Speech by Minister Sherlock T.D. at the Co-operative Alliance Conference: Co-operatives Building a Sustainable Future
15th May 2012
Check Against Delivery
It is with great pleasure I am here today to open the Co-operative Alliance Conference during the United Nations International Year of Co-operative Societies.
I would like to take this opportunity to congratulate the Irish co-operative sector for their success to date and their durability and endurance as a sustainable business model not just in Ireland, but internationally.
Co-operative societies have been an integral part of the economic and social scene in Ireland for over a century.
Co-operative societies have contributed significantly to the Irish economy helping to shape Irish business models and enterprises.
The co-operative sector in Ireland accounts for about 12 billion euro in annual turnover, and employs approximately 38,000 globally, including around 12,000 people in Ireland.
Such figures are indicative of co-operatives achievements and the positive impact they have had on the Irish economy. I have no doubt this will continue for many years to come.
Commitment in the Programme for Government & Action Plan for Jobs 2012
The Government is committed to encouraging and developing sustainable business enterprises which includes those in the co-operative sector.
The Programme for Government gives a clear commitment to promoting “a greater appreciation of the co-operative model as a distinct form of organisation, ensure a level playing field between co-operatives and the other legal options for structuring enterprise activities, and provide a constructive framework for the full potential of the co-operative model to be realised...”.
In addition to this, the Government gave a further commitment in the Action Plan for Jobs this year (6.12) to introduce legislation aimed at easing the regulatory burden on co‐operative societies helping ensure that the co-operative model can thrive and grow to its potential.
Legislative Reform - Industrial and Provident Societies Acts (1893-1978)
My Department’s particular responsibility lies in the legislative provision for co-operatives in general.
The Industrial and Provident Societies Acts (1893-1978) cater generally for “co-operative” organisations pursuing a wide range of economic or business activities.
While the Industrial and Provident Societies Acts have served the co-operative sector well over the years, they are for the most part 19th century- not only in origin but in content- and are in need of a comprehensive review.
As a first step in the review process my Department initiated a public consultation in April 2009 to identify any practical difficulties that co-operatives have with the Industrial and Provident Societies Acts and what action should be taken to deal with them.
This consultation process led the Government to the conclusion that a number of regularity improvements should be introduced as an interim measure which would facilitate the continuing growth and the development of the co-operative sector.
In June last year my colleague, Minister Bruton secured government approval to draft the necessary legislation.
The proposed legislation will make a number of amendments, including:
- Easing the financial reporting restrictions by extending the period for the preparation and submission of the annual return and accounts to the Registrar of Friendly Societies
- Abolishing the statutory limit on individual shareholdings in societies and the related triennial return of shareholders to the Registrar of Friendly Societies:
- Making available to societies the examinership process of the Companies Acts
- Making it easier for cancelled societies to be restored to the register, and
- Easing fund-raising restrictions for non-agricultural societies.
These proposals will make it easier to start up and run a co-operative as an alternative form of enterprise organisation.
The Government hopes to publish this Draft Bill during 2012 and I expect that the planned amendments will make the co-operative model more attractive for those wishing to use it.
Administrative Burden Reduction
The Industrial and Provident Societies Acts form part of the Irish business regulatory system.
The Government is committed to reducing administrative burdens on business, imposed by domestic regulation, by 25% by the end of 2012.
There is a particular focus on the reduction of regulatory burdens and costs imposed on small firms and enterprises. Most co-operatives fall within this category.
The proposed legislation forms part of this wider drive for better business regulation generally. This should contribute towards creating a better business environment for co-operatives.
By introducing these legislative changes for co-operatives, the Government is recognising the value of the co-operative business model to our economy, particularly at the present time.
The primary objective of these legislative changes is to provide a regulatory environment that is supportive of the co-operative movement and of its capacity to contribute to economic and social well-being into the future.
This legislation will facilitate the development of co-operatives and is particularly welcome in this the International Year of Co-operatives.
Wider Review of Co-operative Legislation
The wider comprehensive review of the Industrial and Provident Societies Acts, which I mentioned earlier, is a substantial and complex undertaking and will take some time to complete.
Work on this review is dependent to an extent on progress made on the finalisation and enactment of the new Companies Bill.
As many of you know the Companies Acts are themselves the subject of a major modernisation and consolidation project.
Since much of the content of the new Companies legislation will be directly relevant to any new legislative arrangements for co-operatives, it is important that the review of the co-operative legislation takes full account of it.
I wish to congratulate the co-operative sector in Ireland for their important contribution to economic growth and social wellbeing.
The International Year of Co-operatives provides us with the opportunity to celebrate the sector, acknowledge their contribution thus far and work together to ensure that the co-operative sector is part of Ireland’s economic regrowth.
The establishment of new indigenous co-operative businesses has an important role to play in the regrowth of our economy.
There are opportunities for development and expansion by co-operatives that are market focussed, well governed and strategic in their business development ambitions.
I would like to welcome initiatives for the creation of new co-operative enterprises like the one pioneered by ICOS, developing a ‘Co-operative Start-Up Guide’ to assist the establishment of new co-operatives, which was launched by my colleague, the Minister for Agriculture, Marine and Food, Simon Coveney.
The co-operative model is and continues to be a sustainable business model and I am delighted to open this event, promoting the co-operative agenda.
I believe that the co-operative model has significant potential for growth and to contribute to the economic regrowth of this country.
I wish to commend the Co-operative Alliance Ireland for organising this event today, providing participants with the opportunity to discuss co-operative development in Ireland, learn from global experiences and to discuss the way forward for the co-operative movement.
I am sure it will lead to some interesting discussions and I wish you every success with your deliberations today.
Last modified: 15/05/2012