By the end of 2005, the number of cooperatives in Hanoi had 353 agricultural cooperatives, an increase of 3.5% compared to 2001, and an increase of 43.2% compared to 1997; 11 cooperatives were dissolved after conversion but were operating ineffectively.
Converting old-style cooperatives into new-style cooperatives is considered the main solution to build new-style cooperatives. Converting cooperatives has determined the capital fund, debts of the cooperative, and the status of members (which cooperatives could not do many years ago). Building a production and business plan for the cooperative, mainly providing services to cooperative members.
The number of converted cooperatives has increased, but in reality, this conversion is just a simple transition, not a real revolution . This is reflected in the fact that the process of converting cooperatives is heavily formal, following the trend to report the results of the conversion en masse. These cooperatives only change in terms of organization (re-electing a new board of directors), there is no change in content or method of operation. In most of the cooperatives surveyed in Soc Son and Dong Anh, the old cooperative transfers the entire list of members to the new cooperative, leading to the situation where members are indifferent to the cooperative after the conversion. They join passively, following the trend, and think that doing so will keep the land and avoid being disadvantaged in terms of rights.
In fact, the implementation of the transformation of the cooperative model is not convincing, “old wine in new bottles”. The transformed cooperatives have fallen into debt. Many cooperatives have not yet developed cooperative charters. Members do not pay their shares.
b) Newly established cooperatives
In response to the practical requirements of household economy, many districts in the City have established new cooperatives. As of December 2005, there were 40 agricultural cooperatives established in the City. The number of newly established cooperatives increased by 135% compared to 2001. The newly established cooperatives are mainly cooperatives providing services for consumption and production of safe vegetables.
Newly established cooperatives in Hanoi are mainly formed from two directions.
Firstly, from a number of households with needs, capacity, and sensitive management staff, the households support and voluntarily establish cooperatives.
Second, from the old cooperatives that have completely disintegrated.
Most newly established cooperatives follow the correct procedures and order of the Law on Cooperatives. That is, building a specific Charter according to the regulations of the cooperative, having a production and business plan, having charter capital according to regulations, organizing a Congress of members to ensure the implementation of democratic principles, equal voting on issues related to the content and methods of operation of the cooperative, electing the management board and the control board... are conditions for the stable development of new cooperatives.
Most members of newly established cooperatives voluntarily join the cooperative. The basis of voluntariness is that members have a need to cooperate, understand the basic differences between new-style cooperatives and old-style cooperatives, and see the benefits of cooperatives. (This is clearly shown in cooperatives established on the basis of cooperative groups and production teams that have operated effectively for many years...).
Cooperative members are aware that contributing shares is both the responsibility of the members and shows that the cooperative's proposed plans are supported by the majority of members, who enthusiastically contribute their efforts to building the cooperative.
These newly established cooperatives are mostly organized according to small and medium scale models in terms of capital and number of members, have feasible production and business plans, along with a lean, dynamic, dedicated and qualified management team, so they are flexible in production and business, and most of their operations are highly effective. What is noticeable in the operations of new cooperatives is that their capital is still low, but they know how to combine with other economic sectors such as the private sector and enterprises to provide services for cooperatives, which is both beneficial, reduces service costs for members, and brings revenue and profit to the cooperative. Some cooperatives have focused on production, focusing on investing in clean products, ecological products associated with environmental protection or investing in specialized cultivation, combining processing and agricultural consumption.
products, livestock, poultry with the goal of developing concentrated production areas, increasing the value and efficiency of agricultural products, diversifying products, creating the premise for developing large-scale production, high economic efficiency, such as Phu Dong dairy service cooperative (Gia Lam), clean vegetable production and consumption cooperatives in Van Noi commune, Dong Anh district of Hanoi
Newly established cooperatives also face many difficulties, because they are newly established, their economic relations are still limited, and their investment in production is limited. These cooperatives are currently not stable in production, and they have to rent locations for a short period of time, so they do not have the conditions to invest in expanding production; some cooperative groups have converted to cooperatives more conveniently and organize production effectively.
c. Cooperatives that have not converted
Since the implementation of the Party's renovation, the State initiated and led the abolition of centralized bureaucratic subsidy mechanisms and shifted to a market mechanism with state management in a socialist orientation. In that context, most cooperatives have stood firm and gradually adapted to the new mechanism, shifting to production, business and services, consolidating management organizations and operating more and more effectively, contributing positively to the socio-economic development in Hanoi. In addition, there are a number of cooperatives that, for various reasons, do not meet the conditions to convert to a new cooperative model operating under the Law.
