Embed Size (px)
Citation preview
i
A Study of Samakhya and the Multicoops Association in Hyderabad India
FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS Rome - 1987
ii
MULTICOOPS IN ANDHRA PRADESH, INDIA
A Study of Samakhya and the Multlcoops Association
in Hyderabad, India
Food and Agriculture Organization of the United Nations
Rome - 1987
iii
Acknowledgements
In preparing this report the authors wish to acknowledge the assistance of the members of the
executive committee of MCA, trustees of Samakhya, ex-office bearers of the various member
societies, their executives and staff members, the Secretary and Director of MCA and the
Chairman of TCA who so readily placed all the material at our disposal, enabled tours of the
field study team to be successful and responded to requests for conferences and discussions at
short notice despite their pre-occupations. Mr. Raju's services were availed of almost whole time,
and without his help much of this report would not have been written. Mr. Ramana assisted with
computer studies of the field reports. The readiness with which the entire staff co-operated and
the efficiency with which typing and secretarial assistance was made available is a testimony of
their commitment and excellence. They all appear to share the spirit of the organisation.
The field work undertaken by the Post Graduate Students of Osmaina University and Shri
Shekhar Reddy despite dangerous weather conditions, was of an excellent order and the
comments made by each of them were extremely valuable. The authors are indebted to Dr. J.
Satyanarayana and Dr. Obul Reddy of the Osmaina University for making an excellent choice of
personnel in this regard and for having briefed the students before their departure to the field.
B.N. Raman
C.E. McKone
iv
Contents
Acknowledgements i
1. BACKGROUND TO THE STUDY 1
1.1. Methodology for the study 2
2. SUMMARY AND CONCLUSIONS FROM THE STUDY 4
3. CO-OPERATIVE DEVELOPMENT IN ANDHRA PRADESH 6
4. THE FORMATION OF MCA AND SAMAKHYA-AIMS AND
OBJECTIVES
12
5. NATURE OF THE RELATIONSHIP BETWEEN SAMAKHYA AND ITS
MEMBERS
17
6. MEMBERSHIP OF PRIMARY SOCIETIES AND THEIR SERVICES TO
THE RURAL POOR
20
7. ACTIVITIES OF SAMAKHYA, ACHIEVEMENTS AND
EFFECTIVENESS OF CURRENT PROGRAMMES
23
7.1. Research 24
7.2. Publications 25
7.3. Training 25
7.4. Education 26
7.5 Counselling 26
7.6. Lobbying 27
7.7. Development 28
7.8. Co-operative Development Fund 29
8. SAMAKHYA'S INFLUENCE ON GOVERNMENT POLICIES,
LEGISLATION ETC.
32
9. FINANCING OF SAMAKHYA, FOREIGN ASSISTANCE AND THE
ATTAINMENT OF SELF-SUFFICIENCY
34
v
Contents continued.
10. SAMAKHYA AS A MODEL CO-OPERATIVE DEVELOPMENT
ORGANISATION -
Lessons learned from ten years experience and their relevance for the
promotion of co-operative development in other countries.
36
10.1. Structure and Organisational Form 37
10.2. Size of Organisation 39
10.3. Emphasis on Business Development 39
10.4. Co-operative Development Fund 40
10.5. Lobbying and Public Opinion Forming 41
10.6. Financing the Organisation 42
10.7. Leadership 44
10.8. Promotion of the Samakhya Concepts 44
ANNEXES
1. Outline of the Study 47
2. Multicoops Association - Articles of Association 58
3. Samakhya - Articles of Association 51
4. Samakhya Organisation Chart - Who's who at Samakhya 50
5. Field Study Data 82
6. Information on Selected Multicoops 91
7. Co-operative Development Fund - Conditions for Eligibility 95
1
1. BACKGROUND TO THE STUDY
Rural India is covered by thousands of multicoops (Primary Agricultural Credit Societies,
Multipurpose Co-operative Societies, Large Size Co-operative Societies, Co-operative
Rural Banks and Farmers1 Service Co-operative Societies, etc -) each of which is
expected to fulfil the financial, production, marketing, consumer and welfare needs of its
members, who are drawn from all the rural occupations - The Multicoops' Association
(MCA) is an association of multicoops and was registered in 1977 as a public society in
order to help multicoops function more effectively, within the principles of co-operation.
More recently a Thriftcoops' Association (TCA) has been registered as an association to
help the many urban societies to function more effectively, including Employee Credit
Co-operatives, Urban Co-operative Banks and Neighbourhood Credit Co-operatives etc.
Samakhya was registered as a public trust in 1982, primarily to operate a co-operative
development fund created by MCA and to support professionally the work of MCA.
Today, Samakhya works closely with the MCA and the TCA, providing the co-ordination
necessary between those two organisations, and supporting both with promotional and
professional services. The activities of Samakhya embrace, Research, Publications,
Training, Education, Counselling, Co-operative Development Projects and Lobbying.
This unique mix of activities has evolved over the years. Commencing with programmes
for training field educators, the leaders of Samakhya began to identify constraints to co-
operative development and a widespread ignorance amongst farmers and their
representatives, of their basic rights within the existing framework of the co-operative
legislation. It became apparent that if multicoops were to thrive and flourish, a much
needed revision of the co-operative law was necessary, together with a fuller
understanding of the operational procedures and management practices used by some of
the outstandingly successful multicoops, such as the Mulukanoor Co-operative Rural
Bank in Karimnagar District, and others serving farmers and the rural population.
2
As the work progressed, national and international agencies concerned with the
promotion and development of co-operatives, began to take an active interest in
Samakhya, and to lend support where appropriate. Today Samakhya spans the whole
spectrum of co-operative promotion and development, from practical training at field
level to the essential public awareness creating, by lobbying civil servants and politicians
in order to bring about policy changes designed to create a more favourable environment
for co-operative development. This work is being achieved by a non-government
organisation and it provides an exceptional opportunity for FAO to examine the
modalities of the organisation for its potential either as a model for co-operative
promotion and development in other countries, or as a valuable source of ideas for
organisations that support small-farmer co-operatives.
1.1. Methodology for the Study
The study was conducted between August 4 - September 12, 1986. Mr. McKone's first
visit (June 23 - July 3) was utilised for settling the modalities of the study and his second
visit (2-6 September) to discuss the contents of the proposed report. The opportunity was
also utilised for field visits and discussions with ministers, high officials and trustees of
Samakhya.
In order to secure impressions and elicit opinions from a large cross section of people,
several methods were adopted. Some areas of the study being sensitive, free and frank
discussions held with certain opinion and decision-makers were not secured in writing,
as, any such attempt would have denied quality to the response or timely attention which
were essential to the report. Three questionnaires were drafted and the collection of data
was entrusted to six post graduate students of the Osmania University and a lecturer of a
college selected for their excellence by the Head of the Department of Commerce, Prof.
J. Satyanarayana. The 28 Societies selected for the study out of a total of 76 members
were representative of several aspects like varying years of association with MCA,
availment of a variety of services of Samakhya and MCA, different stages of growth and
size, and from different regions of the state.
3
Field studies were undertaken between August 4 and August 24, despite inclement
weather which developed into a calamitous flood and which prevented an approach to
two of the societies, the quality of the survey was maintained.
Mr. B.N. Raman also visited four societies during the period. Material collected and
impressions of the investigators were discussed on August 25 through to August 29.
Detailed discussions were held with trustees of Samakhya, several past and present
members of the executive committee of MCA, Secretary and Director of Samakhya and
MCA, Chairman of the Thriftcoops' Association, Officers of the State Government and
two of the ministers in the State Cabinet, of whom one had earlier held the portfolio on
the subject of co-operation and the other being directly aware of MCA and Samakhya in
his capacity as Chairman of a successful member society before he became Minister.
Discussions with the Minister presently holding the portfolio of co-operation could not be
held as he was camping in the flood affected areas, personally directing flood relief
operations.
All the reports, publications, minute books and files of the MCA and Samakhya were
placed at our disposal which, together with the extreme readiness of the staff to assist,
enabled systematic study.
The findings of the field study have been separately annexed as the study itself was only
one of the exercises for the report. (Annexure 5)
4
2. SUMMARY AND CONCLUSIONS FROM THE STUDY
The study on Samakhya and the Multicoops Association has indicated that the concepts,
organisational structure and the activities are entirely relevant for the promotion and
development of co-operatives both as business organisations and as structures which
contribute positively towards the improvement of the local economic and social
environment. There is evidence that improving the farmers co-operative leads not only to
improved opportunity for the farm families but greater benefits for those that earn their
living indirectly from agriculture. Employment opportunities are increased at the co-
operative and at the farm level with a demand for additional labour. Other artisans and
their families share these opportunities as demand increases for clothing, consumer items,
furniture and improved housing. In addition there is evidence that as the multicoop
develops it offers services to the general population in the form of consumer shops with
goods at lower prices than otherwise obtainable. This undoubtedly is a 'trickle down
effect' and cannot be discounted as it is a tangible off-shoot which arises when the
multicoop develops and moves into crop processing and more sophisticated marketing on
behalf of its members.
There is no evidence that the multicoops effectively and directly undertake projects for
the poorest as they are quite clearly organisations of small-farmers whose business
objectives and self-interest are well defined. The report draws attention to the failure of
Government programmes designed for the poorest and the different class structures, when
co-operatives were instructed to implement them.
MCA's membership is entirely voluntary and no special efforts have been made to
encourage rapid enrolment. It has adopted the position that, qualificatin by membership
for the societies, is not essential when making representations on important issues.
However, membership may qualify the societies to take advantage of and use specific
MCA services.
5
It is important to note that it is an association of multicoops and not a co-operative itself.
In this way it preserves its independence and freedom of action which is essential in its
lobbying activity which often involves actively challenging Government policy on behalf
of its members.
It places great emphasis on business development through the operation of the Co-
operative Development Fund. This Fund is used to improve the non-credit business of the
co-operative and often involves assistance with the installation of rice mills for
processing paddy to add value. An objective of the Fund is to increase self-reliance.
Seventeen projects have been funded and the bulk of the Fund is placed with co-
operatives working actively to develop their businesses.
There are lessons to be learned from the Samakhya and MCA experience which could be
of value in other developing countries. It may be unrealistic to attempt to precisely
reproduce elsewhere, the innovative organisation created in Andhra Pradesh as certain
aspects are locality specific. Certain activities and organisational features could however
be introduced in other organisations responsible for co-operative development. These
include the operation of a co-operative development fund, the policy on limited
membership, the emphasis on business development, the lobbying activity and the role of
the Samakhya trustees whose eminence and experience lend great credibility and strength
to the organisation.
The authors of the study are left with the feeling that something innovative and rather
special has been created by the leaders of Samakhya and that it is of such value that it
should be shared with others as an important contribution to co-operative development.
6
3. CO-OPERATIVE DEVELOPMENT IN ANDHRA PRADESH
The ills of the co-operative movement, be they internally or externally caused, reach back
into history which has its unfailing reputation of repeating itself. The movement
generated by a few benign workers in a predominantly law and order administration,
more as solace than as solution has continued in the welfare state much with the same
prescriptions. Both in British administered provinces of India and several native states,
governments which were reluctant even if not strongly opposed to democratisation of
government, introduced instititutional forms which could acquire health only in the
democratic process. There is, therefore, inevitable contradiction, suspicions breeding
regulation, and regulation eventually giving place to regimentation and dictation.
Placed in such a situation and where people had no voice to propose solutions for their
own problems, government was confronted with serious agrarian problems of poor
production, low productivity, frequent occurrences of famine and devastating floods,
unfair systems of tenure and tenancy in respect of agricultural land holdings, heavy
indebtedness of the rural population which overcame any possible motivation by farmers
for attempting rewarding activity. The co-operative movement in the first half of the
century was closely associated with reforms attempted in respect of each of these
problems and, in particular, with reforms in respect of indebtedness. It is no coincidence
that the attempt to organise credit through co-operatives of farmers has invariably been in
the wake of debt relief measures* measures more to overcome a likely hiatus or to
substitute for the money-lender rather than establish vibrant democratic institutions and
measures for ensuring lasting self-reliance. Infusions of government finances and
consequential provisions for government controls and treatment of co-operatives as
amateurish organisations needing constant care of government, together with interference
from its ever multiplying operational arms, continue to give rise to equally amateurish
solutions which have been imposed, often, with greater fervour ostensibly for the purpose
of ensuring the health of the institutions which those very measures instead place in
jeopardy.
7
In depth studies made by several committees appointed by the government and poignant
statements made by persons no less than Prime Ministers, who also chair the Planning
Commission, have all recommended major roles for the co-operatives, particularly in the
field of agricultural production - an activity which employs directly or indirectly over 70
percent of the rural population.
The governments' desire to ensure freedom within the movement has generally been
translated through the enactment of sketchy Acts but equally well negatived by stringent
rules, and more than required enthusiatic executive instructions or actions. The general
atmosphere within the co-operatives has been one of acceptance of the inevitable
resulting in further aggressions - which it is feared by some to be a growing tendency.
Andhra Pradesh is one of the most prosperous states in agricultural production. The
wisdom of its governments to invest heavily in irrigation taking advantage of the
availability of water resources has resulted in the creation of a vast potential for ensuring
surpluses in most farm items. Efforts of farmers in the field of minor irrigation, in
particular lift irrigation is, perhaps, not equalled anywhere else and their enterprise has
ensured relief from distress to themselves, and a better spread of prosperity than even that
afforded by major irrigation schemes. About 60 percent of the budget on plan schemes
for decades has been channelised to the creation of irrigation potential.
A few more schemes will contribute greatly in meeting the additional food and fibre
requirements of the country in the nineties and the first decade of the next century. In this
context alone the role of the co-operatives in organizing farm credit and marketing
assumes great importance. Any movement, which works towards the health of the co-
operative institutions, is particularly opportune.
8
The over-dependence of the movement on the officialdom and the easy access of
government to the latter have however resulted in prescriptions which have led the
movement away from the principles of co-operation. There is a need to correct this trend
and for the Department to assign to itself extension services ensuring healthy growth of
societies in place of the rather unpleasant tasks of super-intendence, regulation and
control - tasks which should be rendered from within and to the extent necessary.
Governments both at the Centre and the States and institutions like the Reserve Bank of
India, have shared the anxiety together with the leadership in the movement at the
continued ineffectiveness of large numbers of societies and their inability to gain strength
and provide the intended benefits to their members, despite supports and exceptional
treatment. The anxiety that prompted such patronage perhaps has expressed itself in ways
which favoured dependence rather than independence. Later day measures to bridge the
gap of funnelling credit through commercial banks and institutions not set up by the
farmers is an admission of the failure of external measures originally designed to ensure
health and progress. But few would like to admit the logical conclusion of leaving the
institutions well alone despite several examples of inordinate success. The failure of co-
operatives to respond adequately to cultivators needs have made them platforms for
aspirations other than those for which they were intended. Even as of now, in Andhra
Pradesh only 29 percent of the members use the services of the societies and the bulk of
them do not.
