The Rajya Sabha, the Upper House of Parliament, on Tuesday approved the Multi-State Cooperative Societies (Amendment) Bill 2023. This bill introduces significant amendments to the Multi-State Cooperative Societies (MSCS) Act. These modifications aim to enhance the transparency and accountability of these cooperatives’ operations and improve their governance structures.
The MSCS Act has not seen changes since 2002, making these updates a noteworthy development. The Lok Sabha previously approved the Bill.
India is home to approximately 1500 multi-state cooperative societies, with the majority located in Maharashtra. Credit societies constitute the majority of these multi-state cooperatives.
One of the key provisions in the amendments empowers the Central government to suspend a MSCS’s Board if it fails to meet within a prescribed time frame. It also establishes a process for the liquidation of such cooperatives.
In a bid to improve multi-state cooperative societies’ governance, the Bill includes specific provisions for the creation of a Cooperative Election Authority, Cooperative Information Officer, and a Cooperative Ombudsman.
The Election Authority will ensure that elections are conducted in a fair, free, and timely manner, potentially reducing the occurrence of complaints and malpractices. Furthermore, the Bill includes a provision to disqualify offenders from elections for three years, enhancing electoral discipline.
The Ombudsman will establish a structured system for member grievance redressal, while the cooperative information officers will improve transparency by providing members with timely access to information.
For ease of doing business, the amendment Bill proposes a reduction in the registration period. It allows applicants to seek an additional two months to rectify errors. The Bill also promotes a comprehensive digital ecosystem through the provision for electronic submission and issuance of documents.
The amendment introduces a provision for the issuance of non-voting shares in multi-state cooperative societies, aiding in fund-raising. Furthermore, it proposes the creation of a Rehabilitation, Reconstruction, and Development Fund designed to rejuvenate struggling cooperative societies.
The Bill also bans the appointment of related persons, further strengthening cooperative societies by enhancing transparency and implementing a system of regular elections.
Minister of State Cooperation B L Verma presented the Multi-State Cooperative Societies (Amendment) Bill, 2023 for consideration and passage in the Rajya Sabha.
In response to inquiries about the Bill, Verma asserted that it includes standards for employee appointments, effectively preventing nepotism. He emphasized that the cooperative sector’s progressive role is essential for India to achieve its target of becoming a 5-trillion-dollar economy.