CHAPTER ONE
INTRODUCTION
1.1. Background of the study
Nigeria as a land filled with milk and
honey suffers from the menace of poverty. Different questions have been
asked to how poverty which is affecting the economy can be reduced to
minimum. Several Government bodies have been setup to find a lasting
solution to the problem striking the masses. However,it will be
expedient to know what poverty is all about and to know the meaning of
cooperative according to different scholars and join the two together to
have a clearer understanding of the purpose of the study.
According to Oxford Advanced Learners
Dictionary, Poverty is a state of being poor. It is the inability of a
household to generate adequate income for the maintenance of the
household.
Poverty has become a pervasive National
and Global issue resulting from a state of short or long term
deprivation and insecurity in basic human needs (Chambers, 1996; Mullen,
1996;Obadan, 2002). Poverty has also become a feature of the living
conditions and life situation of the vast majority of Nigerians. The
incidence of poverty in Nigeria was put at 28.8% in 1980, 46.3% in 1985,
42.7% in 1992 and 65.6% in 1996. In 2008, estimates from the National
Bureau of Statistics put incidence of poverty at 54.4% (Fakoya, Banmeke,
Ashimolowo, Fapojuwo2010). Several evidences have suggested that
majority of the world’s poor live and work in the rural area and that
they would continue to do so in 2025 (IFAD, 2001).
(Oseni, 2007) defined poverty as a state
of involuntarily deprivation to which a person, household, community or
nation can be subjected topoverty is a condition in which one cannot
generate sufficient incomerequired to secure a minimum standard of
living in a sustainable pattern. Poverty in Nigeria is caused by lack of
employment, high rate of illiteracy among the citizenry, poor
infrastructure, inadequate access to micro credit facilities,
mismanagement of public funds, bad governance, instability of the
governments and its policies. Poverty gives rise to many other serious
social problems, some of which, not only impose enormous economic and
social costs upon the non- poor and society in general, but also
threaten the survival and stability of the society. In these regards,
the Federal Government of Nigeria had designed several programmes aimed
at alleviating poverty and improving the living conditions of its people
which include Operation Feed the Nation (OFN), Green Revolution,
Structural Adjustment Programme, Better Life Programme and Family
Support Programme, National Directorate of Employment (NDE), Directorate
of Food, Roads and Rural Infrastructure (DFRRI), National
PovertyEradication Programme (NAPEP) and National Economic Empowerment
and Development Strategy (NEEDS). These programmes bythe various
governments of Nigeria were designed by policy makers and targeted at
poverty alleviation in Nigeria. Unfortunately, the quality of life of
majority of Nigerians had remained unenviable and embarrassingly low,
despite the huge budgetary allocations by these governments to these
poverty alleviation programmes (Orji, 2005). There is a need to identify
other means of addressing the serious damage caused by poverty to the
Nigerian society, attention should therefore be shifted to the use of
self-help using Cooperative organizations formed and administered by the
people.
Cooperativeshave been dedicated to
conducting business in a way now being recommended as the most effective
route to transformational development: putting people in charge of
their own destinies and helping them bring services to their
communities; increasing decision making, trust and accountability
through democratic participation; providing a profitable connection to
the private sector; building and protecting assets at the community
level; limiting the role of government; and working together to resolve
problems.
A co-operative is an autonomous
association of persons united voluntarily to meet their common economic,
social, as well as cultural needs and aspirations through a jointly
owned and democratically controlled enterprise (COPAC, 1999). A
Co-operative is a group-based and members-owned business that can be
formed for economic and social development in any sector (Ohio
Co-operative Development Centres (OCDC) 2007). According to DFID (2005),
co- operatives have four main characteristics: first, they are formed
by groups of people, who have a specified need or problem. Secondly, the
organization is formed freely by members after contributing to its
assets. Thirdly, the organization formed, is governed democratically in
order to achieve desired objectives on equitable norms, and fourthly, it
is an independent enterprise promoted, owned and controlled by people
to meet their needs. Cooperatives provide self-employment through
millions of worker-owners of production and service cooperatives;
financial cooperatives mobilize capital for productive investment and
provide people with secure institutions for the deposit of savings;
consumer cooperatives provide households with affordable goods and
services reducing the proportion of income usedfor basic living costs,
and similarly user-owned cooperatives such as housing, utility, health
and social care cooperatives provide affordable access to basic
services.
