BRIEFING PAPER FAITH AN ACT OF Chloe Stirk Humanitarian financing and Zakat and financing Humanitarian AUTHOR: DATE: March 2015 EXECUTIVE SUMMARY

Contents EXECUTIVE SUMMARY Executive summary 3 All of the world’s major religions contain world, or how it is spent globally. Yet data we • IDEOLOGICAL – such as how best to Introduction 4 some element of almsgiving, and faith plays have collected for Indonesia, Malaysia, Qatar, manage conflicting opinions on whether a key role in the funding and delivery of Saudi Arabia and Yemen, which make up 17% non-Muslims can benefit from Zakat and humanitarian response across the world. of the world’s estimated Muslim population,2a where it can be used. Glossary of key terms 5 While we cannot say how much religiously indicates that in these countries alone at least motivated giving takes place globally each US$5.7 billion is currently collected in Zakat The question of whether non-Muslims can 1. Faith and humanitarian assistance 6 year, it is clear that faith-based organisations each year. benefit from Zakat is central to discussions mobilise and channel a significant proportion concerning the compatibility of Zakat with of global humanitarian assistance, and are We estimate that the global volume of the humanitarian principles and will have 2. Zakat 7 actively involved in its delivery. In 2013, Zakat collected each year through formal an impact on efforts to increase What is Zakat? 7 faith-based organisations received and mechanisms is, at the very least, in the tens international humanitarian assistance delivered between US$420 million and of billions of dollars. If we also consider provided through Zakat. How is it collected? 7 US$434 million (15–16%) of all international Zakat currently thought to be paid through humanitarian assistance channelled through informal mechanisms, then the actual amount To begin to address these barriers, and 3. Relevance of Zakat to humanitarian response 8 non-govermental organisations (NGOs).1 available is likely to be much higher, and could so maximise the potential volume and potentially be in the hundreds of billions of effectiveness of Zakat for humanitarian Islamic countries and those with large dollars. By way of comparison, international assistance, interested parties need to focus 4. What is Zakat worth? 11 Muslim populations are also becoming more humanitarian assistance from government and efforts in five areas: CASE STUDIES: Saudi Arabia, Islamic Relief Worldwide 12 significant humanitarian actors, as both private donors in 2013 totalled US$22 billion,3 donors and recipients. Between 2011 and while official development assistance (ODA) 1) Humanitarian donors and agencies Untapped and growing potential scale of Zakat 13 2013, international humanitarian assistance from member countries of the Organisation should engage in discussion with from governments within the Organization of for Economic Cooperation and Development academics, Islamic scholars, theologians 5. How is Zakat spent? 13 Islamic Cooperation (OIC) grew from (OECD)’s Development Assistance Committee and practitioners, and share learning US$599 million to over US$2.2 billion, (DAC) was US$134.8 billion in the same year.4 on the use of Zakat for humanitarian CASE STUDIES: Indonesia, representing a growth in the share of total assistance. The Zakat Foundation of America 14 international humanitarian assistance from Our research also shows that between 23% governments from 4% to 14%. At the same and 57% of Zakat currently collected is used 2) An independent and credible global body 6. The humanitarian potential of Zakat 16 time, an estimated 75% of people living in the for humanitarian assistance, depending on that has taken part in these discussions top ten recipient countries of humanitarian the context in which it is raised and used. needs to provide guidance on the Domestic response 16 assistance in 2013 were Muslim.2 It is therefore likely that Zakat is already a parameters of reasonable interpretations significant source of humanitarian financing in of Zakat. International response 16 Zakat, the mandatory Muslim practice of many places, and there are indications that it CASE STUDIES: Indonesia, Pakistan 17 giving 2.5% of one’s accumulated wealth for has the potential to provide considerably more 3) Actors at all levels – including small, charitable purposes every year, is one of the humanitarian assistance than is currently the local Zakat-receiving organisations, 7. Barriers to realising the humanitarian financing main tools of Islamic social financing. case. For example, evidence suggests that national and international NGOs, and the It is explicitly intended to reduce inequality and the amount of Zakat potentially available in UN should work together to improve potential of Zakat 18 is widely used in Muslim countries both Indonesia and Pakistan could meet all channels between Zakat funds given and to fund domestic development and current requirements to respond to domestic the international humanitarian response Logistical barriers 18 poverty-reduction efforts. There are clear humanitarian emergencies, with significant system. Ideological barriers 19 parallels to be drawn between the eight amounts remaining to cover other areas of individual categories of eligible recipients of Zakat spending. 4) Resource-mobilisation efforts should Other barriers 19 Zakat listed in the Qur’an and people in need of focus on increasing Zakat revenues and humanitarian assistance. However, there are a number of possible channelling new funds to humanitarian 8. Conclusions and recommendations 20 barriers that will need to be overcome if Zakat assistance, rather than redirecting Zakat can be paid in a variety of different ways is to fully realise its humanitarian potential. existing funds. Engage and share learning 21 to a variety of different institutions, either These fall into two main categories: Provide guidance 21 governmental or non-governmental, often 5) Efforts to increase the use of Zakat depending on the country a Muslim lives in • LOGISTICAL – such as streamlining and for humanitarian assistance should Improve channels between Zakat and the or on their sect of Islam. There is no reliable formalising how Zakat is collected, by be combined with those of the wider international humanitarian system 22 data currently available to show precisely how whom, and how it is channelled to the development community to ensure a much Zakat is paid by Muslims around the humanitarian response community. complementary approach. Combine efforts with the wider development community 23 Increase Zakat revenues and channel new funds to humanitarian assistance 23 Methodology 25 Acknowledgements 25 Notes 26

3 AN ACT OF FAITH INTRODUCTION

INTRODUCTION GLOSSARY OF KEY TERMS

The gap between humanitarian need and witnessed in both the United Kingdom (UK)7 Awqaf or waqf: A type of endowment and a Zakat: A form of Islamic social financing humanitarian funding is growing. The total and the United States (US), where this type form of Islamic social finance. through which all Muslims whose wealth funding requested from international donors of giving is well monitored.8 One potentially falls above a certain threshold are required within the United Nations (UN)-coordinated significant area of charitable giving that has Islamic: Of or pertaining to the principles of by the Qur’an to give 2.5% of their assets humanitarian appeals system trebled in the received less attention in discussions around Islam; following Shari’a law. each year to help people in need. Note that, ten years between 2005 and 2014, more than the current humanitarian financing crisis is while the proportion a person is required doubling between 2011 and 2014.5 While faith-based giving, and Islamic social finance Islamic social financing: A range of to pay remains the same, there is some international humanitarian funding has in particular. financial mechanisms employed by the variation between Sunni and Shia Islam increased to record levels in response, the Muslim community that are designed to concerning the payment and use of Zakat. financing gap appears to be getting bigger: Previous estimates suggest that anywhere promote social protection of the poor, This report discusses Zakat as practised the proportion of appeal requirements met in between US$200 billion and US$1 trillion is reduce vulnerability and increase economic by Sunni Muslims (around 87–90% of the 2014 was the lowest since 2001 (58%), and spent in the form of Zakat across the Muslim equality. world’s Muslim population).10 the volume of unmet requirements was the world each year,9 and our evidence suggests For the purpose of this report: highest on record (US$7.5 billion). According to a significant proportion of the money Muslim: A person who follows Islam (n.); of Valerie Amos, UN Under-Secretary-General for collected is directed towards humanitarian or pertaining to the Muslim faith (adj.). Islamic country refers to a country that is Humanitarian Affairs, “Needs are growing so assistance. However, Zakat is a resource that governed in accordance with Shari’a law or fast, the funding cannot keep pace.”6 is not well understood by many organisations Mustahiq: Person receiving Zakat; following explicitly Islamic principles. and actors involved in the international beneficiary of charitable giving. Muslim-majority country refers to The urgent question of how to fill this humanitarian response. a country in which the majority of the growing gap is being considered across the Muzakki: Person paying Zakat. population is Muslim, but which is not humanitarian world, including in the World The aim of this report is to shed some light necessarily governed in accordance with Humanitarian Summit process and by the on the purpose, scale and potential of Zakat Nisab: The threshold of wealth or assets Shari’a law or according to explicitly Islamic recently announced High-Level Panel on for financing humanitarian response. It beyond which a Muslim is required to pay principles. Humanitarian Financing. Many are actively will provide a basis on which to open up Zakat. seeking innovative solutions, including the discussions around how that potential might Inter Agency Standing Committee (IASC)’s be maximised – both by increasing the overall Sadaqah: Voluntary charity, a form of Future Humanitarian Financing initiative, the volume of Zakat collected and improving the Islamic social financing. UN Office for the Coordination of Humanitarian mechanisms available to channel Zakat to Affairs (OCHA)’s private sector section the humanitarian response. In the absence and Business in the Community (BITC)’s of reliable or readily available data on Zakat International Disaster Relief programme. It is mobilised globally, the report draws on clear that new funding will need to come from evidence gathered through case studies and a variety of different sources in order to meet existing research to provide an indication of the scale of the challenge. However, much the scale of Zakat’s value and its potential attention is being paid to the role of business for humanitarian response. It outlines some and other private donors, such as individuals of the key barriers to increasing humanitarian and private foundations. funding available through Zakat and to improving the way in which it is channelled Individuals have long been major donors of to support the humanitarian response. It ALMSGIVING ACROSS THE WORLD’S MAJOR RELIGIONS humanitarian funding, providing an estimated also offers some recommendations for 17% of the total international humanitarian humanitarian donors and agencies, and Zakat is one of the few examples of seen as a form of self-taxation rather than a Buddhism voluntary donation. Some sources suggest response between 2008 and 2012. There is those responsible for collecting and mandatory almsgiving to be found in According to Buddhist teachings almsgiving that Jews are required to give tithes (one-tenth likely to be further untapped potential in terms distributing Zakat, to consider in overcoming the major world religions. However, all is the first of the Ten Perfecting Qualities of their income) to charity, a practice known as of their giving capacity, as is evident with the these barriers. major religions involve some form of (Dasa Parami Dhamma) that helps a ma’aser kesafim.14 rise in philanthropy for charitable purposes voluntary almsgiving. Money is generally given to Bodhisathwa to attain Buddhahood. It is also the poor, healthcare institutions, synagogues the first of the ten Meritorious Deeds (Dasa 15 Christianity or educational institutions. Punna Kriya), the first of the Ten Virtues of The Christian church promotes charitable Hinduism a Good King (Buddhist Governance) (Dasa giving as a religious duty, and almsgiving Rajadhamma)19 and the first of the Four In Hinduism, giving is known as dān in is considered an essential part of Christian Bases of Social Harmony (Sahgha Vatthu).20 11 Hindi16 and is built into all aspects of life. stewardship and faithfulness. Christians Almsgiving is also considered the highest Dān can be given as offerings to deities are not required to donate a certain blessing in Buddha’s teachings (Mangala (nirmalya), to individuals, to priests, spiritual percentage of their income to the poor, but it Karunu). The concept of dān also exists in guides or teachers and institutions (NGOs).17 is common to donate at some point during a Buddhism.21 service and for a church to run appeals for Some scriptures suggest giving 10% of an specific crises or charities. individual’s earnings to charity, with the caution that a householder should never give Judaism gifts beyond their means – they should not Tzedakah is translated literally as make their family and dependents worse off ‘charity’,12 but its true meaning is closer on account of their generosity.18 to righteousness and justice,13 and it is