Consequent on the failure of the one village one co-operative society movement, initiated
through concepts developed elsewhere, a movement towards amalgamation to achieve
viability in societies was initiated, again at the instance of external agencies and sought to
be implemented through administrative action.
9
Persuasive measures, if at all, touched a few active members of managing committees,
but rarely the members of the societies themselves, with the inevitable consequences of
poor response at one end and impatience at the other. Yet these very circumstances
prompted innovations and experimentation. In several parts of the State those who had
nursed the movement or had been associated with it in their various capacities made
significant contributions to re-orientate the movement in terms of the accepted principles
of co-operation. In this context, the achievements of the Mulukanoor Rural Co-operative
Bank need distinct mention. The painstaking work done in Rajendranagar Samithi area
which had on the register 54 societies is the earliest attempt on a large-scale for voluntary
effort to inject health and momentum into the movement. Following all the principles of
co-operation 54 primary agricultural societies were amalgamated into 15 multicoops in a
period of a few months. Had this pioneering work been emulated elsewhere - and given
time such expectations would not have been belied - at least the cardinal principle of
supremacy of the general body would have been easily established. However an adverse
conclusion was drawn even from the success of this very attempt, that, such favourable
conditions were unlikely to prevail in other areas of the State and the viability programme
had to be implemented through compulsive legislative measures. In place of about 15,000
primary agricultural co-operative societies set up over the years to serve the rural
population spread over 29,000 revenue villages, 6,562 "viable societies" were formed
through processes of amalgamation in 1977. The criteria followed were:
1. identification of societies which had achieved short-term loan businesses of
Rs.200,000, and;
10
2. societies which had achieved short-term loan businesses of over Rs.100,000 but had
potential capacity to achieve Rs.200,000 based on availability of an aggregate
cropped area, irrigated or not, of 2,000 hectares.
Even so it would appear that in less than five years the Government itself came to doubt
the results of this measure.
1. Commenting on external support for meeting the expenses of a paid secretary in a
PAC it was observed: "Any scheme of viability of PACs cannot be allowed to
indefinitely depend on external assistance particularly from outside the co-operative
fold."
2. While speaking of deposit mobilisation, particularly of the scheme drawn up the AP
State Co-operative Bank and the subsidy provision therein it was mentioned: "In
spite of all these multifarious efforts, several potentially viable societies may not
become viable in the near future, if they are retained in the present form unless their
coverage and territorial jurisdiction is suitably enlarged to make them potent and
powerful economic instruments for rural development.
3. In respect of the implemented viability scheme it is said: "The functioning of existing
PACs leaves much to be desired as many as 5,444 societies constituting 85 percent
of the total number of societies are not able to meet the establishment expenses of a
paid secretary (computed at 1 percent of the outstandings at Society level, the
balance going for other expenses, dividend etc.) which is one of the essential criteria
for the0 determination of a viable society ……. the large majority of the existing
societies even after five years of the implementation of the viability programme have
unfortunately not been able to attain viability."
11
4. "The earlier limit of 2,000 hectares of cropped area, whether irrigated or not, and Rs.
2.00 lakhs business has had the effect of restricting the area of operations of the
societies too narrowly."
These extracts indicate that not only the very assumptions on the basis of which a
programme of restructuring was launched were proved incorrect, but, also, that the
programme resulted only in a mere substitution of a smaller number in place of a larger
number, that societies which had attained health continued to remain healthy and the sick
continued to remain sick. It also established that societies which were viable, were so
without administrative intervention.
A visit to the Mulukanoor Rural Co-operative Bank by a group of co-operators from the
Rajendranagar Samithi area appears to have triggered off the move to inspire voluntary
action to improve the working of societies. That society still stands out for due
observance of all the principles underlying the movement and demonstrates the case with
which an institution can be built up without placing undue reliance on excessive external
inputs or external direction, supervision and control.
MCA and Samakhya were promoted in these circumstances -accepting the need for
improvement but not accepting the role of government and its departments to bring it
about artificially and compulsorily.
12
4. THE FORMATION OF MCA AND SAMAKHYA - AIMS AND OBJECTIVES
It is general experience that institutions founded in reaction to contend with unpleasant
situations, set large tasks for themselves and invariably face the consequential
embarrassments of shedding or contracting their activities. MCA and Samakhya do not
fall in the category of such institutions. This appears to be primarily so, as they have, at
no time, been persuaded to state anything new. Their beginnings have been through the
organisation of voluntary effort to develop a healthy movement from within. Their
constant emphasis on the six principles of co-operation and the classification of their
activities among those principles is easily noticed and rather unusually so, when others
charged with responsibilities by law have made quick departures from co-operative
principles on excuses of pragmatism, needs of situations, adjustability and other
exigencies.
Beginnings
The beginnings of the MCA are to be found in the Government's contemplated
implementation of the viability programme. the lead was taken by the Rajendranagar
Samithi having jurisdiction around Hyderabad, the capital city of Andhra Pradesh. Both
official and non-official opinion appear to have " considered essential that the viability
programme should be implemented voluntarily by the co-operatives concerned."
The exercise which resulted in condensation of 54 societies in the block to 15 was
achieved in the year 1975, itself involving not only the officials and non-officials of the
Samithi but the office bearers and members of the respective co-operative societies. The
procedure followed is evidence of the commitment of those who initiated the programme,
the high quality of the response they received is attributable only to the involvement of
all the society members and the creation of a favourable climate for swift follow-ups to
ensure future health.
13
Based on the experience of the Co-operative Education Field Project of Indore in Madhya
Pradesh, the Co-operative Education and Development Project in Kaira District of
Gujarat and a study of the working of the Mulukanoor Rural Co-operative Bank in
Karimnagar District of Andhra Pradesh, a pilot project called the Multipurpose Co-
operative Development Project was sponsored initially for the 15 societies newly formed
out of the 54 societies in Rajendranagar Samithi area. On registration of the MCA in
1977, the implementation of this project became its responsibility.
The Multipurpose Co-operative project of 1975-76 stated its objectives to be:
1. to form viable and potentially viable co-operatives by voluntary amalgamation and
mergers;
2. to make them take up multipurpose activities such as Banking Operations, Agro
Services, Agro Marketing, Consumer Services and Community Services;
3. to make them provide integrated credit and other services to all members for
production as well as consumption purposes;
4. to ensure that these societies facilitate large-scale assistance to weaker sections by
availing themselves of the facilities offered by special agencies like Small Farmers
Development Agency, Tribal Development Agency, Drought Prone Area
programme, and Special Corporations for Scheduled Tribes, Scheduled Castes and
Backward Classes etc;
5. to see that the co-operatives take an active interest in the programmes sponsored by
voluntary organisations; and
6. to establish an intimate administrative relationship between Multipurpose Co-
operatives and the Gram Panchayats for better implementation of developmental
plans in rural areas.
14
Very specific training programmes were undertaken as part of the Project. Unlike the
consequences of a compulsive programme of amalgamation and restructuring discussed
elsewhere in this report, the experiment of voluntary amalgamation in the Rajendranagar
area produced commendable results. This voluntary implementation of a viability
programme demonstrated the practicability of allowing the members to determine matters
for themselves. The results even in the first year and the improvements registered, laid
the foundations of MCA and Samakhya and re-affirmed the correctness of the approach.
The results obtained in the first year were:
1. Membership in societies increased by 72 percent;
2. Share capital of members rose by 64 percent;
3. Outstanding loans of short-term credit at end of year increased by 58 percent;
4. Outstanding loans of medium-term credit increased by 389 percent;
5. Payments of interests improved to 66 percent of dues;
6. Several societies registered profits;
7. Thirteen societies acquired offices;
8. Number of employees increased from 12 to 53.
Consequent on the compulsory amalgamation of 640 societies in other areas of
Rangareddy District to 220, thought was given to expanding the educational programme
of the Project, first to all the societies in the District and, later to other districts. A
programme for covering 51 societies was launched in 1978. In order to formalise the
undertaking of the work so far conducted in Rajendranagar, the Multipurpose Co-
operative Association (MCA) was registered in January 1977, as a voluntary society
under the Public Societies Registration Act. The State Governments formal permission
was obtained in due course to use the term 'Co-operatives' in its name as its duties lay
only in respect of that activity and its associate activity of rural development.
15
The aims and objects of the MCA are stated in its Memorandum of Association
reproduced at Annexure 2.
Even though the expression Samakhya appears in earlier years it was promoted as a
public trust by MCA in 1982 under the Indian Trust Act. The Articles of Association are
given in Annexure 3. MCA—appears to have been persuaded to form Samakhya for three
major reasons:
1. Legal disability of multicoops to receive aid from a society of which they are
members.
2. Legal prescriptions could prevent experienced leaders in the movement from serving
on the managing committee of MCA whenever their presence and experience were
of great importance.
3. Several issues dealt with by MCA were of common concern to all types of co-
operatives and, therefore, while retaining the identity of MCA, the trust could
function in the total area comprising all co-operatives. It was, however, ensured that
Samakhya and MCA had common purposes and objectives and worked closely
together. A 1985 information pamphlet sets out the position. (Annexure 4)
It describes Samakhya as a registered public society working closely with MCA and TCA
(Thriftcoops' Association analogous to MCA, but not described in this study), providing
the co-ordination necessary between MCA and TCA, and supporting both with
promotional and professional services.
16
The constitutional arrangements and structure with Samakhya as the umbrella
organisation provide the necessary freedom for action, reduce the likelihood of
government interference and ensure that the organisations can give maximum response to
their members' needs for representation of interests with government departments and
official bodies. As a public trust Samakhya's trustees can allocate their funds and
authorise expenditures without the restrictions that may be placed on a co-operative. This
is of particular significance when needing support for lobbying activities and in
challenging government policy.
Through all its activities, Samakhya has sought to interest managements, staff and
members of the primary societies to work towards strong institutions for themselves. A
cross section of persons from each group interviewed in the field considered that
Samakhya should expand its activities and develop plans for the large number of societies
which are sick. Societies which had several counsellings from Samakhya shared
extraordinary improvements in performance. Such successful societies have also become
examples to others in the neighbourhood. There however, still persists some feeling that
the services of Samakhya are mainly available to its members and, therefore, a
programme for including more members should be initiated. This misgiving needs to be
dispelled. There does not appear to be any need to follow the prescription of unrestricted
membership which societies themselves have had reason to regret. No other movement
from within has had the type of impact as Samakhya has had.
17
5. NATURE OF RELATION BETWEEN SAMAKHYA AND ITS MEMBERS
MCA is an association of the member multicoops, whereas Samakhya is a registered trust
created by the MCA- In its organisational structure, MCA represents the member
societies. Samakhya is managed by a board of trustees comprising individuals of known
standing and with commitment to the co-operative movement. Power to fill casual
vacancies or nominate additional trustees is with the members of the trust board, ensuring
thus, perpetuity, as well as choice from among excellent workers. This pattern for
Samakhya appears to have been made deliberately to prevent partial or wholesale
displacement of chosen trustees through indirect actions. Whereas MCA's executive
committee has representatives of Chairman and chief executives, three nominees from
Samakhya ensure continuity and mutuality.
With the present membership standing at 76 multicoops the relationship between MCA
and its members is intimate, contacts are frequent and meetings, even arranged at short
notices, well attended. MCA's managing committee was ordinarily to have
representatives from elected Chairmen of member societies but as elected office bearers
are not available presently, representation is of the Chairmen of the earlier elected
committees. This situation arose in March, 1985 when the AP Government suspended
elections within co-operatives leaving them without any elected managing committees
and watched over by a government appointed 'person in charge'. Samakhya quite
naturally has been challenging this government decision through its lobbying activities.
(see Section 7)
Enquiries were made during discussions on the growth of membership in the MCA.
Opinions were sought as to whether it was deliberate policy to keep the number low,
whether it would not add strength of numbers for lobbying activities and be more
impressive and representative of large-scale opinion with more members, or whether
Samakhya should not pioneer an interstate movement, thereby securing strength at the all
India level. Opinions were varied. One of the suggestions was that even though there
were over 6,500 multicoops registered, apart from about 500 the rest remained non-viable
and mere membership in MCA was unlikely to herald any improvements.
18
It was also indicated that at one time it was contemplated to introduce an element of
competition, with membership of MCA denoting a status in performance and
achievement. No thought has as yet gone into the creation of a national level body or
creating statewise chapters, though MCA and Samakhya have already attracted
considerable attention outside the State of AP. Greater concern appears to be focused not
on membership numbers but on the quality and variety of services given by MCA and
Samakhya. This appears to be acceptable also to the users of the services and others
interacting with the two institutions. However early thinking on membership appears in
the contents of the fifth Annual Report (1979) of MCA.
" As members will eventually form the backbone of the organisation, MCA has been
careful in offering membership to multicoops which have reached some degree of
viability, and which feel responsible to their own members. The services of MCA,
however, have been open to all multicoops irrespective of their membership in the
MCA." This perhaps may not reflect opinion for all time, but neither in the interest of
collecting numbers, nor, even expanding its resource base, MCA has been anxious to
seek affiliations. While MCA may seek to serve the cause of all the multicoops, as events
have proved, physical constraints in respect of some of the activities like member
education etc., will soon arise.
Mere extension of membership, in itself, does not guarantee strength. Neither can there
be a case for open membership, if it means admission of members only because they can
boast of a place on the register. A more compact body with a larger spread of executive
and field staff is, perhaps, the answer.
19
Samakhya's promotional work in assisting the organisation of specialised agencies in
other fields of co-operation will make for greater strength in the movement. For example
the formation of the Thriftcoops Association (TCA). Activities of relevance to the health
of the members is intense, detailed and accurate. Commencing with the earliest project of
1975 results can actually be related to specific acts of MCA and Samakhya.
Improvements in performance, quality of participation by members in multicoops,
proposals for expansion and new ventures are in some instances easily relatable to
general or specific actions of MCA. See for example data on growth of member
multicoops achieved during membership. (Annexure 5)
20
6. MEMBERSHIP OF PRIMARY SOCIETIES AND THEIR SERVICES TO RURAL
POOR
Membership figures and classifications do not present any rational picture either of effort
or lack of effort on the part of managing committees to cater to the weaker sections. In
the Multipurpose Co-operative Development Project of 1975 it was stated:
"To ensure that these societies take to large scale assistance for weaker sections by
availing themselves of the facilities offered by special agencies like Small Farmers
Development Agency, Tribal Development Agency, Drought Prone Areas Programme,
and special corporations like Scheduled Tribes, Scheduled Castes, Backward Classes
etc."
