DEVELOPMENT OF THE CO-OPERATIVE
MOVEMENT IN
JAMAICA
Historical Overview
The Co-operative
Movement in Jamaica, like in most developing
countries, had its origin in the peasantry.
Its growth and development can be traced back
to emancipation (1838) to the present time,
spanning a period of over 160 years.
The informal Co-operative efforts, which
characterized the period 1840 - 1938, had some
modicum of success; roads, schools and
churches were constructed. Farmers benefited
from group action in their agricultural
pursuits, and most importantly, a keen sense
of fraternity developed which augured well for
future efforts. This was the foundation on
which the more formal co-operative development
of the period 1938 to the present time was
built, and which saw the formation of
Co-operative organizations and the enactment
of Co-operative legislation.
In Jamaica there is a great need for improving
the economic and social conditions of the
masses through self-help. The Co-operative
Movement, which builds confidence and enhances
the dignity of people, and therefore the
nation, is one of the vehicles used for
achieving this improvement.
To date, although the Movement has not
achieved all it had hoped, a good deal has
been done to effect social and economic
changes within the Jamaican society.
The Role of Co-operatives in Social & Economic
Development, Particularly in Rural Areas
Traditionally, Jamaica's economy has had an
agricultural bias. It was not surprising,
therefore, that during the post war period,
developmental strategies were centered in the
rural areas. Two major problems faced the
agricultural community: the acquisition of
agricultural equipment, seeds and fertilizers
on one hand, and its inability to market its
produce on the other. Invariably production
was low.
Agricultural Co-operatives developed from
these areas of need. Farmers were then able to
procure their farming requisites and market
much of their crops through these
organizations. In addition, the introduction
of modern farming techniques was possible
through the Co-operatives.
As a result, the standard of living of the
rural communities increased. More persons
could send their children to school. The
hut-like habitats of the poorer folks were
improved, and farmers now had the ability to
save portions of their earnings in the Credit
Co-operatives that were rapidly developing at
the time. The way was now open for
agricultural Co-operatives to further enhance
the efforts of the peasantry.
Today, more than 100,000 persons are members
of 39 Agricultural Co-operatives, most of
which are in the rural areas. Efforts at
increasing the range of services to their
members are continuing. The emergence of
thrift and credit societies opened new
avenues, not only for farming communities, but
for the rest of the rural population as well.
Several persons went into small consumer
businesses, whilst others begun small-scale
industries.
More land was brought into production. The
burden was taken from the government health
care system as more persons could afford,
through inexpensive loans, medical expenses of
private physicians. The nutrition of the
peasantry improved. The availability of
capital opened new avenues of employment and
developed creativity in our people. It is true
to say that, among other things, the thrift
and credit societies assisted in stemming the
urban drift which threatened to place
additional pressure on the slum areas of the
city. Of significance too, is the fact that,
the commercial banking system relaxed its
stringent loan policy towards Co-operatives in
the face of the growing thrift and credit
societies.
Co-operatives have been playing and are expected to
continue to play a major role in the social
and economic development of the nation, and
rural communities in the following areas:
-
Foreign Exchange
Generation
-
Income
Generation
-
Employment
Creation
-
Import
Substitution
-
Representation
at the Local and National Level
-
Dissemination of
information
However,
Government and Political Representatives must
ensure that the appropriate business
environment, legislation and infrastructural
framework are created to facilitate the
successful establishment and development of
Co-operatives.
Participation of Peasants including Landless
Peasants as well as Women and Youth in
Co-operatives
Peasants in Co-operatives
Like other developing countries, Jamaica has a
very large percentage of small farmers on
plots of 1-5 acres of land. These make up the
bulk of rural farming communities. These small
farmers have no choice but to organise
themselves into Co-operatives in order to
survive.
In Jamaica, agriculture contributes greatly to
the Gross Domestic Product (G.D.P.); it is the
3rd greatest contributor to G.D.P. and its
contribution follows closely to that of
tourism and bauxite. Above all, agriculture is
the largest employer of labour and provides a
livelihood for approximately 200,000 persons.
It follows, therefore, that the Co-operative
Movement in Jamaica has a strong agricultural
base. Two main types of Agricultural
Co-operatives were established: :
Collective Production Co-operative
This type of organization began in l950 and
consisted mostly of landless farmers who were
assisted by Government to farm the land on a
Co-operative basis. Later, Land Lease Projects
were set up in different parts of Jamaica. The
objectives of these Land Lease Projects were
primarily to settle landless small farmers on
the land, to alleviate unemployment and to
boost productivity.
Individual Production Co-operative
The development of this type of Co-operative
organization emerged, and was seen to be more
successful than the collective production. It
was found that Jamaican farmers are
individualistic by nature, and produce more
individually on their small plots than farming
collectively.
