Chairperson, the concept of co-operatives was first established by the then Chief Minister of KwaZulu, the hon Prince and Dr M G Buthelezi, to encourage self-help and self-reliance through co-operatives to enable people to help and rely on themselves. In this era, it was important that those who were oppressed were empowered and enabled.
Co-operatives' registration started in KwaZulu, the first being in Mpumalanga township and from there in Nongoma and Pongola. The co- operatives assisted people in creating their own business opportunities. Other co-operatives that were launched are Phambili Ntuthuko Community Development Co-operative in Eshowe, where the hon Prince Buthelezi encouraged people to stand up and do things to develop themselves. The visionary leadership of hon Buthelezi pioneered the concept of co- operatives and savings clubs among women, the youth and rural communities.
During the political transition period, these initiatives started deteriorating due to politicisation and lack of support for co-operative initiatives. It became a good success, but because of lack of funds, some did not survive. Even now, the IFP has employed Prof Okoye, an expert on co- operatives, to assist our citizens with registration and funding of co- operatives.
There are many challenges that face co-operatives. Firstly, lack of an enabling environment for co-operatives to thrive. The government has left co-operatives to compete with already established commercial businesses, thereby stifling their development. There is a need for an enabling environment in terms of one, special concessions on tariffs; two, exemptions from some taxes; and three, creating a special taxation regime for co-operatives.
Secondly, co-operatives have been lumped together with black economic empowerment, BEE, and small, medium and micro enterprise, SMME, environments. This does not allow co-operatives to thrive as economic entities.
The third challenge is that the government has allowed cheap goods, mainly from China, to flood the market and they have penetrated even in rural communities. This has killed local entrepreneurship, including co- operatives.
The fourth is that there are too many players in the co-operative field and this gives rise to a lack of co-ordination. Sometimes there is duplication of rules of government agencies, departments and even local governments, including municipalities. The fifth is that comprehensive support programmes for co-operatives with definable features, goals and objectives is lacking. This is essential so that the development of co-operatives can be measured.
The sixth is the lack of an organisational structure for co-operatives, starting with a director of co-operatives at national level, coming down to provincial and district levels.
The seventh is that support for co-operatives has sometimes been politicised to the extent that it is perceived that the government has poured money into co-operatives for political gain, which shows that support for co-operatives is superficial and not properly co-ordinated, and thus not to be taken seriously. I thank you.