The fast-track development in infrastructures, industries and agriculture are crucial to reduce poverty, but increasing the pie solves only half the problem; what is lacking is a fair distribution of the pie that can only happen if the poor themselves are organized through better Duterte administration reforms in the cooperative sector, thus enabling them to be the means and ends of development itself.
Poor can’t survive free market? Individually, the poor can hardly fend for themselves in the ruthless free-market system, where they get clobbered by unscrupulous traders, who have no loyalty for production, being margin players, whose interests is to maximize profits, at the least costs and the least effort, and will not hesitate to import than buy from our farmers if they can profit more.
It is neither advisable to subsidize the poor and their prices as that would distort markets. However, when markets are imperfect, the government must come in to assist the poor, not through dole-outs and subsidies, but by investing where they count most—empowering and organizing them into cooperatives and equipping them with production and postharvest equipment and logistics for distribution, all on credit. This enables them to achieve economies of scale and full value supply chain, making them more competitive.
Let’s lax barriers to coop entry. While it takes a day or two to get registered with the Securities and Exchange Commission (SEC), it takes three to 10 months to get registered with the Cooperative Development Authority (CDA), particularly transport groups, which are vulnerable to tedious red tape.
With Duterte’s transport modernization program requiring industrial consolidation translating to coop-organizing for jeepneys, the massive applications soon will worsen existing bottlenecks that already takes two to three months to get a preregistration seminar scheduled.
CDA is partly to be blamed as CDA Chairman Orlando Ravanera issued Memorandum Circular 2017-02 on February 1, declaring only CDA can exclusively give seminars. Earlier, local government units (LGUs) conducted these seminars as part of devolution and in compliance with Executive Order (EO) 96, mandating all LGUs to help register coops.
CDA may be violating EO 96 by centralizing seminars. Worse, it has specified seminar frequency schedules at “once a month at the CDA extension office and once per quarter at CDA field offices,” which leaves little flexibility. Its Manila extension office was forced to hold weekly seminars, and plans to increase frequency with rising demand, in violation of its own untenable circular.
Assist, not echo the same. In compliance with EO 95, requiring agencies to assist coops, Department of Transportation (DOTr) has its Office of Transport Cooperatives (OTC), which does nothing else, but repeats CDA’s half day seminars, lengthening them to a full day.
Sadly, many drivers are neither literate enough nor have the patience to endure daylong lectures. While CDA allows founding cooperators to conduct the same seminars to its members, OTC requires all members to undergo its day-long Cooperative Education and Transport Operations Seminars at its office, which are peak hours and peak days for drivers.
Lacking personnel and offices nationwide, OTC requires its seminars at its central office. Expanding its bureaucracy wont help, and the solution is simply allowing back more LGU participation.
Perhaps, OTC must focus, instead, on designing alternative practical hands-on learning programs. After all, there is no substitute to experiential learning or learning by doing. One can read handbooks or watch YouTube tutorials on swimming or driving, but will never learn, unless one plunges in a pool or does actual driving.
Simplify the complex. CDA can learn a lot from the SEC, which readily approves registration, but requires applicants to issue pledges of undertaking to be accomplished within reasonable periods, if there are remaining minor corrections.
About 25 years ago, I interviewed an American businessman, whose mining accessories business in the United State only took him $11 and three minutes to get registered, but in the Philippines, it took him nine months going back and forth, and ridiculously asked of unnecessary details like names of ex-wife, kids, which were irrelevant being divorced.
We need not simplify too much, but just get rid of unnecessary redundancy. For one, scrap the required signing on every page of registration papers, which is difficult for transport groups. Gathering 20 to 30 founding cooperators is already a problem, getting them to sign on every page is ridiculous, having no danger of alterations being express lane forms anyway.
Another hindrance to entry is the “economic survey,” requiring various unrealistic projections. It also demands submission of various committees required by law, which is ironic as there are 21 types of cooperatives, but with “one formula that fits all” type of committees, most of which end up disfunctional. Perhaps, leeway be given to set up functional committees at start-ups, and create new ones as needs arise.
Apart from this feasibility study/economic survey, there are over 14 coop lecture-seminars developed totaling over 188 hours or about 24 days. Remember, drivers learn more by doing not listening to lecture, and have different needs than credit cooperatives. These seminars were likely developed to meet ready funding from the required 10-percent coop allocation for education.
These seminars are mostly detailed breakdowns of coop management and related concerns, but for transport coops, what they need more are practical seminars on maintenance, running vehicle service centers, supply parts business, etc.
How come small market vendors learn business on the job, without these seminars or feasibility studies? Appropriate and blended models must therefore be developed.
By simplifying procedures, CDA can now be called “developmental,” otherwise, it gains the monicker Coop Regulatory Authority, which critics says sounds like sira or defective, when it has vast potentials of developmental work it can do like business matching, organizing intra-Koop trade and investments, organizing big brother small-brother coop partnerships, etc.
E-mail: mikealunan@yahoo.com.