CM 102 (History of Cooperative Movements)

History of Cooperative Movements

Topics
- Robert Owen and Co-operative Movements
- Rochdale Society of Equitable Pioneers
- The Cooperative Movements in the Philippines

Robert Owen and Co-operative

As the owner of a cotton mill, Robert Owen was an early industrialist who envisioned a more humane way of
running factories, which he called cooperatives, as well as a system of education for worke rs.

Robert Owen and His Life’s Work

Owen and Beyond Textile Factory

New Lanark, Scotland and Factory Workers

- New Lanark, Scotland and Workers’ Well-being

Owen and New View of Society

- As early as 1802, some British politicians had advoca ted the sort of reforms on a national basis that
Owen tried to introduce in his factory, such as a limit on the length of the workday, a minimum age for
working long hours, and education for children (who often worked in factories as early as age six).
- BUT, Owen has a different view on how society be managed. He decided to appeal directly to the
public.

Rochdale Society of Equitable Pioneers

- The Society was established by workers and enlightened entrepreneurs since the
beginning of the nineteenth century.
- In 1844, the Rochdale Pioneers, 28 weavers and other artisans, set up their own
cooperative society, collected a capital of £1 sterling per member and started a
grocery shop.
- By 1850, membership had risen to 600, making the Rochdale Society the first
successful cooperative that survived for more than a few years.
- The Cooperative Group can be considered as the descendant of the Rochdale Society
of Equitable Pioneers.

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Accomplishments of Rochdale Society of Equitable Pioneers

- Blueprint for cooperatives worldwide.
- Formation of the International Co- operative Alliance (ICA).
- Affecting the lives of about 800 million people and increasing.

Cooperative Development Authority (CDA)

- ls a government agency created by virtue of RA No. 6939 in compliance with the provisions of Sec. 15, Article XII of the Philippine
Constitution of 1987 which mandates Congress to create an agency to promote the viability and growth of cooperatives as instruments
for equity, social justice, and economic development.
 CM 102 (History of Cooperative Movements)

- The CDA is governed by the Board of Administration consisting of a Chairman and six (6) members appointed by the President and
are chosen from among the nominees of the cooperative sector with two (2) representatives each from Luzon, Visayas, and Mindanao.

- They serve for a term of six (6) years without reappointment.

Questions:

1. List in chronological order steps taken by the Philippine government on cooperatives. (Ferrer, Cornelio M. (1956). The Cooperative
Movement in the Philippine. Philippine Sociological Review. Va.4, No. 1. pp. 33 36.)
2. How the first co-operative in the Philippines was established and eventually failed? {History of Cooperatives in the Philippines }
3. How Agricultural Credit and Cooperative Finance Administration (ACCFA) response to the needs of the expanding Philippine
agricultural production during the time of its development? (hart, D. {1955). The Philippine Cooperative Movement. Far Eastern
Survey, 24(2), 27-30. http://www. jstor.com/stable/3023947)

History of Cooperative Movements (Additional Points)

Early Co-operative Organizers: Rizal and Sandiko
Two known forerunners of Philippine cooperative movement are Jose Rizal and Terodoro Sandiko.
- Rizal’s idea came from his side trip to Sandakan, Borneo in 1892. However, it is Dapitan, during his exile, he was able to partially
implement his ideas in cooperative, for example put up a school for poor communities and a Society of Abaca Producers.
- Sandiko must have had close contact with the cooperate movement in Germany, Raifai-z. When he was appointed as one of the
governors when Civil Government was established, he introduced cooperative in the Philippines.
- After its first failed attempt, the Rural Credit bill was signed into law under RA 2508. When this Act was finally made into law, Gov.
Sandiko earned a title of Father of Cooperation in this country.

