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THE ROLE OF CO-OPERATIVE SOCIETY IN POVERTY ALLEVIATION IN NIGERIA

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THE ROLE OF CO-OPERATIVE SOCIETY IN POVERTY ALLEVIATION IN NIGERIA

ABSTRACT

A cooperative is an enterprise in which individuals voluntarily organize to provide themselves and others with goods and services via democratic control and for mutually shared benefit. Members generally contribute to, and control via a democratic process, the cooperative’s capital. Moreover, cooperatives often provide education and training to their members. Over the years the cooperative form has extended to credit unions, wholesale and/or retail consumer groups, residential organizations, producer enterprises, and marketing associations. Certain broadly defined economic advantages accompany each specific cooperative type. For example, members of a consumer cooperative are entitled to receive a patronage dividend. Distributed from net earnings, the amount of current dividends received per member is determined by the amount members spent on the cooperative’s products since the last period’s payout. Moreover, members working within the cooperative can qualify for substantial in-store merchandize discounts. For members of a residential cooperative, property-owning members function as stockholders and receive benefits from the cooperative nature of incurring maintenance and interest costs.

 

CHAPTER ONE

INTRODUCTION

1.0    THE BACKGROUND OF THE STUDY

Much of the modern-day research and historical literature on cooperatives centers on the category of producer cooperatives, even though consumer cooperatives have been in existence since the 1840s. For the most part, this one-sided treatment is historically related to the rise of the capitalist factory system. To many workers experiencing the harsh routines of the factory systems’ exacting discipline for the first time, producer cooperatives held out the promise of a more humanistic alternative form of economic organization.

The “modern cooperative era” began in 1844, when the Rochdale Equitable Pioneers Society was established in Rochdale, England. Its members documented the principles by which they would operate their food cooperative, implementing the central tenets around which cooperatives are structured today. Throughout the late 19th and early 20th centuries, cooperatives sprung up sporadically in America, particularly in times of economic hardship. In 1922, Congress passes the Capper-Volstead Act, allowing farmers to collectively market products without being held in violation of the nation’s anti-trust laws. In the Depression years, Congress established various agencies to provide loans and assistance to cooperatives, including the Farm Credit Administration (1929), the National Credit Union Administration (1934), and the Rural Electrification Administration (1936). The National Cooperative Bank was established in 1978 under the National Consumer Cooperative Bank Act.

 From the report of the workshop held on 10th – 11th November 2008 during the 8 the ICA Africa regional assembly at the international conference centre, Abuja. Mr Tom Tar – The Executive Secretary of Cooperative Federation of Nigeria, In his introduction of the movement in Nigeria, said the Cooperative Federation of Nigeria (CFN) was formed in 1945 and got registered in 1967.

He traced the background of cooperatives in Nigeria to the traditional savings and loans system. He added that following agitation by the Agege Cocoa planters Union in 1907, the study for establishment of formal cooperation was commissioned in 1934. This was followed by the enactment of cooperative legislation in 1935. The early move was in agriculture and latter shifted to marketing following the shift in the Nigerian economy from agriculture to crude oil. He gave the scope of cooperative activities in Nigeria as covering: On population, he said there are about 5million family members covering 20 million house holds. Total number of registered cooperative societies is about 50,000.

He enumerated the following social and economic impacts of cooperatives in

Nigeria as:-

– Employment creation

– Credit to empower members to own their own business

– Contribution to GDP though statistics not available but impact is known

– Advocacy and lobbying for better legislation

He gave the future development of cooperatives as:

– Committed integration of women

– Strengthening cooperatives from within and reduced dependence on

government because “assistance seekers are always vulnerable”

– Better services to members to enable them increase their income

– Improved business entrepreneurial skills

– Stronger cooperative identity by members, committee and managers.

1.1     STATEMENT OF THE RESEARCH PROBLEM

In considering the statement of the research problem, these question readily come to mind:……Why cooperative model:

– This involved insurance to the poor people who are neglected by

conventional insurance companies

– Cooperative model satisfies needs of the poor

– Product is developed with market needs in mind covers all needs of

members- lands, agric, commercial, cooperatives.

– Community minded

– Member involvement

– Cooperatives are trust worthy organizations in environment where

corruption is high

– Member education claims first promptly because the best customer is

educated customer.

1.2    OBJECTIVES OF THE STUDY

The main objective of this research work is to determine the cons and pros of cooperative movement in Nigeria, according to Mr. Oki of

Lagos State Cooperative Federation (LASCOFED).Cooperative movement is developing a strong cooperatives for social and economic progress the members.

He unveil that cooperatives has moved from more contribution and

lending of money to members to creating returns through engagement in

business activities.

He stated that since COOPERATIVES is seen AS a SOCIAL ORGANIZATION, the primary objective is that :…

– Cooperatives put people at the centre of their business and not capital.

– in cooperative movement, the welfare of members is emphasized

– Cooperatives engage in business activities that touch members eg

schools building, credit.

– cooperative Create jobs and empowerment for members

1.3    SIGNIFICANCE OF THE STUDY

This study is significant because it will produce data on cooperative movement in Nigeria that will be useful to:

  1. federal ministry of labour and productivity
  2. national union of local government employees
  3. state civil service commission
  4. federal civil service commission .
  5. managers and top executives in organized private sector
  6. united nation commission on employment
  7. federal ministry of finance
  8. Central bank of Nigeria
  9. students carrying out a research work in this same issue.

1.4   HYPOTHESES

It is a conjectural statement of the relationships between two or more variables. It is testable, tentative problem explanation of the relationship between two or more variables that create a state of affairs or phenomenon.

E.C. Osuola (1986 page 48) said hypothesis should always be in declarative sentence form, and they should relate to them generally or specially variable to variables.

HYPOTHESIS THUS:

  1. Explain observed events in a systematic manner
  2. Predict the outcome of events and relationships
  3. Systematically summarized existing knowledge.

In essence, there exist NULL HYPOTHESIS set up only to nullify the research hypothesis and the ALTERNATIVE HYPOTHESIS for the purpose of the study. For the efficiency of the study, the hypothesis is as follows:

          Null Hypothesis (Ho)

  1. Cooperative does not  play  leading role in poverty reduction 2.`Cooperative does not grant  Credit to empower members to own their own business

Alternative Hypothesis     

  1. Cooperative plays a leading role in poverty reduction
  2. Cooperative do grant credit to empower members to own their own business

1.5   LIMITATIONS OF THE STUDY

A research work of this nature cannot come to an end without limitation. The researcher encountered numerous problems which affected the smooth running of the work. These problems includes, difficulty in procuring materials for the project, time factor and financial constraints.

Material Procurement

There was a lot constraints as to getting information and materials for the job. The researcher made series of consultations and visit to most renowned institutions to acquire the needed information. Most materials used were very difficult to come by, as there is no library within the town.

Time Constraints

Combining academic work with job is no doubt a thought provoking issue, as it has to do with time. Actually, a lot of time was wasted as the researcher visited the organizations and individuals together with government agencies to obtain valuable information for the project.

Financial Constraints

The researcher would have obtained more information than what is obtainable here but due to lack of money to visit some of the firms and government agencies located a bit farther from the researcher place of resident. 

1.6   THE STRUCTURE OF THE WORK

This research work is to be organized in five chapters as follows:

  • Introduction
  • Review of related literature
  • Research method
  • Data presentation and analysis
  • Summary, conclusion and recommendation

 

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