Kerala - Thiruvananthapuram   

‘Retain structure of cooperatives’

Thiruvananthapuram: The United Democratic Front (UDF) has strongly opposed the move to amend some of the provisions of the laws governing cooperatives in the State.

The pro-UDF Sahakarna Janadhipatya Vedi, which tabled its note of dissent at the recently concluded 6th Cooperative Congress in Kochi, has opposed amendments that would fundamentally alter the status of affiliated societies and the functioning of district cooperative banks.

If the proposed amendments are effected, a number of cooperative societies that have showed impressive growth and financial stability would lose their membership to their affiliated district cooperative banks. The cooperative societies that cater to dairy, employees, coir, handloom, consumers and education sectors would be in serious trouble as they would be deprived of funds, the note said.

Vedi chairman Karakulam Krishna Pillai said the District Cooperative Banks (DCBs) were the designated bodies, as per law, to extend financial assistance to these societies.

Leaders of the cooperative movement and other experts had an objective in promoting these societies in a big way in the absence of a district-level intermediary similar to the DCBs in the credit sector, Mr. Pillai said.

He alleged that the amendment moves reflected the political agenda of the CPI(M). Amendments seeking to merge various societies functioning within a panchayat would seriously harm the growth of the cooperative movement in the context of economic liberalisation and competition in the financial sector, he noted.

The merger would lead to the proliferation of ‘blade companies’ in the absence of credit avenues. In fact, the Government should encourage establishment of new cooperative societies to take on the informal credit sector dominated by these private financial establishments, the Vedi’s note said.

The Vedi also opposed the amendments seeking to induct panchayat presidents in the administrative boards of cooperative banks.

This would be a stumbling block because it would lead to the dominance of functionaries with statuary powers affecting the smooth operations of cooperative societies.

The vedi strongly opposed the amendments seeking to give voting rights to government nominees in district and State-level cooperatives. Mr. Pillai said the current trend was to strengthen the democratic structure of the cooperatives by reducing the dominance of government nominees in their administrative boards.

It is easy to see through the political agenda of the ruling party in providing voting rights to government nominees on the boards, he said.

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