Establishing a charitable fund to help the poor

Q: Al-Birr Charitable Society in `Unayzah receives Zakah (obligatory charity) money (Part No. 9; Page No. 450) and distributes it to Shar`y (Islamically lawful) recipients. It allocates part of this money to refurbish and construct houses for the poor. However, we have discovered that the benefit gained from this operation is temporary and limited, as some beneficiaries sell their houses to construct or rent better homes or even villas. They may also abandon them at a time when others could be in need of these houses. These houses might also exist in old districts, which make them subject to dispossession at anytime. The question we pose to your Eminence is: Is it permissible for the Society to refurbish its houses that are made for the poor to dwell therein from Zakah money in return for nominal fees that go into the rehabilitation of these houses afterwards, or even construct them at no charge on condition of transferring the ownership from those who are no longer in need to other needy persons? As we see these days, people's circumstances are changing quickly from poverty to wealth, praise be to Allah for this. Also, people in our time tend to prefer concrete houses.

A: The basic principle of Zakah is that it should be distributed to the legal recipients that Allah specifies in the Ayah: As-Sadaqât (here it means Zakât) are only for the Fuqarâ’ (poor), and the Masâkin (needy) and those employed to collect (the funds), and to attract the hearts of those who have been inclined (towards Islâm), and to free the captives, and for those in debt, and for Allâh’s Cause, and for the wayfarer (a traveller who is cut off from everything); a duty imposed by Allâh. And Allâh is All-Knower, All-Wise. Thereafter, those who receive it are to spend it in that which they see is beneficial to them; whether it is food, clothing, housing, or repayment of debt and so on. This is in accordance with the clear meaning of the Ayah, and they are most knowledgeable of their own needs. But, if a person does not know how to spend it or (Part No. 9; Page No. 451) if it is being spent in Jihad (striving/ fighting in the cause of Allah), their guardian or the one responsible for this should spend it where there is benefit. Thus, it is not permissible for Al-Birr Society to construct houses or the like using the money collected for Zakah to benefit the needy neither by renting them the houses nor giving them ownership; since this involves giving Zakah to those who are not eligible to receive it. Also, it leads to the loss of its origin without giving it to the qualified recipients, specifying the type of benefit, delaying its receipt to the eligible in addition to controlling their benefits. This has occurred before and has proven its failure, as it opposes the Nas (Islamic text from the Qur’an or the Sunnah) without a Shar`y excuse.May Allah grant us success. May peace and blessings be upon our Prophet Muhammad, his family, and Companions.