Government Influence On Co-operative Officialization Problems And Prospect (a Study Of Enugu North Local Government Area)

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In this research work titled “Government Influence on co-Operative Officialization Problems and Prospect with a particular reference in Enugu North Local Government Area” the researcher examine the extent to which government supports and promotion can lead to officialization. Identify the possible measure to reduce the degree of government influence on co-operatives. Examine the ability of co-operative members in managing their society.  Data for the study was sourced from two main sources which include Primary and Secondary sources of data Collection. Primary data: questionnaires and oral interviews were used to collect information from the respondents. Secondary data: journals, and other relevant materials relating to the area of my investigation were reviewed.  Research instrument used in this study includes oral interview and questionnaire. The questionnaire is structural as to contain both close and open ended question. Simple tables and percentages were used in treatment of data. Chi-square was used in testing the hypotheses.  At the end the researcher found out that independent co-operative also have problems which include antagonism from government therefore it's advised that co-operative should not enter into competition with government because of their independent with government because of their independent and autonomous nature. This will no doubt bring about tremendous positive change to co-operative societies in Enugu North Local Government Area and Nigeria as a whole. Based on the findings the researcher hereby recommends that co-operative should come out with a well-formulated policy which will clearly define it's dealings with third parties, outlining the reasonable amount of loan which it can borrow and in due time repay and fix a limit to which they will accept grants from government and other institutions. Co-operatives should appropriate a reasonable percentage of net surplus to education fund which will amount to a reasonable sum that will enable them conduct seminars and workshops for the members to make them competent of the required skills of co-operation.



Title page                                                                         ii

Approval page                                                                  iii

Dedication                                                                       iv

Acknowledgment                                                             v

Abstract                                                                           vii

Table of contents                                                             viii


1.0   Introduction                                                          

1.1   Background of the Study                                                 1

1.2   Statement of the Problem                                                7

1.3   Objective of the Study                                              8

1.4   Research Questions                                                         9

1.5   Research Hypothesis                                                       9

1.6   Significance of the Study                                                 11

1.7   Scope of the Study                                                   12   

1.8   Limitations of the Study                                          12

1.9   Definition of Terms                                                  13

References                                                               9


2.0   Review of Related Literature

2.1      Introduction                                                             14

2.2      Conceptual Framework                                            15   

2.2.1Concept of Co-operative and Co-operation      15   

2.2.2Function of co-operatives in connection with

Development                                                    17

2.2.3Importance of co-operation Members               18

2.3      Review of Co-operative Autonomy and

Independence                                                          19

2.4      Nigerian experience of Co-operative                         21

2.5      Relationship between Government and

Co-operatives                                                           24

2.6      Officialization of Co-operatives                                26

2.6.1Indirect/partial officialization                          27

2.6.2Direct/full officialization                                  28

2.7      De-officialization of Co-operatives                            30

2.8      Gap in Literature                                                     32

2.9      Empirical Studies                                                    34

2.10  Theoretical Framework                                            38

References                                                               47


3.0   Research Design And Methodology

3.1   Research Design                                                      49

3.2   Area of Study                                                           50

3.3   Population of the Study                                           52

3.4   Sample and Sampling Techniques                           53

3.5   Sources of Data Collection                                       56

3.6   Instrument Used for Data Collection                                56

3.7   Test for Reliability of Research Instrument              58

3.8   Test for Validity of the Instrument                           58

References                                                               59


4.0      Data Presentation, Analysis And Discussion of Result

4.1   Data Presentation                                                    60

4.2   Analysis of Data                                                       62

4.3   Analysis with Respect to Research                           50

4.4   Discussion of Findings                                            68


5.0 Summary of Finding, Conclusion and Recommendation

5.1   Summary Finding                                                    73

5.2   Recommendation                                                     75

5.3   Conclusion                                                              77           Bibliography                                                                79

Appendix                                                                         81




1.1 Background Of The Study

A Co-operative society is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically controlled enterprise (lCA 1995).

Obodoechi (2011:29) quoting Berko (1978:12) Co-operative is a voluntary and democratic association of persons with variable membership and variable capital whose members pooled themselves and their resources together on mutual and self help resources together on mutual and self help basis to form a business enterprise which seeks to solve the socio-economic problems of these members by directly providing goods and services to them in their capacity as either the owner/customer or owner-employees of the co- operative enterprise.

From the above definitions, it can be pin-painted that co- operative is a self help organization (S.H.O) and non- governmental organization (N.G.O) which is run on the basis of democratic management. This project will place emphasis on the nongovernmental identity of co-operatives which means that co-operatives should be free from governmental control, influence and management which complements its autonomy. This reflects the principle of autonomy and independence of co-operatives.

According to Ebue (2006:52) Co-operative are autonomous self help organizations controlled by their members and if they enter into agreement with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy. Co- operatives were not supposed to be under government influence and control. Though co-operatives were not supposed to work in isolation or in competition with government for in all state of the world appointed power is exercised for the state by government. Government provides security for lives and property; the governments also provide and enact laws which enable business and co-operatives to flourish. Obodechi (2011:97). The problem is that government fails to recognize co-operatives as independent tools of economic and social development, rather government recognize them as a direct instrument for implementing various programmes projects and other developmental polices initiated by the state. In extreme case, co-operatives are being used by government and state authorities as well as development institutions as agencies in the country side. Hanel (i981: 135). For government to recognize co-operative as this, it means that they take them as their parastatal. Co-operatives in Nigeria have been officialized from the onset due to the report from Mr. Strickland in the year 1934. Which he enunciated that government should:

1.     Use co-operatives as a poverty alleviation programme.

2.     Government should establish co-operatives.

3.     Government should sponsor co-operatives and

4.     Government should control co-operatives.

Due to these recommendations government have wrong view of co-operative. According to him, members of co- operatives no longer form co-operative to assist their members but to enjoy promotion and fund from government.