Cooperative as socio-economic
institutions through their activities could be a potent tool for poverty
alleviation particularly in fighting poverty and unemployment. This
could be in the area of agriculture, provision of infrastructural
facilities and education.
Therefore, in Yewa Division where the
research wascarried out, the activities that was conducted is to know
the impact of cooperative societies in alleviating poverty among rural
households.
1.2. Problem Statement
Poverty is seriously severe in rural
areas where social services and infrastructures are limited or not in
existence. The greater number of those who live in rural areas depends
solely on agriculture for food and income, and a high proportion of
rural people suffer from malnutrition and other diseases related to poor
nutrition.
Rural poverty tends to be evenly
distributed in the country rather than concentrated in specific
geographical area. Rural infrastructure across has been long neglected
why investment in health, Education and Water supply have largely been
focused obn the cities. As a result, the rural household has extremely
limited access to services such as schools, health centers and about
half of the rural household population lacks access to save drinking
water, limited education opportunities and poor health perpetuate the
poverty circle. The poor tends to live in isolated villages that can
become virtually inaccessible during rainy season.
Therefore, the situation is aggravated
by the fact that many rural household are stark illiterates, and also
lack inadequate capital to start a business of their own.
On the other hand,cooperatives in
Nigeria are still known to be bedevilled with problems including,lack of
capital, lack of access to credit facilities, poor
management,misappropriation of funds, etc. While efforts are being made
by stakeholders ofcooperative in Nigeria to remove and/or reduce these
problems, there is anapparent consensus that the need for adequate and
sufficient knowledge of the roleof cooperatives in poverty alleviation
still exists. For example there is a need toidentify and analyse in
sufficient details those cooperative activities and functionsthat bear
directly on the economic empowerment of members, as well asidentifying
factors that could promote and enhance cooperative efforts in
povertyreduction. Unless these issues are known and appreciated, the
emphasis oncooperative as a poverty alleviating platform may continue to
be unrealistic.
The questions of interest in this study are;
- What are the socio-economic characteristics of the respondents in the study area?
- What is the incidence, depth and severity of poverty among the respondents?
- What are the determinants of poverty among the rural households?
- What are the influences of cooperative membership on poverty status of rural households?
- What are the constraint affecting cooperative societies in alleviating poverty?
1.3 Objectives of the Study
The broad objective of the study is to
access the importance of cooperative societies in alleviating poverty
among rural household.
The specific objectives are to;
- examinethe socio-economic characteristics of the respondents in the study area.
- assessthe incidence, depth and severity of poverty among the respondents.
- examine the determinants of poverty among the rural households
- examinethe influence of cooperative membership on poverty status of rural households.
- constraint affecting cooperative society in alleviating poverty.
1.4 Justification of the Study
From time past, Nigerian government and
the international agencies have introduced measures in alleviating
poverty, such programmes ranges from Structural Adjustment Programme
(SAP) in early 1980s; Directorate for Food Road and Rural Infrastructure
(DEFRRI). Therefore the study is aimed at the following
1) To reveal how cooperative will
further increase its role in poverty reduction and also to convince
policy makers that it is time to develop a national poverty reduction
policy through cooperative society.
2) To the poor, to know how
cooperative society works, which will go a long way in assisting them to
reduce poverty, by establishing Cooperative Societies.
3) To the Federal Government, they
can use this work as a standard in measuring the effectiveness of
cooperative societies. Hence, Government can through this work know the
appropriate steps to take in funding cooperative societies.
1.5 Plan of the Study
This research was divided into five
chapters, Chapter one consist of introduction, research problem;
objective and justification. While chapter two consist of literature
review and conceptual framework, chapter three consist of research
methodology, sampling techniques, method of data collection and method
of data analysis. On the other hand, chapter four consists of result and
discussion and chapter five is the summary, conclusion and
recommendation