20 Feb 2013

Assistant Minister of Trade and Industry, Mr Keletso Rakhudu says government has decided that consumer cooperatives should be run like businesses in an attempt to revive them.

Addressing Kweneng District councillors, Mr Rakhudu said in 2007, Parliament established a policy which sought to revive cooperatives after realising that the cooperative sub-sector did exceptionally well until the 1990s when their performance took a nose dive and became almost non-existent.

Although there were many factors that contributed to their plummet, they faced a number of challenges and could not take advantage of opportunities that presented themselves as they lacked technological advancement and faced stiff competition especially from chain stores that swallowed them up.

He also added that management at the time also lacked expertise in running cooperatives. Of the few cooperatives that remained active, Selebi Phikwe cooperative lingered a little longer with Etsha singled out as one of the strongest.

Mr Rakhudu highlighted that in other countries, cooperatives were doing well because there was a strong partnership of shareholders, adding that his ministry was now learning from businesses that partnerships were the way to go.

Furthermore, he said, they had noticed that for cooperatives to realise results, they ought to learn from the idea that originated from countries such as Kenya and Tanzania.

He explained that cooperative movement in these countries had contributed immensely to the economy. For example in Kenya, cooperatives contributed 40 per cent of GDP, the more reason why government benchmarked in that country.

The assistant minister also revealed that while government was in the process of reviving cooperatives, policies were also being reviewed. He said to ensure smooth running of cooperatives, there should be some introductions of courses in local institutions on cooperative management.

He further said cooperatives should be branded and sell their own merchandise.  They would also promote linkages with one another across the country with one common goal of putting the customer first. "Youth also will be at the forefront in taking part in cooperatives, either with their produce or in their smooth running," he said.

However, he said cabinet had drafted a cooperative society amendment bill. Some of the objectives of the bill would be to create an enabling environment for the development and growth of cooperatives.

Mr Rakhudu explained that the bill sought to strengthen the institutional framework for the strategic development of cooperatives society by making it easier to form a society by reducing the required minimum number of membership from 20 to 10 and 50 to 20. 

He said also, key was the introduction of Apex organisation to be the voice of the movement both locally and internationally. In addition, he said a new dispute settlement procedure was established to speed up resolution of disputes.

Commenting on the draft bill, councillors welcomed the idea of reviving cooperatives.

Councillor Banks Ndebele of Mogoditshane north said cooperatives could better lives of people living in rural areas because buying power in those areas was low hence the introduction of cooperatives would enable residents to bargain for better prizes.

He advised that in the draft bill, government must also ensure that cooperatives should cut across all sectors of the economy and that communities should be at the heart of cooperatives. He said they should agree on what would work best for their own area.

For his part, Councillor Poloko Motlhobogwa of Sebele Ward urged government to limit chain stores on what to trade on in order to give Batswana a chance to do business, especially in rural areas.

Councillor Tona Selala of Thamaga West emphasised that cooperatives should be community based in terms of shareholding and proposed that some board members should be allowed to form part of the boards because of their experience.

However, councillors did not welcome the idea of the method of selling cooperative shares which would require people to raffle for the shares, saying that the method of sale would only allow rich people to monopolise the cooperatives.  Instead they suggested that the number of shares per person should be limited. ENDS