Undoubtedly, societies did take advantage of such schemes, but, a study of a few
societies has indicated that it has proved burdensome and, even, leading to sickness. The
causes are not of the Society's doing. Some of the schemes were poorly conceived and
did not guarantee an adequate return to the beneficiary and, therefore, no surpluses to
repay loans from. Much improvement has taken place more recently in formulating
viable schemes for the weaker sections and using the budget effectively rather than
thinly. Membership review, however, has been attempted year after year to assess growth
and coverage and forms part of MCA's ongoing data collection. Enquiries at field level
brought out that where the societies had become prosperous and responsive to members'
needs, economic activity in the territory of the society's operations had increased
considerably. With better productivity and returns from agriculture, and with higher
margins being allocated to cultivators by the multicoop societies in comparison with
areas having multiple agencies serving farmers, employment and wages had improved.
This is the trickle down effect. But the dominant position still is of landowner cultivators
even where membership has actually swelled.
21
A profile of one multicoop visited provides some insight into the way in which
multicoops try to serve all the community within their area of operations.
Pothangal Multicoop
As at 31 December 1985 the Society had 2,066 shareholding members but it claims to be
serving 3,000 agricultural families out of a total population of 25,000. The breakdown of
membership is as follows:
Scheduled Schedule Backward Other TOTAL
Tribes Castes Classes Classes
Small
Farmers 341 42 709 673 1,765
Other *
Farmers 3 — 74 224 301
TOTAL 344 42 783 897 2,066
Services provided for the farmers include short-term and medium-term loans, supply of
seeds, implements, fertilizers, pesticides. Procurement and purchase of crops. With the
assistance of MCA this Society has successfully installed a rice mill which will
dramatically improve the returns to the farmer through the principle of adding value to
their crop. MCA technical staff assisted the Managing Committee of the multicoop to
prepare a feasibility study and Samakhya trustees approved a loan from the Co-operative
Development Fund. In addition to direct services to farmers, the multicoop operates small
consumer shops selling essential consumer items at lowest price and cheaper than can be
obtained from private merchants. This assists the poorer sections of the community. It is
anticipated that the increased incomes available to the farmers because of the rice mill,
will result in more cash within the community and therefore more opportunities for
agricultural labourers. Another measureable effect has been the steady improvement of
fanners' housing and new building which has resulted in more work for builders and their
labourers, more work for carpenters and furniture makers.
22
It may be argued that the multicoops do not focus their efforts on programmes directly
for the poorest sections of the community as they are essentially organisations of farmers
intent on doing better business. MCA staff argue that most programmes for the rural poor
concentrate on small isolated group activities that may do little to improve the general
economic environment of the community. In contrast they argue that the MCA approach
focuses on the major economic activity in the area which is agricultural production, and
through building this up it creates a more favourable climate for other sections of the
community who may not be landowners but who nevertheless derive their incomes and
opportunities indirectly from agriculture. In addition the multicoop is steadily improving
its services to the community directly through its consumer shops.
Although individual societies are making real efforts to serve the poorest, MCA's
recommendation to societies to cater to the needs of all those engaged in economic and
earning activities and its promotional programme recommending support to activities
other than agriculture, have to be implemented with greater vigour. The traumatic
experience of programmes designed by Government, specifically for the weaker sections,
implemented in the earlier stages has to be overcome by a review of such schemes and
reformulation to ensure adequate returns.
23
7. ACTIVITIES OF SAMAKHYA, ACHIEVEMENTS AND EFFECTIVENESS OF
CURRENT PROGRAMMES
MCA and Samakhya have concerned themselves from the beginning with comprehensive
programmes to build the health of the movement and, in particular, to remove existing
deficiencies in the functioning of societies. It is more the comprehensive content of the
programme and approach to fundamentals rather than small measures of correction, that
has distinguished the work of these institutions.
Commencing with the steps taken up with the multipurpose project of 1975-76 and
followed up with specific training programmes during 1976-77, a five year Multipurpose
Co-operative Project started in January 1978 with 51 societies of the district. By the end
of the year 1982 it covered 220 societies in the district and, thereafter, served societies in
other districts. In the context of the steps taken by government to amalgamate
compulsorily the societies into 'viable' ones, MCA appears to have realised that
amalgamation in itself had achieved little. As a follow-up, therefore, the action plan
adopted was directly aimed at the removal of persistent deficiencies which were:
1. absence of books of accounts for several years;
2. disinterest among members due to lack of education;
3. exclusiveness of membership;
4. lack of involvement of governmental staff;
5. lack of developmental attitudes on the part of financing
banks and their exclusive concern with repayments
6. lack of full-time trained employees;
7. lack of follow-up by government to further the viability programme.
24
In that year itself, the targets for the plan of action, which included educational and
training programmes, as well as, improvement of forms and contents of management and
services were over reached in many cases, and, MCA bridged a wide gap which, neither
the societies on their own, nor, the extension services of the government, had been able to
overcome. From the year 1979, MCA, while continuing its work in the Ranga Reddy
district moved out to other areas, and, its efforts and publications were welcomed in co-
operative and other circles.
The activities of Samakhya and MCA have been placed under convenient classifications:
1. Research
2. Publication
3. Training
4. Education
5. Counselling
6. Lobbying
7. Development
The Field Study Report (Annexure 5) provides data on usage of these services and
numbers of member multicoops participating.
7.1. Research
Research programmes undertaken have been specific, either to a group of societies, or, to
subject matter of both immediate and long-term importance. Findings are clearly
reasoned out and can form the basis of executive actions. Until the introduction of special
officers in place of the managing committees (March 1985), research findings relevant to
the societies were shared with managing committees and senior staff of co-operatives to
enable quick decision. Critical studies of subjects like interest rates in the 3 tier credit
system, cost-volume-profit analysis of 11 of the member co-operatives, convenient
design of pass books, study of the election system in co-operatives, preparation of model
laws, bylaws, personnel policies, business operations, funds and inventory management
in respect of co-operatives and the operation of the Co-operative Development Fund
(CDF) are illustrative of the range of research activity. Their value both to the members
and the administration has been considerable.
25
7.2. Publications
Study reports, training packs, booklets and pamphlets continue to be produced. On
demand from outside the State, English translations of some of MCA's publications in
Telegu have been produced. Publications are of direct instructional or suggestive value,
and, some of them can be used as practice manuals. Several publications have been
adopted by the National Co-operative Development Corporation of the Government of
India and others as valuable training material.
Publications include two newspapers. Sakalartha Sahakaram, which is a monthly
newspaper, has a circulation of around 8,000 including all multicoops, bankers,
departmental officials, trainers and others concerned with the movement. Samithi Vartha
Lekha which is an in-house news letter is restricted to member co-operatives.
7.3. Training
This activity has necessarily been the earliest activity of the MCA, and, appears to have
generated an overwhelming demand, both, because of its utility and the state of clientele
available. In order to contain it within reasonable limits, MCA has had to consider
making it mainly available to member coops, with some limited capacity for interested
non-members -
26
Training programmes are worked out in consultation and with the participation of
professional trainers. Some of the material has been accepted by agencies like NCDC,
ILO-MATCOM. MCA is contemplating introduction of a correspondence course which
should overcome other physical constraints in reaching out to large numbers of persons
needing training and spread throughout the State.
7.4. Education
The member education programme has already resulted in visible improvements and is
evidenced by members' response to internal and external measures. Starting with
programmes organised from MCA at its expense, several multicoops have organised this
activity on their own, meeting much of the cost. Greater attendance at general meetings
and pertinent, searching questions addressed to the managing committees are noticeable.
In the course of the field visits, questions put to members visiting the societies on
subjects like deposits, increase of share capital, contribution etc., showed an awareness of
these subjects which were not common knowledge earlier amongst farmer-members.
Table 4 in Annexure 5 shows the results of a field study designed to test the knowledge
and understanding by members of Samakhya and MCA. The results indicate that
Committee members and staff have a good knowledge (65 percent) of the organisation
that they belong to. As might be expected Presidents and Chief Executives have the most
knowledge as they attend MCA meetings on behalf of members. This type of survey can
be repeated in order to test for improved member awareness and understanding.
7.5. Counselling
This activity comprises guidance to societies in general or on specific problems. Reviews
of performance of member societies, publication of statistical information in their regard,
recommendations based on studies relevant to their programmes make direct impact both
on decisions to undertake new projects and look into their own affairs more closely.
Critical reviews of the annual reports of the societies and suggestions for improved
reporting was a feature of 1985 and is indicative of the constant awareness of the need to
maintain improvement.
27
7.6. Lobbying
It could be stated that lobbying on behalf of co-operatives, if at all, was an occasional
activity, at best by interested or motivated individuals and generally casual. It was left
usually to the government or the Registrar to take the initiative in any consultative
process in which it was an exercise in seeking endorsement rather than opinions. MCA
and Samakhya's initiative in this regard has thrown up a large number of subjects ranging
from co-operative law and administration to problems encountered in the field. Their
attempt to focus attention on problems and represent them has been received with mixed
feelings, but appears also to have received recognition in that, their office bearers and
their employees have served on committees and working groups set up by the State
Government to formulate the State's 7th Five Year Plan. They have been consulted on
subjects like that of audit, their representation on interest rates in the credit area acted
upon. Discussions with a senior official of the government revealed that on the problem
of interest rates government's stand was firmed up on account of the lobbying by
Samakhya.
This resulted in better margins allowed to multicoops for handling and administering
government credit programmes, considering that lobbying has not been actively
employed by the co-operative movement on previous occasions, the effort by Samakhya
is pioneering and in the circumstances effective. For more details see Section 8.
28
7.7. Development
Samakhya views multicoops as essentially businesses privately owned by the farmer-
members, and which choose to operate within the framework of co-operative principles,
allowing the members (owners) to take a full part in controlling their business through a
democratic structure. Admittedly the multicoops in Andhra Pradesh fall short of this ideal
state due to attempts by Government to impose excessive control. Nevertheless
Samakhya recognises that economic progress for the co-operative members and indirectly
for the whole community, including the poorest, can only be achieved through
developing the business activities of the co-operative. Assisting co-operatives to review
business development and helping them to undertake feasibility studies for new
developments such as the installation of rice mills is an important service function of
MCA.
The emphasis on business development, processing to add value and federal marketing
arrangements (in the planning state) is in line with the FAO Appropriate Management
Systems for Co-operatives (AMSAC). In this respect MCA's achievements in assisting 17
development projects at multicoops by providing business advice and finance from the
Co-operative Development Fund is undoubtedly impressive. The Table shows on-going
projects supported from the Fund.
29
TABLE
0N-GOING PROJECTS SUPPORTED BY
SAMAKHYA's CO-OPERATIVE DEVELOPMENT FUND - 31.12.85
Deposited Balance of
MULTICOOP PURPOSE Amount deposits
as on
31.12.85
1 Tekulapalli Construction of godown 1,00,000 72,000
2 Chennaraopet Construction of godown 1,00,000 80,000
3 Sivannaguda Supply of inputs 1,00,000 72,000
4 Kukatpally Supply of consumer goods 40,000 36,700
30
5 Mulukanoor Developing paddy business 50,000 38,000
6 Rayadurg Construction of office, godown 1,00,000 71,500
7 Malleboinpalli Construction of office, godown 1,00,000 82,000
8 Malleboinpalli Supply of inputs 60,000 38,000
9 Kapulakanaparthy Construction of office, godown 1,00,000 67,000
10 Kapulakanaparthy Installation of rice mill 4,00,000 3,70,000
11 Gattududdenapalli Supply of consumer goods 50,000 27,000
12 Gattududdenapalli Seed producing unit 1,00,000 80,000
13 Pothangal Installation of rice mill 4,00,000 3,20,000
14 Kothapalli Installation of rice mill 4,00,000 3,80,000
15 Ghatkesar Construction of office, godown 1,00,000 91,000
16 Mulukanoor Developing paddy business 4,00,000 4,00,000
Projects
initiated
during
1985
17 Malleboinpalli Installation of rice mill 4,00,000 4,00,000
17 PROJECTS TOTAL 30,00,000 26,35,200
7.8. Co-operative Development Fund
A manual on the objectives and operation of the Fund-has been prepared and it provides
an interesting model for possible use by other co-operative development organizations
who wish to assist the business development of co-operatives with both on-going advice
and finance. The objectives of the Fund are stated as follows:
31
The concept of the Samakhya Co-operative Development Fund is to encourage and assist
member multicoops of MCA to take up non-credit activities. More specifically, the
implicit objectives of the CDF are to help member multicoops to:
1. Create assets that will earn a surplus and thereby improve the financial strength and
managerial efficiency of the multicoop.
2. Increase returns to their members in order for them to become self-reliant.
3. Increase their share capital and reserves and promote self-regulated thrift and
voluntary savings, and thereby become self-reliant.
4. Make their members play their role effectively in deriving full benefit from the
multicoop services.
Annexure 6 shows the eligibility conditions for a financial deposit from the Fund to assist
multicoop development. Interesting features of the conditions include the necessity for
the multicoop to mobilise new funds amounting to 25 percent of the project costs of
which 10 percent must come from the members. Other conditions concern the business
health of the multicoop such as size of outstanding loans, up-to-date audit, and
compliance with co-operative principles.
The results of the developmental activity has been the generation of aspirations among
member societies to diversify their activities into profitable lines. The advice tendered by
Samakhya and MCA to member societies to extend activities beyond short-term credit,
supported by specific development support has aroused the interest of members as well as
non-members. A corollary to this activity is guidance to societies to approach concerned
authorities for assistance to schemes.
32
Correspondence in the offices of MCA and Samakhya, deliberations at its meetings,
impressions gathered during field visits, and attendance at its programmes indicate, that
the activities undertaken by the two institutions have gained popularity and hence
momentum. A senior official of the Government of India in charge of development of
rural technology even suggested during discussions with him, that, MCA and Samakhya
could become agencies of transfer of technology to the rural areas, they having the best
rapport among all other rural services and a prior capability for sustained extension work
through co-operatives. While their services to the co-operatives have shown results in
improved working, greater realisation of the strength of co-operative institutions, self-
reliance, resistance to the temptations of disproportionate external funds and above all
good management and sound directions to growth, there have also been achievements in
other areas. In place of a complacent atmosphere, where, societies expressed aquiescence
to any fiat or dictation, there is greater realisation of the principles guiding the movement
and an assessment of what is 4 suggested from the society's point of view.
