There is no denying that co-operative sector in the state is ailing, as many co-operative banks are running into losses and the registrar has been reduced to merely making suggestions with having little or no power over these banks.
Panaji
Given such a sorry state of affairs, chief minister, Manohar Parrikar’s budget announcement, wherein he proposed to enforce accountability on the co-operative sector through strict measures and by also holding the directors responsible for misfeasance seems to be on the right direction.
But, the big question is - How will Parrikar do it? Consider the case of Goa State Cooperative Bank (GSCB), which by Parrikar’s own admission is in bad shape. The registrar of co-operative societies, which is the regulator for this sector, had earlier written to the state government recommending that the GSCB should reduce the size of its board.
GSCB rejected the suggestion of the registrar and kept the size of board of directors what it was. Clearly, registrar’s suggestion didn’t find much audience with GSCB. Unless the registrar is given powers to regulate the co-operative sector in true spirit, how is it possible to make the sector more accountable?
What is worrisome is also that GSCB has been making losses. The bank was saddled with accumulated losses to the tune of ` 53 crores as on March 31, 2016. GSCB isn’t the only co-operative bank facing trouble.
Parrikar further said that whatever bitter medicine required shall be administered to prevent further deterioration of GSCB’s health. He has also made a provision of ` 20 crores for GSCB in his budget.
Chandrakant ‘Babu’ Kavalekar, Leader of Opposition and Quepem Congress MLA, said, “The allocation of ` 20 crores to Goa State Cooperative Bank is far from being ‘bitter medicine’ and it is yet another ‘package’ from the government to placate some dissatisfied elements. Political interference in cooperative banking sector is a long-standing issue. But, the allocation of huge capital sums to cooperative banks is hardly aimed at meeting the issue of political interference head on.”
He continued, “If the government’s intentions were honest, it would have instead focused on administrative reforms instead of financial allocations to allow for structural independence. For instance, experts from this field should be appointed to head these banks and as directors and these appointments should be transparent.”
Clearly, the fear is GSCB may not be transparent and professional if government infuses ` 20 crore in it. A source, on the condition of anonymity, said, “As of now, there is no funding from the state government to co-operative banks in the state. This helps in limiting political intervention in co-operative banks.”
In the recent past, there was an attempt to make co-operative sector more transparent, but the government subsequently took a U-turn to it. Few years ago, an amendment was passed by the government, which said that no person shall be allowed to be chairman or office bearer of co-operative societies for more than ten consecutive years.
This was to ensure that the co-operative sector doesn’t remain in the control of same set of people forever. But, the state government later took a U-turn and passed another amendment as per which people are allowed to be chairman or officer bearer of co-operative societies for more than ten consecutive years as well.
As of now, there is resistance in the system to reform the co-operative sector.
