The implementation of cooperative policy : perceptions from cooperatives in the Umgungundlovu District Municipality (KwaZulu-Natal, South Africa).

Abstract

The thesis explores the evolution of cooperative policies in South Africa and investigates the challenges experienced by cooperatives located in the uMgungundlovu District in KwaZulu-Natal, South Africa. The study adopted a cross-sectional qualitative design with twenty-six conveniently selected cooperatives. Representatives of the participating cooperatives were interviewed face-to-face using a semi-structured questionnaire. This generated detailed empirical data that elucidated the challenges facing cooperatives in the uMgungundlovu District. These cooperatives operated in rural, poverty-stricken, underdeveloped locations. The study found that a number of challenges including a lack of finance, access to inputs, land, transport, market, income, knowledge, and skills hindered the success of these cooperatives. Unfortunately, many of these cooperatives are small in terms of membership and employees. As a result, they have not led to employment creation or local economic development in the uMgungundlovu District. The study also found that a majority of the participant cooperatives in the uMgungundlovu District cannot survive without ongoing government support. The study concludes that the dependence of these cooperatives on government support makes them non-viable, unsustainable, and not conducive to local economic development. The thesis recommends that the government redefine its relationship with the cooperative sector by focusing on creating an environment that fosters the growth of cooperatives rather than being at the forefront of the formation and support of cooperatives. This thesis argues that the nature of government’s relationship with cooperatives is essential in changing how cooperators perceive cooperatives. It recommends changing the perception that cooperatives are a government development programme, or a means to access government funding. Government needs to make it clear that cooperatives are member-owned, self-sustaining business entities. Although the literature suggests that networking is central to successful cooperative activity, this research indicates that participant cooperatives from the uMgungundlovu District do not engage in any meaningful networking activities. In the uMgungundlovu District, it was found that cooperatives are not only dependent on government funding; they are not intent on establishing collaborative relationships with other cooperatives. On the contrary, they regard other cooperatives as rivals, competing for government grants and hence many do not trust or collaborate with other cooperatives. In addition, cooperatives are located in extremely poor and underdeveloped environments. The competition among cooperatives for access to funding is therefore high. Furthermore, networking with other cooperatives is difficult in the uMgungundlovu District for a number of reasons (namely, vast geographical distances between cooperatives; the competition for government tenders; the political and religious differences in the local community; and lack of experience and skills in governing cooperatives). The study proposes a renewed emphasis on educating and capacitating cooperatives to value and engage in productive networking activities. To facilitate cooperation among cooperatives, it is recommended that training and support offered to cooperatives is tailored towards emphasising the values and benefits of networks. This can be achieved through the provision of support to groups of cooperatives in order to create networking opportunities that will foster collaboration among cooperatives.