“Proposed Localized Implementation Policy of Cooperative (LIPC)

In Barangay San Gregorio”

A Policy Paper Presented to the

Panel of Oral Examiners of the College of Public Administration
TANAUAN CITY COLLEGE

In Partial Fulfillment of the Requirements for the

Degree of Bachelor of Public Administration
 CHAPTER I
AREAS OF CONSIDERATION AND SOURCE OF
BACKGROUND

A. INTRODUCTION

A cooperative is an autonomous association of persons united voluntarily to meet their

common economic, social, and cultural needs and aspirations through a jointly owned and
democratically controlled enterprise as defined by International Cooperative Alliance (ICA).
The International Cooperative Alliance is an independent non-governmental organization
which unites represents and serves co-operative organizations in the world. The Alliance
was founded in London in 1895. The Alliance members are national and international
cooperative organizations in all sectors of activity including agriculture, banking, credit and
saving, industry, insurance, fishing, social housing, health, public services, consumer
services and tourism. There are 310 member organizations from 107 countries that
represent nearly 1,000 million individuals worldwide.

In 1946 the Alliance was the first non-governmental organization to be accorded

consultative status with the United Nations. Nowadays it is one of the 41 organizations
which appear in Category I on the list of organizations which enjoy consultative statute
before the Economy and Social Council of the United Nations (ECOSOC).

The main objective of the Alliance is to promote and to strengthen independent co-
operatives all over the world. By means of international, regional, and national activities.
The Alliance also tries to encourage and defend the values and principles of the co-
operative movement; to stimulate mutually beneficial relations between its member
organizations; to favor the economy and social progress of people, thus contributing to
security and international peace.

In the Philippines, the partner of International Cooperative Alliance (ICA) is the

Cooperative Development Authority (CDA). CDA is a proactive and responsive lead
government agency for the promotion of sustained growth and full development of the
Philippines cooperatives for them to become broad - based instruments of social justice,
equity, and balanced national progress. One of its developmental function is to formulates,
adopt, and implement integrated and comprehensive plans and programs on cooperative
development consistent with the national policy on cooperatives and the overall socio-
economic development plans of the Government. Also, it develops and conduct
management and training programs upon request of cooperatives that will provide
members of cooperatives with the entrepreneurial capabilities, managerial expertise, and
technical skills required for the efficient operation of their cooperatives and inculcate in
them the true spirit of cooperativism. And it provides, when necessary, technical, and
professional assistance to ensure the viability and growth of cooperatives with special
concern for agrarian reform, fishery, and economically depressed sectors.

Moreover, CDA has regulatory functions and one of these is to register all
cooperatives and their federations and unions, including their division, merger,
consolidation, dissolution, or liquidation. It shall also register the transfer of all or
substantially all their assets and liabilities and such other matters as may be required by
the Authority. Another regulatory function is to require all cooperatives, their federations,
and unions to submit their annual financial statements, duly audited by certified public
accountants, and general information sheet. It also orders the cancellation after due notice
and hearing of the cooperative’s certificate of registration for non-compliance with the
administrative requirements and in cases of voluntary dissolution.

For the progress of cooperatives, the Local Government Units (LGU) has also role in
the cooperative on their jurisdictiction. This role was clearly explained in the Joint
Memorandum Circular No. 2019-01 dated January 21, 2019 of Department of Interior and
Local Government, Cooperative development Authority, with the subject: Cooperative
Promotion, Organization, Regulation, and Development in Local Government Unit. The
purpose of the policy is to provide guidance to all concerned in cooperative promotion,
organization, development, and supervision by local government units.
 The roles of LGUs are to formulate Local Cooperative Development Plan consistent
with the National Development Plan and the Philippine Cooperative Medium-term
Development Plan; to be incorporated in the Comprehensive Development Plan (CDP) and
Annual Investment Plan (AIP) of the Local Government Units (LGUs); ensure the provision
of technical guidance, financial assistance and other services to develop cooperatives into
viable and responsive economic; promote the organization of cooperative and support their
development within their areas of jurisdiction; appoint the Local Cooperative Development
Officer to take charge of the office for the development of cooperatives; establish
partnership and collaboration in the sharing of cooperative information and implementation
of cooperative development plans and programs with the CDA being the lead government
agency on cooperative promotion, development and regulation; assist the cooperative in
the preparation of registration documents and mandatory report, in collaboration with the
CDA; provide training for the development of cooperative in accordance with guidelines
prescribed by the CDA; initiate and implement a localized program for cooperatives
promotion and development within their jurisdiction, in line with CDA policies on
cooperatives; and provide such information as required by the CDA in relation to its
research projects.