As of December 31, 2005, the whole city still had 24 agricultural cooperatives that had not been converted and dissolved according to the Law on Cooperatives, mainly concentrated in districts: Dong Da with 9 cooperatives, Hai Ba Trung with 4 cooperatives, Ba Dinh with 6 cooperatives, Long Bien with 1 cooperative, Hoang Mai with 4 cooperatives.
Table 2.2. Summary of agricultural cooperatives that have not been converted and dissolved in Hanoi City
(As of September 1, 2004)
TT
District | Total number of cooperatives | Total number of members | Total capital, funds, assets | Total land |
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Quantity | % | (People ) | (1000 VND) | (m2) | ||
Total | 24 | 100 | 2302 | 24,052,057 | 930,433 | |
1 | Dong Da | 9 | 37.5 | 490 | 20,548,052 | 157,289 |
2 | Hai Ba Trung | 4 | 16.7 | 146 | 335,463 | 173,643 |
3 | Ba Dinh | 6 | 25.0 | 24 | 74,057 | |
4 | Long Bien | 1 | 4.1 | 28 | 2,183,794 | 20,910 |
5 | Hoang Mai | 4 | 16.7 | 1396 | 984,748 | 504,534 |
(Source: Hanoi City Cooperative Alliance)
- Regarding the capital fund of agricultural cooperatives that have not been converted or dissolved, there is currently 24,052,057,000 VND. This fund capital is mainly from urban agricultural cooperatives due to the value of compensation and support for land acquisition by the state, agencies and organizations. The assets of agricultural cooperatives no longer exist, especially tools for production; currently, the remaining assets are mainly assets on land such as: headquarters, trees, crops to calculate the value of cooperative assets.
- In reality, the organization and management of agricultural cooperatives is very fragmented and weak. Many cooperatives are no longer in operation. The cooperative management board is old, weak, has low educational level, and has no mindset in finding ways to consolidate and develop cooperatives; the main activity of cooperatives is to assign land to people to wait for compensation from the State.
Through investigation and survey of Hanoi City Cooperative Union, the basic cause of the weakness in cooperative transformation is due to:
- On the subjective side: Most of the cooperatives that have not been converted were established during the subsidy period. When they switched to operating under the market mechanism, the cooperatives' operations were confused, passive, disoriented, and did not meet the conditions for converting to operating cooperatives according to the Law, such as: not being able to develop a production and business plan, lacking capital, lacking members.... Some cooperatives did not want to maintain the cooperative type and divided benefits among members to request dissolution or dissolved themselves. Some cooperatives, due to not identifying
The cooperatives have not yet been able to determine the status of members, the working time of members, internal disagreement, disunity causing prolonged complaints, so they cannot organize the conversion of cooperatives. Some agricultural cooperatives want to convert the agricultural production cooperative model to a small-scale handicraft and trade service model, but are stuck with land lease procedures, land legalization, that is, converting the land use purpose from agricultural production to non-agricultural production.
- On the objective side: Due to the City's policy of socio-economic development and anti-environmental pollution, most of the 24 inner-city agricultural cooperatives previously specialized in growing crops and raising fish, but now the city has reclaimed most of the cooperatives' land and ponds to build infrastructure such as: traffic, public works, schools, housing, apartments, etc. The remaining land and ponds are not used for agricultural production because they affect the environment in the City, so the cooperatives are currently growing water spinach and raising fish on this land. Another objective reality is that in addition to the State land that has been reclaimed, more than 50% of the remaining area is located in the City's planning area and the rest is stuck land. Therefore, the cooperatives are not proactive in using the land but have to wait for the City's policy. These are the difficulties and obstacles that lead to the requests for conversion and dissolution of cooperatives not being resolved by all levels and sectors.
Furthermore, authorities at all levels have not paid attention to and focused on directing the conversion and dissolution of cooperatives to let them float, which is also a reason why the conversion and dissolution of cooperatives cannot be carried out.
2.1.1.2. Qualitative innovation.
According to the classification criteria of the Hanoi City Cooperative Union, Fairly Good Cooperatives are those with clear production and business plans, good working capital, low debt and payment ability, capable management staff, stable income of members and workers from
500,000 VND/person/month or more, fulfilling tax obligations to the state, clear books according to the state's accounting and statistical regime. For example, cooperatives
Thong Nhat (Tu Liem district) revenue in 2005 reached 4.8 billion VND, an increase of 35% compared to 2003. In 2004 and 2005, Trieu Khuc Agricultural Service Cooperative opened many new services such as providing clean water and car parking, so revenue in 2005 reached more than 6 billion VND, an increase of 142% compared to 2003.