4 5 AN ACT OF FAITH 2. ZAKAT

1. FAITH AND HUMANITARIAN ASSISTANCE 2. ZAKAT

Faith plays a key role in international examples to show the active role that faith can alongside international donors, their combined What is Zakat? humanitarian response. Between 11% and play in the delivery of humanitarian response. private humanitarian assistance of US$396.7 16% of NGOs listed in UN OCHA’s Financial In the Ebola crisis, for example, engagement million would have made them the 14th Tracking Service (FTS) as humanitarian with local Muslim and Christian faith leaders largest provider of humanitarian assistance Zakat is a mandatory form of alms for all in the form of goods, or by offering a service or balance of equality in society. Others include funding recipients in 2013 are explicitly guided in affected countries was vital to ensuring in 2013. According to FTS data, in 2013 Muslims who are able to pay it, and is one providing help to someone in need. Sadaqah, a form of voluntary giving, and by faith-based principles. Seven of the 22 effective and trusted communication with local between US$420 million and US$434 million of the five pillars of Islam.27 Through Zakat, Aqwaf, a type of endowment. NGOs represented on the board that oversees communities.25 (15–16%) of all humanitarian assistance Muslims are required to give a proportion – The word Zakat can be translated to mean the Core Humanitarian Standard also have channelled through NGOs went to faith-based traditionally defined as one-fortieth, or 2.5% ‘purification’ or ‘growth’; through giving an explicit faith-based ethos,22 as do five of Faith-based organisations also mobilise and organisations.26 Not all of this was religiously – of their accumulated wealth after it has Zakat, an individual is cleansing or purifying the 13 NGOs that constitute the UK Disasters channel a significant proportion of financing motivated – it includes funding from donor been in their possession for a lunar year for both themselves and their remaining wealth. Emergency Committee (DEC).23 for global humanitarian assistance. Most governments, and not all of the privately the benefit of the poor or needy (and other Rather than being seen purely as a charitable major religions have an element of charitable generated funds were necessarily based on recipients as highlighted in the verse of the donation, Zakat is in fact the spiritual duty “Alms are for the poor and the needy, Often whether or not an agency has faith- giving (see box on page 5), and many faith- faith-based giving. Figure 1 shows the volume Qur’an, right), in addition to a small annual of the Muslim, as a means of redistributing and those employed to administer the based principles is irrelevant to the activities based organisations actively fundraise and proportion of funds channelled through payment (zakat al-fitr) during Ramadan. Zakat wealth in order to restore social equality and (funds); for those whose hearts have been it carries out or the people it helps; most through faith communities, being seen as a faith-based NGOs from 2011 to 2013. is payable by all Muslims, providing their promote a more just society. (recently) reconciled (To Truth); for those in humanitarian organisations operate in trusted and like-minded channel for religiously acquired wealth that year falls above a certain bondage and in debt; in the cause of God; accordance with the humanitarian principles,24 motivated givers. threshold known as the nisab.28 Muslims Zakat is the only obligatory form of a range of and for the wayfarer.” (Qur’an 9:60)29 meaning that they target assistance to people whose wealth falls below the nisab are different Islamic social financing mechanisms, based on need rather than membership of If the five largest Christian and Islamic encouraged to give Zakat in kind – this can be all of which are intended to redress the a religious group. However, there are many humanitarian agencies were classed

FIGURE 1: HUMANITARIAN ASSISTANCE CHANNELLED THROUGH How is it collected? FAITH-BASED AND NON-FAITH-BASED NGOS, 2011–2013 The overwhelming majority of Zakat is paid appears in the national constitution.33 Where Mosques during Ramadan, the holy month of prayer taxation levels are relatively low, such as in Mosques collect large sums of Zakat, and fasting, which is another of the five pillars Kuwait and Qatar, Zakat resembles a form of particularly in non-Muslim countries with no 3.5 20% of Islam and a time of particular religious tax, as it is collected and managed by the state centralised or government-managed Zakat significance for Muslims in terms of fulfilling in relation to a person’s earnings and used collection agency, where the mosque may 17% 18% 3.0 16% 16% their spiritual obligations. Thus the payment to provide social welfare services or a public represent an alternative form of Islamic 16% Humanitarian assistance of Zakat during Ramadan is seen as a way of safety net for people in need. authority. Zakat collected by mosques may to faith-based NGOs doubling the spiritual reward and benefit for be spent on the mosque itself – such as 2.5 0.4 0.4 14% the donor. Ramadan also provides a practical Independent collection on upkeep or renovations – or it may be marker or milestone relating to the lunar year and delivery agencies distributed by the mosque to local people in 12% Humanitarian assistance (the period over which Zakat should be paid) In some Islamic and Muslim-majority need. Some may also be passed onto a third- 2.0 0.4 to non-faith-based NGOs and Zakat al-fitr is also due at the end countries, the government oversees the party organisation, such as an Islamic charity 10% of Ramadan. collection and distribution of Zakat, but or international NGO, to be used in support of 1.5 independent agencies are given a license their work either locally or elsewhere. 8% % of humanitarian assistance

US$ BILLIONS Zakat can be paid in a variety of different ways to manage the process. This is the case in to NGOs channelled through to a variety of different institutions, either Malaysia, for example, where depending on Individuals 6% faith-based organisations 1.0 governmental or non-governmental, often the state (which are run by different sultans), Some Muslims believe that Zakat should not 4% depending on the country a Muslim lives in or an individual can choose which approved be paid via a third party; rather that it should % OF HUMANITARIAN ASSISTANCE % OF HUMANITARIAN on their sect of Islam.30 agency they pay their Zakat to. be a direct transaction between the person 0.5 2% giving (the muzakki) and the person receiving Government-collected Zakat In countries where Zakat is not managed it (the mustahiq). Many people therefore give 0 0% In Islamic and Muslim-majority countries by the state and there is no governing body their Zakat directly, perhaps to someone in 2011 2012 2013 where Zakat is collected and distributed overseeing collection and distribution, need who lives within their community, or to by the state, it can be taken directly from Muslim citizens can choose how to pay their someone further afield with whom they have an individual’s bank account or paid to the Zakat and to whom. Many Muslims living in connections. In this way, funds given through state or a government agency each year. Six Muslim-minority and/or non-Islamic countries Zakat may contribute to money sent abroad in Source: Development Initiatives based on UN OCHA FTS data. countries have legally enforced payments choose to pay their Zakat to charities or other the form of remittances. Note: Values and proportions of funding channelled through NGOs vary within FTS data depending on different of the Zakat31; for three of these,32 the NGOs, which use the money to fund their reporting headings used by reporters. Data presented here is based on ‘agency code’ figures. responsibility of the state for collecting Zakat own programmes.

6 7 AN ACT OF FAITH 3. RELEVANCE OF ZAKAT TO HUMANITARIAN RESPONSE

3. RELEVANCE OF ZAKAT TO HUMANITARIAN RESPONSE

Islamic countries or those with large Muslim billion, representing a 4% to 14% growth in populations are growing in significance as their share of total international humanitarian both humanitarian donors and recipients. assistance from governments. At the same Between 2011 and 2013, international time, an estimated 75% of people living in the humanitarian assistance from governments top ten recipient countries of humanitarian within the Organization of Islamic Cooperation assistance in 2013 were Muslim.34 (OIC) grew from US$599 million to over US$2.2

FIGURE 2: ORGANIZATION OF ISLAMIC COOPERATION COUNTRIES, AND TOP 25 HUMANITARIAN ASSISTANCE DONOR AND RECIPIENT COUNTRIES NETHERLANDS Top 25 Top 25 SWEDEN US$410 US$785 humanitarian humanitarian DENMARK donors 2013 recipients 2012 US$409 GERMANY (US$ millions) (US$ millions) FINLAND US$949 NORWAY US$162 AUSTRIA US$62 0–250 0–250 UNITED US$613 KINGDOM SWITZERLAND 251–500 251–500 US$1,825 US$399 TURKEY 501–750 501–750 US$1,638

751–1,000 751–1,000 SYRIA US$1,536 LEBANON IRELAND 1,000–4,000 1,000+ US$404 US$147 IRAQ 4,000+ BELGIUM US$98 CANADA US$250 AFGHANISTAN US$691 LUXEMBOURG US$492 PAKISTAN Organization of Islamic US$59 JAPAN US$529 Cooperation member FRANCE PALESTINE US$1,112 US$427 US$654 UNITED STATES BANGLADESH OF AMERICA SPAIN US$87 EU INSTITUTIONS KUWAIT US$4,686 US$253 US$1,881 US$327 MYANMAR QATAR US$130 ITALY THAILAND US$276 US$69 UNITED ARAB EMIRATES US$85 US$90 THE PHILIPPINES HAITI MALI US$139 US$237 US$258 SAUDI ARABIA US$109 BURKINA-FASO JORDAN US$98 US$303 COTE D’IVOIRE YEMEN US$103 US$305 NIGER ETHIOPIA US$291 US$484 CHAD US$298 SOMALIA SUDAN US$627 US$441 KENYA US$404 SOUTH SUDAN US$865 ZIMBABWE DRC US$152 AUSTRALIA US$464 US$357

Source: Development Initiatives based on OECD DAC and UN OCHA FTS data.