The research will focus on Barangay San Gregorio particularly the Barangay Officials
and Calejon Multi-Purpose Cooperative. Barangay San Gregorio is one of the smallest
barangays in Malvar, Batangas and it is agricultural land. Most of the people sustain their
life living in farming of fruits berries and manufacturing of candies. Now the Barangay San
Gregorio passed the 5 years Development Plan focusing the local economy of the
barangay through the help of cooperative. There is only one cooperative that is legally
established in this barangay- the Calejon Multi-Purpose Cooperative (CMPC). It is
registered in Security and Exchange Commissions (SEC) and Cooperative Development
Authority (CDA). The cooperative is of great help to members residing in the barangay. It
will become more beneficial if the LGU, and cooperatives will work hand in hand.
 With this, the researchers find the need to strengthen the implementation of
cooperatives that will be beneficial to both the Barangay Officials and cooperatives in
Barangay San Gregorio, Malvar, Batangas. The research aims to identify the support
needed in the development of the cooperative in Barangay San Gregorio. Also, to know the
perception of Barangay Officials in improving the local economy of the barangay through
monitoring of the implementation of policy of cooperative. the purpose of the research is to
enumerate the challenges encountered by the Barangay and Cooperative Officials in the
development and implementation of cooperative policies. All of this will lead in forming a
localized implementation policy of cooperative in Barangay San Gregorio, Malvar,
Batangas.

B. LOCALE OF THE STUDY: NAME OF THE ORGANIZATION/PLACE

The target locale of the study is the Barangay San Gregorio particularly the Barangay
Officials and Calejon Multi-Purpose Cooperative. Barangay San Gregorio is one of the
smallest barangay in Malvar, Batangas and it is agricultural land. Most of the people
sustain their life living in farming of fruits berries and manufacturing of candies. Part of the
Development Plan of barangay focused on the local economy and the cooperatives will aid
in uplifting the local economy of the barangay.

There is one cooperative that is legally established in this barangay. The Calejon
Multi-Purpose Cooperative (CMPC) is SEC registered and in accordance with CDA
guidelines.

CMPC helped a lot of members residing in the barangay. It will become more beneficial if
the Barangay Officials, and cooperatives will work hand in hand.
C. SCOPE AND SEVERITY OF PROBLEM SITUATION

This study aimed to propose a localized implementation policy of cooperative in

Barangay San Gregorio that will lead to well-organized monitoring of cooperatives and
improvement of the local economy of the barangay.

Proper coordination and harmonious relationship between barangay and cooperative

will help the success of both organizations. Identifying the guidance and support needed by
the cooperative in Barangay San Gregorio will aid the Barangay Officials in implementing
local cooperative policies. On the other hand, knowing the perception of Barangay Officials
in the monitoring of the implementation of a policy of cooperative is necessary for the
improvement of the local economy of the barangay. The challenges encountered by the
Barangay Officials and Cooperative Officials in the development and implementation of
cooperative policies will be used in formulating the implementation policy of cooperative in
Barangay San Gregorio.

D. REVIEW OF RELATED LITERATURES AND STUDIES

Foreign Literature

International Cooperative Alliance (ICA) defines cooperative as an autonomous

association of persons united voluntarily to meet their common economic, social, and
cultural needs and aspirations through a jointly-owned and democratically-controlled
enterprise. ICA is the voice of cooperatives worldwide. It was established in 1895 to
promote the cooperative model. Today cooperative members represent at least 12% of
humanity. As businesses driven by values and not by the remuneration of capital, the 3
million cooperatives on earth including CDA of the Philippines, act together to build a better
world. The ICA serves as a forum to boost cooperation between cooperatives in developing
business relationships and partnerships among its members; in organizing a rich diversity
of regional and international events where organizations meet regularly to share ideas; in
providing support instruments and disseminating know-how, and in facilitating training
programs, events, and publications developed in partnership with cooperative development
agencies.

