The government introduced the provision to form 'Troubled Cooperatives Assets Management Committee' through Cooperatives Act 1992 (Amendment) Ordinance 2015 issued last week.Shreedhar Gautam, secretary at the Ministry of Cooperatives and Poverty Alleviation (MoCPA), told Republica that the process to form the committee will begin next week once Prime Minister Sushil Koirala, who also looks after MoCPA, returns from Indonesia.
"Members in the committee will be appointed by the cabinet. We plan to table proposal for formation of such committee by next week," Gautam told Republica. "The committee will start its work soon after the members are appointed."
According to a report prepared by Gauri Bahadur Karki-led probe commission, as many as 12,962 people have filed complaints against 150 troubled cooperatives and made claims against them totaling Rs 10 billion -- Rs 7.6 billion in principal and Rs 2.4 billion in interest.
The highest claim for deposits is Rs 5.5 billion against Oriental Cooperatives which is promoted by Sudhir Basnet.
The Karki-led probe commission, which was formed in November 2013, had made number of recommendations to the government last year including the formation of high level committee with a power to manage assets and liabilities of the troubled cooperatives.
The government made amendment to the Cooperatives Act in line with the recommendation made by the Karki-led commission.
According to MoCPA officials, the committee will carry out all the activities to settle issues related to the troubled cooperatives.
"The committee will carry out due diligence audit (DDA) of troubled cooperatives and direct them to return public deposits as well as take over the cooperatives to sell their assets and settle the liabilities, or return deposits to the public as well as the housing units booked by the customers," Suresh Pradhan, joint secretary at MoCPA, told Republica.
The five-member committee will be chaired by an Appellate Court Judge or a person having qualification of that level. Likewise, a person having working experience at Nepal Rastra Bank or chartered accountant and an expert from cooperative sector will be the two members of the committee to be appointed by the government. Likewise, a staff working with the MoCPA for past three years will be another member of the committee while a joint-secretary of the MoCPA will be the member-secretary of the commission, according to Pradhan.
However, victims of the troubled cooperatives are not optimistic with the government decision to form the committee. "Such committees have been formed earlier also. Whether the new committee and its members wield the power to touch cooperatives which are operated by some influential promoters and return public deposits is yet to be seen," one of the victims of Oriental Cooperatives told Republica, seeking anonymity due to security reason. "It seems that the government is give cooperative fraudsters time to run away rather than bring them to book."
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