Notes: Recipients data not yet available for 2013. Funding from EU Institutions includes contributions from member states. Funding from individual EU member states also includes an imputed amount of EU institutions’ expenditure. DRC, Democratic Republic of Congo.

8 9 AN ACT OF FAITH 4. WHAT IS ZAKAT WORTH?

Zakat is unique in its modality as a form ideological purpose of Zakat, and the moral people in need of humanitarian assistance Most Zakat-collecting and -distributing The international NGO Islamic Relief of mandatory alms intended to respond to purpose of providing both humanitarian and (see Figure 3). Zakat also has to be used within agencies have their own policies regarding Worldwide37 is also currently developing a human suffering, with the specific aim of development assistance across the world. This one lunar year of being given, which in many the issue of whether Zakat can be spent on global policy on its use of Zakat to guide how reducing poverty and inequality. Aside from its is the case both overall and when considering ways makes it ideal for the timeframes of non-Muslims. As there is no definitive answer it is raised and spent by offices around the geographical relevance to a significant number the eight individual categories of eligible humanitarian response. to the question of interpretation, the policies world. At an international level, the National of today’s humanitarian crises, there are recipients of Zakat; there are obvious – and of different organisations with regards the Board of Zakat of the Republic of Indonesia also clear links between the theological and not so obvious – parallels to be drawn with collection and distribution of Zakat will be (BAZNAS) is currently working with the Central more liberal or conservative depending on Bank of the Republic of Indonesia and the their own interpretation and ideological Islamic Research and Training Institute to FIGURE 3: ZAKAT BENEFICIARY CATEGORIES AND POTENTIAL LINKS TO AREAS OF HUMANITARIAN NEED stand point. In the UK, the Muslim Charities formulate a set of core principles for Zakat Forum36 has been working with its members management, as part of an international to formalise policies regarding how Zakat is working group on Zakat collected and who can benefit from it. core principles.38

Al-Fuqara Al-Masakeen Al-Gharimin 4. WHAT IS ZAKAT WORTH? The poor: Poverty and vulnerability to The needy: Could apply to anyone in need People burdened with debt: Where debt is humanitarian crises are closely linked; the of assistance in the aftermath of a crisis or faced as an element of extreme or chronic To date, there is no precise or reliable figure The figure for Indonesia, Malaysia, Qatar, Saudi payment per eligible Muslim is thought to be majority of people living in the top recipient disaster. poverty or as a consequence of humanitarian for the global financial value of Zakat. Previous Arabia and Yemen gives us an idea of the US$1,050 (UK£700) per year.49 countries of humanitarian assistance are crisis, Zakat can be used as a recovery estimates have varied enormously – from scale of formally collected Zakat from those chronically poor. Al-Fuqara is therefore mechanism. It could also be argued under US$200 billion to US$1 trillion per year.39 countries but is not a representative basis Given the limitations to extrapolating directly applicable to a large proportion of this category that Zakat could be used to Given this absence of definitive global data, for projecting the global scale, as incomes global estimates from the data from people in need of humanitarian assistance, support people living in countries impacted by GHA undertook research into a selection in these Asian and Middle Eastern countries national institutions in five countries, we and can be applied to people living in extreme high levels of national debt, where that debt of individual countries and Zakat-raising differ from those elsewhere. Muslims living can only estimate that the global volume of or chronic poverty. Fir-Riqab reduces the government’s domestic spending organisations and institutions in Islamic, in certain African countries, for example, will Zakat collected each year through formal capacity and therefore limits citizens’ access Muslim-majority and Muslim-minority likely have significantly less giving capacity mechanisms is, at the very least, in the People in bondage or slavery: Could apply to basic services (note however that Zakat countries in order to gain an understanding of than those living in the Middle East, where tens of billions of dollars. This is based on a to people who are enslaved, oppressed or can only be used to support individuals, the volume of Zakat currently being collected incomes are generally higher.43 On the other straight-forward scaling up of the data we wrongly imprisoned, or to victims of trafficking. and not to relieve the burden of debt for the in each.40 hand, Zakat from Muslims living in developed have collected according to global Muslim Al’Mu’allafate-Qulubuhum government). Almost one third of the people Western economies will be relatively high. population figures. However, if we also take in need of humanitarian assistance in 2012 We were able to collect enough data for into consideration Zakat currently thought The reconciliation of hearts; those who have were living in low-income countries classified Indonesia, Malaysia, Qatar, Saudi Arabia and In Western and Muslim-minority countries it to be paid through informal mechanisms, embraced or are inclined towards Islam: by the World Bank and International Monetary Yemen41 – which make up 17% of the world’s is particularly difficult to trace overall Zakat then the actual amount available is likely to ‘Reconciliation of hearts’ could be interpreted Fund as having a moderate or high risk of debt estimated Muslim population42 – to give an revenues, as it is not always collected through be much higher, and could potentially be in to refer to peace-building activities. distress, or were already in debt distress.35 indication of the total amount of Zakat raised in formal institutions or mechanisms. Many such the hundreds of billions of dollars. By way each of these countries through formal Zakat- countries have a Zakat fund or foundation, such of comparison, international humanitarian management institutions. Our data shows that, as the UK’s National Zakat Foundation44 or the assistance from government and private in these countries alone, a combined total of Zakat Foundation of America.45 However, these donors in 2013 totalled US$22 billion,49 while Al-‘Amilina ‘Alayha Fi-sabilillah at least US$5.7 billion is known to be currently institutions represent just one of any number official development assistance (ODA) from collected each year. of ways in which an individual may choose to member countries of the Organisation for Ibnas-Sabil Alms collectors/administrators of Zakat: Those in the path of God: There are no clear channel their Zakat in these countries – they Economic Cooperation and Development’s Can be used to cover administrative costs links between the category of Fi-sabilillah and It is likely, however, that the actual amount of might just as easily give it to their local mosque, (OECD) Development Assistance Committee The wayfarer, or stranded traveller: related to the collection and distribution of people in need of humanitarian assistance. Zakat paid in these countries is significantly to a charity of their choice, to a next-door (DAC) was US$134.8 billion in the same year.4 Refugees and internally displaced people. Zakat for humanitarian agencies. This category is also particularly compromised higher than US$5.7 billion, as this figure neighbour who is in need, or directly to family by the interpretation of whether non-Muslims excludes Zakat given outside of formal members or contacts overseas, for example. As detailed in chapter 6, below, without a are eligible to benefit from Zakat. institutions. The majority of traceable Zakat is Perhaps as a result of this, the amount of clearer understanding of the total volume collected by governments and government- Zakat these funds collect only appears to cover of Zakat available or who is collecting it, it is Source: Development Initiatives. managed institutions in these and other a small proportion of the total payable. For impossible to reliably identify how it can be Islamic or Muslim-majority countries. example, in 2012/13, the Zakat Foundation maximised, better targeted, and used more As with many elements of Zakat, such as how humanitarian principles, which is discussed in into either of those categories. There is also However, many people pay their Zakat outside of America collected US$9.7 million,46 which efficiently for addressing humanitarian needs. much should be paid, the question of where it more detail in chapter 7 of this report. There is historical evidence to show that non-Muslims of any traceable system. This is partly, in equates to an average of just US$3.74 for every Better quality data is essential to achieving should be spent and who can benefit from it no consensus on whether Zakat is intended to living under Islamic rule have previously been some places, owing to distrust in the national US-based Muslim.47 This is much less than this. More formal channels to link Zakat up is open to different interpretations. Most be restricted to Muslims or not, and different entitled to Zakat based on this interpretation. government-managed institutions formally the average total Zakat per capita likely to be with the international humanitarian system people tend to believe that, first and foremost, interpretations of verse 9:60 of the Qu’ran tasked with collecting and distributing Zakat. paid in the US. Although no definitive figure is may help, as well as increased dialogue Zakat should be spent in the community (see page 7), which describes the recipient Anecdotal evidence also suggests that available for the total Zakat paid or payable in between all the many different types of from which it was paid. However, some groups, yield different opinions. For example, many Muslims prefer to pay their Zakat the US, we can compare to the UK (which has institutions involved in the collection and interpretation of the Qur’an allows for Zakat to the category Al’Mu’allafate-Qulubuhum, above, directly to the person receiving it or through a slightly lower gross domestic product (GDP) distribution of Zakat. See chapter 8 for more be used elsewhere if a greater need can could either refer to bringing hearts closer independent organisations. per capita),48 where the average total Zakat detailed recommendations. be demonstrated. to Islam (by supporting non-Muslims who are sympathetic to Islam), or to supporting There is also debate among Muslim scholars new Muslims. Many scholars claim that the around whether Zakat is intended only for first two categories (the poor and needy) are Muslims, or whether non-Muslims can also not explicitly referred to as Muslims in the benefit from it. This issue is key to discussions Qur’an, thereby opening up an interpretation concerning the compatibility of Zakat with the that non-Muslims can receive Zakat if they fall