The main objective of the Alliance is to promote and strengthen independent co-
operatives all over the world. By means of international, regional, and national activities.
The Alliance also tries to encourage and defend the values and principles of the co-
operative movement; stimulate mutually beneficial relations between its member
organizations; to favor the economy and social progress of people, thus contributing to
security and international peace.

Local Literature

A cooperative is defined in Republic Act. 6938 known as the “Cooperative Code of the
Philippines as a duly registered association of persons, with a common bond of interest,
who have voluntarily joined together to achieve a lawful common social or economic end,
making equitable contributions to the capital required and accepting a fair share of the risks
and benefits of the undertaking in accordance with universally accepted cooperative
principles. In Article 2, the Declaration of Policy states that it is the declared policy of the
State to foster the creation and growth of cooperatives as a practical vehicle for promoting
self-reliance and harnessing people’s power towards the attainment of economic
development and social justice. The State shall encourage the private sector to undertake
the actual formation and organization of cooperatives and shall create an atmosphere that
is conducive to the growth and development of these cooperatives.

Towards this end, the Government and all its branches, subdivisions,
instrumentalities, and agencies shall ensure the provision of technical guidance, financial
assistance, and other services to enable said cooperatives to develop into viable and
responsive economic enterprises and thereby bring about a strong cooperative movement
that is free from any conditions that might infringe upon the autonomy or organizational
integrity of cooperatives.

Further, the State recognizes the principle of subsidiary under which the cooperative
sector will initiate and regulate within its own ranks the promotion and organization, training
and research, audit and support services relating to cooperatives with government
assistance where necessary.

Also, R.A. 6938 in Article 4, Section 8 stated that Cooperative Development Authority
(CDA) is the government agency in charge of the registration and regulation of
cooperatives as such, hereinafter referred to as the Authority.

One of Cooperative Development Authority developmental function is to formulate,

adopt, and implement integrated and comprehensive plans and programs on cooperative
development consistent with the national policy on cooperatives and the overall socio-
economic development plans of the Government. It also develops and conducts
management and training programs upon request of cooperatives that will provide
members of cooperatives with the entrepreneurial capabilities, managerial expertise, and
technical skills required for the efficient operation of their cooperatives and inculcate in
them the true spirit of cooperativism. And it provides, when necessary, technical, and
professional assistance to ensure the viability and growth of cooperatives with special
concern for agrarian reform, fishery, and economically depressed sectors.

Moreover, Local Government Units (LGU) has also role in the cooperatives as
explained in the Joint Memorandum Circular No. 2019-01 dated January 21, 2019, of
Department of Interior and Local Government, Cooperative development Authority, with the
subject: Cooperative Promotion, Organization, Regulation, and Development in Local
Government Unit. The purpose of the policy is to provide guidance to all concerned in the
cooperative promotion, organization, development, and supervision by local government
units.
 LGUs are tasks to formulate Local Cooperative Development Plan consistent with the
National Development Plan and the Philippine Cooperative Medium-term Development
Plan; to be incorporated in the Comprehensive Development Plan (CDP) and Annual
Investment Plan (AIP) of the Local Government Units (LGUs); ensure the provision of
technical guidance, financial assistance and other services to develop cooperatives into
viable and responsive economic; promote the organization of cooperative and support their
development within their areas of jurisdiction; appoint the Local Cooperative Development
Officer to take charge of the office for the development of cooperatives; establish
partnership and collaboration in the sharing of cooperative information and implementation
of cooperative development plans and programs with the CDA being the lead government
agency on cooperative promotion, development and regulation; assist the cooperative in
the preparation of registration documents and mandatory report, in collaboration with the
CDA; provide training for the development of cooperative in accordance with guidelines
prescribed by the CDA; initiate and implement a localized program for cooperatives
promotion and development within their jurisdiction, in line with CDA policies on
cooperatives; and provide such information as required by the CDA in relation to its
research projects.

