ASSESSMENT OF THE IMPACT OF CO-OPERATIVE SOCIETIES ON POVERTY ALLEVIATION IN ENUGU STATE

CHAPTER ONE

INTRODUCTION

1.0       Background of the Study

            A co-operative society is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise. One dictionary defines a cooperative as "a jointly owned enterprise engaging in the production or distribution of goods or the supplying of services, operated by its members for their mutual benefit, typically organized by consumers or farmers". Cooperatives frequently have social goals which they aim to accomplish by investing a proportion of trading profits back into their communities.

International   Cooperatives   Alliance   and   International Labour Organization (2003) defines cooperative societies as   an   autonomous   association   of   individuals   who voluntarily  comes  together  as  united  force  in  order  to meet  their  mutual  social,  cultural  and  economic  needs and  wants  through  the  help  of  a  jointly  owned  and democratically  managed  enterprise.

This  type  of  group mostly  of  interested  persons  characterized  by  limited means  of livelihood  usually  make  equitable  contribution to  the  resources  required  and  thereby  accepts  fair  or equal share of the benefits and risks that may come with the   undertaking   in   which   the   members   participate.

Ezekiel  (2014)  thus  indicates  that  cooperative societies remain   most   important   catalyst   for   individual   and community  entrepreneurial  growth;  “because  it  retains  within  the  communities  in  which  they  operate  the  capital that they mobilize themselves, as well as surplus derived from  outside  transactions, both  accumulating  for  further entrepreneurial development”.

On the other hand, cooperative is a phenomenon that denotes any form of working together voluntarily by persons or individuals to achieve common goals. To narrow it down cooperative refers to the activities of an association of persons with similar social, cultural and economic needs who willingly come together to. The  poverty  trend  in  Nigeria  is  further aggravated  due  to  lack  of  basic  needs  for  decent  life; access  to  clean  or  portable  water,  healthcare  services, education  opportunities,  shelter,  housing  (MDG,  2013, UNDP, 2015).

Despite   successive   government’s efforts   in   reducing poverty,  its  situation  in  Nigeria  is  quite  worrisome  as  the story  of  poverty  alleviation  seems  to  be  gloomy  over  the years  (Abbas,  2013).    It  is  therefore  not  surprising  that co-operative society in  Nigeria  are  faced by various  agents  of state  and  private  authorities  from  which  they  hinder the progress of people. Unfortunately,    since    poor    people    lack independence, power and voice which to rely on for daily survival,  they  become  cheap  for  all  kinds  of  political  and economic  exploitation.  The gravity of poverty and its situation   is   however   dynamic   across the   globe. Co-operative Societies have played a fundamental role in enhancing the socio-economic status of members. The group encourages people to save, mobilize the fund saved through loan at low rate of interest to members, in order to run his or her Agricultural practices or business and have access to external sources of fund. (Shah, 2001)

Looking  through  the  activities  of  cooperative  societies, the Nigerian system which is fundamentally democratic in nature  must  also  embody  the  wishes  and  aspirations  of the  people.  In  the  case  of  cooperative  societies,  the situation  should  not  be  in  anyway  different  as  efforts made by government have failed over time to alleviate poverty from the society. For  instance in  the  new  thinking  Sapru  (2008)  emphasised  that demands  for  policy  action  are  usually  made  on  political system  by  different  constituents  including  civil  society organizations,  non-governmental organizations,  pressure groups, political parties, citizens, etc. Thus, since poverty still remains a serious menace in Nigeria, and particularly in    Enugu State, despite various    efforts    made    by successive  governments  to  reduce  it,  the  role  that  such non-governmental     organizations     and     bodies     like cooperative  societies  play  in  poverty  alleviation  in  recent time becomes imperative. Poverty is  a  menace  that  continues  to  pose  serious threat to the development prospects of Nigeria in general Enugu State   in   particular.   The   alarming   incidence   of poverty   in   Enugu State especially   among   the   most vulnerable  in  the  society;  women,  children,  youths  is serving  as  hindrance  to  socio-economic  development  of most  of  its communities.

            Co-operative society has helped farmers, traders, business men and women, civil servants to obtained loan from banks to member’s especially individual member without collateral to established their business. Co-operative society has helped to provide better services to members, which has enable them increase their incomes based, foster business entrepreneurial skill and also satisfy needs of the poor.