10 11 AN ACT OF FAITH 5. HOW IS ZAKAT SPENT

Case study: Saudi Arabia Untapped and growing potential scale of Zakat

In Saudi Arabia, Zakat is regulated and As a comparison, Saudi Arabia gave Experts have estimated that the total potential • A lack of clarity regarding how to pay and Turkey) – predicted by some economists collected by the Department of Zakat and US$5.7 billion in ODA in 2013, of which volume of Zakat payable across the world is Zakat in contexts where it is not collected to be the world’s next economic giants55 – Income Taxation (DZIT). Total Zakat collected US$109 million was in the form of significantly higher than the total amount that through a formal process. Muslims make up 61% of their combined has increased every year since 2010 and international humanitarian assistance. is currently being paid.53 Reasons for this populations. The global Muslim population reached a high of US$3.7 billion by midway may include: Growing economies in Islamic and Muslim- is also increasing at a faster rate than the through 2013. majority countries across the world also offer overall population, and as a consequence that • The complex nature of calculating the further potential for the collection of Zakat proportion is predicted to increase slightly, to correct nisab, which could mean that funds to increase over the coming decades. 62%, by 2030.56 FIGURE 4: ZAKAT COLLECTED BY SAUDI ARABIA’S DEPARTMENT OF ZAKAT AND INCOME TAXATION, ODA AND people aren’t aware that they are eligible This is particularly the case in emerging HUMANITARIAN ASSISTANCE FROM SAUDI ARABIA, 2010–2013 to pay Zakat. economies of Africa and Asia with high Muslim populations, such as Nigeria, Malaysia and • The complex nature of calculating how Turkey. The collective economy of Islamic and 6 800 much Zakat is owed, which could mean Muslim-majority countries is currently one of that many Muslims are unintentionally the fastest growing in the world,54 and among 700 under-paying their Zakat. the MINT countries (Mexico, Indonesia, Nigeria 5 600 4 5. HOW IS ZAKAT SPENT? 500 Given the close links between Zakat emergency relief in 2013. Although data is not for international humanitarian assistance. 3 400 beneficiary groups and people in need of available to show where the LAZ funds were However, the lower a country’s GDP, the humanitarian assistance identified in the spent, it appears likely that most if not all more likely it appears that Zakat is spent 300 2 previous chapter, as well as the fact that many were used within Indonesia. The vast majority domestically, so in low-income countries

GNI IN US$ BILLIONS of today’s crises are concentrated in Muslim of emergency relief distributed by the Zakat where a small proportion of the Zakat raised 200 areas of the world, it is likely that Zakat is Foundation of America, however, was spent is spent on international humanitarian 1 already a significant source of humanitarian internationally (see case study assistance, it is likely that a greater proportion 100 financing in many places. on p.15). is used to respond to domestic emergencies. Anecdotal evidence would appear to support 0 0 According to our research, the proportion of Where Zakat is collected and distributed by this, for example the Zakat Foundation of 2010 2011 2012 2013 Zakat used for humanitarian activities, either a formal agency, there is usually some level India,58 which had an income of US$410,000 domestic or international, varies notably of public reporting to indicate where and how in 2013 (25.4 million Indian Rupees), has Zakat collected ODA Humanitarian assistance GNI across different institutions. For example, it is spent. However, Zakat given by Muslims a disaster relief programme to respond to ZAKAT, ODA AND HUMANITARIAN ASSISTANCE IN US$ BILLIONS ASSISTANCE AND HUMANITARIAN ODA ZAKAT, data for the Indonesian Institute Amil Zakat living in countries where no formal institution domestic emergencies. Following severe (Institute of Zakat, LAZ), an independent oversees its collection and distribution is much floods in Kashmir in 2014, the programme Zakat-collection and -distribution agency in more difficult to trace. provided 25 search-and-rescue boats and Source: Development Initiatives based on data from Saudi Arabia’s Department of Zakat and Income Taxation, OECD DAC, UN OCHA FTS and World Bank. Indonesia, suggests that 23% (US$16.8 million) daily provisions including water, medicine, Notes: ODA, Official development assistance; GNI, gross national income. of all Zakat raised by the institution in 2011 Where expenditure data was available for food and blankets for thousands was used for humanitarian assistance,57 while the national Zakat funds or foundations we of people. 57% (US$4.5 million) of Zakat raised by the have looked at in Muslim-minority countries, Case study: Islamic Relief Worldwide Zakat Foundation of America was used for anywhere between 1% and 57% was used

Islamic Relief Worldwide (IRW), an While many Zakat donors restrict their research paid just US$150 (UK£100) of their international humanitarian and development donations according to sector, project or Zakat to the organisation, this would amount NGO whose charitable objects are “the relief country, the majority of the Zakat IRW receives to over US$200 million per year. Over the of poverty in any part of the world”, currently is un-restricted, and is thus earmarked as coming years, IRW expects to invest in new fundraises in 16 countries. In 2013/14 “General Zakat” funds. Partner offices allocate Zakat-based fundraising campaigns, as well IRW conducted research focusing on 11 this General Zakat to projects in accordance as learning from and building the capacity of of its global fundraising markets, plus the with the general principles of Zakat outlined its global fundraising offices on increasing international fundraising department based in the Qur’an, and different offices have their the volume of Zakat they collect. However, the in their global headquarters,51 and found that own mechanisms and criteria for making ability to raise significant funds through Zakat these offices raised between US$30 million these decisions. The organisation is currently is to some extent limited in some countries and US$32 million in Zakat in 2013. The top developing a global policy on its use of Zakat, in which IRW operates. For example, the three donor countries were the US (US$15 which will guide how it is raised and spent by political context in certain environments can million, 49% of total), the UK (US$8.2 million, offices around the world in a more coordinated make it difficult to fundraise through Zakat, 27%) and Canada (US$2.7 million, 9%). The and collective way. and in countries where Zakat has traditionally majority of total Zakat raised globally by IRW been collected by government institutions is collected during Ramadan through general The UK’s National Zakat Foundation estimates it can take time to build up a reputation as a fundraising campaigns including email alerts that the average annual Zakat payment of legitimate Zakat-collecting authority with the to supporters, sponsored events, television UK-based Muslims is US$1,050 (UK£700) general public. appeals on Muslim channels and per person per year.52 If 10% of Muslims in mosque collections. each of the 11 countries included in their

12 13 AN ACT OF FAITH 5. HOW IS ZAKAT SPENT?

Case study: Indonesia BAZNAS allocates Zakat to four different humanitarian aid programme consists of two categories. In 2012, humanitarian assistance major elements: Mustahiq (people receiving was the largest sector on which Zakat funds Zakat) Services Counter, and Disaster At an estimated 205 million, Indonesia is Zakat collection has increased over 30- raised by BAZNAS were spent. The BAZNAS Emergency Aid. home to the largest Muslim population in fold during the past ten years, reaching an the world. While Zakat can be collected by estimated US$231.6 million in 2012. In the private institutions, the National Board of same period, international humanitarian Zakat (BAZNAS) assumed the role of national assistance to Indonesia has decreased from FIGURE 6: BAZNAS EXPENDITURE BY CATEGORY, 2012 collection agency in 2011 and is now thought a record US$1 billion in 2005 following the to manage around 62% of all Zakat raised Indian ocean earthquake and tsunami, to just BAZNAS categories of Zakat expenditure in Indonesia.59 US$51 million in 2012 (see Figure 5). 1 The education programme: designed to provide 12% 16% FIGURE 5: TOTAL ESTIMATED ZAKAT COLLECTED AND INTERNATIONAL HUMANITARIAN ASSISTANCE RECEIVED, educational assistance. INDONESIA, 2004–2012 2

1,200 Humanitarian aid: created to provide humanitarian assistance. Indian Ocean tsunami (2004) 31% Sumatra earthquake (2005) 3 1,000 41% Health programme: intended to provide medical assistance, including a cost-free hospital and 800 mobile clinic serving remote areas. Java earthquake 4 (2006) 600 Economic programme: developed to empower

US$ MILLIONS mustahiq economically through Zakat-based Sumatra community development programmes. Source: Development Initiatives based on the 2014 Islamic Social Financing Report. 400 earthquake (2009)

200 Case study: The Zakat Foundation of America

The Zakat Foundation of America is an FIGURE 7: ZAKAT AND SADAQAH EXPENDITURE BY PROGRAMME AREA, 0 international charitable foundation that aims ZAKAT FOUNDATION OF AMERICA, 2013 2004 2005 2006 2007 2008 2009 2010 2011 2012 to address the immediate needs and ensure self-reliance of the poorest people around the 3% world using money collected through Zakat 3% Zakat collected International humanitarian assistance received and Sadaqah in the US. 3% In 2013, the foundation received US$7.6 million in contributions and Source: Development Initiatives based on OECD DAC and UN OCHA FTS data, and 2014 Islamic Social Financing Report. US$2.1 million in in-kind donations. Of the total 5% expenditure, 57% (US$4.5 million) was spent on emergency relief in the same year. This 6% included projects in the Philippines, Pakistan, Bangladesh, Syria (and surrounding affected countries), Mali and within the US. 7% 57% Emergency aid Seasonal programs 16% Orphan sponsorship Education Management and general Development Other program support Fundraising Development Initiatives based on the Zakat Foundation of America 2013 Annual Report.