Discussions with several workers in the field indicated that they have become
increasingly concerned with the concepts of the movement, that they now have access to
information and a platform to express their opinions. Samakhya has, undoubtedly, as a
result become increasingly burdened with actions which should have been initiated by
respective co-operative societies, their office bearers or members. Particularly in the field
of lobbying and court actions Samakhya has become accepted as representing them all.
33
8. SAMAKHYA'S INFLUENCE ON GOVERNMENT POLICIES, LEGISLATION ETC.
Lobbying in government has been made a regular practice by MCA and Samakhya.
With its initial start in the Rajendranagar area where the officials and non-officials of the
development block preempted government by invoking powers of the general bodies to
amalgamate 54 into 15 viable societies, MCA offered its helping hand to government at
various stages. Government and the Department appeared willing to accept the help since
it was offered in the best of spirits. One of the earliest successes was the revision of the
interest rates in the 3 tier credit structure, retaining to the primary society, the bulk of the
margins. This, in the face of opposition from strongly organised federal units, was no
easy task, and, its success, not only lay in persuading Government at the level of the
Secretary to the Government and the Minister in charge, but in their having been
converted to its view and instructing the Registrar of Co-operative Societies to issue a
directive under his statutory powers. Samakhya and its officials have been associated
with the formulation of the 7th Five Year Plan in the Co-operative Sector. Similar
association took place in the committee of officials constituted by the Registrar of Co-
operative Societies on the subject of audit of co-operative societies. A comprehensive
accounting procedure evolved by Samakhya for multicoops and accepted by an earlier
Registrar of Co-operative Societies is awaiting introduction. Success was achieved on the
matter of abolition of common cadres, essentially due to MCA's firm opposition to any
loyalties outside the general body.
Under the common cadre system, the government provided a core of trained co-operative
managers and allocated them to some 200 co-operatives. The concept was that co-
operatives needed trained managers in their early years when they could not afford to
employ such a person. As the co-operatives developed they found themselves in the
position of being managed by a government servant whose loyalties were divided
between his employer (the government) and his managing committee. Co-operative
members preferred to employ their own manager directly and resented the situation in
which they had to pay salaries to managers who they had not recruited and whose loyalty
was divided. Samakhya lobbied for the abolition of this system and was successful.
34
However, barring these instances, there does not appear to be any desire on the part of the
State Government to grant to MCA or Samakhya any formal recognition or signify its
acceptance of the two institutions as opinion makers.
There obviously cannot be acceptance by MCA of the system of the special officers in
place of elected bodies or indefinite postponement of elections and the reasons advanced
by the government have failed to carry any conviction with MCA and Samakhya•
Samakhya, therefore, in the absence of any elected management in the member bodies,
has moved the High Court of Andhra Pradesh in writ jurisdiction. However, despite this
irritation, Samakhya's work continues to be appreciated. The latter day estrangement has
far deeper roots in their respective positions on the subject of regulation of co-operative
institutions rather than in the immediate problem of holding or not holding elections, but
has come to the surface on this issue. When elections are held in due course and new
managing committees assume office, the prospects of lobbying in the State Government
would improve and assist the research project on the revision of co-operative law. It
would be unrealistic to expect Samakhya to achieve results for all the subjects and issues
upon which it lobbies. Nevertheless it has achieved some notable success and who knows
whether in the absence of the lobbying stance, co-operatives might suffer further
injustices.
35
9. FINANCING OF SAMAKHYA, CONTENT OF FOREIGN ASSISTANCE AND THE
ATTAINMENT OF SELF-SUFFICIENCY
From inception till date, MCA and Samakhya have received about Rs 3,121,000 from overseas grants, Rs 904,500 fromservice charges, and Rs 23,800 from subscriptions,
indicating that its major support comes from overseas donors. Interest earnings on the
CDF have been excluded from these figures. There does not appear to be any serious
misgiving in securing foreign assistance, particularly to assist with the development of
multicoops and for encouraging some of the weaker ones. Nor is any difficulty foreseen
in raising subscriptions from members, should the need arise, once elected committees
take office. The present situation with regard to subscriptions is that each member
deposits RS 1,000 with MCA and the Interest earned on this deposit is treated as the
annual subscription.
There appears to be resistance to work to a situation of comfortable financial strength as
that could affect efficiency of personnel and induce complacency or suggest unnecessary
and expensive indulgences.
Expansion of membership in order to raise subscription does not appear feasible. Several
such members would need to receive services out of proportion to their subscriptions
over a long period without guarantees of improvement. MCA is particularly anxious to
avoid the situation which prevails with the State Co-operative Union in which multicoops
pay compulsory dues in proportion to their surplus. This inevitably gives rise to the
question of "What do we get for our payment?" This is a common situation facing many
co-operative unions in other countries. MCA prefers to provide services against payments
which represent value for money for the user.
The practice of restricting membership to those which are viable appears sound. Such
members could as and when required pool funds to support common activities of
MCA/Samakhya or at their instance assist weaker societies directly. Programmes of the
Co-operative Development Fund could be equally well performed by a one time
assistance programme provided bilaterally or through a linkage scheme brought about at
the instance of the MCA/Samakhya. Activities like member education programmes
should increasingly be supported by loan of material and all other expenses directly borne
by the society.
36
An annual budgeting exercise indicating the need for funds from member societies would
ensure the development of healthy practices, contributions becoming proportionate to
their own capacity. During enquiries, no difficulty was expressed in regard to
contributions by erstwhile managing committee members of member societies. A senior
National Co-operative Development Corporation official stated that MCA could
undertake the preparation of intensive development prlans on its behalf, much in the
manner of consultancy now offered to its members, and, ensure to itself satisfactory
surpluses for other activities. There appears to be some argument in favour of not being
too lavishly endowed and continuing the present system for a few more years.
37
10. SAMAKHYA AS A MODEL CO-OPERATIVE DEVELOPMENT ORGANISATION -
Lessons learned from 10 years experience and their relevance for the promotion of co-
operative development in other countries .
One of the objectives of the study on Samakhya was to examine its potential as a model
for co-operative development in other countries. Following the study it seems unlikely
that the precise organisational form and content could be reproduced elsewhere but there
is no doubt that a number of its characteristics could be of considerable value if adopted
as an approach to co-operative development in other countries.
The leaders of Samakhya adopt a fundamental position on the value of the co-operative
principles. They believe that if any of the principles are overlooked or violated, a
multicoop is unlikely to be successful and may face total failure. They are not prepared to
compromise their rigid position on the adherence to the co-operative principles.
Notwithstanding their own position, it is evident that co-operatives in Andhra Pradesh are
failing to follow some of the co-operative principles due to intervention by the
government. Suspension of elections and the interference in the democratic principles is
one of several infringements of principles forced on co-operatives.
In the African situation where many governments work closely with co-operatives,
compromises are adopted which have the effect of eroding principles where government
wishes to retain some power and control over development situations. Samakhya would
argue that this is unacceptable and that the dilution of the co-operative principles leads
inevitably to loss of democratic control, failure to develop the business potential and
ineffective management.
38
Accordingly Samakhya places great emphasis on the lobbying procedures which
constantly draw attention to actions which contravene the principles and tries to influence
public opinion and educate the politicians and decision makers. As the study shows they
have had some success in this work and there is evidence that the stronger societies have
worked steadily to reduce their dependence on government finance. They have also laid
great emphasis on member education trying to ensure that the farmers understand how a
commercial business is conducted following co-operative principles giving them
opportunities to control their co-operative which belongs to them.
10.1 Structure and Organisational Form
MCA is an association of co-operatives but not registered under the Co-operative Law.
Samakhya is a trust created by the MCA and also registered outside the Co-operative
Law. This was necessitated in order to avoid the embarrassment of displacement of
management under the Co-operative Law by non-selective and indiscriminate
administrative actions which could halt the functions of the two organisations.
Their managements have been organised with some mutuality but not excessively. MCA
mainly secures on its managing committee, representatives of chairmen and Chief
Executives of member co-operatives and three nominees from Samakhya. Samakhya's
executive is from a Board of Trustees comprising eminent individuals with their own
determination and selection in perpetuity.
In the current absence of elected bodies the MCA still has the non-official element from
among the Chairmen of the immediately past elected bodies who continue to liaise
closely with MCA.
In suggesting a model organisation the earlier composition of the management committee
of MCA offers possibilities. The need to set up two bodies may not exist elsewhere. A
co-operative promotion and development organisation could be registered under any law
other than the Co-operative Law with management drawing representatives from
Chairmen of societies, Chief Executives and with nominations from among a
predetermined college of individuals drawn mainly from areas of intellectual activity -
universities, research establishments etc,), field activity relevant to social welfare and
rural development, and persons who have retired from emplyment after securing eminent
positions on the basis of merit, in governmental or non-governmental organisations• The
organisation itself should consist of member societies not exceeding fifty or so in
addition to the individuals nominated by the college. Among the various promotional
tasks a definite place must be assigned to lobbying. In order to ensure healthy growth of
societies on the universal principles of co-operation, aid flowing to co-operative
institutions or to their financing bodies should be conditional upon guarantees of freedom
from dictation from outside the co-operatives, and, particularly from government, except
to the extent of audit, wherever private audit systems are not available. Such conditions
against compulsory measures are often provided for in international assistance
programmes and high observance of ethical principles have been ensured, in other sectors
of development as for example, in population control programmes.
39
The structure and organisation of Samakhya is quite unlike that of the usual co-operative
apex organisation and it would probably be unrealistic to liquidate an existing
organisation registered as a co-operative apex and then restructure it along the lines of the
Samakhya/MCA model. In theory any group of progressive agricultural co-operatives
could form an association to provide them with the type of support and services currently
being offered by Samakhya/MCA, including the operation of a Co-operative
Development Fund.
40
10.2. Size of Organisation
One of the weaknesses of conventional co-operative apex organisations is the concept of
open membership which leads to situations where too many members have expectations
of receiving services which the apex has no resources or capability to deliver. In some
countries membership of an apex is compulsory and so are membership fees based on
some formula relating to surplus or business turnover. This in turn leads to member
societies complaining with some justification that they do not get value for money from
their apex and that the apex appears to provide more service to the largest and strongest.
In the Samakhya model they see no reason to practice unrestricted membership as they
know that it would be quite unrealistic to attempt to offer services to every co-operative
on the register. They leave it to the societies to seek membership. In addition they
provide newsletters and valuable information to all 6,500 co-operatives in Andhra
Pradesh free of charge. They expect membership to grow gradually by including
additional societies as they develop the capacity for growth and ability to pay for
services. The results of their work, their reports and studies are freely available to all co-
operatives for a nominal charge. Their work in encouraging the weaker but potentially
strong societies is supported by external donors.
10.3. Emphasis on Business Development
One of the most important activities of MCA is encouraging the development of the
multicoops as efficient businesses. They know that economic strength is essential before
social benefits can flow. Staff members assist individual multicoops to review their
business activities and help them to draw up feasibility studies for further development.
The emphasis is on processing farmers crops to add value and improved storage and
marketing. Although banks and the National Co-operative Development Corporation
have funds for investment in co-operative development, it is difficult for multicoops to
approach these organisations unless they have a written feasibility plan properly
researched and costed. In addition they sometimes lack sufficient capital to invest
themselves in the project. MCA assist the staff of the multicoop to prepare a plan and
proposition. This often includes an application to Samakhya for partial finance from the
Co-operative Development Fund. This Fund is an essential working tool for Samakhya
and is of such importance that it should be considered by all organisations charged with
the responsibility for the promotion and development of co-operatives.
41
Another interesting feature of their work on business development is the collection of
data on the performance of their members. This is recorded from published annual reports
and is studied on the basis of management ratios which compared regularly with norms
and other societies provides an efficiency audit. Members are ranked each year and their
placing provides an effective way for managing committees and staff to discuss and
correct any deficiencies. This activity provides a competitive element in co-operative
development and has done much to stimulate multicoops to make progress. Thoughts
have also been given to the concept of membership of MCA based on the attainment of
minimum business standards coupled with compliance with co-operative principles.
10.4. Co-operative Development Fund
The study has reported in some detail on the operation of the Co-operative Development
Fund and this is considered to be of great value to any organisation that is concerned with
co-operative promotion and development. The eligibility conditions shown in Annexure
7. are stringent and purposely designed to persuade the multicoop to take corrective
action where necessary to bring the business performance and application of co-operative
principles up to required standards. This includes standards for auditing, annual reports,
outstanding loans and a requirement to freshly mobilise a financial contribution from
members to meet part of the costs of any new development.
42
The Co-operative Development Fund was provided by the Co-operative Union of
Canada. It is a revolving fund as members pay interest on the deposits (loans) placed in
the multicoop by Samakhya. In addition the multicoop pays an additional two percent
repayment as a contribution towards increasing the Fund. Interest earned on the Fund
provides some income for Samakhya after allowing for capital appreciation. The income
allows it to administer the Fund and assist other multicoops. Multicoops are asked to pay
MCA for its services in helping to draw up feasibility studies. The existence of this Fund
gives MCA positive strength in assisting co-operative development. It has many
advantages over government funding of co-operatives which can take place
indiscriminately with insufficient attention to viability of the development, excessive
control and possibly leading to failure.
Non-official independent co-operative associations could be funded by development
banks providing a co-operative development fund whose operation would be strictly
controlled and subjected to eligibility conditions including adherence to co-operative
business principles.
10.5. Lobbying and Public Opinion Forming
The study has described the lobbying and public opinion forming activities which are
particularly relevant in situations where governments try to excessively control co-
operatives and in the process stifle the free development of member owned businesses. It
is unlikely that a registered co-operative apex organisation could follow the path taken by
Samakhya and MCA in challenging the legality or natural justice of government
directives which obstruct and effectively impair the development of co-operatives. Hence
the strength of Samakhya as an association of co-operatives independent of the co-
operative legislation.
43
This work is time consuming and can only show real results over time and at a point
when a sufficient number of people both in government and in society are made aware of
the advantages of co-operatively organised business enterprises. When the ideas
promoted can be supported by examples of strong, self-reliant co-operatives servicing
farmers, governments will be less likely to act indiscriminately against co-operative
growth. However, a well informed and educated public will not protect co-operatives
from the cut and thrust of market forces. They will have to survive through combined
strength and effective performance. It is likely that action by governments to control co-
operatives will be moderated by public opinion and the presence of a well organised and
articulate representation on behalf of the co-operatives.
The study indicates that lobbying and public opinion forming is a legitimate and
worthwhile activity for co-operative promotion bodies but they need to be
constitutionally organised and with a degree of independence which ensures that they
cannot be silenced by those who are challenging their members.