Steps to Philippine Co-operative movement

1915 Act 2508 was passed as the Rural Credit Law. Agricultural Credit Cooperative Associations were organized under
this Act.
October 18, 1916 Agricultural Credit Cooperative Association of Cabanatuan, Nueva Ecija was organized.
End of 1926 544 rural credit cooperatives organized in the 42 provinces

Failures are: After number 3:

1. mismanagement,
Instead of using the money borrowed for production
2. lack of proper leadership training, purposes, the borrowers spent it for fiestas, vices and
3. money borrowed was mis- used, luxuries,
4. defective securities,
5. politics, After number 8:
6. lack of trained personnel,
ACCFA organizers are sent to various provinces to
7. inadequate compensation for officers, and encourage farmers to form cooperatives;
8. inadequate supervision. unfortunately, most organizers are given too large an
area to manage effectively.

After Rural Credit Law (Act 2508)

December 9, 1927 Cooperative Marketing Law (RA 3425)
- Wherever rural credit associations were organized cooperative marketing societies were also designed to be organized.

1939 ONLY 164 cooperatives were organized with 5,000 organized farmers
ONLY 35% reported their sales of products to the Bureau of Commerce.

Failures are:
1. lack of sufficient working capital,
2. defective management,
3. inadequate marketing facilities, and
4. lack of understanding of the aims and true purpose of the movement.
5.

After Cooperative Marketing Law (RA 3425)

1939  Formation of the Consumers' Cooperative League of the Philippine (a private entity).

 Cooperative Law (Act No. 565) was passed.

1940  The National Cooperatives Administration (NCA) was created and changed to National Cooperatives
and Small Business Corporation.
 CM 102 (History of Cooperative Movements)
1953  The birth of the Agricultural Credit and Cooperative Financing Administration (ACCFA).

Agricultural Credit and Cooperative Financing Administration (ACCFA) & Pres. Magsaysay
- Expanding Philippine agricultural production by establishing an effective rural marketing organizations and credit facilities adjusted to
the small farmer’s needs.
- Agricultural Credit and Cooperative Financing Administration (ACCFA)
- During Ramon Magsaysay’s administration, his personal concern was a rural improvement that some leaders in his own political party
started to criticize his administration as neglecting other problems.
- He wants to expand Philippine agricultural production by establishing an effective rural marketing organizations and credit facilities
adjusted to the small farmer’s needs.
- This is to protect farmers from the unscrupulous moneylenders, landlords and alien middlemen. In response to these needs,
- Prior to ACCFA, 11 major attempts to establish cooperatives and other sources of agricultural credit for small farmers ended in failure.
So ACCFA should take the lessons from the failed co-ops and credit facilities

Agricultural Credit and Cooperative Financing Administration (ACCFA)

- It is an administrative agency to implement Republic Act 821.
o The Act shall encourage “the organization of farmers into effective cooperative associations under their own control for
greater unity of effort in
production, processing,
storage, and marketing, and
promote the establishment and
financing of farm marketing
system of producer – controlled
and producer-owned co-
operative associations.”
o Recognizing the socio-
economic challenges faced by
the farmers, and the economic
development plan of the
country for the farmers, the
Congress in 1952.
o This law established a system
of liberal credit which is specially designed to meet the needs of the smaller rice farmers to build strong rice producer’s
group in order to take away control of the cereals from Chinese and to assure the nation of a constrant, adequate supply at all
times.

To implement the great task of rural financing, four general and interrelated objectives of the law are set forth as follows:

Four Major Objectives

1. To assist small farmers in security liberal credit.
2. To promote the effective groupings of farmers into cooperative associations.
3. To establish an orderly and systematic marketing machinery for, and controlled by, the small farmers, and
4. To place agriculture on a basis of economic quality with other industries.

Operating Co-ops by Region (As of 2018)

Questions:
1. What is the purpose of setting up a cooperative?
2. How to organize a cooperative?
3. Given your answers on question #1, are those top 13 co-ops in the Philippines, achieved the
purpose of setting up a cooperative? Focus on one (1) co-op from the 13 top cooperatives.