News on Sunday

Associations: Unaware of their economic potential

The association of hawkers is very active these days. It is fighting for the rights of its members, estimated at about two thousand. Other associations, like those similarly aim to promote their members’ welfare. However, in most cases, these associations are unaware of the economic power they can derive from their collective force. The Constitution of Mauritius guarantees the freedom to form associations. Freedom of association is the right to form, join and refuse to join an association. The country has about 14,000 associations registered with the Registrar of Associations, the public institution that governs associations. According to official figures, from January to March 2016, there were 119 new registered associations. Moreover, there are about 370 registered trade unions in the country. The associations are commonly called NGOs (Non Governmental Organisations).

Collective Projects

An association is a contract between a number of people who decide to pool their knowledge or activity to achieve a collective project for a purpose other than generating profits. There are various types of associations, such as voluntary associations, professional associations, etc. Voluntary associations are often engaged in social causes while professional associations seek to protect and promote the rights and interests of their members engaged in the same profession. Whilst most often, associations have no profit motive, this does not mean that an association cannot have lucrative activities (that is to say which allow it to make profits), but these activities and revenues generated only serve to finance the object of the association. To exist, organisations need financial resources. They usually seek the help of the state, individuals or businesses. Membership fees are not enough to meet costs. In Mauritius the government subsidises several types of associations, such as consumer associations or religious organisations. Other NGOs receive funding from private companies through the Corporate Social Responsibility (CSR). Each year, companies are required to pay the equivalent of 2% of their profits to non-governmental organizations recognized by the National CSR Committee. The various types of associations rather use traditional tools to ensure the interests of their members. For example, they seek the help and intervention of the state for funding, grants or incentives for them. Associations also often lobby the authorities in various forms, even resorting to hunger strike to further their cause. Yet, associations and other social groups could play a greater role and solve their problems themselves if they were better organised, more innovative and evolve with time. But there are also legal obstacles caused by the legislation governing associations that need to be updated.

Taxi drivers

The country has about 4,000 taxi drivers, who are grouped in several regional associations. So far, their collective struggle is rather limited to the fight against aggression of which they are often victims, denouncing the unfair competition posed by taxis ‘marrons’, and against proliferation of street vendors causing disturbance to the plying of taxi trade. They fight against operational constraints within hotels, such that the government took a decision to set up taxi desks’ in hotels. Too bad that in the era of Uber and Ola and other computer and mobile applications for taxis throughout the world, here, the National Transport Authority is still in the era of ‘Taxi Stand’ with taxi drivers battling for limited space in town centres (or elsewhere) and also being subject to outdated regulations. Yet the 4,000 taxi drivers, instead of simly waiting for the authorities to evolve, could have taken the initiative themselves to innovate through the contribution of their thousands of members to come forward with modern systems of ‘booking’ and other ancillary services, resulting not only in a raising of the level of service but also creating jobs and other opportunities for themselves. But again, it is the legislation that hinders progress. We remember how Rama Valayden once suggested introducing a system inspired by the British ‘Minicab’ to solve the ‘taxi marron issue’, but there was never any development in that direction. Meanwhile, these associations remain unaware of their potential collective strength, leaving the field to other innovative entrepreneurs in the transport sector who are gradually encroaching upon their ‘territory’ through the provision of such services as luxury transport, personal chauffeur, meals on wheels, etc.
[[{"type":"media","view_mode":"media_large","fid":"16705","attributes":{"class":"media-image aligncenter wp-image-28243","typeof":"foaf:Image","style":"","width":"566","height":"318","alt":"marchands-ambulants"}}]]  

Hawkers

They boast of having over 2,000 members. Just imagine, with a monthly contribution of as low as Rs 500 per member, the association of street vendors can easily generate revenue of a million a month, enough to invest in the necessary infrastructure. Too bad that banks do not lend easily to associations, otherwise, with such repayment ability, the association could borrow to finance the construction of modern street fairs for its members, obviously with the collaboration of the authorities or even under a Public Private Partnership concept with private investors. Unity is strength, unfortunately, the lack of innovative ideas or appropriate advice deficit deprive these people of their potential and they mistakenly believe that the only resort is a hunger strike!

Publicité
<\/scr"+"ipt>"); //]]>-->

Economic policy

With the budget fast approaching, it would be interesting if the Ministry of Finance comes up with incentives to help NGOs and associations to further tap into their economic potential. Perhaps it is also time for donors to benefit from tax deduction to encourage donations. Social enterprises must be considered as a means of job creation. Associations and social enterprises must benefit from more banking facilities to finance their projects. Just like small entrepreneurs face less bureaucracy, associations and other NGOs should also be spared administrative burden in their day to day management.

Cooperatives

Cooperatives are entities that can open new horizons for their members, but innovation is still miles ahead. Fortunately, the government has decided to review the sector completely, starting with a review of the legislation in order to boost the sector. The objective is to engage cooperatives in new sectors such as bio-farming, aquaculture, and the green economy. Traditional cooperatives do not realise the opportunities available to them. They do not use their combined strength to make profits or further their interests. A simple example: Cooperative societies regrouping individual bus owners always complain of rising operational costs and often demand (and sometimes rightly) either subsidies on fuel, or a hike of bus fares. Yet these cooperatives could have easily made additional profits through huge savings if they had really been operating with a cooperative spirit. For example, they can benefit from economies of scale on the bulk purchase of tyres, spare parts and diesel. The cooperatives could also engage in parallel economic activities, such as providing maintenance services for buses and other vehicles, the import of their own buses, etc. There is already the example of cooperatives in the agricultural sector that import their own fertilisers. Similarly, if small cooperative breeders regroup and become more efficient, they could import their own cattle feed, which would cost them a lot lower than what they currently purchase on the market. Collective bargaining could also make them negotiate better prices from local manufacturers, but the situation is the other way round, where the suppliers impose their price!

The obstacles

The associations are limited in their actions by several obstacles. First, there is a legal obstacle. The law governing associations does not allow associations evolving into social enterprises. Such an eventuality would have allowed many organisations to become financially autonomous and also create jobs. The associations also cannot easily borrow from the bank to finance their projects. Easier access to funding will encourage them to better achieve their goals. The lack of skills is also a failure because an NGO can attract qualified people to support them. In such situations, the global trend is to create a link between retired professionals and NGOs so that they enjoy the skills of these pensioners.

Related Article
 

Notre service WhatsApp. Vous êtes témoins d`un événement d`actualité ou d`une scène insolite? Envoyez-nous vos photos ou vidéos sur le 5 259 82 00 !