14 15 AN ACT OF FAITH 6. THE HUMANITARIAN POTENTIAL OF ZAKAT

6. THE HUMANITARIAN POTENTIAL OF ZAKAT Case study: Indonesia (see also earlier case study on Zakat expenditure in Indonesia) Estimates suggest that the world’s Muslim Zakat is likely to increase due to a combination population is set to grow by 35% between 2010 of an increasing Muslim population and and 2030,60 as noted in chapter 4, with the increasing wealth. This will affect the Zakat is estimated to have the potential to humanitarian assistance in Indonesia The Indonesian government spent an most significant growth occurring across sub- resources available for domestic humanitarian provide the equivalent of between 1.59% and each year. estimated US$1,053 million on its domestic Saharan Africa, followed by the Middle East response, and ultimately international 3.82% of GDP in Indonesia,65 amounting to humanitarian response in 2012 and received and North Africa. In growing economies with humanitarian assistance in the surrounding between US$13.8 billion and US$33.2 billion Indonesia is highly disaster-prone and has US$51 million in international humanitarian large Muslim populations, such as Ethiopia, region, through Zakat. annually. Indonesia’s two main Zakat- faced over 100 disasters and emergencies assistance the same year. The total cost of its Tanzania and Turkey, giving capacity through collecting institutions spend on average 34% since 1990, including the devastating 2004 humanitarian response therefore amounted of their collective income on humanitarian Indian Ocean earthquake-tsunami. In the to just over US$1.1 billion in 2012. It appears assistance, and though we cannot confirm it last eighteen months Indonesia has been that Zakat collected in Indonesia could easily Domestic response due to a lack of available data, it seems likely affected by flooding, landslides, a volcanic meet all current requirements to respond to that all or most of this is spent domestically.66 eruption and an earthquake,67 and the UN has domestic humanitarian emergencies, with Using the same proportional breakdown, Zakat predicted that climate change will contribute significant amounts remaining to cover other Our research indicates that Zakat has the chronically poor countries where international could therefore have the potential to provide to an increase in frequency and severity of areas of Zakat expenditure. potential to provide a significant amount of resources will play a more important role. The between US$4.7 billion and US$11.3 billion for future disasters.68 humanitarian assistance in some Muslim domestic potential of Zakat is therefore less in countries. However, given that its volume countries with low GDP per capita and a large is linked to the income of the muzakki (the number of poor people. person paying Zakat), its potential is limited in

Case study: Pakistan

Zakat is estimated to have the potential to disasters. Figures for expenditure on provide the equivalent of between 1.74% and humanitarian assistance by the Government of International response 4.18% of GDP in Pakistan.69 In 2010/2011, Pakistan are not available, but even at 40–50% of Zakat distributed in Pakistan was a cautious estimate it appears likely that allocated for response to natural disasters.70 Zakat collected in Pakistan could meet There are an estimated 47 million Muslims terms of volume, Zakat also offers the benefit This amounts to potential domestic revenue all current requirements to respond to living across Europe and North America.61 of a relative lack of earmarking compared to from Zakat for humanitarian assistance domestic humanitarian emergencies, both In the UK, home to 2.9 million Muslims,62 government and institutional funding. in Pakistan of between US$1.6 billion and natural and man-made, with significant around two-thirds are thought to pay Zakat US$4.8 billion per year, at the current GDP. resources remaining for other areas of with an average annual payment of US$1,050 While Zakat has long been a traditional In 2013, Pakistan received US$529 million Zakat expenditure. (UK£700).63 This suggests that Zakat revenue source of funding for Islamic humanitarian in international humanitarian assistance in from the UK alone could be over US$2 billion agencies, renewed efforts are now being response to conflict- and displacement- per year. Based on the average proportion made to maximise its fundraising potential related emergencies as well as natural of Zakat used for humanitarian assistance by these and a wider group of international by Western-based Zakat foundations and humanitarian agencies.64 Outside of the Zakat-collecting organisations, as found in our traditional Islamic agencies, Zakat is beginning research, it is estimated that UK Zakat revenue to feature as a potential new source of income could provide US$1 billion of international for international humanitarian agencies. We humanitarian assistance have identified two separate UN agencies that per year. are beginning to develop specific fundraising strategies and tools for accessing increased There is a growing awareness of the potential funding through Zakat. However, initiatives role of Zakat in international humanitarian are fragmented and lack a coordinated or response, and of its potential to help fill the systematic approach. growing humanitarian financing gap. As well as offering significant financial potential in

16 17 AN ACT OF FAITH 7. BARRIERS TO REALISING THE HUMANITARIAN FINANCING POTENTIAL OF ZAKAT

7. BARRIERS TO REALISING THE HUMANITARIAN Ideological barriers FINANCING POTENTIAL OF ZAKAT There are a number of key issues surrounding Where Zakat can be spent This is a question of political will as much as the compatibility of the principles and The question of whether Zakat can be spent in religious interpretation. The governments and purposes of Zakat with those of humanitarian a country outside of that in which it is raised institutions that already oversee the collection While Zakat clearly offers opportunities 1) LOGISTICAL – such as streamlining and action. In particular, there are potential may also limit its humanitarian potential. As and distribution of Zakat are currently the in terms of mobilising and channelling formalising how Zakat is collected, by incompatibilities around the following issues. our research has shown, large volumes of main bodies responsible for deciding how additional financial resources to support whom, and how it is channelled to the Zakat are used for international response – it is used. If they do not recognise it as a international humanitarian response, there humanitarian response community. Who can receive Zakat but some scholars and institutions maintain viable instrument for providing humanitarian are a number of potential barriers that will The issue of whether non-Muslims can benefit that it should be limited to, or primarily for, assistance, then it will not be widely used need to be overcome if it is to fully realise its 2) IDEOLOGICAL – such as how best to from Zakat is much debated among Islamic domestic use. The concern that Muslims as one. Many of these institutions use Zakat humanitarian potential. These fall broadly manage conflicting opinions on whether scholars. However, if Zakat is limited to be may be neglecting their local obligations by primarily as a resource to respond to under two main categories: non-Muslims can benefit from Zakat and used only for Muslims, this would be in direct making international financing a priority can domestic social and economic issues. For where it can be used. contradiction to the humanitarian principle of be seen as particularly relevant in light of Zakat to be successfully used to support impartiality, namely that “humanitarian action recent austerity measures put in place in a international humanitarian response, these must be carried out on the basis of need alone, number of developed countries following the bodies would need to support and enable its giving priority to the most urgent cases of international recession in 2008/2009. This its distribution internationally. Logistical barriers distress and making presented a context in which Zakat could be no distinctions on the basis of nationality, put to use to provide social welfare services When should Zakat be spent race, gender, religious belief, class or political domestically, supporting the notion that Zakat Zakat has to be used within one lunar year of it Reporting, transparency been particularly affected, due in part to the humanitarian pooled funds. A wide variety of opinions”.72 was traditionally – and according to many being given. In many ways this makes it ideal and traceability collection and distribution of funds through different financing flows support the response people, should still be – given locally, not for the timeframes of humanitarian response. Transparency in development and Zakat, which represents a significant source to people affected by crises; some of these, Challenges in the delivery of assistance internationally. However, any coordinated means of collecting humanitarian financial flows is an essential of their income. Reputable international such as Zakat, may operate outside of the funded through Zakat also arise as a result and distributing Zakat for humanitarian enabler of effective response. It helps to organisations are falling foul of complex legal internationally coordinated system. These of contradicting views concerning this However, as seen in chapter 6 of this report, response will need to take this into account, build trust between donor and recipient and procedural requirements, as a result of flows can play a key role in directly meeting issue. Opinions vary among individual the domestic potential of Zakat is lowest in ensuring that funds are distributed and used communities and is one of the necessary which they may be prohibited from channelling the needs of individuals and households; Muslims about who can benefit from Zakat, countries with low GDP per capita and a large within the required timeframe. conditions for accountability to stakeholders. funds to certain partner organisations in indeed in many ways they may be able to and any money given by an individual must number of poor people. Yet these countries are Understanding what resources are being specific countries, or from carrying out operate more efficiently as they have fewer be spent in accordance with their own beliefs also often the ones with the most significant channelled to whom also enables donors humanitarian activities in certain places. associated transaction costs, often reach the and requirements. humanitarian needs, which cannot be met and agencies to target their resources in an intended beneficiary more quickly, and can by domestic resources alone and require appropriate, complementary and coordinated The incompatibility between some counter- be used more flexibly according to immediate international assistance. manner. Development and humanitarian terrorism laws and humanitarian principles need. However, there is clearly also value actors are therefore under increasing of providing assistance according to need in coordination, and this requires a sound pressure to operate transparently when it has been well documented.71 In the specific understanding of the resources operating in a Other barriers comes to their finances. However, due to case of Zakat, if Islamic NGOs are prohibited given context. Mechanisms for systemisation the myriad ways in which Zakat may be from providing response directly or indirectly and coordination will be required to improve Lack of understanding example, reporting to the International Aid considered and employed as a future source collected and distributed – both at a global through local or national partners in certain links between Zakat given through formal There is a widespread lack of understanding Transparency Initiative (IATI). These efforts of funding for the post-2015 Sustainable and at national level – it is not subject to any contexts as a result of counter-terrorism institutions and the international humanitarian outside of the Muslim community (and to seem to be yielding results – as can be seen Development Goals.77 systematic form of financial reporting. Zakat measures, then an important means of system, so that the use of resources can be some extent within it) regarding the role and in the increase in humanitarian funds for UN- is also intended to be given and received mobilising and using Zakat for international better aligned to meet the most pressing use of Zakat. Until this is better understood, coordinated appeals coming from Gulf donors, There are clearly also links between Zakat privately, so as to preserve the dignity of the humanitarian response is significantly needs and priorities of those affected. international humanitarian agencies will for example74 – but a greater degree of trust recipients and people in need of humanitarian person paying it. This limits its transparency reduced. face significant challenges in their efforts to still needs to be built. assistance, and therefore potential for more as a financial resource flow and its traceability, How Zakat should be collected mobilise more funding through Zakat. Zakat to be raised and used for this purpose. in terms of understanding who benefits and Systematised collection Some Muslims believe that Zakat should not Distrust of national Zakat-collecting However, this should not be at the cost of other how it is spent. and coordination be gathered by a third party, but that it should The international humanitarian system institutions is also thought to be limiting the activities relating to poverty alleviation which Many countries have invested in strengthening be passed directly from provider to recipient. and the UN in particular have historically overall volume of Zakat collected.75 It will could also be, and to some extent already are, Counter-terrorism their humanitarian emergency prevention This way of giving makes it difficult to align its been perceived with a certain degree of be challenging to significantly increase the funded through Zakat. Recent legislative changes resulting from and response coordination in recent years, use with broader humanitarian efforts, as well scepticism and in some cases distrust amount of Zakat collected through formal counter-terrorism measures put in place by approving national policies and establishing as limiting its transparency and accountability, by some governments, institutions and mechanisms while the people who pay it Instead of running the risk of separate and some governments have put further pressure National Disaster Management Ministries. as highlighted above. There are also potential communities in Islamic and Muslim-majority do not feel able to invest a greater level of competing efforts from both humanitarian and on aid agencies to account for their funding There has also been renewed effort on concerns regarding the permissibility of countries. This distrust is to some extent a confidence in the institutions responsible for development agencies to mobilise significant sources and demonstrate how their funding the part of the international humanitarian non-Muslim or secular humanitarian agencies result of misconceptions. For example, while managing it. international financing though Zakat and has been spent. This has limited the ability community to improve coordination over collecting and distributing Zakat, and their researching this report we came across other forms of Islamic social financing, a of a number of organisations to operate the past decade, including through the legitimacy to do so. anecdotal evidence to suggest that, in the Competition and complementary approach could be pursued to internationally and Islamic organisations have UN-coordinated appeals process and past, some Middle Eastern governments had opportunity costs mobilising Zakat for response and resilience. limited the amount of funding they channelled The purpose of Zakat is to redistribute wealth As seen in the case studies above for Pakistan through the UN system due to a mistaken as a means of reducing poverty and inequality. and Indonesia, a significant proportion of belief that 75% of UN expenditure is used for It is therefore closely aligned with the Zakat collected in disaster-prone countries administration costs.73 This misconception objectives of official development assistance is already used to fund domestic disaster further serves to highlight the importance of (ODA) and wider global efforts to end poverty.76 response. Greater investment in disaster transparency by all humanitarian actors. In Humanitarian agencies are by no means the resilience through Zakat would help recent years, UN agencies have worked hard first to recognise its potential as a source of maximise the impact of the donors’ money, to build greater trust and collaboration with funding; Zakat has widely been discussed as well as providing longer term benefits for new and non-traditional UN donors, and many within the context of financing development the recipients. have improved their own transparency by, for goals already and will almost certainly be