10.6. Financing the Organisation
Many co-operative apex bodies or unions charged with co-operative development suffer
from lack of finance with which to provide the services to their members. They become
weak and dependent on external finance and lose control of their organisations. They
sometimes engage in business activities designed to provide income for survival. This
can distance them from their members and take a disproportionate amount of their time
and resources. Their priorities become their own rather than that of servicing their
members needs.
44
Samakhya has carefully avoided this situation over a period of ten years. It limits its
membership to avoid raising unfulfilled expectations from a wider membership than it
can reasonably serve. It concentrates on developing services which members can afford
to purchase. Its membership subscriptions so far have been limited to a joining fee
(returnable if a member leaves the society) with the interest accruing to Samakhya in lieu
of an annual subscription. This system is however under review. It operates the all
important Co-operative Development Fund which provides some income from interest
earned, thus allowing the organisation to undertake further business development studies
and create more demand for development funds. It has no moral objections to accepting
development grants from overseas donors on the basis that this is a partnership in which
Samakhya helps them to achieve their development objectives, by using the money
responsibly to assist part of their work with the weaker co-operatives that cannot afford to
pay for services. A study of the accounts and expenditures indicates careful budgeting
and husbanding of resources. There is certainly no intention of becoming over-dependent
on external aid and there is a conscious attempt at working for self-reliance.
Approximately one-third of their income is self-generated and this will improve when
elected committees are re-established and work on development with elected officials
commences again.
Perhaps the most interesting mechanism for funding both the organisation and their
members' business development is the Co-operative Development Fund. If this were
large enough it could support a regular staff of development workers who would have the
finance available to support the developments elaborated in the feasibility studies.
Examples from the seventeen projects funded to date indicate that the availability of
loans from the Fund have acted as a catalyst and have made possible additional loans
from commercial banks. The installation of rice mills have created further opportunities
for storage facilities funded by a World Bank programme. All this suggests that co-
operative development organisations can do much to serve the interests of their members
if they have access to a development fund which they and their members control.
45
10.7. Leadership
One of the interesting characteristics of most non-government organisations is the quality
and motivation of the leadership and staff. Samakhya is no exception and is particularly
fortunate in having exceptional leadership both in executive positions and in the body of
eminent nd experienced persons who form the Trustees of the organisation. It has to be
said that rarely in conventional co-operative apex organisations do you find such
motivation and professionalism. This situation could only have developed and been
sustained in a non-government organisation that is largely independent but controlled by
members supported by persons of substance and high standing. The suggestion here is
that the public trust form of umbrella organisation that is Samakhya, provides an
opportunity for experienced persons to volunteer their services for the common good
without seeking reward, and thereby strengthening the work immeasureably.
10.8. Promotion of the Samkhya Concepts
This study is most likely to be of interest to chairmen and chief executives of existing co-
operative development organisations who perhaps are looking for new directions or
alternative development ideas for strengthening their programme and services to
members. In these situations the readers themselves will have some idea whether or not
the concepts and practices are appropriate for their situation, could be tried on a pilot
basis, or perhaps successfully introduced over a period of time- They may feel the need
for some external independent assessment of their situation or perhaps wish to visit
Samakhya and see for themselves the work being undertaken.
46
There would appear to be no real barrier to setting up a new type of development
organisation designed to support and develop a selected number of viable or potentially
viable co-operatives. However, mere imitation of the ideas derived from Samakhya
cannot guarantee success, for it should be stressed that the mechanisms used are
dependent on quality of leadership and motivation, the ability to organise and effectively
manage the organisation in such a way as to earn the full support of its membership and
all those who give their time freely and voluntarily such as the trustees.
International development agencies should be prepared to consider undertaking some
dialogues with selected national co-operative organisations with a view to discussing the
mechanisms used by MCA to support business development with the assistance of the
Co-operative Development Fund. The concept of the Fund should also be brought to the
attention of the development banks who might be persuaded to place a limited
development fund on an experimental basis, with suitable co-operative support bodies,
who would be prepared to operate the fund using strict guidelines ^subject to regular
review.
47
Annexure 1
A STUDY OF
SAMAKHYA AND
MCA
Outline
- examine the aims and objectives of Samakhya (this term includes MCA) and their
relevance to the co-operative promotion and development in Andhra Pradesh.
- examine the activities of Samakhya and assess their achievements so far and the
effectiveness of the current programme.
- examine the nature of the relationship between Samakhya and its member co-
operatives to determine how the services provided meet the needs of the members.
- examine the membership of the primary co-operatives to determine how these
societies meet the needs of the rural poor, women, the disadvantaged and particularly,
different ethnic groups; and to study how the Samakhya approach reflects these needs in
its policy and promotional work.
- identify situations in which Samakhya has achieved changes in government policy
for co-operative development and associated legislation through its work and influence,
and to study the nature of its relationship with the State Government and the mechanisms
for any formal or informal consultative and advisory status.
48
- examine the ways in which Samakhya as a non-government organisation is
financed, including the level of support from its membership, the level of dependency on
external finance and its policy with regard to attaining financial self-sufficiency.
- study Samakhya and its potential, as a model for co-operative promotion and
development in other countries and make recommendations for a model system based on
Samakhya, which could be considered for FAO support if introduced in other countries,
particularly in Africa.
The findings of the study will be reflected in the report to be submitted to FAO. The
Consultants will design and draft the report on the field study with particular reference to
the recommendations for a model co-operative promotion and development organisation
which may be suitable for other developing countries and which may draw extensively on
the experience of Samakhya.
49
Annexure 2
A word about
MCA, TCA AND SAMAKHYA
Multicoops' Association (MCA)
Rural India is covered by thousands of multicoops (Primary
Agricultural Credit Society, Multipurpose Cooperative
Society, Large Size Cooperative Society, Cooperative Rural
Bank, Farmers' Service Cooperative Society, etc) each of
which is expected to fulfill the financial,production,
marketing, consumer and welfare needs of its members,
drawn from all rural professions.
MCA, an association of multicoops, was registered in 1977
as a public society in order to help multicoops function
effectively, in consonance with the principles of
cooperation.
Thriftcoops' Association (TCA)
Urban India is covered by thousands of thriftcoops
(Employee Credit Coops, Urban Coop Banks, Neighbour-
hood Credit Coops, etc) each of which is expected to help
its members through provision of mutual savings and credit
facilities, financial counselling and various social and
welfare activities.
TCA, an association of thriftcoops, was registered in 1984
as a public society in order to help thriftcoops function
effectively in consonance with the principles of cooperation
Samakhya
Samakhya, an association of cooperators, was established in
1 982, primarily to operate the cooperative development
fund created by MCA, to lobby for and promote coope-
ratives.
Today, Samakhya, a registered public society works closely
with MCA and TCA, providing the coordination necessary
between MCA and TCA, and supporting both with
promotional and professional services.
Our Address :
3rd FLOOR. KRISHNA COMPLEX. OPPOSITE SURYA THEATRE, TILAK ROAD.
POST BOX 265. HYOERABAD-500 001 . INDIA GRAMS: SAMAKHYA
TELEPHONE: 222531
50
Administrative set-up
As MCA, TCA and Samakhya share human and materia! resources, the word Samakhya is used
to represent all three in day-to-day activities The accounts of each of the three organisations
however, are maintained separately.
51
ANNEXURE 3
SAMAKHYA
Articles of Association General
General
1. The organization shall be called SAMAKHYA.
2. The head office of SAMAKHYA shall be situated in Hyderabad. Regional offices or
branch offices may be established at such other places as the Board of Trustees may
determine from time to time.
3. SAMAKHYA shall be a corporate body with perpetual succession and common seal and
with powers to hold property, to enter into contracts, to sue and to be sued.
4. SAMAKHYA shall be a non-profit, voluntary, secular and service organization.
Aim
5. The aim of SAMAKHYA is to enable cooperatives to be effective catalysts for
community development, functioning in consonance with principles of cooperation, as
decentralised democratic institutions utilizing local resources to the maximum.
Activities
6. In furtherance of its aim - either by itself or in collaboration with Multicoops' Association,
Thriftcoops' Association and other organizations - SAMAKHYA will undertake the
following activities:
52
a) Education and Training:
i) provide education and training in concept, management and functioning of
cooperatives to members, directors, employees of cooperatives and bankers,
bureaucrats, and legislators concerned with cooperatives .
ii) arrange workshops, conferences, meetings and seminars for exchange of
information relating to cooperatives.
iii) assist other cooperative training institutions in their programmes
b) Publications and Communication
i) collect, classify, publish and circulate information of interest to cooperatives,
through appropriate media.
ii) prepare and distribute educational, training and management material on
cooperative principles, cooperative law, and on concept, management and
functioning of cooperatives.
iii) utilize various modes of communication to create a contructive attitude towards
cooperatives, in the minds of members, directors and employees of cooperatives
and bankers, bureaucrats and legislators concerned with cooperatives.
c) Liaison and Promotion:
i) liaise on behalf of cooperatives with related agencies such as governments,
financing banks, employee unions.
ii) protect rights, privileges and interests of cooperatives.
53
iii) promote fresh thinking on cooperatives legislation with a view to bringing about
modifications in cooperative law and practices in favour of principles of
cooperation as enunciated by the International Cooperative Alliance.
d) Research and Consultancy:
i) survey for growth opportunities for cooperatives.
ii) study existing practices in cooperatives and in other enterprises with a view to
systematizing procedures in cooperatives.
iii) respond to specific requests of cooperatives with regard to issues before them.
e) Development Assistance
i) assist cooperatives in implementation of their activities.
ii) help cooperatives in achieving high degee of effectiveness.
iii) aid cooperatives wherever possible and necessary, directly or through other
sources to raise funds in the shape of grants, deposits, collateral security, etc.
f) Other Activity
Undertake any other activity which is incidental and conducive to attaining the aim
of the Trust.
Membership
7. Any individual, whose commitment and contribution to the promotion of cooperatives has
been significant, may be invited by the Board of Trustees to be a trustee of
SAMAKHYA; On receiving the invitee's consent, the invitee shall be enrolled as a
trustee of SAMAKHYA provided that the number of trustees shall not be less than seven
nor more than fifteen.
54
8. Board of Trustees
There will be a Board of Trustees to manage the affairs of SAMAKHYA.
9. The Board of Trustees will comprise all trustees with the following designations:
a) Shri EV Ram Reddi Chairman
b) Shri MG Ali Asghar Trustee
c) Shri SVSN Raju “
d) Shri AK Vishwanah Reddy “
e) Shri PLKV Subba Rao “
f) Smt Lalitha Gir “
g) Shri K Pratap Reddy “
h) Shri PR Paruchuri “
i) Dr. G Gopal Reddy “
J) Shri M Rama Reddy Secretary
10. In the event of any vacancy amongst the trustees by reason of death or resignation of any
trustee, the Board of Trustees may, by a simple majority of trustees in office, invite any
individual, whose commitment and contribution to the promotion of cooperatives has
been significant, to be a trustee.
11. The Board of Trustees shall meet at least twice in a calendar year.
12. The Chairman shall convene and preside over the Board Meetings. The quorom for the
Board meeting shall be a majority of trustees in office. In the absence of the Chairman,
the trustees present in the meeting may elect one among themselves to preside over the
meeting. The Secretary shall not be elected to preside over the meeting. Every decision of
the Board will be taken by a simple majority. The president of a Board meeting shall
have an additional vote in the case of equality of votes.
55
13. The Board of Trustees shall:
a) consider and approve plan and budget for the ensuing year.
b) consider and approve report and accounts for the previous year.
c) appoint a chartered accountant for auditing the accounts for each year.
d) receive and consider the auditor's report for the previous year.
e) arrange for carrying on administration as per the articles of association and the rules
made thereunder.
f) raise funds and supervise all financial transactions.
g) appoint attorneys agents, legal advisers, etc., to defend and institute legal
proceedings.
h) acquire, purchase, own, invest, lease, mortgage, hypothecate or dispose of any
movable and immovable assets.
i) deal wih all staff matters including recruitment, appointment, promoion, disciplinary
action, suspension, removal, etc.
j) have the right to appoint committees, persons, or agents, with or without
remuneration and on specific terms and conditions, as it may think appropriate, and
k) have the right to delegate any of its powers to the committees, the Chairman, the
Secretary, or any officer of SAMAKHYA.
Resources
14. The resources to support the activities of SAMAKHYA will consist of:
a) Receipts arising out of the activities of SAMAKHYA:
b) Returns from the investment of trust capital and endowed funds; and
56
c) Grants, donations, loans and other contributions from trustees, governments,
corporate bodies, and individuals for general as well as specific purposes.
15. The accounting year will be the calendar year.
16. The funds and property of SAMAKHYA shall be applied towards the promotion of the
aim as set forth in articles and no portion of them shall be paid or transferred directly or
indirectly to any person who is or who has been a trustee of SAMAKHYA; provided
nothing herein contained shall prevent payment of remuneration to the person who is or
who has been a trustee of SAMAKHYA in return for any service rendered to
SAMAKHYA.
Rules
17. The Board of Trustees shall make, from time to time, rules of administration for
regulating the activities of SAMAKHYA in accordance with the articles of association.
18. The Chairman, the Secretary, other trustees, committees, other functionaries and
employees of SAMAKHYA shall exercise their powers, discharge their duties and
perform their functions in accordance with the rules of administration.
Miscellaneous
19. The Chairman shall have over-all supervision of the administration of SAMAKHYA.
20. The Secretary shall be the chief executive of SAMAKHYA and also the officer to sue or
be sued on behalf of SAMAKHYA.
Amendments
21. No amendment shall be made in the articles of association unless such amendment has
been passed by two-thirds of the trustees present at a special meeting of the Board of
Trustees convened for the purpose and confirmed by two-thirds of the trustees present at
a second special meeting convened for the purpose, and unless such other organization
has the prior approval of the Income Tax Authorities.
57
Amalgamation
22. SAMAKHYA shall not be amalgamated or merged with any other organization unless
such a proposal has been passed by two-thirds of the trustees present at a special meeting
of the Board of Trustees convened for the purpose and confirmed by two-thirds of the
trustees present at a second special meeting convene for the purpose, and unless such
other organization has been recognized by the Income Tax Authorities under section 12A
of the Income Tax Act.
Dissolution
23. SAMAKHYA shall not be dissolved unless such a proposal has been passed by two-
thirds of the trustees present at a special meeting of the Board of Trustees convened for
the purpose and confirmed by two-thirds of the trustees present at a second special
meeting convened for the purpose.
24. In the event of dissolution of SAMAKHYA, its property and funds, which remain after
the full satisfaction of its liabilities, will be transferred to some other organization which
has similar aims and has been recognized by the Income Tax Authorities under section
12A of the Income Tax Act.
