Dhaka, Bangladesh
The golden heredity of cooperative legacy in our soil

The golden heredity of cooperative legacy in our soil

By Samir Kumar Biswas

WE must remember the great saying "Knowledge and Union are Power, Power directed by knowledge, is happiness; Happiness is the end of Creation" and at same time we need to remember the great line of great Bangla Poet Kamini Roy, "We are all for others" which actually carry the main theme of the cooperative. Simply, the word Cooperative is well known as a socio-economic movement. But my heartfelt belief is that the term Cooperative contains something more than this. Considering the basis of Human Civilization, cooperation among each other is the only indicator which could be designated as the wheel of progress. In every step of civilization, this wheel acts as the reinforce of advancement. Cooperative ideologically, as a movement and as a thematic term is always neutral. By having the combination of three of its salient characters- movement, democracy and ideology, Cooperative has acquired worldwide recognition and admiration. Perpetually it has attained the shape of an appropriate approach for poverty alleviation and self-reliance all over the world. The term Cooperative has its own origin of special meaning. Co stands for together and Operative stands for working; so cooperative is the practice of living together, thinking together and working together for mutual benefit of members. According to Culvert, a well known economist "Co-operative is such an organization through which common people voluntarily and honestly get together as human being to achieve their economic freedom" A co-operative society as defined by International Co-operative Alliance is "an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through jointly owned and democratically controlled enterprise". A co-operative society may also be defined as a business owned and controlled equally by the people who use its services or by the people who work there. In other words, the main objective of the cooperatives is to create employment and to improve their own socio-economic conditions by consolidation and making profitable investment of the small capitals of the cooperators. In fact, cooperatives started and expanded for self-reliance, poverty alleviation and socio-economic development. Basically a cooperative society is an association of persons, formed on the basis of equality, for the promotion of the members' interests and managed by the members themselves. In this respect, cooperative has been compared to a state which has similar aims and methods. A state is a politically organized and sovereign body of a number of persons in a particular territory. It represents a group of persons looking after their own collective needs, through a governing body and agreeing to remain within a set of self-imposed disciplinary rules, called its constitution. A state has thus four ingredients namely (1) territory, (2) population, (3) sovereignty and (4) governing body. A cooperative society also, if viewed from these angles, is identical to a state. It has got an area of operation, which may be compared with the territory of a state. Cooperative societies follow the policy of open door and there is no restriction on anybody's assuming the duties of membership. They have managing committee of their own and within the framework of their constitutions are free to pass any order and get them executed. Like a state, a society also has got the welfare of its members at heart. Its management is democratic in the sense of the term. Members have got an equal voice in administration, irrespective of their financial position, religion and sex. Sovereign authority vest in the general body of members who elect their own managing committee which like a cabinet in a state carries on day to day working. A cooperative society is, thus, a miniature state in itself. However, with various limitations in its activities, its position cannot be elevated to that of a full-fledged state. It has, in its working to remain within the limits set by the constitution of the country and other laws of the land. The bye-laws it frames, cannot over-ride the concerned Acts and Rules. They have to be scrutinized and registered. Societies are also not sovereign in their dealings with outsiders. A cooperative society, thus though not a state in itself, is a smaller state within a bigger one, in as much as within the framework of the constitution of the state, it conducts itself like a sovereign democratic body. Beginning of Beginnings: A retrospective of Cooperatives If we look at the past, cooperative movement began in Europe in the 19th century, primarily in Britain and France, although The Shore Porters Society claims to be one of the world's first cooperatives, being established in Aberdeen in 1498 (although it has since demutualized to become a private partnership).The Industrial Revolution and the increasing mechanization of the economy transformed society and threatened the livelihoods of many workers. The