18 19 AN ACT OF FAITH 8. CONCLUSIONS AND RECOMMENDATIONS

8. CONCLUSIONS AND RECOMMENDATIONS Engage and share learning

It is clear that Zakat is already providing potential is to be realised. In the course of Humanitarian organisations and institutions than discussions based purely on the question an approach that empowers recipients significant funds for humanitarian assistance this research, five key areas for action have interested in increasing the volume and use of of resource mobilisation. and promotes a sense of solidarity and and could be a source of further alternative emerged to maximise the potential volume Zakat for humanitarian assistance will need compassion. The approach of empowerment financing to help respond to growing and effectiveness of Zakat for humanitarian to engage with Islamic academics, scholars, Ultimately, mutually understood and ownership resonates with recent shifts humanitarian needs. However, there are assistance, as shown in Figure 8. theologians, regulators, finance experts, accommodation of the multiple approaches towards cash transfer programming in significant obstacles to overcome if its full fund/foundation managers, practitioners and needs to be reached regarding how best to humanitarian and development response, agencies to ensure understanding across link up resources generated through Zakat which have also proven highly effective in all actors. This will include debating issues with humanitarian need. This will help to allowing the recipient choice and control over around Zakat and the humanitarian principles, ensure a coordinated approach and will how the money is spent. as well as addressing logistical barriers and limit opportunities for contradicting views to how they might be overcome. prohibit the effectiveness of efforts to increase Zakat is not seen by either those giving or and improve the use of Zakat for humanitarian receiving as charity; rather, it is a means Existing networks and initiatives (such as assistance. of sharing and redistributing wealth more FIGURE 8: KEY AREAS FOR ACTION TO MAXIMISE THE VOLUME AND EFFECTIVENESS OF ZAKAT the World Humanitarian Summit, the Muslim fairly across all members of society, and is a FOR HUMANITARIAN ASSISTANCE Charities Forum’s work with its members Humanitarian agencies that already raise and right due to individuals less able than others to improve policies around Zakat collection use funds through Zakat also need to share to amass wealth. As such, there is strong and distribution, and Indonesia’s work to their experience and learning with the wider evidence of the capacity of Zakat to reduce establish a set of core principles for Zakat community. If the humanitarian community inequality.78 STEP 1: ENGAGE IN DISCUSSION AND SHARE LEARNING as part of an international working group collectively starts to test Zakat as a source on Zakat management) may all have a role of income for humanitarian assistance, The mandatory nature of Zakat could also Humanitarian organisations and institutions with an interest in increasing the volume and to play by creating links and networks, and there can be greater evidence about its provide an example for both government and use of Zakat for humanitarian assistance should engage in discussion with academics, by expanding their outreach to involve other channels, functions and potential. In this private donors to follow. If all international Islamic scholars, theologians and practitioners, and share learning on the use of Zakat for actors in discussions. Domestic institutions respect, learning around the use of Zakat for donors were required to give a minimum humanitarian assistance. currently responsible for collecting and humanitarian assistance needs to be mutual. proportion of their funding to support the distributing Zakat will also need to be involved provision of basic, life-saving humanitarian in discussions, and in some cases may be There are a number of valuable lessons that assistance, or indeed to disaster risk required to approve supporting regulation can be taken from Zakat regarding its purpose reduction, preparedness and resilience STEP 2: PROVIDE GUIDANCE (including tax laws where Zakat is collected and the manner in which it is intended to be building, this could provide a guaranteed by the government) to enable Zakat to be used, which could be applied to international regular source of funding that could go An independent and credible global body that has taken part in these effectively collected and distributed not only humanitarian practice. For example, the some way towards addressing the ongoing discussions needs to provide guidance on the parameters of reasonable nationally but also internationally. Substantive notion of ‘donors’ and ‘recipients’ is a divide humanitarian financing short-fall. interpretations of Zakat. partnerships will be required based on who is strongly engrained in the current international best placed to collect Zakat and to implement aid architecture. Zakat and Islamic social Zakat-funded humanitarian activities, rather financing, on the other hand, demonstrate

STEP 3: IMPROVE CHANNELS Provide guidance Actors at all levels – including small, local Zakat-receiving organisations, national and international NGOs, and the UN – should work together to improve channels between Zakat funds given and Anecdotal evidence from both Muslim Guidance need not be absolute; it may the international humanitarian response system. and non-Muslim aid agencies suggests recognise the fact that interpretation of Zakat that some are cautious about using Zakat is not only dependent on sect but is also to for humanitarian response due to a lack some extent defined by the personal nature of of clear guidance on how it can be used. an individual’s beliefs. Instead it should focus STEP 4: INCREASE REVENUE Recommended policies, rooted in Islamic on setting out the parameters of a reasonable religious scholarship, would help address interpretation of Zakat, clearly laying out Efforts should be focused on increasing Zakat revenues and these concerns. Opening up discussion the arguments for different understandings channelling new funds to humanitarian assistance, rather than and sharing learning are the first steps to regarding who can benefit and where it can redirecting existing funds. developing such guidance. This should focus be spent. initially on identifying the challenges charities face in managing and implementing Zakat in the modern context, and then begin to develop STEP 5: COMBINE EFFORTS a set of shared solutions.

Efforts to increase the use of Zakat for humanitarian assistance should be combined with those of wider development actors to ensure a complementary approach.

Source: Development Initiatives.

20 21 AN ACT OF FAITH 8. CONCLUSIONS AND RECOMMENDATIONS

Improve channels between Zakat and the Combine efforts with the wider international humanitarian system development community