             In   the   case   of   Nigeria,   several   poverty   alleviation policies  were  designed,  initiated  and  implemented  over time  with  the  hope  to  improve  living  standard  of  its citizens.  Some  of  the  past  programmes  for  instance includes:     National     Economic     Empowerment     and Development   Strategy   (NEEDS),   Poverty   Alleviation Programme     (PAP),     National     Poverty     Eradication Programme     (NAPEP),     National     Agricultural     Land Development  Authority  (NALDA),  Directorate  of  Food, Road    and    Rural    Infrastructures    (DFRRI),    National Directorate   of   Employment   (NDE),   Family   Support Programme    (FSP),    Family    Economic    Advancement Programme   (FEAP),   Better   Life  Programme   (BLP), Peoples  Bank  and  Community  Banks  initiatives,  Green Revolution (GR), and Operation Feed the Nation (OFN) , etc.(Ugoh and Ukpere, 2009, Abbas, 2013).

1.2       Statement of Problem

            It is in the light of the above understanding that led the Nigerian Government at all levels to promote the use of cooperative in poverty reduction efforts. Nevertheless cooperatives in Nigeria are still known to be bedeviled with problems including, lack of capital, lack of access to credit facilities, poor management, misappropriation of funds, etc. While efforts are being made by stakeholders of cooperative in Nigeria to remove and/or reduce these problems, there is an apparent consensus that the need for adequate and sufficient knowledge of the role of cooperatives in poverty alleviation still exists. For example there is a need to identify and analyses in sufficient details those cooperative activities and functions that bear directly on the economic empowerment of members, as well as identifying factors that could promote and enhance cooperative efforts in poverty reduction. Unless these issues are known and appreciated, the emphasis on cooperative as a poverty alleviating platform may continue to be unrealistic.

1.3       Research Questions

1. What are the roles co-operative society plays in poverty alleviation?
2. What are the problems faced by co-operative society in reducing poverty in the state?
3. What benefits do co-operative society have in enhancing the socio-economic status of members?
4. Does co-operative society have any significant relationship with poverty alleviation?

1.4                   General Objective

The general objective of this study is to investigate the role of co-operative societies in poverty alleviation.

1.5                   Objective of the Study

i.          To identify the role played by co-operative societies in poverty alleviation.

ii.         To examine the problems facing co-operative societies in poverty alleviation.

iii.        To investigate the benefit of co-operative societies to members.

1.6                   Research Hypothesis

H_o: Co-operative society has no significant role in poverty alleviation.

H₁: Co-operative society has significant role in poverty alleviation.

H_o: Co-operative society has no significant problems facing co-operative societies in poverty alleviation.

H₁: Co-operative society has no significant problems facing co-operative societies in poverty alleviation.

H_o: Co-operative society has no significant relationship with poverty alleviation.

H₁: Co-operative society has significant relationship with poverty alleviation.

H_o:  Co-operate society has no benefit to members

H₁:  Co-operate society has benefit to members

1.7       Significance of the Study

            The study will encourage individuals (civil servants, farmers, business men and women, traders etc) to join co-operative societies in order to obtain loan to alleviate their social economic status with adequate information about co-operative societies to meet the needs of individual or group of individuals.

1.8       Scope of the Study

The study is designed to investigate the role of co-operation societies in poverty alleviation in Enugu East Local Government Area Enugu State. It is directed to co-operative members within the geographical location of Enugu East Local Government Area.

1.9       Limitation of 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

1.10     Operational Definition of Terms   

Cooperative: An association of individuals united voluntarily to meet their economic, cultural, social needs and aspirations through a jointly owned and democratically controlled enterprises.

Poverty: Aluwalia (1973) “Defines Poverty by the number of people living below a specified minimum level of income an imaginary poverty line knows nationals boundaries and is independent of the level of national per capital income. However, it magnitude may be much less in terms of total number or percentage of the total populations”

Alleviation: This as a term in this research work means the reduction or lessening and elimination of any factors that leads to poverty and deprivation among the populace so as to increase their income level.

Members: These are persons who are fully registered in the society and who have completed all the necessary registration process.