Women in Co-Operatives
The active participation of Women in
co-operatives began during the seventies, as
prior to this period, women were only members
of Co-operatives, but they did not take any
active part in Co-operative organization. A
Women's Bureau was established to deal
specifically with women's affairs and its
objectives were:
-
To upgrade the
skills of unemployed women
-
To alleviate
unemployment amongst women
-
To train women
for gainful employment
-
To assist women
in Co-operative ventures
With these
objectives in mind, the Bureau, together with
the Department of Co-operatives and Friendly
Societies carried out a series of training
sessions in Co-operative Principles and
Practices involving a large number of women.
Co-operative Projects were then identified and
promoted, and women played an active role in
the development of Co-operative ventures, such
as the Women's Woodwork and Welding
Pre-Co-operative Groups, the Women’s Bankra
and the St. Peter Claver Women’s Housing
Co-operative.
Youth in Co-operatives
The emergence and participation of Youth in
Co-operatives took place also during the
period of the seventies when the State
established Pioneer Farms on idle or
unutilized lands all over Jamaica. The
objectives of these Pioneer Farms were to:
-
Settle the Youth
on the land
-
Provide gainful
employment for the Youth in agricultural
pursuits
-
To harness
Youthful talents and skills into productive
agriculture
-
To boost local
domestic agriculture.
These farms
consisted of Youth between the ages of l6-25,
selected mainly from depressed areas engaged
in farming on a collective basis. In the past
Co-operative Education has also been
introduced in Vocation, Youth and 4H Centres,
but apart from the Pioneer Farms and the
teaching of Co-operatives in Youth Training
Centres, no concentrated effort had been made
in involving the Youths in Co-operatives, and
one will find that the majority of
Co-operative members today are in the average
age group of 30 to 60 years, although
Co-operative membership is open to persons of
sixteen (16) years of age.
Nevertheless, presently there is a move a foot
to make Co-operatives a subject for the
Curriculum in schools, and it is hoped that
when this comes about more youths will be
attracted to join the Co-operative Movement. A
pilot project is being developed by the
Department of Co-operatives & Friendly
Societies with selected primary and secondary
schools. The College of Agriculture, Science
and Education (CASE) was also targeted for the
establishment of a Co-operative venture.
Another method being pursued by the Department
is the introduction of a Co-operative Essay
Competition in the High Schools though
Jamaica. To date the Credit Unions within
Jamaica and the Caribbean Region have been
supporting the effort though sponsorship.
Winning Students have visited Trinidad and
Tobago and St. Lucia, courtesy of Air Jamaica
and BWIA. Other corporate sponsors are Nestle
Jamaica; Interlinc Communications.
Ability of Co-Operatives to Increase Material
Welfare
There is no doubt that Co-operatives not only
in Jamaica, but in other parts of the world,
have played important roles in increasing the
material welfare of their members. Material
welfare as it relates to living standards and
total development of the individual is the
yardstick for measuring social progress, and
Co-operatives have certainly contributed to
this process of growth and development.
Several Third World Countries, including
Jamaica, saw Co-operatives as a vehicle for
social transformation, and used them to this
end.
Through co-operatives many small farmers and
fishermen have been able to earn a decent
livelihood for their families and themselves.
They have been able to sell their produce,
obtain credit, as well as other inputs
necessary for their well being.
Co-operative organizations have been providing
ready market for other crops, and with ready
cash they are able to purchase homes, and
other household items, thus improving their
standard of living. Successful Co-operatives
have been paying handsome dividends and
patronage refunds to their members, thus
encouraging them to trade with the
Co-operative at all times.
The Credit Unions in Jamaica have contributed
greatly to material welfare, in that the small
saver has been able to save and borrow at
reasonable rates of interest, and to use his
money to purchase homes, land and other
personal effects. Presently, there are 50
Credit Unions in Jamaica.
Inter Relationship Between Agrarian Reform &
Agricultural Co-Operatives
Jamaica, like many developing countries,
inherited a very bad system of land
distribution, and as a consequence of this,
they had to implement Agrarian Reform. As a
former British Colony, Jamaica’s system of
land tenure was skewed in favour of
plantocracy who occupied all the fertile lands
on the plains, whilst the small farmers had to
eke out a living from the, almost barren
hillsides, which they occupied.
This system of land tenure created tension and
unrest amongst small farmers, who were hungry
for lands. Shortly after Independence in 1962,
the State set up the Land Utilization
Commission, to monitor the use of idle lands,
and to implement the Agrarian Reform.
Thousands of acres of idle lands were brought
into production, and Agriculture once again
became the leading contributor to the Gross
Domestic Product. The Government later
acquired several large properties, and these
were allotted to small farmers on a freehold
basis.
