. Responding to the concerns, stakeholders like Mr. Yona Wanjala of the Civic Advisory Hub welcomed the push for social enterprises while calling for clearer legal frameworks to support them.

Meanwhile, Ms. Martha Oundo, Assistant Commissioner for Inspection and Compliance at the NGO Bureau, assured the sector that regulatory enforcement prioritizes corrective measures and compliance gaps over immediate punitive actions.

Read more about this development in the Daily Monitor.