Community Development Fund of Cooperatives

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The Philippine Cooperative Code of 2008 (RA 9520) requires all types of cooperatives to allocate their net surplus every year. Article 86 (3) of RA 9520 states” An amount for the community development fund, which shall not be less than three percentum (3%) of the net surplus. The community development fund shall be used for projects or activities that will benefit the community where the cooperative operates.”

Based on previous data generated from cooperative reports coupled with our readings on corporate social responsibility, I propose that the following areas of concern can be considered in the utilization of community development fund (CDF) and preparation of Social Development Plan by cooperatives. The changing environment requires every cooperative to be prepared and help sustain the growth and development of its host community in the following key result areas: 1) Health and Sanitation. Under this item cooperatives can partner with local and national government units and other stakeholders in the delivery of services to the community residents using part of its CDF as equity. Some cooperatives are already supporting medical and dental mission, feeding program, operation “tuli”, sponsorship of Phil health and financial health assistance to needy members and non-members of the cooperative. 2) Education. Some cooperatives sponsor scholarship of high school and college students including support to thesis and paper presentations. Also, support to school youth development through the acceptance of On the Job Training, creation of Laboratory Cooperative lead to exposure and training of the youth on financial literacy and cooperative management. In addition, school improvements (i.e. Brigada Eskwela), financial assistance to sports activities and encouragement of the public to join cooperatives through dialogue, fora, symposia and cooperative month celebration. Registration and operation of schools up to high school can also be undertaken by cooperatives. 3) Mutual Aid/Death Aid. Some cooperatives have built-in Death Aid or Mutual Aid Programs but for their members. As part of the social concern of every cooperative, an amount can be earmarked to support community residents during their time of sorrow. This allows the cooperative as institutions with a social responsibility to connect with non-members and promote stronger community relations. 4) Calamity Assistance. Disasters occur anytime and part of every cooperative need social preparations for any eventuality. A portion of the CDF should be earmarked to support disaster risk reduction management programs in partnership with local and national agencies and other stakeholders. 5) Environmental Concerns. The current situation in the country encourages cooperatives to take an active role in protecting the environment. Cooperatives need to set up funds to support watershed management, clean up drives, tree planting and solid waste management. Recent visits in some parts of Benguet provided us insights on the need for cooperatives to help local government units in protecting remaining forest covers from bush or forest fires. Ensuring protections of water bodies from pollution require help from the cooperatives as stewards of natural resources. 6) Support to Elderly, Persons with Disabilities, Solo Parents, Children, Gender and Development, Anti-Drug Campaign and Peace and Order. As part of the growing concern of every government, efforts of cooperatives to earmark funds and sustain operations to provide help to the aged, solo parents, children and persons with special needs. The need to support for a drug-free and peaceful community is also needed. 7) Infrastructure. Cooperatives that attained sufficient funds can earmark fund to support small physical infrastructure projects that support the community. Some cooperatives have supported communities in developing access roads, footpaths, waiting sheds, school improvements shelters for calamity victims and communication facilities. 8) Livelihood activities for non-members. Cooperatives can influence the community they serve through granting of livelihood assistance to non-members using its CDF. This practice can support small-scale entrepreneurs to engage in business through equity from the cooperative. 9. Others. Other key result areas may be included by cooperatives with the above areas of concern.

Finally, it is highly suggested that cooperatives prepare a Social Development Plan incorporating the above suggested key result areas. To ensure sustainability of the plan, crafting of cooperative policy to apportion CDF funds under each item is necessary.  Identification of Responsible Persons, Time-Frame and utilizing the available community development fund as initial budget can further enhance the realization of cooperatives as partners in nation-building. As cooperatives are considered business enterprises, there is a need to embrace realities that the only way to sustain operations is through preparedness from occurrence of disasters. Mitigating measures when carefully applied could reduce the possible impact of events be it in human lives or properties. Through the cooperative spirit, the burden can be shared by all members and the community. This makes life more meaningful as we journey in this beautiful world created by the Almighty.

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