first documented consumer cooperative was founded in 1769, in a barely furnished cottage in Fenwick, East Ayrshire, when local weavers manhandled a sack of oatmeal into John Walker's whitewashed front room and began selling the contents at a discount, forming the Fenwick Weavers' Society. In the decades that followed, several cooperatives or cooperative societies formed including Lennoxtown Friendly Victualling Society, founded in 1812. By 1830, there were several hundred cooperatives. Some were initially successful, but most cooperatives founded in the early 19th century had failed by 1840.However, Lockhurst Lane Industrial Cooperative Society (founded in 1832 and now Heart of England Cooperative Society), and Galashiels and Hawick Cooperative Societies (1839 or earlier, merged with The Co-operative Group) still trade today. It was not until 1844 when the Rochdale Society of Equitable Pioneers established the Rochdale Principles. Financially, credit unions were invented in Germany in the mid-19th century, first by Franz Hermann Schulze-Delitzsch (1852, urban), then by Friedrich Wilhelm Raiffeisen (1864, rural). While Schulze-Delitzsch is chronologically earlier, Raiffeisen has proven more influential over time -In Britain, the friendly society, building society, and mutual savings bank were earlier forms of similar institutions. Persona Retrospective behind the foundation of Cooperatives are Robert Owen (1771-1858, Fran├žois Marie Charles Fourier (1772- 1837), Dr William King (1786-1865), Louis Jean Joseph Charles Blanc (1811-1882) , Friedrich Wilhelm Raiffeisen (1818-1888), The Rochdale Society of Equitable Pioneers was a group of 10 weavers and 20 others in Rochdale, England, that was formed in 1844. As the mechanization of the Industrial Revolution was forcing more and more skilled workers into poverty, these tradesmen decided to band together to open their own store selling food items they could not otherwise afford. With lessons from prior failed attempts at co-operation in mind, they designed the new famous Rochdale Principles, and over a period of four months they struggled to pool one pound sterling per person for a total of 28 pounds of capital. On December 21, 1844, they opened their store with a very meager selection of butter, sugar, flour, oatmeal and a few candles. Within three months, they expanded their selection to include tea and tobacco, and they were soon known for providing high quality, unadulterated goods. Cooperative Values in ethical grounds *Openness - nobody's perfect, and won't hide anything; *Honesty - Everybody is committed to be honest about what they do and the way they do; *Social responsibility - we encourage people to take responsibility for their own community, and work together to improve it; *Caring for others - we regularly fund charities and local community groups from the profits of our businesses. Cooperative values in particular *Self-help - we help people to help themselves; *Self-responsibility - we take responsibility for, and answer to our actions; *Democracy - we give our members a say in the way we run our businesses; *Equality - no matter how much money a member invests in their share account, they still have one vote; *Equity - we carry out our business in a way that is fair and unbiased; *Solidarity - we share interests and common purposes with our members and other cooperatives. Cooperative principles are the way we put our values into action finally adopted and approved by ICA * Voluntary and open membership - membership is open to everyone; *Democratic member control - all members have an equal voice in making policies and electing representatives; *Member economic participation - all profits are controlled democratically by members and for their benefit; *Autonomy and independence - cooperatives are always independent, even when they enter into agreements with the Government and other organizations; *Education, training and information - cooperatives educate and develop their members as well as their staff; *Cooperation amongst cooperatives - cooperatives work together with other cooperatives to strengthen the co-operative movement as a whole; *Concern for community cooperatives also works to improve and develop the community, both locally and internationally. The Cooperative movement today Considering the plethora of records of cooperatives started out as small grassroots organisations in Western Europe, North America and Japan in the middle of the nineteenth century, however, it is the Rochdale Pioneers that are generally regarded as the prototype of the modern cooperative society and the founders of the Cooperative Movement in 1844.The principles that underpinned their way of doing business are still accepted today as the foundations upon which all cooperatives operate. These principles have been revised and updated, but remain essentially the same as those practiced by the Pioneers in 1844. The Golden Heredity of Cooperative Legacy in our soil In the Indian Subcontinent (Presently India, Pakistan & Bangladesh) the Cooperative