the cooperative movement in the philippines

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Lecture PresentationCooperative Development AuthorityDagupan Extension OfficeRegion IPhilippines


  • 1.20117,290,848members

2. Dr. Jose Rizal, hadorganized Agriculturalmarketing cooperativein Dapitan while onexile in 1896. 3. Cooperative Efforts (1906-1940) 1907 1915 Rural Rural CreditCreditGovernment BillActInitiated1938 19271919 CoopStrengthen MarketingGrant loansCooperatives Lawsto Credit PA 3425AssociationP.A. 3872sPA 3425 was Common Wealth Act 565amended by PA Gen, Basic3872 providedCooperative Lawincorporation ofFACOMA1940 4. Cooperative Efforts (1906-1940)1938 1940 Credit Union in CommonChurchGovernment ViganWealth Act 585Initiated Initiated CooperativeAct1941 National Cooperative Administratio n 5. Expansion of Cooperativism in thePhilippines (1950-1969) 1952 19521952RA No. 821 known as RA 821 RA 2023the AgriculturalCredit and CreditNon FarmersCooperativeAgriculturalGovernment CooperativeFinancing ActCooperativInitiatedMarketingelaw 19671963 PhilippinePhilippinesthe CodeIn 1969 (R.A National6389) Code ofof Agrarian Reform CooperativAgrarian ReformChurch e Bank Sponsored(Rep Act No. 6389d 6. Cooperative Under the 1973Constitution (1973-1986)n April 14, 1973 the President issued a decreeon "Strengthening the Cooperative MovementPD 175GovernmentInitiatedOn July 9, 1973 Implementation No. 23 by President Marcos which set forth the regulations for implementing the decree on Strengthening the Cooperative Movement Electric Cooperatives Under PD 269 Presidential Decree was issued in August 1973 creating the National Electrification Administration giving responsibility for administering a nationwide program of rural electrification thru non stock cooperatives and granting the power to "organize, register, supervise, and finance electric cooperatives." 7. Cooperative Under the 1973 Constitution 1973-1986Presidential Decree No. 775 On August 24, 1975decreed that sugar planters and or producerscooperatives shall be developed by the PhilippinesSugar Commission.GovernmentInitiated Transport Cooperatives under Executive Order No. 893 on October 19, 1973, A Commission on Transport Cooperatives to promote and supervise the development of transport cooperative to serve drivers of public vehicles 8. RA. No. 6938 The bill was passed and signed as law by President Aquino on March 10, 1990. A companion law was also passed creatingGovernment the Cooperative Development AuthorityInitiated (Rep. Act No. 6939) which provided for the abolition of BACOD and the transfer of its functions, qualified personnel and budget to the CDA. 9. RA 9520 Amended the Coop Code promulgated in 1990; Discussed in four (4) Congresses (starting the 11thGovernment Congress up to the 14th)Initiated spanning over ten (10) years; Approved by the Bicameral Committee on November 18,2008; Signed into law last February 17,2009 10. RA 9520 The Philippine Cooperative Codeof 2008 (Article1) Signed on February 17, 2009 Published on March 7, 2009 Effective March 22, 2009 11. the first cooperatives in the Philippines were the product of aseries of legislative measures. Cooperatives did not begin aspeoples movement. Neither did they evolve from peoplesinitiatives at mutual self-help and cooperation. There is,however, one instant in Philippine history where a cooperativewas formed ahead of the passage of the cooperative laws.That was the agriculturalmarketing cooperative which thenational hero, Dr. Jose Rizal, hadorganized in Dapitan while onexile in 1896. Nothing much isrecorded about the cooperative. Inmay be safe to assume that with theexecution of Dr. Rizal in the sameyear, the cooperative must havedied with him. 12. The law, patterned after theRaiffeinsen experience in Germany,The first legislation to attempted inpromoted the organization of ruralthe country was the Rural Credit credit cooperatives. Some 591 ruralCooperative Bill. It was credit associations were organized inintroduced in 1907 develop theamended in the same year and itsagricultural interest of small farmers. administration was given to theThe bill was passed by the Philippine Bureau of Agriculture. Thus beganlegislature in 1908. Unfortunately it the more active involvement of thewas disapproved by Philippine government in cooperative organizingCommission. It took another seven and supervision.years before the first cooperative lawin the Philippines; the Rural CreditAct (Act No. 2508) was passed in1915. 