58
Annexure 4
MULTICOOPS' ASSOCIATION
Hyderabad
Articles of Association
(as amended up to 31st December 1982)
GENERAL
1. The organization shall be called Multicoops' Association. In Telugu, it shall be known as
Sakalartha Sahakara Sanghala Samithi. It shall be an associate of SAMAKYA, the public
trust for cooperative development.
2. The head office of the Association shall be situated in Hyderabad. Regional offices or
branch offices may be established at such other places as the executive committee may
determine from time to time.
3. The Association shall be a corporate body with perpetual succession and common seal
and with powers to hold property, to enter into contracts, to sue and to be sued.
4. The Association shall be non-profit, voluntary, secular and service in nature.
DEFINITIONS5. Words and expressions appearing in these articles of association shall have the following
meaning unless otherwise provided:
a. ASSOCIATION means Multicoops' Association.
59
b. MULTICOOP means multipurpose cooperative.
c. MEMBER means a multicoop or a person who, for the time being, is a member of
the Association.
d. MEMBER-COOPERATOR means a person who, for the time being, is a member of
the Association.
e. MEMBER-MULTICOOP means a multicoop which, for the time being, is a member
of the Association.
f. DELEGATE means the elected president and the appointed secretary of a member-
multicoop. In the absence of an elected management, a person chosen by the general
body of a member-multicoop from among its full-fledged members as its
representative to the Association will be the delegate in the place of president.
g. EXECUTIVE COMMITTEE means the committee constituted under article 21.
h. GENERAL BODY means the body constituted under article 12.
i. RULES means the rules of administration made under article 38.
AIM6. The aim of the Association is to enable multicoops to be effective catalysts for economic,
social and political development.
Multicoop is an acronym for multipurpose cooperative. Multicoops are spread all over
rural India and are known as Primary Agricultural Credit Society (PACS), Multipurpose
Cooperative Society (MPCS), Cooperative Rural Bank (CRB), Farmers Service
Cooperative Society (FSCS), Large Size Cooperative Society (LSCS), Village Service
Cooperative Society (VSCS), etc. They are meant to provide viable integrated services, to
meet the economic, production, marketing, consumer and welfare needs of their members
who are drawn from all occupations.
60
Multicoops can be effective if they function in consonance with principles of cooperation, as
decentralized democratic institutions utilizing local resources to the maximum.
7. ACTIVITIES
In furtherance of its aim, either by itself or in collaboration with SAMAKYA and other
organizations, the Association will undertake the following activities:
a. It shall offer extension services in various aspects of multicoop functioning.
b. It will offer consultancy services on specific professional and technical aspects of
multicoop business and management.
c. It will liaise on behalf of multicoops with related agencies such as governments,
financing banks, federal cooperatives, employee unions, etc.
d. It will lobby for more supportive cooperative legislation which is in consonance with
cooperative principles.
e. It will promote the concept of multicoop as an integral component of rural
development programmes.
61
f. It will organize training on subjects connected with multicoop management for
personnel from multicoops and other related organizations.
g. It will undertake action-oriented research in areas of interest to multicoops.
h. It will publish and distribute education, training and management material of interest
to multicoops.
i. It will prepare projects on behalf of multicoops for financial assistance from other
organizations.
j. It will undertake any other activity which is incidental and conducive to attaining its
aim.
MEMBERSHIP
8. The executive committee may admit any eligible multicoop as a member of the
Association. An admission fee of Rs.10 and a refundable membership deposit of Rs.1,000
will be payable by a multicoop for obtaining membership. The interest earned on the
deposit every year shall be deemed to be subscription from the member-multicoop for the
year. If a multicoop ceases to be a member, the membership deposit amount shall be
refunded to the concerned multicoop.
9. The executive committee may admit any eligible person, as a member of the Association.
An admission fee of Rs.1 and a refundable membership deposit of Rs.100 will be payable
by a person for obtaining membership. The interest earned on the deposit every year shall
be deemed to be subscription from the member-cooperator for the year. If a person ceases
to be a member, the membership deposit amount shall be refunded to the concerned
person.
62
10. The membership of a member-multicoop shall cease on cancellation of registration of the
multicoop, or on withdrawal from membership by the multicoop, or on becoming
ineligible to be a member of the Association, or on termination of membership by the
general body of the Association.
11. The membership of a member-cooperator shall cease on death, or on resignation, or on
becoming ineligible to be a member of the Association, or on termination by the general
body of the Association.
GENERAL BODY
12. The general body shall consist of member-cooperators and delegates of member-
multicoops. Each member-multicoop will send two delegates to represent it in the
Association.
12. Each person shall have one vote. Every decision will be taken by a simple majority. The
presiding member shall vote only in the case of equality of votes.
14. The delegates of a member-multicoop which has not been a member for at least one year
before the date of general meeting or a member-cooperator who has not been a member
for at least one year before the date of general meeting may attend the meeting but shall
not be eligible either to exercise the right of vote or to hold office.
15. The meetings of the general body will be of three types:
a. Ordinary General Meeting
b. Special General Meeting
c. Annual General Meeting.
Any general meeting may be convened by the executive committee by giving 20 days
notice.
63
16. At least one ordinary general meeting will be held every year, in the month of November.
The agenda at the November meeting shall include approval of plan and budget of the
Association for the ensuing year and review of progress in member-multicoops during the
preceding cooperative year.
17. The special general meeting shall be convened by the executive committee within one
month of receipt of requisition in writing from not less than one-third of the total
membership. A requisition for a special general meeting shall state the purpose of the
meeting and such a meeting shall transact the subject specified in the notice.
18. The annual general meeting shall be held every year, in the month of March. The agenda
shall include approval of report and accounts of the Association for the previous year,
and review of plans and budgets of member-multicoops for the ensuing cooperative year.
19 The quorum for any general meeting shall be one-fourth of the total number of member-
coopera tors and delegates of member-multicoops having the right to vote as on that date.
At the beginning of every general meeting, member-cooperators and delegates of
member-multicoops having the right to vote and present shall elect one from among
themselves as presiding member of the meeting. The presiding member should not be a
member of the executive committee.
20. The general body will:
a. supervise and control all activities of the Association;
b. elect every year 3 members at its ordinary general meeting in November, one from
presidents of member-multicoops, one from secretaries of member-multicoops and
one from member-cooperators, to its executive committee for a period of 3 years,
starting from the ensuing 1st January, such that at any given time 9 elected members,
i.e., 3 from presidents of member-coops, 3 from secretaries of member-multicoops
and 3 from member-cooperators, shall be on the committee;
64
c. consider and approve the executive committee' s report and accounts as well as the
auditor's report for the previous year;
d. consider and approve plan and budget for the ensuing year;
e. appoint a chartered accountant for auditing the accounts of the Association every
year.
EXECUTIVE COMMITTEE
21. The executive committee shall consist of 9 elected members, 3 nominated members and 1
ex-officio member. The elected members shall consist of 3 presidents of member-
multicoops, 3 secretaries of member-multicoops and 3 member-cooperators. The Board
of Trustees of SAMAKYA will nominate three members. The secretary of the
Association shall be the ex-officio member.
22. The executive committee members shall elect each year, immediately after the ordinary
general meeting in November, a president and a vice-president from among the 9 elected
members for the ensuing year, i.e., 1st January to 31st December.
23. The executive committee shall meet at least four times every year, in the months of
January, April, July and October.
24. The executive committee meeting shall be convened by the president by giving a 15 days
notice. A shorter notice may be given under special circumstances.
65
25. The quorum for an executive committee meeting shall be at least half of the total number
of members on the executive committee as on that date. Every decision will be taken by a
simple majority. The presiding member shall vote only in the case of equality of votes.
Any committee member absent at two consecutive committee meetings shall cease to be
a member of the executive committee.
26. The executive committee shall:
a. arrange for carrying on the administration of the Association as per these articles of
association and the rules made thereunder;
b. raise funds for the Association and control all financial affairs;
c. appoint attornees, agents, etc. for the Association to defend and institute legal
proceedings on its behalf;
d. acquire, purchase, own, lease, mortgage, hypothecate, dispose off any movable and
immovable assets for attaining the aim of Association;
e. deal with all staff matters including recruitment, appointment, promotion,
disciplinary action, suspension, removal, etc.;
f. appoint a secretary who will be full-time chief executive of the Association;
g. frame conditions of eligibility for membership in the Association;
h. frame conditions of eligibility for voting at the general meetings of the Association;
66
i. frame conditions of eligibility for elected membership in the executive committee;
j. be advisor to SAMAKYA on matters relating to multicoops.
27. An interim vacancy on the elected membership of the executive committee may be filled
up by cooption by the remaining members of the executive committee for the period
remaining in the term of the vacating member. A vacancy on the nominated membership
of the executive committee will be filled up by the Board of Trustees of SAMAKYA.
28. The executive committee may constitute any committee on specific subjects and matters.
29. The executive committee may delegate any of its powers to the president, to the secretary
or to any other officer of the Association.
PRESIDENT
30. The president shall have overall supervision and control of the administration of the
Association.
31. The vice-president shall discharge the duties, perform the functions and exercise the
powers of the president during the "vacancy in the office of the president or during the
absence of the president.
SECRETARY
32. Under the overall control and supervision of the president, the secretary shall have the
following powers, functions and responsibilities:
67
a. implement the resolutions of the general body, the executive committee or any other
committee constituted by the executive;
b. maintain records and properties of the Association;
c. manage the funds and maintain the accounts of the Association;
d. determine powers, functions and responsibilities of the employees of the
Association;
e. exercise administrative control on all employees of the Association;
f. operate the accounts of the Association with banks and other institutions; endorse,
sign, encash cheques; and endorse, transfer, negotiate promissory notes, securities
and other instruments on behalf of the Association, along with the president or such
other officers as the executive committee may resolve;
g. sign on behalf of the Association and carry out its correspondence;
h. perform all functions delegated by the executive committee and the president.
33. The secretary shall be the officer of the Association to sue or to be sued on behalf of the
Association.
34. The secretary may delegate any of these functions to any officer of the Association.
68
RESOURCES
35. The resources to support the activities of the Association shall consist of:
a. subscriptions from its members
b. grants, donations, loans and other contributions from members, governments,
corporate bodies and individuals for general, as well as specific purposes
c. returns from the investment of trust, capital and endowed funds
d. receipts arising out of its activities.
36. The accounting year of the Association will be the calendar year.
37. The funds of the Association shall be spent only for the attainment of its aim and no
portion of it shall be paid or transferred directly or indirectly to any of its members.
RULES
38. The executive committee shall make rules of administration for regulating the activities
of the Association.
39. The president, the vice-president, committees, other functionaries and employees of the
Association shall exercise their powers, discharge their duties and perform their functions
in accordance with the rules of administration.
69
MISCELLANEOUS
40. No amendment shall be made in the articles of Association unless such amendment has
been passed by two-third of the total number of delegates of member-multicoops and
member-cooperators having the right to vote and present at a general meeting convened
for the purpose and confirmed by two-third of the total number of delegates of member-
culticoops and member-cooperators having the right to vote and present at a second
general meeting convened for the purpose.
41. In case the Association has to be wound up, the property and funds which will remain
after the full satisfaction of its liabilities, will be transferred to some other organization
with similar aim.
70
Item No:
The following alterations, amendments and extensions to the Articles of Association may be
considered by the General Body:
Existing Provision Proposed Provision
Words and expressions appearing in these
articles of association shall have the
following unless otherwise provided:
(No change)
a. ASSOCIATION means Multicoops'
Association
(No change)
5.
b. MULTICOOP means multipurpose
cooperative
MULTICOOP means a rural-based, multi-
service organiz- ation formed by a group of
people, with a common bond of farming and
allied professions, who join together to get a
package of integrated services (Financial,
Production Aid, Marketing, Consumer and
Welfare Services) from that organization.
Multicoops are spread all over rural India and
are generally known as Primary Agricultural
Cooperative Society, Multipurpose Society,
Cooperative Rural Bank, Farmers Service
Cooperative Society, etc.
71
c. MEMBER means a raulticoop or a
person who, for the time being, is a
member of the Association.
(Deleted)
d. MEMBER-COOPERATOR means a
person who, for the time being, is a
member of the Association.
(Deleted)
e. MEMBER-MULTICOOP means a
multicoop which, for the time being,
is a member of the Association.
(No change)
D
m
i.
DELEGATE means the elected
president and the appointed secretary
of a member-multicoop. In the
absence of an elected management, a
person chosen by the general body of
a member- multicoop from among its
full-fledged members as its
representative to the Association will
be the delegate in the place of
president.
ELEGATE means a person sent by a
member-multicoop to represent that member-
ulticoop at the general meetings of the
Association. Delegates will be from three
distinct components of a multicoop-
membership management and staff:
a person chosen by the general body of a
member-multicoop from among its full-
fledged members;
ii. the elected president of a member-
multicoop- in the absence of an elected
board of directors a person chosen from
among its full-fledged members by the
general body of that member-multicoop;
f.
iii. the full-time, paid chief executive of a
member-multicoop.
72
g. EXECUTIVE COMMITTEE means
the committee constituted under
article 21.
(No change)
h. GENERAL BODY means the body
constituted under article 12.
(No change)
i. RULES means the rules of
administration made under article 38.
(No change)
6. The aim of the Association is to enable
multi-coops to be effective catalysts for
economic, social and political
development.
Multicoop is an acronym for multipurpose
cooperative. Multicoops are spread all over
ruural India and are known as Primary
Agricultural Credit Society (PACS),
Multipurpose Cooperative Society
(MPCS), Cooperative Rural Bank (CRB),
Farmers Service Cooperative Society
(FSCS), Large Size Cooperative Society
(LSCS) Village Service Cooperative
Society (VSCS), etc. They are meant to
provide viable integrated services, to meet
the economic, production, marketing,
consumer and welfare needs of their
members who are drawn from all
The aim of the Association is to enable
multicoops, by whatsoever name they may be
called, formally registered or not, to be
effective catalysts for economic and social
development. Multicoops can be effective if
they function, in consonance with the
principles of cooperation, as decentralized
democratic institutions utilizing local resources
to the maximum.
73
occupations. Multicoops can be effective if
they function in consonance with
principles of cooperation, as decentralized
democratic institutions utilizing local
resources to the maximum.
8. The executive committee may admit any
eligible multicoop as a member of the
Association. An admission fee of Rs.10
and a refundable membership deposit of
Rs.1,000 will be payable by a multicoop
for obtaining membership. The interest
earned on the deposit every year shall be
deemed to be subscription from the
member-multicoop for the year. If a
multicoop ceases to be a member, the
membership deposit amount shall be
refunded to the concerned multicoop.
