Kerala Cooperative Revival Fund to be Created

Sahakarana Sangham Punarudhdharana Nidhi Padhdhati is meant for the rehabilitation and revival of ailing, weak, or defunct societies and helping the better-performing ones to diversify into newer, profitable areas

Kerala, INDIA – The revival fund proposed as a support mechanism for cooperative societies is to be created by pooling assistance from the State government and “loans” secured from the reserve funds of cooperative societies.

The Sahakarana Sangham Punarudhdharana Nidhi Padhdhati (cooperative revival fund scheme), according to Cooperation department sources, is meant for the rehabilitation and revival of ailing, weak, or defunct societies and helping the better-performing ones to diversify into newer, profitable areas.

The proposal for the fund, in particular the move to use the reserve funds of cooperative societies for it, has sparked a debate against the backdrop of the Karuvannur Service Cooperative Bank scam and the subsequent bail-out proposals.

Primarily, two sources will be made use of for creating the fund: in the first case, loans secured from the reserve fund and the agriculture stabilisation fund (money transferred from the profits of cooperative societies) under the Cooperative Societies Act. This contribution will be made be in accordance with the norms finalised by a high-level panel, according to the proposal.

Assistance from the State government will be the second source for the fund. In addition to these, the fund scheme will also make use of other available sources, according to department officials.

The comprehensive amendments recently cleared by the State Assembly for cooperative societies, which include the proposal for raising the funds, will soon be submitted for the Governor’s assent, department sources said.

Internal audit board

Further, the scheme envisions the creation of an internal audit board for cooperative societies as part of streamlining the operations of the societies. This is designed to bring in professionalism into matters related to revival schemes and new investment proposals of the societies. To be headed by the Secretary, the Cooperation Department, the board will have senior government officials and two experts as members. The service of experts will be used to draft revival schemes.

The revival schemes will be cleared by a committee headed by the Minister for Cooperation.

SOURCE: The Hindu