News Highlight
The Union Cabinet on Wednesday approved the Multi-State Co-operative Societies (Amendment) Bill.
The bill seeks to enhance transparency and accountability and improve the ease of doing business, among others.
What is the Act, and what are multi state cooperative societies?
- Cooperatives are a state subject, but there are many societies such as those for sugar and milk, banks, milk unions etc whose members and areas of operation are spread across more than one state.
- The Multistate cooperative societies act was passed to govern such cooperatives.
- For example, most sugar mills along the districts on the Karnataka-Maharashtra border procure cane from both states.
- They draw their membership from both states, and they are thus registered under the MSCS Act.
- Their board of directors has representation from all states they operate in.
- Administrative and financial control of these societies is with the central registrar, with the law making it clear that no state government official can wield any control over them.
Need for the Amendment
- Absence of checks and balances
- The system for state-registered societies includes checks and balances at multiple layers to ensure transparency in the process.
- For state-registered societies, financial and administrative control rests with state registrars who exercise it through district and tehsil-level officers.
- These layers do not exist in the case of multi-state societies.
- For multi-state cooperatives, the 2022 act provides exclusive control to the Central Registrar, who is also the Central Cooperative Commissioner.
- Lack of day-to-day government control
- Unlike state cooperatives, which must submit multiple reports to the state registrar, multistate cooperatives are not required to.
- The Central Registrar can grant inspection of societies only under special conditions.
- Lack of infrastructure for the Central Registrar
- There are no officers or offices at the state level, with most work being carried out either online or through correspondence.
Provisions of the Amendment bill
- Improving the governance of multi-State Cooperative societies
- Provisions for setting up of cooperative election authority, cooperative information officer, cooperative ombudsman, etc, have been proposed in order to make the governance of multi-state cooperative societies more democratic, transparent and accountable
- Incorporates the provisions of the 97th Constitutional Amendment
- It dealt with issues related to the effective management of cooperative societies in the country.
- It had amended Article 19(1)(c) to protect the cooperatives and inserted Article 43 B and Part IX B relating to them.
- Debarring offenders
- The proposed Bill will have a provision to debar offenders for three years and will bring in more “electoral discipline”.
- Redressal and grievances mechanism
- The cooperative ombudsman will set up a mechanism for the redress of member grievances “in a structured fashion”
- Promotes equity and inclusiveness
- Provisions related to the representation of women and SC/ST members on the board of multi-State co-operative societies have been included.
- Promotes professional management
- Provisions have been included for bringing in co-opted directors with experience in banking, management, cooperative management etc.
- Enhances ease of doing business
- The bill has provisions to reduce the period for registration with a provision for the applicants to seek additional 2 months to rectify mistakes.
Content Source: Indian Express