In the period l972-8O, the Agrarian Reform
gained momentum. It was during this period
that project Land Lease was introduced and
several thousand acres of land were allotted
on a leasehold basis to small farmers. Under
this programme there were two (2) types of
Land Lease Projects:
The Collective
Land Project was that in which the farmers
worked on a collective basis on the property
allotted to them. Whilst on the Individual
Land Lease Projects the farmers were given
their own plots of land on which to farm.
In 1978 under the aegis of the Ministry of
Agriculture more properties were acquired for
allocation to the small farmers. It was during
this period that Pioneer Farms were introduced
and more available land put into production.
Jamaica's Agrarian Reform helped to make the
small farmers self-sufficient, and organized
them into Co-operative ventures.
Both the Land Lease Project and the Pioneer
Farms were products of the State’s Land Reform
Policy, and as such there was
inter-relationship between Agrarian Reform and
Co-operatives. Consequently the Department of
Co-operatives carried out a series of training
and development programmes on these Projects,
with a view to effecting this policy and
broaden the knowledge of said farmers on the
subject of Co-operation and Co-operative.
During the years 1974 – 80 the Department’s
Officers worked assiduously to set up
agricultural Co-operatives on these Projects,
but the shortage of staff hindered the
process.
Barriers to Establishing, Managing &
Maintaining Successful
Co-operatives
In establishing and developing Co-operatives,
many countries, especially developing
countries, experienced many and varied
difficulties. Some of these are as follows:
1. Lack of Proper Management
Committee Level
One of the major setbacks in establishing
Co-operatives is the lack of suitable
management. In most developing countries
leadership and managerial skills are not
easily available and the Co-operative Movement
is no exception. For a Co-operative to succeed
it is important that proper leadership be
identified from its inception. It is the
quality of leadership that is displayed at the
Committee or Board level, which determines the
success or failure of the Co-operative. If
suitable leadership can be identified from
amongst the membership then there could be
hope for the establishment of a successful
Co-operative.
In Jamaica, the lack of proper leadership,
especially amongst Agricultural Co-operatives
is among the principal reasons for their
failures. It is sometimes very difficult to
identify leaders at the grass-root level, and
even if this is done, one will find that the
same set of people dominate the rank and file
membership, and are returned to office year
after year. This is not good for the
Co-operative, owing to the fact that it is a
democratic institution, and a change of
leadership, is essential from time to time. To
overcome the problem of leadership in the
Jamaican context, the Department of
Co-operatives and Friendly Societies through
its Development Section carries out a period
of training for all Pre-Co-operative members
and during this training, potential leaders
are identified and also trained to run the
affairs of the business.
Training, therefore, is a continuous process,
and by so doing members are geared to take
over leadership roles in their Co-operatives,
and as such are able to run their business
successfully.
Administrative Level
Over the years Co-operatives have been
under-capitalized. Consequently, these
organizations cannot afford the employment of
suitably qualified managers and technical
personnel with the result that their
operations lack professionalism and forward
planning. Routine functions of accounting,
purchasing, etc., are left to unqualified
persons.
Few meaningful budgets are prepared.
Therefore, invariably, the Co-operative will
continue as small-scale enterprises. In
response to this need the Department of
Co-operatives has embarked on a number of
training to better equip persons in these
areas critical to the co-operative's
development. Formal courses have been held as
well as on the job training. In addition,
technical assistance were sought and obtained
in the form of experts, scholarships and
training aid from the United Kingdom, the ILO/DANIDA,
the Organization of American States (OAS),
Israel, Hungary, the former USSR and the
United States of America. Most of that
assistance has been directed towards raising
the level of management skills in Co-operative
Principles. However, there is still much more
to be done.
2. Lack of Adequate Financing
Traditionally, Co-operatives have developed
around persons of limited means who lacked the
financial strength to adequately capitalize
their organizations. Until recent years, the
commercial banking sector had no faith in the
Co-operative Movement, and credit from this
sector to Co-operatives was virtually
impossible. Government provided only minimal
assistance through its lending agencies.
As a consequence, only the Credit Union sector
of the Movement developed in any significant
manner; mainly because of the constant capital
injection resulting from the relationship
between personal loans and share capital held.
The positive effects of the constant
capitalization in this sector are easily seen
through efficient management, expanding
operations and increased services.
On the other hand Co-operatives without this
self-financing feature remained at low
operational levels. Members were not attracted
to these societies whose services were poor
and haphazard. Member participation waned in
the face of poor record keeping, delayed
audits and Annual Meetings, all of which
stemmed from the basic problem of inadequate
financing.
In addressing this problem, the Department has
been encouraging increased savings from
Co-operative members through seminars and
training courses. Additionally, Committees of
Management are advised to charge minimal cess
payments for goods and services provided to
members, which will in time build capital
contributions. The Credit Union sector too, is
being encouraged to provide soft loans to
weaker societies.