Due to the inherent nature of Zakat as a agencies using Zakat need to ensure that a fund to be managed outside of the current A joint approach to mobilising funding through together to address these. The flexibility of transfer of resources between individuals, appropriate risk-management measures global political architecture, for example by Zakat and Islamic social financing could help Zakat as a source of funding and in relation as well as the myriad ways in which it can are in place, while the international donor the Islamic Development Bank or a similar, to ensure complementarity and appropriate to the range of people who can benefit from be paid, it is unlikely that it can ever be community and governments need to politically independent institution. According allocation of resources across humanitarian it makes it well suited to supporting such a fully reported or accountable. However, ensure that concerns about security and to Shari’a rules it is widely believed that and development programming, and could resilience approach. If the aforementioned in order to maximise its efficiency and fiduciary risks do not restrict the delivery of the state is the most appropriate body for provide new opportunities for humanitarian fund were to be established, making it a joint effectiveness in humanitarian settings, and humanitarian assistance where and when it collecting and distributing Zakat,80 therefore and development actors to work more closely international Zakat fund to address poverty, to ensure complementarity between different is needed. any institution responsible for this on an together. There are close links between vulnerability and crisis could help to ensure a funding sources, better communication and international scale would need to be invested poverty and vulnerability to humanitarian collective, rather than competitive, approach coordination channels need to be established A Zakat fund? with a similar level of legitimacy as a collector crises, and poverty alleviation efforts and to raising and allocating funds. to improve links between the collection of One way to improve the channelling of Zakat and distributor of Zakat. A corresponding humanitarian assistance need to work better Zakat and its disbursement in crisis situations. to humanitarian assistance, which has been monitoring and evaluation unit would also be suggested in consultations around the World required to assess effectiveness and ensure Just as IATI and OCHA’s FTS are developing Humanitarian Summit, could be to explore accountability in the use of funds. standards, outreach and support for launching a dedicated fund that both collects government and private donors to report and distributes Zakat at a regional and sub- Once given, Zakat is intended to be immediate Increase Zakat revenues and channel humanitarian assistance, so could this be regional level. This approach may go against in its capacity to empower the individual offered to Zakat donors or institutions. New the belief, outlined earlier, among some receiving it. Local councils and actors have new funds to humanitarian assistance technologies offer new opportunities for this Muslims that Zakat should not be gathered been shown to be more effective in the – as one interviewee for this paper noted: by a third party but should be passed directly distribution of Zakat in this respect than larger “online tools provide the perfect mechanism from provider to recipient. It may also raise organisations, which tend to be restricted Scholars and researchers have repeatedly Zakat has the potential to offer significant to help people calculate and pay their Zakat, questions around who benefits from the fund, in their ability to distribute funds quickly, shown that there is more Zakat available than and much-needed resources to support the and the future of fundraising through an ever- taking into account differing opinions within often due to higher levels of institutional is currently being collected.82 International response to growing humanitarian needs more global community of stakeholders in the Muslim community as well as international bureaucracy. There is evidence to suggest efforts should therefore focus on mobilising across the world. To make the most of this humanitarian assistance is also online.” counter-terrorism measures. Despite the that once larger institutions become involved, new resources to meet growing need rather potential and effectively mobilise and use pooled nature of the fund, one solution to this including the state and international NGOs, than redirecting existing resources away from Zakat for the provision of humanitarian Encouraging the use of more traceable, could be to enable an individual’s contributions the effectiveness of Zakat in terms of its their current objectives. Growing economies assistance, collective efforts need to be transparent and formal channels for Zakat to be earmarked according to the beliefs and capacity to empower the person receiving in Islamic and Muslim-majority countries carefully considered, coordinated and targeted. could also help to address some of the distribution priorities of the muzakki (donor), it is reduced.81 Due to this need for Zakat to will further enable this. However, as noted Better coordination will help to ensure greater potential negative impacts of counter- such as whether the money should be spent be quickly distributed, it would be important above, efforts to mobilise greater international complementarity of response efforts, making terrorism measures on humanitarian locally or internationally. to ensure that established local actors are financing through Zakat should be joined the most of all available resources to help the operations. Clearer systems and avenues for involved in its distribution where possible. up and collective with broader development people who are most in need. Zakat to be absorbed into the international There would be further challenges to activities, rather than operating in competition humanitarian system on a more formal overcome in terms of agreeing who should While such a pooled fund would take time with each other. Increased humanitarian basis would provide opportunities to report set up and manage such a fund. As mentioned and consideration to establish, the short- resources from Zakat should not come at on resources generated through Zakat in a previously, distrust of national Zakat-collecting term priority should be to link existing funds the cost of resources for wider efforts to more transparent way. This would help to institutions is thought to be limiting the overall available through Zakat with immediate reduce poverty. improve its accountability as well as provide volumes of Zakat collected, and there is humanitarian need, while working towards a evidence of safe provenance and use of funds limited trust in the UN system among sections longer term goal of building an infrastructure channelled through such mechanisms for of the Muslim community.79 In order to avoid that is able to fully support the use of Zakat for counter-terrorism actors. Meanwhile, aid similar issues it may be appropriate for such humanitarian assistance.

22 23 AN ACT OF FAITH METHODOLOGY AND ACKNOWLEDGEMENTS

METHODOLOGY

Much of the Zakat paid globally is channelled 3) The Islamic Social Finance Report 201491 Our figures on the proportion of total Zakat through informal mechanisms, such as collected that is used for humanitarian between individuals. Where Zakat is collected • Indonesia assistance are based on the average by a national institution, the mechanisms • Pakistan percentage used for humanitarian assistance for its management and reporting practices by the Zakat-collection and distribution can vary considerably. There is therefore no Data gathered through these case studies institutions and organisations included in our reliable or readily available data on Zakat included, where available: research, where data on expenditure by sector mobilised globally, and as such this report is available. has drawn on evidence gathered through case • Total Zakat collected in the most recent studies and existing research to provide an year for which data is available. Data presented in the Islamic Social Finance indication of the scale of Zakat’s value, trends • Sector breakdown on Zakat expenditure Report 2014, based on Kahf’s 1998 research around its existing use, and its potential for and the amount used to provide domestic estimating the potential of Zakat in eight humanitarian response. and/or international humanitarian different Muslim-majority countries with assistance. updated calculations relevant to the current In order to collect the data for these case situation, was used to calculate the potential studies we used three main sources, in the Our estimate of the total global value of Zakat value of Zakat in Indonesia and Pakistan (case following order of priority: collected through formal institutions is based studies in chapter 6). on data for countries where Zakat collection 1) Figures published by Zakat collection is overseen by a single institution, and figures Data on Muslim populations by country and and management institutions including are available to show the total amount expected Muslim population growth has been annual reports and accounts, or data collected in a single year. We have applied taken from the Pew Center for Research’s provided directly to GHA by the agency or Pew Research Center’s data on global Muslim 2011 research on “The future of the global by an umbrella body population figures disaggregated by country Muslim population”.92 to the countries for which we have data on • Zakat Foundation of America83 the total amount of Zakat collected by formal • South African National Zakah Fund84 institutions, to gain an understanding of the • Government of Saudi Arabia, Department proportion of the world’s Muslims represented of Zakat and income taxation85 by those countries. This has guided our • Islamic Relief Worldwide estimate of the total global value of Zakat. (data provided directly) • Muslim Charities Forum Due to the considerations outlined in chapter (data provided for seven Islamic NGOs) 4 of the report (the wealth of Muslims in our case study countries is not representative of 2) Reports and press releases detailing the wealth of Muslims globally; Zakat given by Zakat collection and expenditure in Muslims living in non-Muslim countries that specific contexts are generally comparatively more wealthy is difficult to trace; and evidence suggests that • Malaysia 86 Muslims give a significant amount of Zakat • Qatar 87 outside of formal and therefore traceable • Yemen 88 channels), we are unable to provide a firm • United Kingdom89 estimate for the total global volume of Zakat. • India 90

ACKNOWLEDGEMENTS

The author would like to thank Alex Spencer for her invaluable research assistance, Amjad Mohammed-Saleem for his guidance and advice, Jemilah Mahmood for her support, Professor Habib Ahmed for his time and Fidel Budy for providing background research. Thanks also to Sadia Kidwai (Islamic Relief Worldwide), Omayma El Ella (Muslim Charities Forum), and Houssam Chahin (UNHCR).

