Welcome reforms

The proposal to bring in a constitutional amendment to strengthen the co-operative sector by minimising government interference in the working of these institutions is a welcome move. The Constitution (110th Amendment) Bill, which has been approved by the Union cabinet and may soon be introduced in parliament, aims to promote autonomous functioning, democratic control and professional management of co-operative bodies. There are over 120 million such bodies in the country, some of them on paper, others defective and malfunctioning and only a few working well.

Vested interests dominate most of them. Co-operative societies are run like persona l fiefdoms and political interference is rampant.

The proposed amendment seeks to do to the co-operative sector what the 73rd amendment did to panchayat raj institutions. A new article, 43B, will be inserted in the Constitution which will mandate regular elections to the societies, ensure a fixed term for office-bearers, limit the size of the director board and provide for independent audit of the accounts. More importantly, elections will be conducted by the state election commissions, as in the case of panchayats, or a similar independent authority. State governments will not be able to dissolve them at their will as they will enjoy statutory protection.

Governments have consistently ignored recommendations made by many committees  to reform the co-operative sector, for obvious reasons. It should not go back on the proposal now. The provision of statutory status alone does not guarantee the best results. Governments still influence their functioning, subvert them and very often manage not to hold regular elections. But the working of these institutions has generally improved and there is greater popular awareness of their role. The same will be the case with co-operative societies also. If they are empowered and given autonomy many of them will increasingly refuse to toe the line set by politicians or others and develop into institutions that best serve their members’ interests. As grassroots level bodies, they have the potential to improve the lives of millions of people. When they grow stronger, society will gain what the vested interests lose.