Amendments to the Co-operative Societies Act - IE - 23/12/22

Context:
Recently, responding to the demands by the Opposition, the Lok Sabha has referred the Multi-State Co-operative Societies (Amendment) Bill 2022 to a joint committee of Parliament.
The Bill is aimed at overhauling the Multi-State Cooperative Societies Act, 2002, which was enacted 20 years ago.
Relevance:
GS3;GS2
About:
-Cooperatives are organizations formed at the grassroots level by people to harness the power of collective bargaining in the marketplace.
-This can mean different kinds of arrangements, such as using a common resource or sharing capital, to derive a common gain that would otherwise be difficult for an individual producer to get.

->Jurisdiction:
-Cooperatives are a state subject under the Constitution, meaning they come under the state governments’ jurisdiction, but there are many societies whose members and areas of operation are spread across more than one state.
-Cooperatives of more than one state are registered under the Multi-State Co-operative Societies Act (MSCS) of 2002 Act.

->Need for Amendment:
-Since 2002, many changes have taken place in the field of cooperatives. At that time, Cooperation was a department under the Ministry of Agriculture. However, in July 2021, the government carved out a separate Cooperation Ministry.
-Part IXB was inserted in the Constitution via 97th Constitutional Amendment Act 2011. In view of the insertion of Part IXB, it has become imperative to amend the Act.

->Proposed Amendments:
i. Merger of Cooperatives
ii. Co-operative Election Authority
iii. Stricter Punishments
iv. Cooperative Ombudsman
v. Rehabilitation and Development Fund

->Criticisms of the Proposed Bill?
-The Opposition members in the Lok Sabha have argued that the bill seeks to “take away” state governments’ rights.
-Some of the objections are based on the fact that cooperative societies are a state subject. Entry 43 of the Union List (7th Schedule) makes it clear that co-operative societies do not come in the Centre’s domain.

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