24 25 AN ACT OF FAITH NOTES

NOTES 50 Development Initiatives, ‘Global Humanitarian Assistance Report 74 Development Initiatives, ‘Global Humanitarian Assistance Report 1 Development Initiatives analysis based on UN OCHA FTS data. 27 The five pillars of Islam are Shahadah (declaration of Faith), Salah 2014’, Development Initiatives, Bristol, 2014. 2014’, Development Initiatives, Bristol, 2014. 2 Figure compiled using Pew Research Center data on Muslim (prayer), Zakat, Sawm (fasting in the month of Ramadan) and Hajj 51 International Fundraising for 2013 included income from individual 75 Abioye, M.M.O, Mohamad, M.H.S. and Adnan, M.A. (2011), ‘Antecedents demographics, www.pewforum.org/2011/01/27/table-muslim- (pilgrimage to Mecca). donors, donations to the IRW website, income from the Middle East & of Zakat Payers’ Trust: the case of Nigeria’, International Journal of population-by-country/, and GHA Report 2014 data. 28 There are two measures of the nisab: gold and silver. The gold Emerging Market fundraising unit and Islamic Relief Ireland. Economics, Management & Accounting, Supplementary Issue 19, 2a Pew Research Center, www.pewforum.org/2011/01/27/table- measure requires that Zakat be paid on all acquired wealth over 52 National Zakat Foundation, ‘UK’s needy Muslims missing out as pp133–164; christinasafiyah.wordpress.com/2014/06/05/zakat-for- muslim-population-by-country/. 3oz of gold, or its equivalent in cash. The silver measure requires 81% of charity donations sent overseas’, www.nzf.org.uk/News/ social-welfare-and-international-development-2014-world-zakat- 3 Development Initiatives, ‘Global Humanitarian Assistance Report 2014’, that Zakat be paid on all acquired wealth over 21oz of silver, or its ViewArticle/47. forum/. Development Initiatives, Bristol, 2014. equivalent in cash. The silver measure is significantly lower than the 53 76 www.oecd.org/investment/stats/34086975.pdf. 4 gold due to the decreased value of silver since the time of the Prophet. “The potential [of Zakat] remains unrealised as actual zakah mobilized http://www.oecd.org/newsroom/aid-to-developing-countries- 77  29  falls far short of its potential in most countries.” Islamic Research and Islamic Development Bank and UN-DESA, ‘The Role of Islamic rebounds-in-2013-to-reach-an-all-time-high.htm Taken from The Holy Qur’an: Translation and Commentary by Abdullah Training Institute, Islamic Social Finance Report 2014, p42. Finance in Sustainable Development Financing and the 5 Yusuf Ali, first published in 1934. UN OCHA Financial Tracking Service. 54 30 www.dinarstandard.com/emerging-muslim-market/. Opportunities in Creating New Partnerships in the Implementation 6  In Pakistan, for example, Zakat from Sunni Muslims is collected by the Amos, Valerie, UN Under-Secretary-General for Humanitarian Affairs, 55 of the Post-2015 Development Agenda’, June 2014, www.oicun. state, however Shia Muslims are exempt from state collection and pay Investopedia, www.investopedia.com/terms/m/mints-mexico- July 2014, http://news.yahoo.com/un-humanitarian-chief-calls-aid- org/9/20121119013818998.html. their Zakat independently, to an agency of their choice. indonesia-nigeria-turkey.asp; ‘The MINT countries: next economic revamp-041157102.html. 78 Shirazi, Nasim Shah (2006), ‘Providing for the resource shortfall for 31 Saudi Arabia, Sudan, Yemen, Pakistan, Malaysia and Libya. giants?’, BBC News, 6 January 2014, www.bbc.co.uk/news/ 7 Charitable giving in the UK increased from UK£9.6 billion in 2011/12 32 magazine-25548060. poverty elimination through the institution of Zakat in low-income to UK£10.4 billion in 2012/13, according to the Charities Aid Yemen, Pakistan and Sudan. 56 Pew Research Center, www.pewforum.org/2011/01/27/the-future-of- Muslim countries’, IIUM Journal of Economics and Management, 14(1), Foundation, www.cafonline.org/pdf/UK%20Giving%202012-13.pdf/. 33 ‘Abd al-Rahman al-Salimi (2015), ‘Zakāt, citizenship and the state: the-global-muslim-population/. pp133–164; Kahf, Monzer (1989), ‘Zakat: Unresolved Issues in the 8 Charitable giving in the US rose for the fourth year running in 2013 the evolution of Islamic religious and political authority’, Journal of Contemporary Fiqh’, Journal of Islamic Economics, 2(1), pp1–22. 57 Islamic Research and Training Institute, Islamic Social Finance Report reaching over US$335 billion, according to the Indiana University Lilly the Royal Asiatic Society (Third Series), 25, pp57–69, doi:10.1017/ 79  2014. Abioye, M.M.O, Mohamad, M.H.S. and Adnan, M.A. (2011), ‘Antecedents Family School of Philanthropy, www.philanthropy.iupui.edu/news/ S1356186314000376. 58 of Zakat Payers’ Trust: the case of Nigeria’, International Journal of 34 www.zakatindia.org. article/giving-usa-2014. Figure compiled using Pew Research Center data on Muslim Economics, Management & Accounting, Supplementary Issue 19, 59 Islamic Research and Training Institute, Islamic Social Finance Report 9 www.irinnews.org/report/95564/analysis-a-faith-based-aid- demographics, www.pewforum.org/2011/01/27/table-muslim- pp133–164; christinasafiyah.wordpress.com/2014/06/05/zakat-for- 2014. revolution-in-the-muslim-world. population-by-country/, and GHA Report 2014 data. social-welfare-and-international-development-2014-world-zakat- 35  60 Pew Research Center, www.pewforum.org/2011/01/27/the-future-of- 10 www.pewforum.org/2009/10/07/mapping-the-global-muslim- High: Afghanistan, Chad, Mali, Haiti. Moderate: Democratic Republic forum/. the-global-muslim-population/. population/. of Congo, Niger, Yemen In debt distress: Zimbabwe, Sudan. Data was 80 Guermat, C., Al-Utaibi, A.T. and Tucker, J.P. (2003), ‘The practice not available for six countries (Somalia, Syria, South Sudan, West 61 Islamic Research and Training Institute, Islamic Social Finance Report 11 Saunders, S.G. (2013), ‘The diversification of charities: from religion- of Zakat: an empirical guide in four countries’, Economics Bank and Gaza Strip, Pakistan and the Philippines), three were at low 2014. orientated to for-profit-orientated fundraising’, International Journal Department Discussion Papers Series, University of Exeter risk (Ethiopia, Kenya, Myanmar), and the remaining two (Lebanon and 62 of Nonprofit and Voluntary Sector Marketing, 18 (2), pp141–149. Ibid. Business School, business-school.exeter.ac.uk/documents/papers/ Jordan) are upper-middle-income countries and have therefore been 63 12 Chodorow, A.S. (2007/2008), ‘Biblical tax systems and the case for Pew Research Center, www.pewforum.org/2012/12/18/global- economics/2003/0302.pdf. not classified according to their risk of debt distress. progressive taxation’, Journal of Law and Religion, 23 (1), pp69. religious-landscape-muslim/. 81 The West Bank Zakat Committees (1977–2009) in the Local 36 www.muslimcharitiesforum.org.uk. 64  13 Dalin, D.G. (1997), ‘Judaism’s war on poverty’ (cover story), Policy Pew Research Center, www.pewforum.org/2011/01/27/table- Context, Emanuel Schaubin, Centre on Conflict, Development and 37 www.islamic-relief.org. Review, 85, p28, Business Source Complete, EBSCOhost (viewed 12 muslim-population-by-country/. Peacebuilding; http://graduateinstitute.ch/files/live/sites/iheid/files/ 38 February 2015). National Board of Zakat of the Republic of Indonesia (BAZNAS) and the 65 Islamic Research and Training Institute, Islamic Social Finance Report sites/ccdp/shared/Docs/Publications/WP5_2_engl.pdf Central Bank of the Republic of Indonesia, ‘Towards an Establishment 82  14 Chodorow, A.S. (2007/2008), ‘Biblical tax systems and the case for 2014. Islamic Research and Training Institute, Islamic Social Finance Report of an Efficient and Sound Zakat System’. Paper presented at the 66  progressive taxation’, Journal of Law and Religion, 23 (1), p54. Ibid. Note proportions are weighted according to the volume of Zakat 2014; Shirazi, Nasim Shah (2006), ‘Providing for the resource shortfall Working Group of Zakat Core Principles 2014, www.zakat-chamber. 15 www.jewfaq.org/tzedakah.htm. collected by each institution. for poverty elimination through the institution of Zakat in low-income gov.sd/english/files/zakah_core_principles.pdf; Beik, Irfan Syauqi, 67 Muslim countries’, IIUM Journal of Economics and Management, 14(1), 16 Eck, D.L. (2013), ‘The religious gift: Hindu, Buddhist, and Jain http://reliefweb.int. ‘Initiation of International Working Group on Zakat Core Principles’. 68  pp133–164; Kahf, Monzer (1989), ‘Zakat: Unresolved Issues in the perspectives on dana’, Social Research, 80 (2), pp359–379. IRIN, www.irinnews.org/report/86617/indonesia-climate-change- Presented at the Working Group of Zakat Core Principles 2014, www. Contemporary Fiqh’, Journal of Islamic Economics, 2(1), pp1–22. 17 Bornstein, E. (2009), The Impulse of Philanthropy, Cultural worsening-disasters-says-un. bi.go.id/id/publikasi/artikel-kertas-kerja/kertas-kerja/Documents/ 83 69  http://zakat-publications.s3.amazonaws.com/2275/zakat-foundation- Anthropology, 24(4), pp622–65. National Zakat Foundation, ‘UK’s needy Muslims missing out as Session%203%20Dr.%20Irfan%20Syauqi%20Beik.pdf. 2013-anual-report.pdf 18 81% of charity donations sent overseas’, www.nzf.org.uk/News/ www.hinduismtoday.com/modules/smartsection/item. 39 www.irinnews.org/report/95564/analysis-a-faith-based-aid- ViewArticle/47. 84 http://sanzaf.org.za/annualreport2014/ php?itemid=506. revolution-in-the-muslim-world. 70  85 19  We are unable to identify agencies as information was given https://dzit.gov.sa/dzit-news/-/asset_publisher/Mwc0L0nwIwvj/ Collins, S. (2006), Nirvana and Other Buddhist Felicities. Cambridge, 40 See methodology section for details and accompanying spreadsheet confidentially. content Cambridge University Press, pp460–461. for a full breakdown of the data collected. 71  86 20  http://www.zakat-chamber.gov.sd/english/files/world_zakat_forum. Swearer, D.K. (1998), ‘Buddhist virtue, voluntary poverty, and extensive 41 Mackintosh, Kate and Duplat, Patrick, Study of the Impact of Donor See accompanying data, available to download from GHA website, pdf benevolence’, The Journal of Religious Ethics, 26 (1), pp71 –103. Counter-terrorism Measures on Principled Humanitarian Action, UN www.globalhumanitarianassistance.org. 87 21  OCHA and Norwegian Refugee Council, July 2013. http://www.businessstartupqatar.com/44000-millionaires-in-qatar- www.thebuddhism.net. 42 Pew Research Center, www.pewforum.org/2011/01/27/table- 72 UN Office for the Coordination of Humanitarian Affairs, ‘OCHA on says-zakat-fund-official/ 22 www.corehumanitarianstandard.org/files/files/TAG%20member%20 muslim-population-by-country/. Message: Humanitarian principles’, June 2012, https://docs.unocha. 88 http://al-shorfa.com/en_GB/articles/meii/features/2013/08/06/ list%20as%20of%2030_06_2014.pdf. 43 World Bank DataBank, GDP per capita data. 23  org/sites/dms/Documents/OOM-humanitarianprinciples_eng_ feature-03 www.dec.org.uk/member-charities. 44 www.nzf.org.uk. June12.pdf. 89 24  http://www.nzf.org.uk/News/ViewArticle/47 UN Office for the Coordination of Humanitarian Affairs, ‘OCHA on 45 www.zakat.org. 73 While actual administration costs of the UN as a whole are not 90 http://www.zakatindia.org/DisasterRelief.html Message: Humanitarian principles’, June 2012, https://docs.unocha. 46 Zakat Foundation of America 2013 Annual Report. available, individual UN agencies report their administration costs 91 org/sites/dms/Documents/OOM-humanitarianprinciples_eng_ http://www.irti.org/English/Research/Documents/Report-2.pdf 47 According to the Pew Research Center there are an estimated 2.6 as being much lower than this. For example, 11% of UNHCR’s June12.pdf. 92 http://www.pewforum.org/2011/01/27/the-future-of-the-global- million Muslims living in the US, www.pewforum.org/2011/01/27/ total expenditure is currently used to cover administration (http:// 25  muslim-population/ The pivotal role of faith leaders in the Ebola virus disease outbreak in table-muslim-population-by-country/. www.unrwa.org/donate/questions-about-donations, ‘Using your West Africa, CAFOD, November 2014. 48 US$41,788 compared with US$53,042 in the US, World Bank, data. donation’). The UN regular budget 2012-2013 shows jointly financed 26  Actual figure likely to be significantly higher as this excludes much worldbank.org/indicator/NY.GDP.PCAP.CD. administrative activities and special expenses at 2.5% of total budget of the funding to smaller local faith-based NGOs and civil society 49 National Zakat Foundation, ‘UK’s needy Muslims missing out as (http://www.un.org/en/hq/dm/pdfs/oppba/Regular%20Budget.pdf). organisations that is not reported to FTS. 81% of charity donations sent overseas’, www.nzf.org.uk/News/ ViewArticle/47.

26 27

AN ACT OF FAITH HUMANITARIAN FINANCING AND ZAKAT

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