LEGISLATING FOR BETTER CONTROL AND ACCOUNTABILITY OF CO-OPERATIVE SOCIETIES' FUNDS

Mr Tong Kok Yeo asked the Minister for Community Development whether he will consider introducing legislation to amend the Co-operative Societies Act to provide for better control and accountability of the utilisation of funds.

Note: The Member has stated: "In asking this question, I wish to declare my interest as the Secretary of the UTES Multi-Purpose Co-operative Society Ltd."

Mr Yeo Cheow Tong: The Co-operative Societies Act was last amended in 1990. It has adequate provisions for the control of co-operative societies and the safeguarding of the interest of their members.

The accounts of every co-operative society are required to be audited annually by an auditor authorised by the Registrar of Co-operative Societies. The auditor is required to report any irregularity disclosed by his audit. In addition the Act provides for the Registrar to inspect the books of co-operative societies whenever necessary. Where malpractices are detected, the Registrar is empowered, among other things, to suspend the society's activities, freeze its funds, remove its management committee and take appropriate action against its officials.

To ensure accountability for utilisation of funds, the Act requires members of management committees to exercise due prudence and diligence in their decisions. Failure to do so renders members of the management committee jointly and severally liable for any loss sustained.

Since 1980, the Registrar has had no occasion to take action involving mismanagement or misappropriation of the funds of co-operative societies.

There is no need at present to amend the Act for better control and accountability of funds. However, my Ministry will continue to monitor the affairs of co-operative societies and review the legislation should the need arise.