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MIĘDZYNARODOWEJ ORGANIZACJI PRACY
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Recommendation concerning the Role of Co-operatives in the Economic and Social Development of Developing CountriesThe General Conference of the International Labour Organisation,
Having been convened at Geneva by the Governing Body of the International Labour Office, and having met in its Fiftieth Session on 1 June 1966, and
Having decided upon the adoption of certain proposals with regard to the role of co-operatives in the economic and social development of developing countries, which is the fourth item on the agenda of the session, and
Having determined that these proposals shall take the form of a Recommendation,
adopts this twenty-first day of June of the year one thousand nine hundred and sixty-six, the following Recommendation, which may be cited as the Co-operatives (Developing Countries) Recommendation, 1966:
I. Scope
1. This Recommendation applies to all categories of co-operatives, including consumer co-operatives, land improvement co-operatives, agricultural productive and processing co-operatives, rural supply co-operatives, agricultural marketing co-operatives, fishery co-operatives, service co-operatives, handicrafts co-operatives, workers' productive co-operatives, labour contracting co-operatives, co-operative thrift and credit societies and banks, housing co-operatives, transport co-operatives, insurance co-operatives and health co-operatives.
II. Objectives of Policy Concerning Co-operatives
2. The establishment and growth of co-operatives should be regarded as one of the important instruments for economic, social and cultural development as well as human advancement in developing countries.
3. In particular, co-operatives should be established and developed as a means of--
(a) improving the economic, social and cultural situation of persons of limited resources and opportunities as well as encouraging their spirit of initiative;
(b) increasing personal and national capital resources by the encouragement of thrift, by eliminating usury and by the sound use of credit;
(c) contributing to the economy an increased measure of democratic control of economic activity and of equitable distribution of surplus;
(d) increasing national income, export revenues and employment by a fuller utilisation of resources, for instance in the implementation of systems of agrarian reform and of land settlement aimed at bringing fresh areas into productive use and in the development of modern industries, preferably scattered, processing local raw materials;
(e) improving social conditions, and supplementing social services in such fields as housing and, where appropriate, health, education and communications;
(f) helping to raise the level of general and technical knowledge of their members.
4. Governments of developing countries should formulate and carry out a policy under which co-operatives receive aid and encouragement, of an economic, financial, technical, legislative or other character, without effect on their independence.
5. (1) In elaborating such a policy, regard should be had to economic and social conditions, to available resources and to the role which co-operatives can play in the development of the country concerned.
(2) The policy should be integrated in development plans in so far as this is consistent with the essential features of co-operatives.
6. The policy should be kept under review and adapted to changes in social and economic needs and to technological progress.
7. Existing co-operatives should be associated with the formulation and, where possible, application of the policy.
8. The co-operative movement should be encouraged to seek the collaboration in the formulation and, where appropriate, application of the policy, of organisations with common objectives.
9. (1) The governments concerned should associate co-operatives on the same basis as other undertakings with the formulation of national economic plans and other general economic measures, at least whenever such plans and measures are liable to affect their activities. Co-operatives should also be associated with the application of such plans and measures in so far as this is consistent with their essential characteristics.
(2) For the purposes provided for in Paragraph 7 and Paragraph 9, subparagraph (1), of this Recommendation, federations of co-operatives should be empowered to represent their member societies at the local, regional and national levels.
III. Methods of Implementation of Policy Concerning Co-operatives
A. Legislation
10. All appropriate measures, including the consultation of existing co-operatives, should be taken--
(a) to detect and eliminate provisions contained in laws and regulations which may have the effect of unduly restricting the development of co-operatives through discrimination, for instance in regard to taxation or the allocation of licences and quotas, or through failure to take account of the special character of co-operatives or of the particular rules of operation of co-operatives;
(b) to avoid the inclusion of such provisions in future laws and regulations; (c) to adapt fiscal laws and regulations to the special conditions of co-operatives.
