The Hon. Nimal Palihena

¶ 01 Madam Deputy Chairperson, thank you for the opportunity at the 2025 Budget Committee Stage.

¶ 02 The President, presenting the Budget, allocated Rs. 2,564 million under this Ministry for cooperative sector development, infrastructure, and financial strengthening. We discuss an institution closely bound to the people—the cooperative movement. We expect the trade arm to lead, regulate as needed, and deliver services.

¶ 03 Though many agencies come under this Ministry, I will focus briefly on: - What we expect from cooperatives, - The role of the National Institute of Cooperative Development (NICD), - Advancing cooperatives across all sectors, - And on the Registrar General of Companies.

¶ 04 Our experience: In times of common need or crisis, we have historically turned to cooperatives. Today, about 8 million people benefit from the cooperative sector, spanning agriculture to trade—dairy, grains, fertilizer, and more—via many societies. Rather than only seeing cooperatives as crisis responders, we must structure them to sustain daily life. Though established under cooperative laws, many societies create ad-hoc constitutions and governance arrangements that foster malpractice. We see theft, fraud, and corruption, often enabled by ad-hoc statutes designed to perpetuate control.

¶ 05 I propose Government intervention to remove such malpractice through education and by appointing qualified personnel. The NICD functions for this purpose. A cooperative is not merely a trading spot; it entails staff, inventory management, service delivery, savings and withdrawals, lending—complex transactions. Therefore, all employees must act with understanding and responsibility. We must train them in sales management, finance, accounting, audit, service management, and ICT. Courses are underway and will be expanded with this Budget.

¶ 06 On misuse: In Anuradhapura and the North Central Province, entities styled “Saubhagya” and “RCD Co-op Bank” solicited deposits. Their funding sources and operations are unclear; under the guise of cooperatives, depositors face insecurity. Similar risks exist across the island, including in Colombo.

¶ 07 Regarding companies: About 225,000 companies are registered with the Registrar of Companies, yet fewer than 300 are listed on the CSE. The CSE provides a trustworthy avenue for investment and capital gains. Through the Registrar, we aim to guide registered companies toward listing, thus opening safer investment channels for the public and capital-raising avenues for businesses. Many enterprises fail due to capital shortages; listing enables interest-free capital raising via equity. We plan programs under the Registrar and will enhance eROC systems to improve service and information access, supporting cooperative businesses and public service.

¶ 08 Thank you.