Cooperatives

Definitions and Scope

Target Community Asset: Cooperatives

Co-ops are democratically run for-profit entities where people voluntarily unite to achieve a common social or economic aim. Co-ops operate on principles of self-help and mutual assistance, and have social missions that benefit their members or society at large (Annual Report on the Co-operative Societies in Singapore (for Financial Year Ended 31 March 2017)).

"Cooperatives, owned by members, are not driven to make big profits for shareholders but to create the best value for its members and customers. Ownership is shared and decisions are made democratically" Dolly Goh, CEO of SNCF (ST 20 Jul 2015)

Types of Cooperatives

Consumer Cooperatives

Producer Cooperatives

Worker Cooperatives

Sanjay Perera, editor of Philosophers For Change, an online journal on alternative socioeconomic paradigms wrote an op-ed on Workers' Self-Directed Enterprises (ST 14 Feb 2015)

In Singapore, Co-ops are classified into three categories by the Registry:

1-Consumer and Services Co-ops

Consumer and services co-ops provide goods and non-financial services to their members while fulfilling social mission(s). These co-ops protect the economic interests of their members through their activities, such as providing employment opportunities, selling goods or supplying tailored services on a co-operative basis. The total assets held by 56 consumer and services co-ops amount to approximately $9,121 million

2-Credit Co-ops

Credit co-ops take in deposits from and give out loans to their members. They have a fiduciary duty to their members to exercise prudent oversight over their deposits. Currently, there are 24 credit co-ops of which 1 is under liquidation. The table below shows the key financial figures for the 23 credit co-ops in Singapore for the financial year ended 31 December 2016 / 31 March 2017

3-School Co-ops

The 4 school co-ops in Singapore provide students in secondary schools or junior colleges with bookshops and/or platforms to expose students to entrepreneurship through businesses. The total assets held by school co-ops amount to $800,000, with the largest school co-op holding $390,000 in total assets.

Number of Cooperatives

There were 1,468,900 members in 84 co-ops which hold $10,115 million in total assets as at 31 March 2017 (‘FYE2016’).(Annual Report on the Co-operative Societies in Singapore (for Financial Year Ended 31 March 2017))

Benefits of Cooperatives

"Football club FC Barcelona...is another example of how a cooperative - owned and run by 175,000 members who are mainly fans - has produced super results. The club...scores points by giving priority to youth development and fan welfare above financial gains. This is best exemplified by its cheap tickets. The average cost of an adult season ticket is just £75 (S$160), and the club pays a charity, Unicef, €1.5 million (S$2.2 million) a year to sponsor its own shirts. By comparison, top English clubs, such as Manchester United, receive £20 million a year in shirt sponsorship, while Arsenal charges at least £900 for a season ticket" Dolly Goh, CEO of SNCF (ST 20 Jul 2015)

"Credit cooperatives - which have gone through several financial crises unscathed as compared with larger financial institutions - offer the lowest unsecured loan interest rates of about 6 per cent to 8 per cent a year" Dolly Goh, CEO of SNCF (ST 20 Jul 2015)

Legislation and Regulations

Co-ops in Singapore are regulated by the Registry of Co-operative Societies, under the Co-operative Societies Act (Chapter 62) and Co-operative Societies Rules 2009.

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Need for high governance standards, especially of credit co-ops

Existing Resources

Code of Governance for credit co-ops issues on 17 Oct 2016, coupled by training on the Code

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Resource Directory

Government & National Association

Registry of Co-operative Societies (MCCY)

https://www.mccy.gov.sg/en/Topics/Charities/Articles/Cooperative_Societies.aspx

Dr Ang Hak Seng is Executive Director, Registry of Co-operative Societies

Central Co-operative Fund (CCF)

The CCF is used to further co-op education, training, research, audit and for the general development of the co-op movement in Singapore. It derives its income from co-op contributions.The Co-operative Societies Act requires co-ops to contribute 5% of the first $500,000 of their annual operating surplus to the Central Co-operative Fund (‘CCF’), and 20% of any operating surplus in excess of $500,000 to either the CCF or the Singapore Labour Foundation (‘SLF’).Annual Report 2017

Singapore National Co-operative Federation

http://www.sncf.coop/

Funded by CCF

Consumer Cooperatives

NTUC Cooperatives

NTUC Fairprice - groceries

NTUC Income - insurance

NTUC First Campus - preschools

In 1969, then Deputy Prime Minister Goh Keng Swee challenged the NTUC labour movement to set up cooperatives for workers that could compete with private enterprises. A year later, in 1970, it set up its first cooperative, NTUC Income, which made insurance within the reach of lower-wage workers. Next came FairPrice, which moderated the cost of essential goods. Dolly Goh, CEO of SNCF (ST 20 Jul 2015)

NUS Coop

https://nuscoop.nus.edu.sg/

Set up in 1969 by Student Liaison Officer because of the escalating prices of books and capital raised though selling membership shares to staff and students.