Recommended Actions for LGUs are highlighted in the case study of Dr. Edna Co
entitled “Experiences in Cooperative – LGU Collaboration”. This includes the LGUs need to
officially recognize the cooperatives in local governance and to institutionalize the presence
of cooperatives in local government structure; laying down policies which would further
encourage the participation of cooperatives in the CDCs; ensuring that CDCs are indeed
functional and that these are regularly consulted and involved in identifying local
development policies and projects, planning and implementing the same; allocating portion
of the local budget to this council; inclusion of a Cooperative Officer at the level of the LGU,
as one who would approximate the functions and responsibilities of a Planning and
Development Officer; providing incentives and meritorious appreciation for coops that
involve themselves in the CDC and similar structures of local governance; recognizing the
capability of coops through contracts and service agreements; and through resolutions that
promote and encourage coop activities specially when coops prove their reliability and
trustworthiness. The role of the LGU and the local chief executives are crucial in the
institutionalization of the partnership. More than the coops, the LGUs are expected to take
the lead in any policy to institutionalize the collaboration and to carry out such policy.

On October 8, 2021, CDA, Institutional Development Services (IDS), Information, and

Training Division (CRITD), DILG, and Batangas Provincial Cooperative, Livelihood and
Entrepreneurial Development Office (PCLEDO) discuss the implementation of R.A. No.
11535. Republic Act No. 11535 is legislation signed by Pres. Duterte last April 9, 2021,
which mandates the creation of the position of Cooperatives Development Officer (CDO) in
all municipals, cities, and provinces in the country. The group also discussed how to
cascade cooperative programs at the barangay level.

In the said meeting DILG Asec. Calacat expressed his unequivocal support on the
three initiatives laid by CDA. First is the orientation of barangay officials about CDA and its
cooperative developmental programs. Second, the revitalization of CDA’s partnership with
DILG. And lastly, the Joint CDA-DILG Action to drumbeat R.A. No. 11535 Asec. Calacat
also suggested that CDA tap the league of barangays, league of municipalities, and league
of provinces as partners in these initiatives. Trainings for barangay officials about CDA’s
development programs can be conducted so that barangays will be aware of the
cooperative programs that CDA is offering. Asec. Calacat also promised that DILG shall
issue a strong advisory in assistance to CDA’s initiatives, highlighting the fact that
cooperativism is part of the national government’s socio-economic programs and so it
should be implemented at the provincial, municipal, and barangay levels.

This productive meeting is seen as a step towards stronger collaboration between

DILG and CDA. This will surely redound to better public service as information about CDA
programs and activities for cooperatives and their members will be easily accessible in the
municipalities and barangays.
Foreign Studies

The study conducted by Maskur (2015) emphasizes the role of the government in
developing cooperatives. The role should focus on empowering cooperatives by meeting
cooperative development with the cooperative values and principles. The study focused on
the appropriateness of local government action in developing primary cooperatives with
cooperative values and principles. It relied heavily on descriptive research method. The
result showed that strategy of local government - especially Malang District local
government - focused on strengthening individual member businesses and cooperative's
financial capacity that was not meet with cooperative values and principles.

Based on the result of the study, Maskur (2015) concluded that the development of
primary cooperatives in Indonesia was conducted by dividing primary cooperatives into
some categories based on their independence, namely stabilization, consolidation, and
rehabilitation. In terms of institutional strengthening, human resources development, and
financial strengthening, the development of primary cooperatives in Indonesia focused on
developing individual businesses of cooperative members and strengthening the financial
capacity of cooperatives and cooperative members. Also, the development focusing on the
individual business of cooperative members and financial support was not appropriate with
cooperative values. The development was not stimulating the independence of primary
cooperative. It made primary cooperative more dependent from outside party, especially
from the government. It would also deprave the solidity of the cooperative members in
managing primary cooperative. Cooperative is not individual oriented, but community
oriented. In addition, the local government action for developing primary cooperatives more
focused on providing financial support than giving education and training. It was not
appropriate with cooperative principle as well. Therefore, government should be more
responsive to their objects. It means that government should have well understanding
about the cooperatives problems before giving treatment. The ignorance of their object
condition and information will result to the ineffectiveness of the development

In addition, the study in Nigeria entitled “Role of Government in Cooperative

Development”, emphasized the role of government in cooperative development
emphasizes on the economic growth of the nation and the eradication/alleviation of poverty
among the populace. The significance of the contribution of government towards the growth
of cooperative society in the country (Nigeria) cannot be over emphasized because it has
brought about the reduction of dependency rate of the country. This increasing the national
income of the country. The government take no special interest in the cooperative
movement outside providing it with the necessary legal basis for registration and under
some circumstances, granting minor privilege in the form of reduced tax rate. The aim of
this project is to find out the role of Anaocha Cooperative society development, Anaocha
local government area in Anambra state. The researcher also stressed on the need for the
cooperative officers in Anaocha local government area to encourage the women to invest
more to productive ventures than collection of individual loans from the cooperatives. This
will help provide employment opportunities for the members and the people of Anaocha in
general.