13. Three years after,in 1919, Act No. 2818 was enactedprimarily to grant loans to members of rural creditassociation. The P1 million fund appropriated for riceand corn production under the law spurred theorganization at the end of 1926 of 544 rural creditcooperatives in 42 provinces. Because the membersand the leaders have these cooperatives had notadequately imbibed the principles of cooperativism andbecause government wanted to short-circuit thecooperative principle of autonomy self-reliance andvoluntarism, not surprisingly, the cooperatives failedand the loans were never paid. 14. Thereafter, other legislative measures were enacted toaddress the particular needs of farmers. For instance, tosupport the marketing of farmers production, theCooperative Marketing Law (Act No. 3425) waspassed in 1927. The law gave the Bureau of Commerceand Industry the responsibility of organizing farmers intomarketing cooperative. Another law, Commonwealth ActNo.116, was enacted to provide loans to marketingcooperatives. By 1938, there were some 560 cooperativemarketing associations. Unfortunately, the cooperativesultimately turned out to be dismal failures due mainly tothe lack of education in cooperative principles not only ofthe members and leaders of the cooperatives themselvesbut also of the government which had impatiently pushedfor the adoption of cooperatives prematurely. 15. 1n 1938, an American minister of theChurch of Christ, Rev. Allen R.Huber, organized church membersin Vigan, Ilocos Sur into thecountrys first privately-initiatedcredit union. Significantly, thecooperative generate savingsinternally from among its members.The internally-generated savingsshowed that cooperatives need not bedependent upon government financialsupport to get started. 16. Inspired by the success of Vigancooperative, the Protestant Church inthe Ilocos region organized othercooperatives. Because of theachievements of church initiatedcooperatives, the government passedCommonwealth Act No. 287 in 1938to strengthen the cooperatives. Alsoin the same year, the privatelyorganized consumers cooperativeswere forged into the Consumers Leagueof the Philippines under government-sponsorship. 17. The governments active involvement inthe cooperative movement continuedunabated into the early 1940s. For,instance, in 1940, Commonwealth ActNo. 585, the Cooperative Act, waspassed. It provided for the organization ofall types of cooperatives; authorized theNational Trading Corporation (NTC) topromote and supervise cooperatives;establish the National Cooperative Fund(NCF) ; gave permission for theorganization of a cooperative of not lessthan 15 members; and grantedcooperatives exemption from governmenttaxes and fees for the first 5 years of theiroperation. 18. In 1941, the National CooperativeAdministration (NCA) wasestablished. The functions of NTCand the management of the NCF weretransferred to it. Cooperativesmultiplied under the NCA. Unfortunatelythe Second World War intervened inDecember of that year. There is, thus,no way to assess objectively how thosecooperatives qua cooperativesperformed 19. During the war, the cooperativemovement ceased to functioneffectively. Many cooperativesbecame inoperative. But after the war,cooperatives were once againorganized or reorganized to help inthe distribution of relief goods underthe supervision of the EmergencyControl Administration (ECA).More than 1,500 cooperatives wereenlisted in the relief distribution effortbut they folded up when there wereno more relief goods to distribute. 20. By 1947, the government revved up attempts toconsolidate its hold on the cooperative movement. Forinstance, the merchandising functions of the NCA overcooperatives were transferred to the PhilippineRelief and Trade Rehabilitation Administration(PRATRA). From that year up to the 1960s variousregulation shunted the responsibility to promote,organize an supervise cooperatives from one agencyto other. matters. 21. Executive Order No. 95, forexample, transferred thosepowers to the NationalCooperative and Small BusinessCorporation (NCSBC). Then, in1950, the NCSBC was abolished.In its place, the CooperativeAdministration Office (CAO)under the Department ofCommerce of Industry was createdto take change of cooperativematters 22. Thereafter, several other measures andcooperatives were enacted by government. Thegovernment, for instance, created the AgriculturalCredit and Cooperative Financing Administration(ACCFA) in Rep. Act No. 821, otherwise knownas the Agricultural Cooperative Law, the FarmersCooperative Marketing (FACOMA) wasorganized, financed by ACCFA and task toorganize, supervise and support the agriculturalcooperatives. Non-agricultural cooperativeshowever continued to be under supervision ofCAO. 23. The FACOMA law offered to farmers large scalegovernment financing with counterpart funding comingfrom the United States Agency for InternationalDevelopment (USAID) through various types of loanswithout any collateral. At the end of five years, 455FACOMAs had been organized with aggregate paid upcapital of over P5, 125,077 representing 259,029 farmers inabout 10,700 barangays in 50 provinces.The FACOMAs however, suffered fromthe problems of low repayment of loansand poor loan administration. About P500million FACOMA loans were not paid.Thus, the FACOMA experiment endedingloriously. The FACOMAs areconsidered a monumental failure of thecooperative movement in the country. 24. The FACOMA debacle taught cooperators that therewas a need to amend the existing laws on non-agricultural cooperatives and adopt a new law thatwould define more clearly the thrust of governmentinvolvement in cooperatives in genera


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