Cooperatives

Sociedade Cooperative de Crédito e Consumo 'A Sacavenense' (Lisbon, Portugal), 1900 - present

Typification

  • Type of institution for collective action: Cooperative
  • Name/description institution: A Sacavenense
  • Country: Portugal
  • Region: Lisbon
  • Name of city or specified area: Sacavém
  • Further specification location: First headquarters was in Lisbon, at the Largo da Saúde, the second in Rua Almirante Reis.
  • Recognized by local government: Yes. The statutes were promulgated by the governement in September 1900 by publication in the Government’s official Gazette on September 3, 1900.

Foundation – termination

  • Foundation/start of institution, date or year: 1900
  • Confirmed year of founding or first mention: Confirmed.
  • Foundation act present: Yes, see underneath.
  • Description of Act of foundation: The foundation had its inaugural meeting, in January 1900; the statutes were promulgated by the government by September 1900.
  • Year of termination of institution: Continues to operate today.

Concise history of institution

Savanense credit and consumer cooperative was founded by the workers of the Sacavém’s Tableware factory in 1900, a ceramic plant of great importance in the national context. The scripture was attended by a barber, an employee, and two potters. Although the factory employees had a majority weight, the institution was rooted and open to the local community. It even integrated women, which was exceptional in the Portuguese associative movement at the time. At the first meeting it was decided that ‘not only plant personnel, but also all the people who do not belong there’ might take part in the federation. At the second meeting several residents of Sacavém and the neighbouring parishes were present. The cooperative that started off with 221 members increased in size and comprised an ever increasing proportion of the village inhabitants. In 1982, the society members represented 33 percent of the parish households.

This institution was founded at a time when the working and middle classes, especially the urban ones, were victims of increasing living costs. Consumers’ cooperation was meant mainly to supply the local community with food at affordable prices. Like many other societies founded in this period, Sacavenense combined economic cooperation with social providence, creating a mutual fund aiming to aid its members in case of disease and labour crisis. Subsidies were granted in case of illness from 1934 onwards.

In 1920, Sacavenense joined the National Federation of Cooperatives (FNC) ensuring its integration into the group of companies regarded as having an economic function of public utility (Decree of 16 October 1924), and thus benefiting from significant tax breaks. On November 27, 1956 it was decided by acclamation to integrate UNICOOPE. In the following year, Sacavenense cooperative come to assume the position of secretary in the new federative structure.

In 1957, The Cooperative Newsletter considered Cooperative Sacavenense one of the most important in the country, ranking third in sales volume. The division of profits was proportional to the consumption of members. A small percentage was reserved to gratify the partners who had distinguished themselves in volunteer work. When the size of the cooperative started to require the engagement of professional employees, which came to be 47, the management work and supervision continued to be voluntary and the gratifications merely symbolic.

In the late seventies, the cooperative experienced a period of recession. An analysis performed by the Directorate of the Centre for consumer cooperatives support, within the Ministry of Trade and Tourism, stressed the oversize of the company in terms of area and number of workers,  – as compared to the volume of sales and members -, and hence advised a drastic reduction in size.

After a long process of reorganization, the cooperative now focuses on the areas of culture, leisure, sports, and recreation, using their facilities to serve its members and the population in general.

Special events? Highs and lows? Specific problems or problematic periods?

During the First and Second World Wars, consumer cooperatives played a key role in curbing speculation and hoarding. It was during the conflicts and their aftermaths that the cooperative model proved its uniqueness and its social nature. At the beginning of the World War I, Sacavenense’s board urged shareholders to deposit their dividends in order to allow supply crisis mitigation. The following letter, signed by the President of the cooperative, was posted at the cooperative headquarters: ‘Comrades, once more to you I appeal, increase your fund in this cooperative, the only bastion of half a dozen workers in Sacavém, a minimum number but large enough to hindrance the vile traders without scruple nor humanity (…)’.

Despite the efforts of the cooperative, scarcity and hunger dramatically hit working-class families. At the end of 1918, Sacavém’s population was also victim of the Spanish flue. Faced with this challenge, the general meeting decided to provide some families above their credit limits, corresponding wuth the percentages of their shares.