On the other hand, cooperatives were established as a strategy to sustain livelihoods

of rural communities. With the adoption of cooperatives, people in the rural communities
managed to generate employment, boost food production, empower the marginalized,
especially women, and promote social cohesion and integration, thereby improving their
livelihoods and reducing poverty. Most cooperatives face several challenges that include
lack of financial support, poor management and lack of management skills, and lack of
competitive markets to sell their produce. The study of Mhembwe and Dube (2017)
recommends that the government and the banking sector render financial support to
cooperatives in rural communities to allow them to expand and diversify their business
operations; constant training on leadership and management skills is provided to
cooperatives’ members. There is also a need for cooperatives, especially those in the
agricultural sector, to form some producer associations to easily market their produce.
Lastly, the study recommends that future research should focus on investigating issues that
hinder the growth of the cooperative movement in rural communities of Zimbabwe. It is
hoped that policymakers, the academia, and communities would benefit from the study.

Local Studies

The study of Launio and Sotelo (2021) presents how cooperatives build and use their
community development funds (CDF) and determine their constraints in conducting
community projects. It used data from a mailed survey and annual performance reports.
Findings indicate high compliance in allocating for CDF but a relatively low actual utilization
rate, especially among small cooperatives. Actual CDF spending is highly positively
associated with total assets, net surplus, cooperative size, and the total number of
cooperative members. Common projects implemented are mostly in the area of education,
health, and the environment. Perceived challenges in implementing community
development projects include limited funds, lack of member-participation, poor coordination
with partner organizations, and lack of a concrete plan for using CDF. The study
recommends strengthened support for cooperatives to plan for intentional CDF use through
capacity building on project planning and management, more functional monitoring and
evaluation of development plans, and social audit reports, and further impact research.

According to the conclusion of Czachorska-Jones (2019), Since the 1987 Constitution,

the Philippines has incorporated cooperatives into their policy decisions and plans for
development. The country continues to emphasize cooperatives as a “practical vehicle for
promoting self-reliance and harnessing people power towards the attainment of economic
development and social justice. Cooperatives have successfully adapted to a wide range of
climates, economies, groups of people, and sectors, over the 7,000 islands of the
Philippines. Cooperatives manage millions of members and billions of pesos and contribute
to a growing and inclusive economy. This has been in no small part because of
contributions by the Philippine Government, international organizations, and each individual
member. From the rich cooperative literature, the cooperative sector has gained impressive
insights into how to improve their procedures and how to address the challenges of
globalization and international competition. With a strong base of support and active
engagement from public policy, academics and cooperative members, the Philippine
cooperative movement reaches forward toward a more inclusive and prosperous future.

A study on Laak Municipal Cooperative Development Council in Compostela Valley,

was conducted by Cuarteros (n.d.). The LMCDC has entered into a partnership with the
LGU, private corporations and civil society groups. LGU support is on funds augmentation,
credit extension, policy issuances, transfer of management of the farmers training institute
to the MCDC and building institutions for co-operative development. Regarding the direct
credit assistance, LGU has so far made a total of 4.8 million pesos of non-interest-bearing
soft loans to cooperatives identified by the LMCDC. LGU also made a policy that all forms
of assistance for co-operatives shall be coordinated through the LMCDC. The relationship
is to the advantage of both. The LGU made it more efficient to deliver coop services with
the LMCDC, eliminating personnel and operations related cost. The LMCDC on the other
hand provided more services to its members and is playing a key role in coop development
with the support of the LGU. This boosted the relevance of the LMCDC to municipal co-
operative sector. Effective partnership was made possible by dedication and commitment
of key leaders and the local chief executives, clear view of each other’s roles, unity and
large stock of social capital among the co-ops and stability and consistency in policies. The
LMCDC-LGU partnership is expected to continue as this is beneficial to the co-operatives
and their members

E. THEORY AND CONCEPTS RELATED TO RESEARCH

1.) THEORETICAL FRAMEWORK

 The Article 2 of Republic Act. 6938 known as the “Cooperative Code of the Philippines
Declaration of Policy states that it is the declared policy of the State to foster the creation
and growth of cooperatives as a practical vehicle for prompting self-reliance and
harnessing people power towards the attainment of economic development and social
justice. The State shall encourage the private sector to undertake the actual formation and
organization to cooperatives and shall create an atmosphere that is conducive to the
growth and development of these cooperatives.

