Union Cabinet on Thursday approved a Bill to amend Multi-State Co-operative Societies Act, 2002. The Bill is likely to be tabled during the Parliament’s winter session.

A multi-state co-operative society serves the interests of members in more than one State. Presently, there are more than 1,500 such societies in India.

“The amendment will improve governance, reform electoral process, strengthen monitoring mechanism, improve composition of Board, enhance transparency and accountability, improve ease of doing business, increase financial discipline and enable raising of funds in multi-state cooperative societies,” a government official explained.

Revitalising sick societies

According to him, provision for issuance of non-voting shares would provide multi-State co-operative societies with a tool to raise requisite capital. Further, the newly proposed rehabilitation,reconstruction & development fund will help in revitalising sick multi-State co-operative societies. In addition to these, the provision for stipulating prudential norms will bring in financial discipline. The amendments relating to auditing mechanism will bring in more transparency and accountability.

The Bill will have provisions for setting up of Co-operative Election Authority, Cooperative Information Officer and Cooperative Ombudsman. This will facilitate governance of multi-State co-operative societies more democratic, transparent and accountable. The election authority will ensure fair, free and timely elections, which in turn will help reduce incidents of complaints and malpractices. 

Provision to debar electoral offenders for three years will bring in more electoral discipline. The Co-operative Ombudsman will provide for a mechanism for re-dressal of member grievances in a structured fashion. The provision of Co-operative Information Officer will enhance transparency by providing members timely access to information, said the official.

Inclusive of ST/SC

To promote equity and facilitate inclusiveness, provisions relating to representation of women and Scheduled Caste/Scheduled Tribe members on the board of multi-State co­ operative societies, have been included. Also, to promote professional management, provisions have been included for bringing in co­-opted directors with experience in the field of banking, management, cooperative management and finance or having specialisation in any field relating to the objectives and activities undertaken by such multi-State co-operative society.

Amendments have been proposed to enhance ease of doing business by reducing the period of registration with a provision for applicants to seek additional time of 2 months for rectification of mistakes. There will be provision for electronic submission and issuance of documents, thus providing for a comprehensive digital ecosystem for multi-State co-operative societies.

The Multi-State Co-operative Societies Act–2002 was enacted with a view to facilitate democratic functioning and autonomous working of multi-State co-operative societies in line with established co-operative principles. There is a felt need to amend the Act to bring it in line with the 97th Constitutional Amendment and strengthen the cooperative movement in the multi-State Cooperative societies sector, added the official.