When World War II broke out, the Sacavenense cooperative rented a warehouse designed to store sufficient food provisions to prevent speculation and hoarding. Throughout the conflict, the direction sought by all means to acquire the scarce foodstuffs such as potatoes and olive oil, contracting new suppliers and negotiating directly with producers.

Membership

Numbers of members (specified)

Graph of number of members of A Scavenense over the years. Source: Canhão (2010).

Membership attainable for every one, regardless of social class or familybackground?

According to the statutes, the institution was first and foremost devoted to working-class families. Chapter III states that ‘all the individuals which are workers without distinction of colour, creed, sex or nationality, provided that they accept and comply with the precepts of these statutes and regulations’ could join the cooperative. This chapter made also clear that no ‘senior clerks, foremen, masters or owners of workshops, factories, warehouses or offices’ were eligible for membership of the cooperative.

In 1917, the statutes were amended to incorporate other social strata, as can be seen in Chapter IV, which states that ‘all individuals older than 18 years who did not have a trade with an identical purpose of this cooperative’ could join, ‘irrespective of professions, beliefs, genders and nationalities’. However, during crises, admittance was sealed, since the number of candidates would exceed the society’s possibilities. In such periods, like World War II or the crisis of the seventies, only members’ sons who were married, were allowed to join.

Specific conditions for obtaining membership? (Entrance fee, special tests etc.)

Apart from the limitations, mentioned in the statutes and during crises (see above), members have to pay for the diploma, the statutes, and the weekly fees.

Specific reasons regarding banning members from the institution?

The non-payment of assessments was the key motive to banish members. Nevertheless, according to the statutes of 1900, there were main reasons to be tolerant: good behaviour and regular partner, lack of health, labour crisis, and forced absence were considered to be ‘softening circumstances’.

Advantages of membership?

Membership was promoted by three main advantages that the cooperative offered over traditional commerce:

  • the system of credit sales
  • the annual return
  • the existence of the mutual-aid fund 

Obligations of members? 

  • The possession of at least one share, wish could be acquired in installments
  • The payment of a weekly fee
  • Payment for the diploma
  • Payment for a copy of the statutes

Literature on case study

  • Canhão, José António, 2011.  A Sacavenense: história de uma cooperativa.  S.l.: Cooperativa A Sacavenense.
  • Cooperativa de Crédito e Consumo A Sacavenense, 1950. Bodas de ouro: 1900-1950. S.l.: s.n.

Sources on case study

All sources are kept in the cooperative headquarters in Sacavém. Researchers interested in these sources need the society directors’ permission.

  • Printed documents:
    • Centro Cultural da Cooperativa A Sacavenense, 1984. O cultural Loures magazine. Sacavém: C.C.C.S., 1984;
    • Centro Cultural da Cooperativa A Sacavenense, 1977[?]. Circulante: boletim interno da Cooperativa de Consumo A Sacavenense. Sacavém: C. C. S., 
    • Centro Cultural da Cooperativa A Sacavenense, 1963[?]. Relatório de 1962. Sacavém: A Sacavenense.
  • Manuscripts:
    • Minutes of general assemblies
    • Minutes of board meetings
    • Members’ enrollment registration
    • Audit reports
    • Terms of office of governing bodies
    • Attendance records of shareholders at the general assemblies

Case study composed by Joana Dias Pereira, Instituto de História Contemporânea da Faculdade de Ciências Sociais e Humanas da Universidade Nova de Lisboa

A Voz do Operárion (Lisbon, Portugal), 1883 - present

Typification

  • Type of institution for collective action: Cooperative
  • Name/description institution: A Voz do Operário
  • Country: Portugal
  • Region: Lisbon
  • Name of city or specified area: Lisbon
  • Further specification location: Rua da Voz do Operario, 13 – 1100-620, Lisbon, Portugal (location on Google (R) Maps)
  • Recognized by local government: Yes. On July 6, 1907, the Lisbon civil government formally acknowledged the bylaws of the cooperative as laid down in 1904.