- Medium cooperatives: These are cooperatives with production and business plans, low working capital, unsynchronized management staff, unclear accounting books according to state regulations, and members' income below 500,000 VND/person/month.
- Weak cooperatives: These are loss-making cooperatives, existing only in form, operating at a low level, with low and unstable income and employment for members.
With that classification, in 2005 the number of cooperatives with good performance was 78, double that of 2001, while the number of average cooperatives increased from 98 in 2001 to 124 in 2005 (an increase of 26%); while the number of cooperatives with poor performance during the same period decreased by 54 cooperatives, a decrease of 34%, and accounted for only 36.28% of the total number of cooperatives (compared to 55.41% in 2001).
a) Innovation in organization and management of cooperatives
Based on the Law on Cooperatives and the Model Charter of Agricultural Cooperatives, depending on specific conditions, each district has organized the conversion of cooperatives in the area appropriately. Currently, out of a total of 343 agricultural cooperatives in Hanoi, there are 73 cooperatives operating in the whole commune (accounting for 24.91%); 220 cooperatives operating in villages or inter-villages (accounting for 75.09%).
The model of agricultural cooperatives after conversion and newly established has brought elements of the new cooperative economy, demonstrating the qualitative change of the cooperative model according to the Law on Cooperatives and Decree 43/CP of the Government on promulgating the model charter of agricultural cooperatives. Most cooperatives are established on the basis of workers (mainly farmers).
) have the need to contribute capital and efforts on a voluntary, democratic and mutually beneficial basis to
more efficient agricultural production and other business activities.
The model of the new cooperative has changed a lot compared to the old cooperative model in the previous centralized subsidy mechanism in many aspects of ownership relations, distribution relations and management relations. Most agricultural cooperatives at different levels have made innovations in organization and operation; cooperatives have improved their organization from the "all-people" community model, from cooperatives without a list of members to cooperatives with a list of members, and a more responsible staff apparatus than before; cooperative organizations have clear legal status, business registration, and operating regulations. Cooperative funds are inventoried and monitored regularly. The activities of most cooperatives are no longer like those of previous socio-economic organizations, the relationship with the State and organizations related to cooperatives is more clearly divided.
The organization and management of cooperatives are carried out according to the principles of democracy and equality. Through the Congress of members, members can exercise their right to be the owner of their cooperative. The Congress of members is where the will and aspirations of members are expressed, and the content and methods of operation of the cooperative are decided. The Congress is held periodically every year or is convened irregularly at the request of 2/3 of members. During the meeting of the Congress of members, members have the highest democratic rights through listening to reports from the Board of Directors and the Board of Supervisors on the operation of all aspects of the cooperative. Members have the right to speak and contribute opinions, question members of the Board of Directors and the Board of Supervisors about issues that are still unresolved and need to be answered. For example, members of the Thuong Thanh General Service Cooperative discussed the direction of production and business of the cooperative, through the conversion of the cooperative's service business form. From organizing service activities mainly for agriculture, now switching to a form of general service business (trading in construction materials, stationery...)
The members of the board of directors and the board of supervisors are elected by the members. The activities of the board of directors and the board of supervisors are carried out according to the term of office stipulated in the cooperative's charter.
The cooperative management board is the direct management apparatus, elected by the General Assembly of members to run the regular work of the cooperative. The management board is under the supervision of the Control Board and must report on the management situation, service activities and use of the cooperative's capital to the Control Board.
In general, the cooperative management board after the basic transformation is arranged compactly and reasonably. The cooperative management board has been reduced from 3-5 people before to 2-3 people. In addition to the general management work of the cooperative, members of the management board are often arranged to concurrently hold the position of service team leader. The management board appoints support departments such as accountants, warehouse keepers, treasurers, etc. to help the management board operate the service and business activities of the cooperatives to meet the needs of members and households. To organize service activities, the cooperative establishes service teams and receives services. The service teams are divided into electricity service teams, irrigation service teams, seed service teams, technical service teams, etc. The service teams are often led by members of the management board or members with professional qualifications invited by the cooperative to be in charge of electricity, veterinary medicine, etc. Providing services to each member household. Ensure convenience and timely response to the needs and wishes of cooperative members. Cooperatives establish service receiving teams at the hamlet or village level. These service receiving teams are arranged reasonably and compactly, usually with only one team leader in charge. The team leader position is often combined with positions such as village chief, hamlet chief, village party cell secretary or can also be elected by cooperative members.
With such personnel arrangement, it will ensure flexibility in management and operation, and coordinate the tasks of both economic development and social stability. It will reduce the cumbersomeness of personnel organization, create conditions for increasing income, and specialize the management work of those working for the organization at the grassroots level.