3. Poor Co-operative Integration
Co-operatives developed in isolation of each
other. In addition, this inability of some
Co-operative Federation and the APEX body to
galvanise the Producers and Services
Co-operatives into efficient and effective
business entities has retarded the development
of the Movement. As a result the stronger
societies were not willing to help the weak,
and the latter were left to the mercy of the
private sector to seek finance at exorbitant
interest rates and harsh terms of repayment.
The Department being cognizant of this factor
is working with the Movement to facilitate
this facet of the Co-operative Principles and
in the resuscitation of the Federations.
4. Government’s Policy
Co-operative Legislation and the Department of
Co-operatives have been put in place since
1950. New Regulations are being developed for
Credit Unions to be placed under the
monitoring authority of the Bank of Jamaica.
Consequently the revision of the Co-operative
Societies Act & Regulations has been delayed,
pending the completion of the Bank of Jamaica
Regulations for Credit Unions.
The role of the Department has also been
expanded to include Promotion and Development
of Co-operatives, Education and Training of
Members and Research into the factors
affecting Co-operative Development.
Under the Law, Co-operative Societies are
exempt from Stamp Duty and Income Tax, and
provision is made for inexpensive methods of
settling disputes. In all other respects
Co-operatives have to compete with the other
sectors of the economy. Consequently efforts
are being made to concentrate on developing
viable and efficient Co-operative enterprises
capable of holding their own in the
competitive global environment. This is
consistent with ILO member states approach
regarding promotion of Co-operatives.
5. Resistance to change
In the early stages of Co-operative
development a number of small societies were
fostered. With the growth and development of
businesses in the private sector these small
societies have proven uneconomical. The
Department has encouraged Amalgamation of
these small societies to ensure viability in
the dynamic global Market. In spite of the
obvious benefits to be derived, members of
Committees were reluctant to agree to
Amalgamation, as they were anxious to preserve
the independence of their own Co-operatives
and their social status gained through their
organizations. As a result of delaying the
Amalgamation process valuable time was lost
and some societies have been forced out of
existence.
The Department had considerable success with
the Credit Union sector of the Movement in
this area of change as the Jamaica
Co-operatives Credit Union League (JCCUL) and
the Credit Union Managers saw the need for
collaboration and in most instances embrace
the idea. However, the response has not been
as good with the Agricultural Sector, and this
has adversely affected the growth of these
societies. Efforts are still continuing to
have Agricultural Co-operatives amalgamated in
collaboration with several agencies involved
with their development.
6. Illiteracy
In order to reduce the high rate of
illiteracy, the Government of Jamaica
established a National Literacy Board, which
later became the JAMAL Foundation. It was
estimated that there were about ½ million
persons in Jamaica who could not read or
write, or whose level of literacy was very
low. Classes were therefore set up throughout
the island, and both voluntary and paid staff
were employed to implement and maintain the
programme.
Since the inception of the JAMAL Foundation,
thousands of persons, young and old have
benefited from it and illiteracy seems to be
on the decline. Despite this, however,
Co-operatives face the problem of dealing with
small farmers and peasants whose level of
literacy is still low, and as such run into
problems at the outset. In promoting
Co-operatives especially Agricultural
Co-operatives in the rural areas, the problem
of illiteracy still has to be overcome.
The low level of literacy amongst farmers,
fishermen and other categories of rural folk
usually frustrate the effort for Co-operative
development. Nevertheless, efforts to
alleviate illiteracy continues.
7. Lack Of Training Facilities
Training, undoubtedly, holds the key to
further and future development of the
Co-operative Movement. Jamaica, as a
developing country is hard-pressed to find the
required resources, which would enable the
establishment of meaningful on-going training
programmes.
Above all there is no training institution
through which the limited number of courses
can be held. This has severely affected the
regularity, quality and effectiveness of the
training offered by the Department of
Co-operatives. Smaller number of participants
has had to be considered for courses at the
convenience of the owners of the Training
Centers. Long range planning is therefore
challenging.
Notwithstanding, the Department has been
working and continues to work within the
limitations; and proceeds with training
courses in the field, on the job and in
available classroom space. In the past members
of Co-operative staff were offered
scholarships through technical assistance
programmes to Holland, Israel, Hungary,
Britain and the United States. The opening of
Eastern Europe has resulted in a significant
shift of foreign aid assistance from the
Developing Countries to that region, thereby
resulting in fewer scholarships for the
Co-operative Movement.
This, clearly, is not sufficient. However,
efforts are still being made to acquire proper
facilities of our own and to ensure that
appropriate training are given to personnel
within the Co-operative Movement.