Foundation – Termination

  • Foundation/start of institution, date or year: 1883
  • Confirmed year of founding or first mention: Confirmed.
  • Foundation act present: Yes.
  • Description of Act of foundation: The first bylaws and deed of incorporation  were approved in and by the general assembly of February 13 and signed by Custódio Brás Pacheco, the head of foundation commission. The document was published in issue 175 of the newspaper Voz do Operário on February 18, 1883.
  • Year of termination of institution: Continues to operate today.

Concise history of institution

The Voz do Operário is an emblematic Portuguese institution for collective action that has deserved the attention of several scholars. Furthermore, until 1945, the society edited several monographies on its history, written by Raul Esteves dos Santos (1889-1954), leader of the institution, sociologist, and journalist. Recently, its historical archive (1863-1974) was digitized and made available online by the General Direction of Books, Archives, and Libraries (DGLAB). Additionally, other national archives include documental records on the institution history, like the Mário Soares Foundation. This studies and primary sources allow one to highlight the institution path, underlining its eminent role in the spheres of education and welfare.

The origins of this institution are related to the industrialization process in Portugal and the lack of social protection in the dawn of the liberal period. Voz do Operário was founded among the tobacco industry workers in Lisbon, first as cooperative to support a newspaper on the workers’ life conditions and aspirations, then to function as a mutual-aid association to support funeral services and allowances and latter to provide for the education of the partners’ children.  

The first meeting with the purpose of creating an association among the tobacco industry workers took place on May 9, 1863, in Lisbon. At the head of the 22 participants was Custódio Pacheco, the Voz do Operário founding father. The aims of this primordial association were ‘to promote by all legal means the well-being of our class’. Custódio Gomes defended the creation of a Montepio (Proceedings of the general assembly sessions of the Fraternal Association of the Tobacco Manufacturing Workers Union, 1863).

According to the first number of the newspaper Voz do Operário, it was the refusal of a journalist to report the tobacco workers’ life conditions that led to the foundation of the institution. The society would have as its mission to: ‘[…] to strive for the material and moral interests of the class it represents; to compete as far as possible for the professional and moral education of the workers and the instruction of the people; defend those who suffer injustices, vexations and violence; promote the development of agriculture, industry and trade, and to work incessantly for social welfare in accordance with this program’ (Brás Pacheco, Editorial, A Voz do Operário, October 11, 1879).

To sustain the newspaper, the cooperative A Voz do Operário was founded on February 13, 1883. According to the deed of incorporation, the cooperative aimed to ‘sustain the publication of the newspaper A Voz do Operário’, but also to ‘study how to solve the great problem of workers, seeking by all legal means to improve their conditions from the economic, moral, and hygienic points of view […; to] establish schools, reading offices, an economic fund, and all that, in line with the nature of this kind of societies, and with the circumstances of the fund, may contribute for the education and well-being of the working-class in general, and of the partners in particular’ (A Voz do Operário, February 18, 1883).

In 1889, considering the increase and diversification of associates and purposes, the bylaws were revised (Proceedings of the general assembly sessions of February 24, 1889), turning the ‘Cooperative Society’ into a ‘Society of Instruction and Charity’ in November 1890 (Santos, 1932: 29-30). The objectives of the latter were to “[c]ontinue the publication of the newspaper A Voz do Operário, founded in 1879; [to a]cquire a house for the company’s headquarters and its dependencies; [to e]stablish one or more day and night classes, and libraries; [to a]ssist Associates and their Families with the funerals and subsidies’ (Statutes of the Sociedade de Beneficiência A Voz do Operário approved in 1904, edited version of 1913).

In 1926, new bylaws were approved and ratified. In addition to the bylaws, the society created an internal regulation which regulated in detail the functioning of the administrative services, commissions and subcommittees in 375 extensive articles (Bylaws approved on November 26, 1925. In the same form is associated the general and internal regulations, approved on June 3, 1926). After the democratic revolution the bylaws approved in 1926 were amended at the general meetings of 23 July 1974 and 15 January 1976, and legally recognized in January 29, 1979 (Diário da República, February 22, 1979).

The first statutory objective established since 1889 – to continue the publication of the newspaper A Voz do Operário – was accomplished. In February 2018, issue 3051 was published, celebrating the institution’s 135th anniversary. Its path follows the Portuguese contemporary history and above all of the Lisbon associative movement. This regular edition constitutes itself as an odd historical source.