11. There should be laws or regulations specifically concerned with the establishment and functioning of co-operatives, and with the protection of their right to operate on not less than equal terms with other forms of enterprise. These laws or regulations should preferably be applicable to all categories of co-operatives.
12. (1) Such laws and regulations should in any case include provisions on the following matters:
(a) a definition or description of a co-operative bringing out its essential characteristics, namely that it is an association of persons who have voluntarily joined together to achieve a common end through the formation of a democratically controlled organisation, making equitable contributions to the capital required and accepting a fair share of the risks and benefits of the undertaking in which the members actively participate;
(b) a description of the objects of a co-operative, and procedures for its establishment and registration, the amendment of its statutes, and its dissolution;
(c) the conditions of membership, such as the maximum amount of each share and, where appropriate, the proportion of the share due at the moment of subscription and the time allowed for full payment, as well as the rights and duties of members, which would be laid down in greater detail in the by-laws of co-operatives;
(d) methods of administration, management and internal audit, and procedures for the establishment and functioning of competent organs;
(e) the protection of the name "co-operative";
(f) machinery for the external audit and guidance of co-operatives and for the enforcement of the laws and regulations.
(2) The procedures provided for in such laws or regulations, in particular the procedures for registration, should be as simple and practical as possible, so as not to hinder the creation and development of co-operatives.
13. Laws and regulations concerning co-operatives should authorise co-operatives to federate.
B. Education and Training
14. Measures should be taken to disseminate a knowledge of the principles, methods, possibilities and limitations of co-operatives as widely as possible among the peoples of developing countries.
15. Appropriate instruction on the subject should be given not only in co-operative schools, colleges and other specialised centres but also in educational institutions such as--
(a) universities and centres of higher education;
(b) teachers' training colleges;
(c) agricultural schools and other vocational educational establishments and workers' education centres;
(d) secondary schools;
(e) primary schools.
16. (1) With a view to promoting practical experience in co-operative principles and methods, the formation and operation of student co-operatives in schools and colleges should be encouraged.
(2) Similarly, workers' organisations and craftsmen's associations should be encouraged and helped in the implementation of plans for the promotion of co-operatives.
17. Steps should be taken, in the first place at the local level, to familiarise the adult population with the principles, methods and possibilities of co-operatives.
18. Full use should be made of such media of instruction as text-books, lectures, seminars, study and discussion groups, mobile instructors, guided tours of co-operative undertakings, the press, films, radio and television and other media of mass communication. These should be adapted to the particular conditions of each country.
19. (1) Provision should be made both for appropriate technical training and for training in co-operative principles and methods of persons who will be--and, where necessary, of persons who are--office-bearers or members of the staffs of co-operatives, as well as of their advisers and publicists.
(2) Where existing facilities are inadequate, specialised colleges or schools should be established to provide such training, which should be given by specialised teachers or leaders of the co-operative movement with teaching materials adapted to the requirements of the country; if such specialised institutions cannot be established, special courses on co-operation should be given either by correspondence or in such establishments as schools of accountancy, schools of administration and schools of commerce.
(3) The use of special programmes of practical training should be one of the means of contributing to the education and basic and further training of members of co-operatives; these programmes should take into account local cultural conditions, and the need to disseminate literacy and knowledge of elementary arithmetic.
C. Aid to Co-operatives Financial Aid
20. (1) Where necessary, financial aid from outside should be given to co-operatives when they initiate their activities or encounter financial obstacles to growth or transformation.
(2) Such aid should not entail any obligations contrary to the independence or interests of co-operatives, and should be designed to encourage rather than replace the initiative and effort of the members of co-operatives.
21. (1) Such aid should take the form of loans or credit guarantees.
(2) Grants and reductions in or exemptions from taxes may also be provided, in particular, to help finance--
(a) publicity, promotional and educational campaigns;
(b) certain clearly defined tasks in the public interest.
22. Where such aid cannot be provided by the co-operative movement, it should preferably be given by the State or other public bodies, although it may, if necessary, come from private institutions. Such aid should be co-ordinated so as to avoid overlapping and dispersal of resources.