The executive committee may admit any
eligible multicoop as a member of the
Association. An admission fee of Rs. 10 and a
refundable membership deposit of Rs.l,000
will be payable by a multicoop for obtaining
membership. If a multicoop ceases to be a
member, the membership deposit amount shall
be refunded to the concerned multicoop.
9. The executive committee may admit any
eligible person, as a member of the
Association. An admission fee of Rs.l and
a refundable membership deposit of
Rs.100 will be payable by a person for
obtaining membership. The interest earned
on the deposit every year shall
(Deleted)
74
be deemed to be subscription from the
member-cooperator for the year. If a
person ceases to be a member, the
membership deposit amount shall be
refunded to the concerned person.
10. The membership of a member-multicoop
shall cease on cancellation of registration
of the multicoop, or on withdrawal from
membership by the multicoop, or on
becoming ineligible to be a member of the
Association, or on termination of
membership by the general body of the
Association.
The membership of a member-multicoop in
the Associ-ation shall cease on withdrawal
from membership by the general body of the
member-multicoop, or on becoming ineligible
to be a member of the Association, or on
termination of membership by the general
body of the Association.
11. The membership of a member-cooperator
shall cease on death, or on resignation, or
on becoming ineligible to be a member of
the Association, or on termination by the
general body of the Association.
(Deleted)
12. The general body shall consist of member-
cooperators and delegates of member-
multicoops. Each member-multicoop will
send two delegates to represent it in the
Association.
The general body shall consist of delegates of
member- multicoops. Each member-multicoop
will send three delegates to represent it in the
general meetings of of the Association.
75
13. Each person shall have one vote. Every
decision will be taken by a simple
majority. The presiding member shall vote
only in the case of equality of votes.
(Deleted)
14. The delegates of a member-multicoop
which has not become a member for at
least one year before the date of general
meeting or a member- cooperator who has
not been a member for at least one year
before the date of general I meeting may
attend the meeting but shall not be eligible
either to exercise the right of vote or hold
office.
The delegates of a member-multicoop which
has not been a member for at least one year
before the date of general meeting and also a
member-multicoop which has not fulfilled the
conditions laid down in the rules in this regard
shall not be eligible either to exercise the right
to vote or to hold office but may attend the
general meeting. Each delegate of a member-
multicoop having the right to vote shall have
the right to vote shall have one vote. Every
decision will be taken by a simple majority of
delegates of the member-multicoops having
the right to vote and present in the general
meeting. The presiding delegate shall vote
only in the case of equality of votes.
19. The quorum for any general meeting shall
be one- fourth of the total number of
member-cooperators and delegates of
member-multicoops having the right to
vote as on that date. At the beginning of
every general meeting, member-
cooperators and delegates of member-
multicoops having the
The quorum for any general meeting shall be
the pre- sence of delegate/delegates from at
least one-fourth of the total number of
member-multicoops having the right to vote as
on that date. At the beginning of every general
meeting, delegates shall elect one from among
themselves to preside over the general
meeting.
76
right to vote and present shall elect one
from among themselves as presiding
member of the meeting. The presiding
member should not be a member of the
executive committee.
The presiding delegate should not be a
member of the executive committee.
20. The general body will: (No change)
a. supervise and control all activities of
the Association
(No change)
b. elect every year 3 members at its
ordinary general meeting in
November, one from presidents of
member-multicoops, one from
secretaries of member-multicoops,
and one from member-cooperators, to
its executive committee for a period
of 3 years, starting from the ensuing
1st January, such that at any given
time 9 elected members, i.e., 3 from
presidents of member-multicoops, 3
from secretaries of member-
multicoops and 3 from member-
cooperators, shall be on the
committee
form itself, at the ordinary general meeting in
November, into three distinct constituencies of
membership-delegates, management-delegates
nd staff- delegates; each constituency will
elect one executive committee member every
year from among its constituents for a period
of three years, starting from the ensuing 1st
January such that at any given time 9 elected
members (i.e., 3 from membership- delegates,
3 from management-delegates and 3 from
staff-delegates) shall be on the executive
committee.
c. consider and approve the executive
committee's report and accounts as
well as the auditor's report for the
previous year
(No change)
77
d. consider and approve plan and
budget for the ensuing year
(No change)
e. appoint a chartered accountant for
auditing the accounts of the
Association every year.
(No change)
f. have the right to recall any of the elected
members of the executive committee.
21. The executive committee shall consist of 9
elected members, 3 nominated members
and 1 ex- officio member. The elected
members shall consist of 3 presidents of
member-multicoops, 3 secretaries of
member-multicoops and 3 member-
cooperators. The Board of Trustees of
SAMAKHYA will nominate three
members. The secretary of the Association
shall be the ex-officio member.
The executive committee shall consist of 9
elected members, 3 nominated members and 1
ex-officio member. The elected members shall
consist of 3 membership- delegates, 3
management-delegates and 3 staff- delegates.
Samakhya may nominate three members. The
secretary of the Association shall be the ex-
officio member.
22. The executive committee members shall
elect each year, immediately after the
ordinary general meeting in November, a
president and a vice- president from
among the 9 elected members for the
ensuing year, i.e., 1st Jan. to 31 Dec.
The elected members of the executive
committee shall elect from among themselves
each year, immediately after the ordinary
general meeting in November, apresident and
a vice-president for the ensuing year, i.e., 1st
January to 31st December. The elected
members have the right to recall a
president/vice- president .
78
26. The executive committee shall: (No change)
a. arrange for carrying on the
administration of the Association as
per these articles of association and
the rules made thereunder
(No change)
b. raise funds for the Association and
control all financial affairs
(No change)
c. appoint attornees, agents, etc. for the
Association to defend and institute
legal proceedings on its behalf
(No change)
d. acquire, purchase, own, lease,
mortgage, hypothecate, dispose off
any movable and immovable assets
for attaining the aim of Association
(No change)
e. deal with all staff matters including
re- cruitment, appointment,
promotion, disciplinary action,
suspension, removal, etc.
(No change)
f. appoint a secretary who will be full-
time chief executive of the
Association
(No change)
79
g. frame conditions of eligibility for
member- ship in the Association
(Deleted)
h. frame conditions of eligibility for
voting at the general meetings of the
Association
(Deleted)
i. frame conditions of eligibility for
elected membership in the executive
committee
(Deleted)
j. be advisor to SAMAKHYA on
matters relating to multicoops
(No change)
k. categorize member-multicoops and fix annual
membership fee and other contributions to the
Association.
27. An interim vacancy on the elected
membership of the executive committee
may be filled up by cooption by the
remaining members of the executive
committee for the period remaining in the
term of the vacating member. A vacancy
on the nominated membership of the
executive committee will be filled up by
the Board of Trustees of SAMAKHYA.
An interim vacancy on the elected
membership of the executive committee may
be filled up by cooption by the remaining
members of the executive committee for the
period remaining in the term of the vacating
member. An interim vacancy on the
nominated member- ship of the executive
committee shall be filled up by SAMAKHYA
for the period remaining in the term of the
vacating members.
80
The executive committee shall make rules for
regulat- ing the administration and activities
of the Association. Every rule made, altered,
amended or extended under this article shall
be placed before the general body in its
meeting immediately following such action,
for information and comments. However, in
respect of the following subjects, the general
body alone shall be competent to make, alter,
amend or extend rules:
a. eligibility criteria for obtaining and
retaining the membership in the
Association
b. eligibility criteria for voting at the general
meetings of the Association
38. The executive committee shall make rules
of administration for regulating the
activities of the Association.
c. eligibility criteria for obtaining and
retaining the elected membership of the
executive committee.
No alteration, amendment or extension shall
be made:
40. No amendment shall be made in the
articles of Association unless such
amendment has been passed by two-third
of the total number of delegates of
member-multicoops and member-
cooperators having the right to vote and
present at a general meeting convened for
the purpose and
a. in the purpose (article 6) of the
Association, nor shall the Association be
amalgamated with any other society
unless it is voted by two-thirds of total
delegates of member-multicoops having
the right to vote and present at a special
meeting convened for
81
this purpose and confirmed by two-thirds
of total delegates of member-multicoops
having the right to vote and present at a
second special meeting: provided that a
notice to hold such special meeting and
the proposed alteration, amendment or
extension shall be delivered or sent by
post to every member- multicoop at least
twenty days in advance of hold- ing such
special meeting.
confirmed by two-third of the total number
of delegates of member-multicoops and
member- cooperators having the right to
vote and present at a second general
meeting convened for the purpose.
b. in the articles (other than article 6) of the
Association unless it is voted by the two-
thirds of the total delegates of member-
multicoops having the right to vote and
present at any general meeting: provided
the proposed alteration, amendment or
extension shall be sent by post to every
member- multicoop at least twenty days
in advance of holding such general
meeting.
82
Annexure 5
Field Study Data and Report
Scope and necessity of the field study:
By 31st December 1985, there are 75 member multicoops in MCA spread over 13 districts of
Andhra Pradesh. The activities of MCA and Samakhya are to a large extent, directed at
imporoving the performance of these member multicoops.
It was felt necessary to conduct a survey to assess the improvement of performance in these
member-multicoops since their joining of MCA as members. It was also felt this will give an
indication of the effectiveness of the services provided by MCA and Samakhya.
It was also felt that the usage of services is a prerequisite for being affected and knowledge or
awareness of the services provided is a prerequisite for using them.
MCA being an association of these multicoops it is having representatives from these member-
multicoops as its general body - the supreme decision making authority for the association. Its
affairs are conducted by a committee consisting of 9 elected members by the general body and 3
nominated members from the general body by Samakhya and the secretary of MCA as ex-officio
member.
It was felt necessary to assess the awareness of MCA and Samakhya among these
representatives.
Efforts are also made to assess the awareness of MCA and Samakhya among staff and managing
committee members of these member-multicoops as these are people who are instrumental in
bringing about an improvement in performance.
83
Selection of multicoops for the study:
Even though it is desirable to have all the member-multicoops covered in the survey for such a
study as this, it was felt not feasible due to the constraint on time available. But a fairly long
number , i.e. 28 out of 75 multicoops are selected.
The following factors were taken into consideration in the selection of these 28 multicoops:
a) Coverage of multicoops from different regions
b) Coverage of multicoops at different stages of growth and size
c) Coverage of multicoops with different age of membership
d) Coverage of multicoops which are users and non users of the services provided by MCA
and Samakhya.
The profile selected member-multicoops vis-a-vis all the member-multicoops regarding some of
these factors are provided below:
Table 1: Age of membership
Years of
Membership
Number of
Multicoops
Number of multi-
coops selected
1 11 (15) 4 (16)
2 15 (20) 5 (20)
3 11 (15) 1 (4)
4 10 (13) 5 (20)
5 8 (11) 4 (16)
6 7 (9) 2 (8)
7 9 (12) 3 (12)
8 1 (1) 0 (0)
9 3 (4) 2 (4)
TOTAL 75 (100) 25 (100)
Note: Figures in parenthesis represent percentage of total.
84
It may be noticed that multicoops selected represent fairly total member multicoops as regards
age of membership.
Usage of services:
The services provided by MCA and Samakhya are divided into six broad categories. They are 1)
training 2) member education 3) assistance to plan/systematize 4) research 5) liaison and
lobbying and 6) assistance from Cooperative Development Fund.
The patronage of these services by the member-multicoops is given below:
Table 2: Extent of Patronage of different services provided
Services Provided Number of Member-
Multicoops used
1) Training 54 (72)
2) Member Education 26 (35)
3) Assistance to plan/systematise 23 (31)
4) Research 27 (36)
5) Liaison and lobbying 36 (48)
6) Assistance from CDF 19 (25)
TOTAL Member-Multicoops 75
Note: Figures in parenthesis represent percentage of total.
It may be seen from the table that among the services used, training is widely patronised.
Considering that almost all the training programmes are charged for, the patronage reveals the
value the users attribute to these programmes.
The apparently low patronage except in Member Education can be explained largely due to the
fact that these services are being offered only from the last few years. The patronage in terms of
number of services used by a single multicoops is given below:
85
Table 3: Patronage in terms of number of services used by a
member multicoop
Number of services used Number of member
multicoops
Number of member-
multicoops selected
6 7 (9) 7 (28)
5 6 (8) 4 (16)
4 11 (15) 5 (20)
3 12 (16) 4 (16)
2 10 (13) 3 (12)
1 15 (20) 1 (4)
0 14 (19) 1 (4)
Total Tnember-multicoop 75 (100) 25 (100)
NOTE: Figures in parenthesis represent percentage of total.
It may be seen from the table that a significant number of the selected multicoops are among
users of the services. It was felt, prior to selecting these multicoops that member multicoops who
used services reveal effect of the services.
A significant number of non users are unviable cooperatives surrounding Hyderabad city and the
rest are relatively new member multicoops which are far away.
Field Survey Administration.
The services of 7 post graduate students from Osmania University who were selected with the
help of Prof. Satyanarayana of Department of Commerce and Business Management, were
engaged from 4th August 1986 to 29 August 1986 for survey of the selected multicoops.
86
These 7 persons were given pre survey orientation and briefing for three days about the study,
multicoops, MCA and Samakhya. They were trained in administering the questionnaire and other
data collection work. Three multicoops were visited during these three days for familiarisation
and testing of questionnaire.
The investigators were divided into 4 teams comprising two persons each excepting one to cover
7 member multicoops each. They spent two days at each of the selected multicoops
administering the questionnaires and collecting data. They met staff, committee members (past
as at present there was no committee), and ordinary members.
They could not visit two of the selected multicoops due to cyclone and floods in those areas.
During the period of survey the National Consultant visited some of the selected multicoops as a
parte of his own study and also to oversee the survey.
The questionnaire is designed to assess the Respondents' awareness of MCA and Samakhya, to
identify the problems their multicoop is facing vis-a-vis the problems identified by MCA and
Samakhya as reflected in their plans and to seek their opinions about the present level of
interaction between them and MCA/Samakhya. The responses are tabulated and provided below.
87
Table 4: Respondents Awarenes s about MCA./ Samakhya.