The second statutory objective – to acquire a headquarters – was more difficult to achieve, despite being created a commission for the effect as soon as 1889 (Proceedings of the general assembly session, December 15, 1889). The land for the actual Lisbon headquarters was ceded by the government in 1907 (Diário do Governo, June 8, 1907). The construction started in October 1912, with the presence of Manuel de Arriaga, the first President (1911-1915) of the First Portuguese Republic was present in the ceremony (Santos, 1933: 13). In 1922, the first part of the building was inaugurated in the presence of the president António José de Almeida (Invitation to the solemn session, Mario Soares Foundation Archive, December 24, 1922). The construction only reached its completion in 1932 (Tavares, Galhordas and Damas, 1992).  According to the public ordinance which classified the building as a monument of public interest ‘the project is characterized by the combination of the necessary functionality of the internal space and a certain monumentality (…) revealing the intentionality of a social and welfare architecture (…), which remains as a place of memory of the cultural and associative life of the city (…)’ (Diário da República, December 24, 2012).

To comply with the third statutory purpose, in May 1891 the ‘instruction commission’ was created with the purpose of ensuring the education of the partners’ children (Proceedings of the general assembly session, May 24, 1891). That same year was founded the first school. The school was free of charge and was intended for the members’ male children aged from 7 to 9 years. (Proceedings of the solemn anniversary session of the newspaper A Voz do Operário and inauguration of the society school, October 11, 1891). On October 1, 1893, the second school was inaugurated for the female (Santos, 1932: 32). The number of schools founded by and through the society increased over the years: from 3 schools in 1894, 69 schools in 1906, until a maximum of 76 schools with 3,500 students at the beginning of Portugal’s republican era (c. 1910). However, of the 76 schools, only 4 were private, whereas the other 72 were designated ‘contract schools’: i.e. private schools where the institution could enrol their students by paying a quota (Pimenta, 1987: 367-368).

Finally, concerning the fourth and last statutory objective, as early as in July 1884, the general assembly decided the construction of a funeral carriage to lead the deceased members into the grave and the creation of a social fund to assure funeral allowances for the partners’ families. According to Raul Esteves dos Santos, the funeral section developed in the following years and it was its social fund that allowed for the creation of the first school. In 1928 the funeral service was extended to the partner’s all family (Santos, 1936).

In 1932, the society foresaw the diversification of educational provision, and a new school regulation was presented to the general assembly, predicting the development of technical courses and special education for the disabled (Report submitted by the subcommittee of education and beneficence, March 1932). This project also planned the organization of school services on the basis of mutuality, with the establishment of social funds by the partners (Bases of School Associations and Pedagogical Program, 1935). Three years later, according to the Report on the activity of the School Services, the 42 schools functioning at the time provided for primary education, including physical and artistic activity, and night courses. This report highlights the social importance of the 40,000 meals served in the school canteens, the school clinical services, as well as the school library, where ‘books are carefully chosen to stimulate children’s taste for reading’. The report does not fail to point out the difficulties and the shortcomings observed in the society schools, particularly as regards to the ‘contract’ schools, which in the opinion of the ‘instruction commission’ were mostly poorly installed. Also regrets the non-functioning of the schools’ social funds and the lack of school supplies (Report from the school services chiefs, July 18, 1938).

Voz do Operário also stands out for its role during the dictatorship as a space of democratic resistance. Several sessions of propaganda took place in the ‘ample Hall of the Voz do Operário’ (A República, February 2, 1949, etc.). The Movement of the Democratic Union (MUD), founded in 1945, realized one of its most important public sessions in the Voz do Operário (Intervention by Mário Soares at the session of November 30, 1946, held at the Voz do Operário. Mário Soares Foundation Archive). In both presidential elections (1949 and 1958) the candidates of the democratic opposition use the Voz do Operário headquarters for their gatherings. The general Norton de Matos was received by the leaders of the republican opposition, former ministers of the First República (República, January 12, 1949). In the elections of 1958, Arlindo Vicente, also holds a rally in the Voz do Operário (Photo collection in the Mario Soares Foundation Archive).