Towards this end, the Government and all its branches, subdivisions, instrumentalities
and agencies shall ensure the provision of technical guidance, financial assistance and
other services to enable said cooperatives to develop into viable and responsive economic
enterprises and thereby bring about a strong cooperative movement that is free from any
conditions that might infringe upon the autonomy or organizational integrity of cooperatives.

Further, the State recognizes the principle of subsidiary under which the cooperative
sector will initiate and regulate within its own ranks the promotion and organization, training
and research, audit and support services relating to cooperatives with government
assistance where necessary.

In connection with the R.A. 6938, there is a joint memorandum between Department
of interior and Local Government (DILG) and Cooperative development Authority (CDA)
implemented. The Joint Memorandum Circular No. 2019-01 dated January 21, 2019 of
Department of interior and Local Government, Cooperative Development Authority, with the
subject: Cooperative Promotion, Organization, Regulation, and Development in Local
Government Unit was utilized as foundation of this study. The purpose of the policy is to
provide guidance to all concerned in cooperative promotion, organization, development,
and supervision by local government units.

The roles of LGU are clearly stated on the said memorandum. The roles are to
formulate Local Cooperative Development Plan consistent with the National Development
Plan and the Philippine Cooperative Medium-term Development Plan; to be incorporated in
the Comprehensive Development Plan (CDP) and Annual Investment Plan (AIP) of the
Local Government Units (LGUs); ensure the provision of technical guidance, financial
assistance and other services to develop cooperatives into viable and responsive
economic; promote the organization of cooperative and support their development within
their areas of jurisdiction; appoint the Local Cooperative Development Officer to take
charge of the office for the development of cooperatives; establish partnership and
collaboration in the sharing of cooperative information and implementation of cooperative
development plans and programs with the CDA being the lead government agency on
cooperative promotion, development and regulation; assist the cooperative in the
preparation of registration documents and mandatory report, in collaboration with the CDA;
provide training for the development of cooperative in accordance with guidelines
prescribed by the CDA; initiate and implement a localized program for cooperatives
promotion and development within their jurisdiction, in line with CDA policies on
cooperatives; and provide such information as required by the CDA in relation to its
research projects.
2.) CONCEPTUAL FRAMEWORK

Figure No. 1
 INPUT PROCESS OUTPUT

1. Support needed
by the cooperative in
the development and
implementation of
cooperative policies
in Barangay San
Gregorio.

2. Perception of LGU Survey Proposed Localized

in improving the local Questionnaire Implementation
economy of the Policy of
barangay through Cooperatives (LIPC)
monitoring of the Interview in Barangay San
implementation of Gregorio
policy of cooperative.

3. Challenges
encountered by the
Barangay and
Cooperative Officials
in the development
and implementation
of cooperative
policies.

FEEDBACK

This research paper dealt with the monitoring of the development and implementation
of cooperative policies in Barangay San Gregorio. The first box shows the input of the
research wherein the support needed by the cooperative in the development and
implementation of cooperative policies in Barangay San Gregorio will be identified as well
as the perception of Barangay Officials in improving the local economy of the barangay
through monitoring of the implementation of policy of cooperative. Also, the challenges
encountered by the Barangay and Cooperative Officials in the development and
implementation of cooperative policies will served as the input of the study. While on the
process box, it is stated that survey questionnaire and interview will be the instrument used
in the study. The survey questionnaire will be utilized in identifying the support needed by
the cooperative and the perception of Barangay Officials in improving the local economy of
the barangay, while interview will be used to know the challenges encountered by the
Barangay and Cooperative Officials in the development and implementation of cooperative
policies. The output of this study is the Proposed Localized Implementation Policy of
Cooperative (LIPC) in Barangay San Gregorio.