Therefore co-operative theorist are writing and making efforts to bring out co-operatives from the control of government (deofficialization). Due to the fact that co-operatives have neglected their autonomous identity depending on government for fund, following them sheepishly so that they will help provide finance, without knowing that the higher government assistance, the higher their controlling power over them and the higher their control, the lower their autonomy, the higher the chances of officialization.

Though co-operatives are not totally free from government interference as earlier stated because of it's regulation, Efforts have been made to buttress the issue. According to Obodechi (2011: 101-102),. The Nigerian co-operative societies Decree NCSD (1993) gives the director of co-operatives wide and far reaching powers which include:

i.            To register co-operative societies

ii.          To approve bye-laws of the societies and the amendment thereto.

iii.        To have access to all the books accounts, papers and securities of a registered society and inspect it's activities.

iv.         To approve the investments of co-operative funds upon all these good provisions, Co-operatives are still suffering from government stifling control leading to over dependence of government handout.

Therefore, this research will focus on placing government control

(officialization)         and co-operative     autonomy (deofficialization) side by side, comparing their effects on the overall performance of co-operative generally in other to help shape the degree of dependence on government for fund by co-operatives and also insight on how to encourage co-operative independence and autonomy.


1.2 Statement Of Problem

Government inability to recognize co-operative as an independent tool for economic and social development is what give rise to their stifling control on co-operatives. This makes it hard in getting co-operative autonomy.

Government should not see co-operative as it's parastatal, it does not mean that co-operative should work outside government regulation. This reflects Dr. Kings believes, that a right type of government must exist to assist co-operatives before it can flourish, Ebue, (2011:39).

Therefore this research will be faced with the problem of analyzing the effect of officialization (over-interference and control of Co-operatives by government) with special attention on the extent to which government support and promotion can lead to officialization. The researcher will investigate how government interference on the establishment and running of co-operatives affects the operations of these societies. Which results to politicization of co-operative post which is the problem of this study.

1.3 Objectives Of The Study

The general objective of this study is to examine the impact of government control on co-operatives, and analyze its effect on co- operatives in Enugu North L.G.A. The study also have these specific objectives.

1.     To examine the extent to which government supports and promotion can lead to officialization.

2.     To identify the possible measure to reduce the degree of government influence on co-operatives.

3.     To examine the ability of co-operative members in managing their society.

4.     To identify the problems of co-operative being independent.

5.     Identify the ways to solve the problems based on findings.

1.4 Research Questions

This study will give answer to the following questions

1.     What is the extent to which government's support and promotions can lead to officialization?

2.     What are the possible measures to reduce the degree of government influence on co-operatives?

3.     How can co-operative members develop the ability to run their co-operatives on their own?

4.     How can the problems of officialization be solved? 

1.5 Statement Of Hypotheses

The researcher hereby formulates the following hypotheses from the research questions;



Hypothesis one

H0:   Government's support and promotions can lead to greater extent of officialization.

H1: Government's support and promotions cannot lead to greater extent of officialization.

Hypothesis Two

H0:   There are no possible measures to reduce the degree of government influence on co-operatives.

H1: There are no possible measures to reduce the degree of government influence on co-operatives.

Hypothesis Three

H0:   There is possibility that co-operatives members can develop the ability to run their co-operatives on their own.

H1: There is not possibility that co-operative members can develop the ability to run their co-operatives on their own.


Hypothesis Four

H0:   The problems of officialization can be solved through the removal of government's undue influence on co-operatives.

H1: The problems of officialization cannot be solved through the removal of government's undue influence on co-operatives.

1.6 Significant Of Study

Significant of any human endeavor is measured by it's relevance           to solving human problems. This research will be beneficial to the following.

1.  The Researcher: it may help to broaden his mind and develop his investigation skills, also it will make it possible for the researcher to be awarded Bachelor of Science degree certificate.

2.  Government: it may help to enlighten government on their policy making and also minimize the level of their interference.

3.  To co-operatives: Especially in Enugu North L.G.A. It will help them to always be meticulous in their dealing with external bodies (government and other institutions).

1.7 Scope Of The Study

The coverage of this study will be Enugu North L.G.A. in Enugu state due to the wide range or vast nature of Nigeria.

1.8 Limitation Of The Study

In effort to carrying out this research, the researcher was faced with the problems of time, finance and visitation of the people in the area of study (Enugu North LGA). The researcher being student have issues that can consume his time and finance. Lg. attendance to lecturers, class assignment ads seminars, including other school activities. She faced other problems such as distribution and collection of questionnaires from the people in the area of study. At last all the challenges were surmounted and successful researcher was made.

1.9 Definition Of Terms

vCo-operatives: Autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically enterprise (leA 1995).

vAutonomy: The right of group to govern it self or organize it's own activities.

vOfficialization: The control of co-operative societies by government.

vGovernment Influence: The power of government to have an effect on people or things and on co-operatives.

vDeofficialization: The control of co-operative activities by co-operative members.



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Government Influence On Co-operative Officialization Problems And Prospect