After the democratic revolution of 1974, it was possible to develop the method of the Modern School Movement, which is still followed today, and cultural and social facilities increased. The Voz do Operário provided films, theatre, plastic arts, and dance exhibitions. Social services were extended with the inauguration of a social centre, day-care centres, and kindergartens, and even home support for the elderly (Tavares, Galhordas, and Damas, 1992).

In 1983, the institution was given the status of Private Institution of Social Solidarity, and currently is partnering with the State in the provision of several social services, within the cooperation agreements promoted by the Social Security Institute (Diário da República, March 7, 2017).

The institution maintains seven schools in the Lisboa area, following the method of the Modern School Movemen, with a sportive, cultural, and educational offer available not only for students but also for surrounding communities. The Voz do Operário nowadays has a Home Support Service as well as a day centre for the elderly (both supported by the Social Security Institute), a public bathhouse, and a Social Canteen (part of the Solidarity Network of Social Canteens framed by the Emergency Food Program), a medical office, and a psychology service for the community (information from the official website).

Special events? Highs and lows? Specific problems or problematic periods?

Among the society’s early achievements was the creation of a library, in October 14, 1888. In its first years the library had only around 500 books and few readers but in 1924 the famous writer Fernão Botto Machado donated his valuable collection with 3023 volumes to the Voz do Operário. According to the new regulation approved that same year, the library was opened to the general public. On its fiftieth birthday the Voz do Operário Library had 51,446 readers.  (Commemorative number of the 50th anniversary of the opening of the Library, 1938).

During the dictatorship, the more progressive pedagogues helped the society to maintain the quality of educational provision. António Augusto Ferreira de Macedo (1887-1959), full professor and founder of the Portuguese Popular University, contributed with several conferences on pedagogy (Macedo, 1945). João dos Santos, founder of child mental health in Portugal, in 1952 inaugurated the psycho-pedagogical centre of Voz do Operário, ‘created not only with the idea of helping teachers solve difficulties presented for certain children, but also to engage in dialogue with parents’ (João dos Santos’ citation in the centenary conference, 2013). The Voz do Operário students also had access to the Institute António Aurélio da Costa Ferreira, aimed at teaching children with special educational needs (Alfredo Franco, Report of the school medical services, 1955: 4).

Currently, Voz do Operário role on pedagogical innovation is still recognized. Its educative project is a case study of academic research in the field of sociology of education (Paulus, 2013) and Educational Supervision and Guidance (Drogas, 2007).

Membership

Numbers of members (specified)

  • In 1883, the cooperative was founded by 316 tobacco workers.
  • In 1887, when the mutual-aid society was created, it had 1,114 members.
  • According to Piteira Santos (1981), it reached 70,000 members during the 1920s, and had about 62,000 members at the end of the Republican period (1926).
  • Currently, the Voz do Operário has around 5,000 members.

Membership attainable for every one, regardless of social class or familybackground?

  • When founded in 1883, tobacco workers and all the subscribers of the newspaper A Voz do Operário, ‘regardless of their social position’ could become a member of the cooperative (Voz do Operário, February 18, 1883).
  • At the beginning of the twentieth century, ‘all persons of both sexes, irrespective of nationality, who, at the time of their admission, were no younger than 10 nor older than 50 years’ could become a member of the mutual-aid society, and ‘[t]he members were divided into three classes, namely: effective, auxiliary, and protective’. However, effectively only men who had reach majority of age and were related to the tobacco industry were members. All men and women who paid the quota could become auxiliary members and enjoy all assistance provided; however, they were not allowed to vote or give their vote to any other member. Protective members were all members who decided not to draw assistance.
  • Currently, all individuals of both sexes, regardless of their nationality, may become a member. There are five categories of members:
    • honorary members – persons who, for the provision of relevant services to the Institution, are recognized as such and proclaimed at a general meeting;
    • collective members – public or private legal persons;
    • child members – persons up to and including 10 years old;
    • juvenile members – persons between 11 and up to and including 17 years old;
    • effective members – persons over 18 years old.

Specific conditions for obtaining membership? (Entrance fee, special tests etc.)

Since 1883, members have been admitted by the board of directors at the General Meeting, and enjoy all of the rights conferred to them as soon as they will have paid the requested jewel and accepted the bylaws (Voz do Operário, February 18, 1883).

