CHAPTER ONE

INTRODUTION

1.1     Background of the Study

In order to get a clear picture of the subject matter it is imperative to defined cooperative. ICA Statement on the cooperative defines cooperative as an autonomous association of persons economic, social and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.

However, primary cooperative which is the subject matter is defined as a society which has as its object the promotion of the socio-economic interest of its members through a common enterprise managed in accordance with cooperative principles. A primary cooperative society must have at least ten individuals if it is an auxiliary cooperative and six persons if it is a productive or industrial cooperative. Each of these must have qualified for membership (NCSA, 1993).

Primary cooperatives are basically established to meet member’s social-economic need. The operations of primary societies permits the people who live in the same locality with the same goals and aspiration to go into synergy in order to actualize such goals collectively (Ijere, 1998).

The prospect of primary cooperative in promoting member’s economic welfare cannot be overemphasis sequel to the economic benefits arising from membership of primary societies: primary cooperatives in this regard pursue mutually beneficial, social and economic interest, provide goods and services to each other and the general public in the most cost effective way, prevent exploitation of the weaker members of the society by bringing them together to help themselves, protect the rights of the people as producers and consumers of goods and services, and promote mutual understanding and peaceful coexistence among the people of the community in which such primary cooperative is located.

The economic results of establishing primary societies arise out of the operation of a society that is jointly own through synergy and the gains of such enterprise is distributed in such manner as would avoid one member gaining at the expense of the others. Primary cooperatives have been recognised as a veritable instrument for the promotion of member economic welfare owing to its ability in mobilizing and organising people of the same economic and social aspiration into a common enterprise or primary societies therefore becomes very appropriate and suitable for improving the economic welfare of people through a common and collective enterprise that is people oriented (Okoh, 2003).

The prospect of primary cooperative in promoting members economic welfare cannot be overemphasis sequel to the economic benefits arising from being a member of such society. It is against this background that the researcher deemed the subject matter worthy of investigation.

1.2     Statement of the problem

Primary cooperatives have the potentials to boost the economic capacity of its members by mobilizing savings and granting soft loans to it members, providing other services as well as investment opportunities for its members (Okoh, 2003).

But inspite of this laudable prospect of primary cooperative in promoting member welfare, membership of primary cooperatives in the area of study is loe and insignificant, as such, doubt is expressed about the prospect of primary cooperative in promoting members welfare in the area understudy. This is so because if indeed  primary cooperatives promotes members welfae as opined by (Okoh, 2003) then why is the membership of primary cooperative low and insignificant and their impact vague and obscure in the study area? It is in this light that the subject matter of this research is seen as a problem worthy of investigation.

1.3     Objective of the study

The central objective of the study is to examine the prospect of primary cooperatives in promoting members welfare. The specific objectives are:

i.                   To identify how primary cooperatives promote member’s economic welfare.

ii.                 To findout how primary cooperative improves member’s social wellbeing.

iii.              To findout the functions of primary cooperatives.

iv.               To determine the type of practical welfare assistance primary cooperative render to their members.

v.                 To identify the problems militating against primary cooperative from promoting members welfare.

vi.               To proffer solution to the identified promote.

1.4     Research Questions

i.        How does primary cooperativespromotes member’s economic welfare?

ii.       How can primary cooperative be used to improve member’s social wellbeing.

          iii.      What are the functions of primary cooperatives.

          iv.      What type of practical welfare assistance does primary cooperatives

                   render to their members?

v.       What are the problems militating against primary cooperatives  in promoting members welfare?

          vi.      What are the soloutions to these problem?

1.5     Significance of the study

This study will be of great benefit to policy makers, cooperative societies, members of the general public as well as students and researchers.

          The study will aid policy framework regarding cooperatives development.

The study will also be useful to cooperative societies in creating cooperative awareness by showcasing the functions and benefits of primary societies to members and potential members.

To student and researchers, the study will serve as a springboard to undertake similar research. This is so because the study will be a useful reference material to students and researchers undertaking similar study. As such the study will add to already existing body of knowledge regarding primary cooperative societies.

1.6     Scope of the study

          The boundaries of this study is restricted to the period of investigation, the environment in which the research data were collected and the cooperatives societies investigated. The study covers the activities of synergy artisan cooperative society from 2010-2011. The research is limited to synergy artisan cooperative as regard the collection of primary data. The subject matter is restricted to the examination of the prospect of primary cooperative in promoting member’s welfare.

1.7     Clarificaton of Terminologies

Cooperative: This is an autonomous association of persons united voluntarily to meet their common, economic, social and cultural needs and aspiration through a jointly own and democratically controlled enterprise (I.C.A, 1995).

Primary Cooperative: This is a cooperative society which has as its object the promotion of the socio-economic interest of its members through a common enterprise managed in accordance with cooperative principles. A primary cooperative society must have at least ten individuals if it  is an auxiliary cooperative and six persons if it is a productive or industrial cooperative (Ishyaku 2010).

Cooperative Union: This is the association of affliation of registered cooperative societies in every state or a particular geographical area.

Cooperative failure: This refers to a situation when cooperative societies cease to actualise or practice cooperative values as enshined in it principles (Isyaku, 2010).

Cooperative Nexus: This refers to the functional relationship and inter-linkages between the cooperative organisation and member’s private business enterprise (Chukun, 1995).

Mutuals: A term used to describe businesses owned and controlled by their members. This includes building societies, cooperatives, credit unions, friendly societies and many associations (operational definition, 2011).

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