Correct Responses President
s
Chief
Executive
s
Committee
members
Staff A.1
1. Our multicoop is a member of
Multicoops' Association (MCA) 13 (81) 20 (83) 4 (44) 9 (53) 46 (70)
2. Multicoops Association is a voluntary
organization for promotion of
multipurpose cooperatives 12 (75) 20 (83) 6 (67)
17
(100) 55 (83)
3. To obtain membership Rs. 1000 was paid
as returnable membership deposit. 12 (75) 17 (71) 2 (22) 13 (76) 44 (67)
4. MCA is registered under the public
societies Act. 5 (31)' 9 (38) 4 (44) 8 (47) 26 (39)
5. MCA's main objective is development of
multicoops in Andra Pradesh 11 (69) 14 (58) 4 (44) 8 (47) 37 (56)
6 . MCA was registered in 1977 9 (56) 16 (67) 3 (33) 10 (59) 38 (58)
7 Our multicoop is represented by
president and secretary/ managing
director alone 14 (88) 19 (79) 6 (67) 11 (65) 50 (76)
8. The number of members in MCA's
executive committee is thirteen 9 (56) 14 (58) 6 (67) 12 (71) 41 (62)
9). MCA's executive committee meeting is
held once in every three months 7 (44) 10 (42) 3 (33) 4 (24) 24 (36)
10. MCA's general body meeting is held
twice in a year 13 (81) 16 (67) 4 (44) 9 (53) 42 (64)
11. MCA promoted SAMAKHYA 1982 16 (100) 24 (100) 8 (89) 16 (94) 64 (97)
12. The member multicoops can obtain
assistance from Cooperative
Development Fund operated by
Samakhya in the form of deposits 9 (56) 16 (67) 6 (67) 14 (82) 45 (68)
13. Three members get elected every year to
executive committee of MCA 13 (81) 19 (79) 5 (56) 9 (53) 46 (70)
Respondents
16 (100) 24 (100) 9 (100)
17
(100) 66 (100)
% correct responses 69 69 52 63 65
88
Table 4: (cont'd) 1NOTE: Figures in parenthesis represent percentage 2
It may be seen from the table that presidents and chief executives, being representatives in 3general body meetings of MCA show better awareness and understanding of MCA/Samakhya. 4
The average number of correct responses among presidents of the member multicoops is 9 with a 5standard deviation of 2.16. 6
The average number of correct responses among chief executives of the member multicoops is 7also 9 with a standard deviation of 2.12. 8
The average number of correct responses among committee members of the member multicoops 9is 7 with a standard deviation of 3.26. 10
The average number of correct responses among staff of the member multicoops is 8 with a 11standard deviation of 2.5. 12
131415
Keeping in view the age of membership of different member multicoops selected, the responses
given by different categories of the respondents show a fair amount of awareness of MCA/
Samakhya.
89
Table 5: Identified problems by respondents as faced by their multicoop
Problems Presidents Chief
Executive
s
Committe
e
Members
Staff A11
1. Lack of continuity of elected
management 14 (87) 20 (88) 8 (89) 15 (88) 57 (86)
2. Lack of well informed, active,
committed members 7 (44) 14 (58) 6 (66) 10 (59) 37 (56)
3. Lack of cooperation from department 9 (56) 7 (29) 6 (66) 9 (53) 31 (47)
4. Lack of own funds 4 (25) 13 (54) 2 (22) 8 (47) 27 (41)
5. Lack of qualified, committed, trained
and accountable leadership. 4 (25) 10 (41) 4 (44) 5 (29) 23 (35)
6. Lack of integrated services to fulfill
members' needs 5 (31) 9 (37) 2 (22) 6 (35) 22 (33)
7. Lack of cooperation from financial
institutions 4 (25) 9 (37) 1 (11) 6 (35) 20 (30)
8. Lack of competent, qualified,
committed, trained and accountable
staff 4 (25) 7 (29) 4 (44) 3 (17) 18 (27)
9. Lack of proper direction in
conducting coops, activities 2 (19) 3 (12) 4 (44) 5 (29) 15 (23)
10. Lack of financial viability 5 (31) 5 (21) 1 (11) 2 (12) 13 (19)
Respondents 16 24 9 17 66
It may be seen from the above that lack of continuity of elected management is identified by
many respondents as the major problem. It is heartening to notice that MCA/Samakhya*s
efforts in the last two years are concentrated on resolving this issue.
It may be seen that the problems are given in the table in the decreasing order of being
expressed as problems by the respondents.
90
Table 6: Respondents opinions about present level of interation
Mode of interation Presidents Chief
Executives
Committee
Members
Staff A11
M E L M E L M E L M E L M E L
1. Correspondence 2- 13- 0 2- 22- 0 0- 8- 1 1- 13- 0 5- 56- 1
2. Staff visits 1- 9- 4 1- 17- 4 0- 3- 6 0- 10- 3 2- 39- 17
3. Your visits 0- 10- 5 0- 14- 5 0- 3- 6 0- 10- 3 0- 37- 19
4. General body,meetings 1- 13- 0 0- 19- 0 0- 7- 0 0- 13- 0 1- 52- 0
0- 9- 6 1- 14- 3 0- 6- 1 0- 11- 3 1- 40- 135. Workshops, seminars,
etc.Q N S Q N S Q N S Q N S Q N S
6. Response to special
requests
7- 8- 0 4- 16- 1 0- 8- 0 0- 12- 2 11- 44- 3
Respondents 16 24 9 17 66
NOTE: M = More
E = Enough
L = Less
Q = Quick
N = Normal
S = Slow
It may be noticed that in the respondents view, staff visits to their cooperatives, their visits to
MCA/Samakhya and organization of workshops, seminars, etc. should increase.
91
ANNEXURE 6
Information on selected multicoops
Some information regarding members' investment and their business activities is
presented in the following two tables.
Table 1 gives information about membership, share capital, reserves and funds, deposits and
internal funds of the selected multicoops as in the year of their joining and as in the year
1984-85. These figures are as they are on 30th June of the respective years.
Table 2 gives information about their activities during the respective years. It may be noted that
some of the selected multicoops have added activities to those existing when they joined.
92
Table 1: Information on internal funds of selected member tmilticoops
MEMBERS SHARE CAPITAL RESERVES &
FUNDS
DEPOSITS INTERNAL FUNDS
MULTICOOP Joining
Year
1984-85 Joining
Year
1984-85 Joining
Year
1984-85 Joining
Year
1984-85 Joininy
Year
1984-85
1. Mulukanoor 3344 3190 1689783 3365000 2074214 11109000 1460278 4 7 78000 5224275 19252000
2. Cattududdenapalli 914 1090 350344 820000 601711 1759000 114231 425000 1066286 3004000
3. Rayadurg 558 NA 67165 NA 46115 NA 16615 NA 129895 NA
4 . Malleboinpal1i 250 640 29955 151000 141 64000 194 279000 30290 494000
5 . Chennaraopet 7027 7550 1352349 2160000 111563 868000 321562 415000 1785474 344 3000
6. Pothangal 1817 2040 332600 571000 449413 994000 395654 1400000 1 1 77667 2965000
7. Chatkesar 2052 2970 383700 697000 11855 57 7000 117600 195000 513155 1469000
8. Kapulakanaparthy 2223 2930 489000 886000 153181 791000 20580 923000 662761 2600000
9. Ookal 1660 2990 863000 1194000 0 158000 2 3000 248000 886000 1600000
10 Nirmal 1842 2100 476920 574000 169034 422000 17000 19000 662954 1015000
11. Palmakole 2400 3060 363000 504000 190398 360000 181000 123000 734398 98 7000
12 Kothapalli 2596 2650 706879 785000 85497 525000 101422 861000 893798 2 171000
13 Covindapet 635 640 120673 142000 181869 19 3000 124 50 23000 314992 358000
14 Tekulapal1i 2152 2610 606000 1206000 251000 320000 189000 140000 1046000 1666000
15. Sivannaguda 1400 1520 200800 295000 0 590000 12500 130000 213300 484000
16. Tandurkichennapet 2252 2280 257875 316000 283568 364000 57253 103000 598696 783000
17 Malthummeda 1570 1590 343746 446000 178865 374000 47362 101000 569973 921000
18 Raikal 841 840 133438 133000 89760 97000 466 13000 223664 24 3000
19 Mydukur 5514 5690 996000 1058000 327000 389000 1208000 1906000 2531000 3353000
20 Atmakur 2786 2790 620930 651000 461000 461000 2830000 2830000 3911930 3942000
21 Kalla 1980 1980 500000 500000 143000 143000 4 38000 438000 1081000 1081000
22 Makkinavarigudem 1260 1260 233129 233000 69322 69322 85266 85000 387717 387332
23 Achanta 7143 7150 899133 899000 1041084 1041084 7004000 7004000 8944217 8944084
24. Kavitam 1580 1580 568860 569000 265111 265111 6484 15 648000 1482 386 1482111
25. Pedapulleru 1780 1780 291000 291000 1625999 1625999 1192864 1192864 3109863 3109863
NOTE: 1 NA = Information not available
2 Internal funds = sliare capital + Reserves & funds + Deposits
93
Table 2: Information on activities of the selected multicoops.
LOANS DISBURSED LOANS
RECOVERED
INPUTS SOLD CONSUMER GOODS
SOLD
PRODUCE
MARKETED MULTICOOP
Joining
Year
1984-85 Joining
Year
1984-85 Joining
Year
1984-85 Joining
Year
1984-85 Joining
Year
1984-85
1. Mulukanoor 1328400
0
18058124 14109000 14390000 5265000 10440000 1054000 5807000 3753000 21080000
2. Gattududdenapalli 1319415 2731350 976013 3198000 1795503 2429000 136277 529000 1484518 6478000
3. Rayadurg 500133 NA 393628 NA 92885 NA 354 NA 0 NA
4. Malleboinapalli 243426 640091 142675 403000 0 155000 0 209000 0 0
5. Chennaraopet 3037541 6221077 2635807 4464000 2200199 2230000 956249 1791000 679862 5806000
6. Pothangal 441255 3415840 1612298 2882000 3858182 7510000 1009401 2303000 0 3757000
7. Ghatkesar 1050941 1377778 860518 1425000 320671 710000 110000 185000 0 0
8. Kapulakanaparthy 4062000 2768309 1157000 2776000 2050694 3067000 143169 2173000 0 0
9. Ookal 1733000 3332750 555000 2677000 1453000 2315000 10000 0 0 0
10. Nirmal 1780386 1308346 1373233 1182000 1813662 1155000 0 22000 601000 0
11. Palamakole 1189000 2627999 1445755 2304000 445000 1699000 272000 0 0
12. Kothapalli 2235795 3028325 1689529 3057000 1877730 2857000 0 10000 0 0
13. Govindpet 794927 893199 737724 849000 491284 784000 0 312000 168230 0
14. Tekulapalli 4857000 4942037 2639000 4078000 881000 1948000 0 0 0 717000
15. Sivannaguda 876700 1376000 856000 1407000 945295 1128000 6976 21000 0 0
16. Tandurkichennap
et
1405110 2280000 994665 1773000 409981 678000 254868 254000 0 84000
17. Maltummeda 2447505 2640000 2054301 2639000 754437 845000 319824 403000 0 0
18. Raikal 1251449 247800 1047984 1026000 6447 73 342000 14189 1000 0 0
19. Mydukur 5002000 3962000 4470000 3055000 1061000 1063000 0 0 0 0
20. Atmakur 4453179 4453179 3933788 3933788 3463066 3466066 0 0 0 0
21 . Kalla 2972025 2972025 4919000 4919000 1397000 1397000 0 0 742000 742000
22. Makkinavarigude
m
1439640 1439640 1810800 1810800 0 0 0 0 0 0
23. Achanta 5447510 5447510 4981527 4981527 1016372 1016372 1208438 1208438 1008763 1008763
24. Kavitam 3063832 3063832 2510104 2510104 1005023 1005023 324704 324704 1525473 1525473
25 . Pedapulleru 1864000 1864000 1679000 1679000 1797450 1797450 854174 854174 3 1 76471 3176471
94
Table 2: Continued
HIRE CHARGES TOTAL BUSINESS NET SURPLUS MULTICOOP
Joining Year 1984-85 Joining year 1984-85 Joining Year 1984-85
1. Mulukanoor 370000 1463000 24551000 53180000 66000 1294000
2. Gattududdenapalli 9885 147000 4402196 12781000 35246 116000
3. Rayadurg 0 NA 486867 NA 11688 NA
4. Malleboinpally 0 9000 142675 776000 6851 7000
5. Chennaraopet 3865 12000 6475982 14303000 294618 180000
6. Pothangal 4054 51000 6483935 16503000 96822 236000
7. Ghatkesar 16000 7000 1307189 2327000 11300 136000
8. Kapulakanaparthy 0 68000 3350863 8084000 66056 126000
9. Ookal 0 0 2018000 4992000 120000 212000
10. Nirmal 0 0 3787895 2359000 64159 21000
11 . Palmakole 0 4000 2162755 4007000 82508 75000
12. Kothapalli 0 33000 3567259 5957000 23741 136000
13. Govindpet 346 0 1397584 1945000 28177 43000
14. Tekulapalli 0 1000 3520000 6744000 -24000 5000
15. Sivannaguda 996 0 1809267 2556000 1743 5000
16. Thandurkitchennapet 0 0 1659514 2789000 72204 84000
17. Malthummeda 0 0 3128582 3887000 146879 114000
18. Raikal 0 0 1706946 1369000 14575 5000
19. Mydukur 0 0 5531000 4118000 145115 -47000
20. Atmakur 0 0 7396854 7396854 227141 227141
21 . Kalla 0 0 7058000 7058000 30782 30782
22. Makkinavarigudem 0 0 1810800 1810800 54000 54000
23. Achanta 0 0 8215100 8215100 119917 119917
24. Kavitam 0 0 5365304 5365304 18670 18670
25. Pednpulleru 0 0 7507095 7507095 157750 157750
NOTE: NA = Information Not Available
95
Annexure 7.
Co-operative Development Fund - Eligibility Conditions
The following conditions should be fulfilled by the member multicoop of MCA to become eligible
for applying for deposits from CDF. To be eligible, the multicoop must:
1. have been an active MCA member for at least one year;
2. have taken up member education;
3. have a perspective plan and operational plans;
4. the activity for which the member multicoop is requesting assistance should have been included in the
plans or should be supported by a resolution of the general body;
*5. have internal funds equal to at least 15% of the total liabilities, i.e. (Internal funds means the total of
members' share capital, reserves and deposits.)
6. have started mobilising funds from its members which can be used for the project, 25% of the project
cost should be freshly mobilised by the society with at least 10% from its members;
7. have initiated legal action against defaults exceeding two years;
*8. have collected at least 70% of the loans on demand;
9. have held committee and general body meetings regularly;
*10. have had its accounts audited regularly;
11. have presented its annual reports and accounts to the general body regularly;
*12. have been earning profit and should be declaring dividend regularly;
13. have not been in default for any payment for more than two years to any financier;
*14. not be a recipient of deposits from Samakhya CDF for more than two projects, currently;
15. have an elected board of management as on the date of application.
* indicates that these conditions are not rigid but flexible subject to the discretion and consideration of
the Board
