Prof. Habib Ahmed Durham University, UK
Agenda Waqf: From Past to Present In Search for Efficiency
Introduction The voluntary sector is increasingly playing an important role providing many social goods and services Third sector is increasingly playing an important role (1999-$1.1 trill., 4.6% GDP in 22 countries) Islam instituted the institution of waqf historically played a very important role Historically waqf played a significant role in providing social and public goods Recent expansion of the third sector has not included growth of waqf institutions
Waqf-Introduction Waqf Stand still, hold still, not to let go (Maliki- habs) Voluntary act of charity sadaqah jariyah Hadith: When a child of Adam dies, his/her deed comes to an end except for three things: a continuous sadaqah, knowledge that benefits (others) and a righteous child who prays for him/her. [Muslim, Tirmithi, Abu Dawud, Nasa i and Ibn Majah ]
Waqf Features Founder (waqif) through the waqf deed determines: Objectives for which waqf is created birr (cannot violate principles of Shari ah) Way(s) its revenues/fruits/services can be used Management process and procedures of succession of managers (mutawalli) as if ownership belongs to God
Potential of Waqf in Enhancing Welfare Beneficiaries Family (ahli or khass) Type General Public (khayri or aam) Religious A C Philanthropic Type A Not too common (graveyards, tombs) Type B Waqf for family members Type C Mosques, cemetery, etc. Type D Waqf for providing social services and enhancing general welfare B D
Waqf Historical Experience The first waqf created by the Prophet (PBUH) was Masjid in Medinah Other than these, the first known awqaf were established for social purposes Umar bin Khattab land of Khaybar Uthman bin Affan well in Madinah Thereafter many different kinds of waqf were created Public utilities, education and research, health care, etc. Property, cash, grains for seeds, etc.
Waqf Historical Experience (2) At the dissolution of Ottoman empire ¾ of the land and buildings in some Turkish towns were awqaf In some Muslim countries awqaf reached 1/3rd or more of cultivable land At the beginning of 2th century In Palestine, 233 waqf deeds recorded (owning 89 properties) compared to 92 private ownership deeds (with 18 properties) al Quds had 64 operating schools supported by awqaf (more than the no. of mosques)
Awqaf during Contemporary Times Status Due to different reasons, awqaf have degenerated now both as a concept and in practice The concept of waqf is corrupted: Waqf is only for religious purposes Waqf can be established in real estate only Lack of awareness that waqf can be productive asset/organization used for philanthropic purposes
Awqaf during Contemporary Times Practice In practice many awqaf have become unproductive assets Most waqf are created for religious purposes Lack of institutional/organizational development Management inefficient mutawallis or government Many waqf assets lost Not too many new social waqf are created
Types of Waqf in Karnataka state. India Type Number Percentage Mosques 7315 32.9 Graveyards 5419 24.3 Tombs (mazaar) 6626 29.8 Ashoor Khanas 297 13. Total 22267 Most of the awqaf are religious (types A and C) No social waqf (type D) Concept of waqf as a tool for social development is absent
Causes of Decline of Waqf Rigidity and unresponsiveness of the legal doctrine of waqf to changing socio-economic conditions Supremacy given to the waqf deed and the irrevocability of the waqf. Operational inflexibility limits the ability of mutawallis to undertake operational changes that might enhance productivity and efficiency Lack of organizational development
World Giving Index 211 Charities Aid Foundation WGI has three components: % giving money, % volunteering time, and % helping a stranger Region WGI Index % Australasia 58 North America 57 Western & Southern Europe 4 South Eastern Asia 37 Southern Asia 37 South America & Caribbean 33 Western Asia/Middle East 32 Northern Africa 31
World Giving Index 211 Charities Aid Foundation WGI has three components: % giving money, % volunteering time, and % helping a stranger Country WGI Index % WGI Ranking USA 6 1 Ireland 59 2 Australia 58 3 New Zealand 57 4 United Kingdom 57 5 Morocco 48 12 Qatar 45 19 Saudi Arabia 35 57 Indonesia 37 49 Malaysia 29 87
Agenda Waqf: From Past to Present In Search for Efficiency
Waqf during contemporary times To revive waqf, there is need to examine various aspects of the organizational architecture Organizational Type & Legal Status Governance and Management Input Types Output Type Income Generating Process
Waqf Management Issues One of the reasons of decline of waqf was mismanagement by mutawallis The response of mismanagement was that the governments took over In most countries the experience has not been good (mismanagement and corruption) Approaches to managing waqf Public bodies Private entities
Management :Public Bodies Management by government bodies/ministries Most cases have not been efficient Management by specialized public institutions some cases of good management Johor MAIJ Kuwait KAPF Singapore MUIS
Waqf Management in Johor Like all other states, State Islamic Religious Council (MAIJ) manages waqf in the State of Johor Johor Corporation (Jcorp) manages the waqf assets of MAIJ Waqf certificates launched by MAIJ First project by using cash waqf RM $4 ml. 6 storied building in 1995 Rental income until 25 was RM 1.2 ml. First waqf-based hospital established in 26 AnNur hospitals/clinics has expanded to other states An-Nur Plaza Kotaraya Mosque mosque cum shopping centre
Private Entities Specialized corporate entities can provide various services for fees/compensation Reasons of using corporate entities Permanence Ensures continuity and permanence (in case of death or disability of donor) Expertise Ensure professional and expert management of the assets Objectivity administration without any bias
Organizations Providing Management Services Two major types: Banks and financial institutions Department some banks offer trust services Subsidiary many major banks have trust subsidiaries Example: Waqf Trust Services Ltd (UAE) owned by Dubai Islamic Bank & DIFC Investments LLC (July 7) Independent Companies Example: Amanah Raya Malaysia provide both conventional and Islamic trust services
Services Provided by Waqf Management Companies Services of Trustee/Mutawalli Custody Services Estate Management Services Investment Management Services Securities/Fund Services Advisory Services
Services Provided by Management Companies to different Sectors Services Personal/ Private Corporate Charitable 1. Services of Trustee X X X 2. Custody Services X X X 3. Estate Management Services X X 4. Investment Management Services X X X 5. Securities/Fund Services X 6. Advisory Services X X X
Thank You!