movement was introduced in 1904. The farmers were suffering a lot due to multifarious problems, namely, lack of loan facilities, exploitation of moneylenders and backdated farming system. To improve the distressed condition of farmers, the need for evolving a workable system was badly felt as farmers' revolts took place in the Deccan in 1875 due to this reason. Eventually, different Acts were passed to control this money-lending system as well as to provide credit and relief as assistance to the suffering farmers. But the desired result was not achieved. Sir Frederic Nicholson, a senior civil servant of Madras Provincial Government, after completing the study on agriculture and land management of some countries of Europe including Germany, submitted report in two parts (1895/1898) with recommendation to establish 'Cooperative Village Bank' for resolving the entire problem of the poor people in each village of the sub-continent and to make the Bank as the main centre for all the development programs of these poor people. Afterwards, on the recommendation of Famine Commission of 1901 and a Committee constituted by the then Viceroy Lord Curzon comprising three members (Lord Edward Law, Sir Fredric Nicholson and Mr. Dupernics), "The Co-operative Credit Societies Act, 1904" was enacted. The main purpose of the act was to increase savings, obtain self-reliance and initiate mutual cooperation among the rural poor to uplift their lives and livelihood. Throughout the period of the then British Government up to present Bangladesh, the Cooperative Law has undergone major changes in 1940, 1984 and 2001; with these changes cooperative movement has crossed a timeline of more than hundred years. Through these hundred years it has had some major achievements withstanding some failure also. After the Independence of Bangladesh cooperative, on the principles of ownership, was given formal recognition in the constitution as the second sector of the economy. At that time two types of cooperative movement started, in one hand, cooperative activities under cooperative department, and on the other hand, cooperative system of IRDP (later on BRDB). Department of cooperative initiated formation of cooperative societies including people from different sectors i.e. agriculture, fisheries, sugarcane, weaving, dairy, transport, poultry, cottage industries, women etc. Under the main program of BRDB, Krishak Samabaya Samity (KSS) at village level, Thana Central Co-operative Association (TCCA) at thana level and under the women development program, Mohila Samabaya Samity were formed. To ensure congenial atmosphere in the management of Cooperatives, the Cooperative Ordinance was promulgated in 1984 and Cooperative Rules were formulated in 1987. Later Cooperative policy was drafted in 1989. At the beginning of the new century Cooperative Society Act, 2001 and Cooperative Society Rules, 2004 are being practiced. However, in Bangladesh, Cooperative has both the success and failure. There are also agreeable reasons for this. Before referring to reasons for its success and failure, Cooperative societies may be divided into two categories in the basis of sponsorship- firstly cooperative society developed by the Government, BRDB, BARD, RDA and other agencies; secondly the societies developed independently. The societies belonging to the latter group are taking lead among the successful ones. However, the activities of some of those developed by Government, BRDB and other agencies are also satisfactory although many of them have failed to achieve any success. The government of Bangladesh has also emphasized cooperative initiatives to protect the interest of common people and to reduce gap between the rich and the poor. It is absolutely true that every cooperative society is an economic unit creating opportunities to promote economic growth and sustain ethical values to put into practice in life and society. Cooperative societies are based on certain values like democracy, equality, and solidarity. In fact co-operatives are autonomous associations of members united voluntarily to acquire some important common economic, social and cultural goals through jointly owned and democratically controlled enterprises. The challenge of upcoming days must be poverty reduction and development of human resource provided that economic emancipation of the poor and disadvantaged remains to be the major goal of the country. To achieve the goals the cooperative societies should be given opportunities to contribute significantly and play their positive roles. Besides, cooperative societies can act for promotion of social security, enhancement of affinity and fraternity among the citizens leading to political stability in the country provided that these cooperative societies are given adequate encouragement and incentives. Writer: Deputy Secretary, Ministry of Food Formerly Joint Registrar, Dptt. of Cooperatives. Ministry of LGRD & Cooperatives Ph D Fellow in Jahangirnagar University

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