Specific reasons regarding banning members from the institution?

  • The non-payment of assessments was the key motive to banish members. Nevertheless, according to the statutes of 1900, there were main reasons to be tolerant: good behaviour and regular partner, lack of health, labour crisis, and forced absence were considered to be ‘softening circumstances’.
  • In 1883, there were four main reasons for banning members of the cooperative
    • when a member did not fit for the position for which he was elected;
    • when a member did not pay the respective fine;
    • disrespect for the society and its employees;
    • partners owing more than two quotas (Voz do Operário, February 18, 1883).
  • At the beginning of the twentieth century, ‘the members who publicly, in words or in writing, would insult or defame this institution and its governing bodies, as well as all those who, within its headquarters and dependencies, would promote disorders and disturbances contrary to the good social progress, will lose the right to membership and to any amounts dully paid to the society’.

Advantages of membership?

In 1883, any member could attend a general assembly, vote, and be voted for to assume any position. The partners could also take advantage of all the benefits the company provided or would provide, and received the newspaper A Voz do Operário (Voz do Operário, February 18, 1883).

Members of the mutual-aid society could attend classes at night, when older than 12 years old and partners for 30 days, and could enrol their children, of any sex, in the schools of the society, by being partners for two years. All members received the newspaper A Voz do Operário and enjoyed funeral services and an allowance, by being members for a year. The children of deceased members would continue to attend school until the end of their studies. The orphans in charge of the partners were also admitted in the society’s schools (statutes approved in 1904 and edited in 1913).

Currently, members are allowed to receive the Journal, attend all the facilities provided by the society, enrol their children on one of the institution’s schools, enjoy the services offered by the Medical Office, attend the Elderly Care Centre and use the Domiciliary Support Services, use the spa, sauna and massages, practice organized sports activities, rent the institution’s spaces at reduced prices, use the sports facilities, benefit from advantages in the area of tourism and leisure, use the Camping Section, attend Ballet, Karate, English or other associative activities, attend musical and cultural shows organized by A Voz do Operário at reduced prices, use the refectory, elect and be elected for the social bodies of the Association, and participate in the General Meetings (Operative Statutes)

Obligations of members? 

As stated in the deed of incorporation, partners must serve in the positions for which they are elected, limited to no more than two consecutive years (Voz do Operário, February 18, 1883). According to the statutes of 1907, besides the weekly quota, members had to acquire a copy of the statutes, pay the monthly fee in case of enrolling a child in the institution’s school, and pay an annual quota for the charity fund.

Literature on case study

  • Macedo, A.A.F. 1945. A Educação do Povo: conferência de António Augusto Ferreira de Macedo na Voz do Operário em 5 de Novembro de 1945. Lisboa: Seara Nova
  • Dias, J.M.G. et al. 2008. “Voz do operário” na alvorada do século XX. Lisboa: Câmara Municipal.
  • Drogas, C.R.V. 2007. A diferenciação pedagógica no 1º ciclo do ensino básico: a escola da Voz do Operário como estudo de caso. Lisboa: s.e..
  • Tavares, D., Galhordas, M.E., and Damas, C. 1992.  Tradição centenária a par com o nosso tempo: contribuição para a história da “Voz do Operário”. Lisboa: Voz do Operário.
  • Lopes, R.J.F. 1995. Sociedade de instrução e beneficência “A Voz do Operário”: uma associação representativa da classe dos Manipuladores de Tabaco, em particular, e da classe operária, em geral. Lisboa: s.e..
  • Pimenta, M. 1987. O ensino não-oficial na 1. República – A Voz do Operário. In: Análise Psicológica 3(5), 363-374.
  • Paulus, P. 2013. Uma outra forma de fazer escola: a Voz do Operário da Ajuda. Lisboa: s.e..
  • Serrão, J. 2006. Ensino Primário e Analfabetismo. In: Dicionário de História de Portugal. Porto: Figueirinhas, 395-398.
  • Santos, R.E. 1932. 1879-1894. A Vida de A Voz do Operário. Da fundação do jornal à inauguração das primeiras escolas. Lisboa:  Sociedade de Instrução e Beneficência A Voz do Operário.
  • Santos, R.E. 1933. A Grande Epopeia dos Humildes. Lisboa: Voz do Operário.
  • Santos, R.E. 1936. Alguns subsídios para a história da mais antiga modalidade de assistência que a Voz do Operário presta aos seus associados. Lisboa: Baroeth.
  • Santos, P. 1981. A Fundação da Voz do Operário: do abstencionismo político a participação no Congresso Possibilista de 1889′. Análise Social, 17(67-68), 681-693.