23. (1) Grants and tax exemptions or reductions should be subject to conditions prescribed by national laws or regulations and relating in particular to the use to be made of the aid and the amount thereof; the conditions of loans and credit guarantees may be determined in each case.
(2) The competent authority should ensure that the use of financial aid and, in the case of a loan, its repayment, are adequately supervised.
24. (1) Financial aid from public or semi-public sources should be channelled through a national co-operative bank or, failing that, another central co-operative institution capable of assuming responsibility for its use and, where appropriate, repayment; pending the establishment of such institutions the aid may be given directly to individual co-operatives.
(2) Subject to the provisions of Paragraph 20, subparagraph (2), of this Recommendation, financial aid from private institutions may be given directly to individual co-operatives.
Administrative Aid
25. While it is essential that the management and administration of a co-operative be, from the outset, the responsibility of the members and persons elected by them, the competent authority should, in appropriate cases and normally for an initial period only--
(a) assist the co-operative in obtaining and remunerating competent staff;
(b) place at the disposal of the co-operative persons competent to give guidance and advice.
26. (1) Generally, co-operatives should be able to obtain guidance and advice, which respect their autonomy and the responsibilities of their members, their organs and their staff, on matters relating to management and administration, as well as on technical matters.
(2) Such guidance and advice should preferably be given by a federation of co-operatives or by the competent authority.
D. Supervision and Responsibility for Implementation
27. (1) Co-operatives should be subject to a form of supervision designed to ensure that they carry on their activities in conformity with the objects for which they were established and in accordance with the law.
(2) Supervision should preferably be the responsibility of a federation of co-operatives or of the competent authority.
28. Auditing of the accounts of co-operatives affiliated to a federation of co-operatives should be the responsibility of that federation; pending the establishment of such a federation, or where a federation is unable to provide this service, the competent authority or a qualified independent body should assume the task.
29. The measures referred to in Paragraphs 27 and 28 of this Recommendation should be so planned and carried out as to--
(a) ensure good management and administration of co-operatives;
(b) protect third parties;
(c) provide an opportunity of completing the education and training of the office-bearers and members of the staff of co-operatives through practice and through critical examination of mistakes.
30. (1) The functions of promoting co-operatives, providing for education concerning co-operatives and for the training of office-bearers and members of the staff of co-operatives, and giving aid in their organisation and functioning, should preferably be performed by one central body so as to ensure coherent action.
(2) The performance of these functions should preferably be the responsibility of a federation of co-operatives; pending the establishment of such a body the competent authority or, where appropriate, other qualified bodies, should assume the task.
31. (1) The functions referred to in Paragraph 30 of this Recommendation should, wherever possible, be discharged as full-time work.
(2) They should be performed by persons who have received training specifically directed towards the exercise of such functions; such training should be provided by specialised institutions or, wherever suitable, through specialised courses in schools and colleges referred to in Paragraph 19 of this Recommendation.
32. The competent authority should collect and publish at least once a year a report and statistics relating to the operations and growth of co-operatives in the national economy.
33. Where the services of federations of co-operatives or of other existing institutions cannot adequately meet the need for research, exchanges of experience and publications, special institutions, serving the entire country or several regions, should, if possible, be established.
IV. International Collaboration
34. (1) Members should, to the greatest extent possible, collaborate in providing aid and encouragement to co-operatives in developing countries.
(2) Such collaboration should be envisaged--
(a) between developing countries;
(b) between countries of a particular region, especially within the framework of regional organisations, where such exist; and
(c) between countries with an old-established co-operative movement and developing countries.
(3) As appropriate, the help of national co-operative organisations should be enlisted for such collaboration, and use should be made, particularly with a view to the co-ordination of international effort, of international co-operative organisations and other interested international bodies.