Sources on case study

Links to further information on case study:

Case study composed by Joana Dias Pereira, Instituto de História Contemporânea da Faculdade de Ciências Sociais e Humanas da Universidade Nova de Lisboa. For this case study, extensive use has been made of the webpage on the history of A Voz da Operário on the association’s website: http://www.avozdooperario.pt/index.php/a-voz-do-operario/historia

Bukonzo Joint Cooperative Microfinance Society Ltd., (Kasese, Uganda), 1999 - present

Typification

  • Type of institution for collective action: Cooperative
  • Name/description institution: Bukonzo Joint Cooperative Microfinance Society Ltd.
  • Country: Uganda
  • Region: Kasese District, Western Uganda
  • Name of city or specified area: Kyarumba Town, Bukonzo County. It’s area of operation embraces the following sub-counties of Bukonzo county: Kyalhumba, Kyondo, Kisinga, Lake Katwe, Maliba, and Mahango.
  • Further specification location: End of main road. For location on Google Maps, click here.
  • Surface area and boundaries: Owns 3.7 acres (ab. 1.5 hectares): microfinance centre, headquarter, and coffee storage sheds. BJCMS does not have own coffee plantations.
  • Recognized by local government: This is a voluntary association without legal power over members. External agencies recognize the institution as exemplarily approach of marrying microfinance and coffee marketing in Western Uganda.

Foundation – termination

  • Foundation/start of institution, date or year: 1999
  • Confirmed year of founding or first mention: Confirmed.
  • Foundation act present: Yes, founding constitution exists.
  • Year of termination of institution: Continues to operate today.

Concise history of institution

General

The extensive mountainous landscape and its regular rainfalls provide the Rwenzori community in the West of Uganda with ideal conditions for planting Arabica coffee which is commonly cultivated between 1,300 and 1,500 meters of altitude. Coffee is a major income-earner for many households in the Rwenzori highlands.

The first community self-help groups were identified by the Uganda Change Agency Association (UCAA) between 1991 and 1996. UCAA then selected potential “change agents” from existing self-help groups in various sub-counties of Bukonzo County and invited them to a “Change Agent Training Course”. After the training, change agents returned to their communities and shared their experience and knowledge with members of their self-help group, as well as with other neigbouring groups. 

According to Demirguc-Kunt and Klapper (2012), 26 percent of Ugandan men have a formal bank account while only 15 percent of women had a bank account. Lack of access to traditional loan and savings products is particularly acute in rural areas where only 6 percent of household have a savings account.

Institution: Bukonzo Joint Microfinance Cooperative Ltd.

In 1999, Bukonzo Joint united eleven of the self-help groups set up by the “change agents” and started as a typical microfinance association (MFA) comprising. The first eleven groups that started to access agriculuture and small business loans were purely female groups, although the self-help groups were not exclusive for women. 

In 2004, Bukonzo Joint Cooperative Microfinance Ltd. (BJMS) became a registered cooperative at Ugandan Cooperative Alliance (UCA). Its initial mission was to provide microfinance services to the poor, remote mountainous farming communities in Western Uganda’s Rwenzori Mountains, which, due to civil strife, abduction by the Allied Democratic Force (ADF) in the mid-1990s has been marginalized in the past.

The MFA offers one savings product (interest rate: half a percent per month) and one loan product (interest rate: two percent per month). Each group elects its chairman, cashier, loans officer, and secretaries. When group members want to apply for a loan they need to explain the purpose of the loan to their group members. At each weekly group meeting the progress repayment schedule (or installment plan) is checked by other group members. In the case of late-repayment or credit default solidarity group members, comprising of five members within the production group, are liable for repayment after liquidation of creditor’s savings.

Over the years Bukonzo Joint’s trainings in organic coffee farming techniques and business development efforts were funded by its members’ microfinance revenues, and by organizations that supported the cooperative’s training in organic coffee farming techniques and business development efforts. Bukonzo East Training Team (BETT), an internal training team of the cooperative pursues specific trainings in group formation, organic farming techniques, leadership trainings, business planning, and microfinance operations. In 2007, the groups were trained in Gender Action Learning System (GALS) which is based on inclusive and participatory principles and simple mapping and diagram tools for individual life/livelihood planning and collective action/gender advocacy for change (see WEMAN link).

In 2005, the cooperative added another focus besides its microfinance and capacity building components. It established a coffee marketing association in order to provide easier market access and therefore generate higher prices for member’s coffee produce.

Since 2005 BJCMS followed a dynamic growth path. Between 2005 and 2010, share purchases increased from UGX 18,185,550 (approx. US$ 5,500) to UGX 320,725,047 (approx. US$ 96,000) and saving deposits grew from UGX 116,425,450 (approx. US$ 35,000) to UGX 755,344,987 (approx. US$ 227,000). Also, from its original 11 self-help farmer groups in 1999, the cooperative grew to 76 in 5 different sub-counties in March 2012. Female members still dominate membership with 75 percent in 2012.

Special events? Highs and lows? Specific problems or problematic periods?

In 2005, the cooperative established a coffee marketing association in order to generate higher prices for member’s coffee produce rather than selling to middle buyers. In 2009 BJCMS produced over 370 tons of green coffee for international export (through Mombasa, Kenya) and national processors. Since then, the cooperative exports to the British Twin Trading Company a quarter of its highest quality coffee produce. In 2012, the cooperative expects to be awarded the fair trade certificate of the Fairtrade Labelling Organization (FLO). The cooperative applied for an organic farming license in 2011. There are also plans to launch roasting and packaging of coffee beans at the cooperative level.

Membership

Numbers of members (specified)

At the end of 2010 BJC registered 76 self-help (production) groups form 7 different primary (coffee) cooperatives with total membership of 3,900 individuals – 75 percent female.

Membership attainable for every one, regardless of social class or familybackground?

Voluntary association and open to both potential female and male members.

Specific conditions for obtaining membership? (Entrance fee, special tests etc.)

In order to become a member of BJCMS, individuals (males and females) must join or found their own production group of at least 15 members at one of the 7 primary coffee cooperatives that are registered under the apex cooperative BJCMS. After a six-months group training by the cooperative’s internal trainings team BETT in group formation, by-laws, microfinance, organization, leadership, and organic coffee farming techniques, new members agree to buy an unlimited number of shares from their savings within their first six months of membership.

Specific reasons regarding banning members from the institution?

None mentioned in this case study.

Advantages of membership?

  • Access to business development funds through microfinance services (e.g. credit and savings) 
  • Negotiate higher prices in contract farming through joint coffee marketing and lower prices for agricultural inputs like seeds, fertilizer and equipment 
  • Provision of safe and dry storage facilities and transport for the dried green coffee beans and hence reduced individual farmer’s risks associated with correct storage (e.g. mould and insects)
  • Access to training in organic coffee farming and best post-harvest handling techniques is likely to improve the quality and output of members’ coffee
  • Information sharing, networking and support consultation from fellow farmers on the group level

Obligations of members? 

  • Regular weekly attendance
  • On-time repayment of loans
  • Production of high-quality organic Arabica coffee (i.e. pick and pulp or pick, dry, and hull green beans)

Literature on case study

  • Mayoux, Linda, 2011. Taking Gender Seriously: Towards a Gender Justice Protocol for Financial Services. In Beatríz Armendáriz and Marc Labie (eds), The Microfinance Handbook, pp. 613-41. Singapore [etc.] : World Scientific.

Sources on case study

  • Demirguc-Kunt, Asli and Leora Klapper, 2012, Measuring Financial Inclusion: The Global Findex Database. World Bank Policy Research Working Paper 6025. Available online here.
  • Bukonzo Joint Cooperative Microfinance Society Ltd, 2010. Annual Report 2009-2010. Available online here.

Links to further information on case study:

Case study composed by Felix Meier zu Selhausen, Mountains of the Moon University