(4) The collaboration should extend to such measures as--
(a) the increased provision of technical assistance to the co-operative movement of developing countries, wherever possible in the form of co-ordinated programmes involving different agencies, both inter-governmental and non-governmental;
(b) the preparation and supply of information, textbooks, audio-visual aids and analogous material to assist in the drafting of legislation, in instruction on co-operation and in the training of office-bearers and qualified staffs of co-operatives;
(c) the exchange of qualified personnel;
(d) the grant of fellowships;
(e) the organisation of international seminars and discussion groups;
(f) the inter-co-operative exchange of goods and services;
(g) the initiation of systematic research into the structure, working methods and problems of co-operative movements in developing countries.
V. Special Provisions Concerning the Role of Co-operatives in Dealing with Particular Problems
35. It should be recognised that co-operatives may, in certain circumstances, have a special role to play in dealing with particular problems of developing countries.
36. Suggestions illustrating the use which may be made of various forms of co-operatives in the successful implementation of agrarian reform and in the improvement in the level of living of the beneficiaries are set forth in the Annex to this Recommendation.
ANNEX
1. In view of their importance as a means of promoting general economic and social progress and as a means of directly associating the rural population with the development process, as well as in view of their educational and cultural value, co-operatives should be considered as having a vital role to play in programmes of agrarian reform.
2. Co-operatives should be used as a means of assessing the problems and interests of the rural population in the planning and preparation of agrarian reform measures. They should also serve for channeling information among agriculturists and making the purposes, principles and methods of such reforms understood.
3. Particular attention should be paid to the development of appropriate forms of co-operatives adapted to the various patterns and phases of agrarian reform. They should enable cultivators to operate holdings efficiently and productively and allow for the greatest possible initiative and participation of the membership.
4. Where appropriate, suitable voluntary forms of co-operative land use should be encouraged. These forms may range from the organisation of certain services and farming operations in common to the complete pooling of land, labour and equipment.
5. Wherever appropriate the voluntary consolidation of fragmentary holdings through co-operatives should be encouraged.
6. In cases where measures are being envisaged for the transfer of ownership or division of large estates, due consideration should be given to the organisation by the beneficiaries of co-operative systems of holding or cultivation.
7. The establishment of co-operatives should also be considered in connection with land settlement schemes, especially as regards land reclamation and improvement measures and the organisation of joint services and joint farming operations for settlers.
8. Development of co-operative thrift and credit societies and co-operative banks should be encouraged among the beneficiaries of agrarian reforms as well as among other small farmers for the purpose of :
(a) providing loans to cultivators for the purchase of equipment and other farm requisites;
(b) encouraging and assisting cultivators to save and accumulate capital;
(c) advancing loans to, and promoting thrift among, agricultural families, including those of hired workers, who normally would not have access to established sources of credit;
(d) facilitating the implementation of special governmental credit schemes through an efficient channelling of loans to beneficiaries and appropriate supervision of the use made of such loans and of their timely reimbursement.
9. The development of supply, marketing or multi-purpose co-operatives should be encouraged for the purpose of :
(a) the joint purchase and supply of farm requisites of good quality on favourable terms;
(b) the supply of basic domestic requirements for all categories of agricultural workers;
(c) the joint conditioning, processing and marketing of agricultural products.
10. Encouragement should be given to the development of co-operatives providing farmers with other services such as the joint use of farm machinery, electrification, livestock breeding, the provision of veterinary and pest control services, facilities for irrigation, and crop and livestock insurance.
11. With a view to improving employment opportunities, working conditions and income, landless agricultural workers should be assisted, where appropriate, to organise themselves voluntarily into labour contracting co-operatives.
12. Agricultural co-operatives of different localities in areas in which agrarian reforms are being implemented should be encouraged to combine their activities where this is economically advantageous.
13. Due consideration should also be given to the encouragement and development of other types of co-operative activities providing full- or part-time non-agricultural employment for members of farmers' families (for instance, crafts, home or cottage industries) adequate distribution of consumer goods, and social services which the State may not always be in a position to provide (for instance, health, education, culture, recreation or transport).
14. The interchange and dissemination of information on the methods, possibilities and limitations of co-operatives in relation to agrarian reform should be encouraged by all possible means so that the experience acquired may be made available to the largest possible number of countries.