844 Agricultural Gazette of N.S.W, [Dec. 2, 1920. 



The organisation must be composed only of persons whose interests are 

 similar and directly involved. In a co-operative store, as all consumers are 

 involved the membership must be open to all, irrespective of occupation. In 

 a producers' co-operation only those growers who are concerned as actual 

 growers should be admitted to membership. Many successful co-operative 

 marketing exchanges have found it necessary to limit membership to quite 

 restricted areas to secure (a.) uniformity of produce; (I)) mutual acquain- 

 tance and confidence of members; and (c) simplicity of organisation. 



Definite provision must be made for financing the business of the organi- 

 sation. A minimum should be fixed which will not exclude possibly earnest 

 members. Shares in a growers' concern should be taken in proportion to 

 bearing acres or volume of probable business. Capitalisation is of first 

 importance, and a means of obtaining necessary capital must be adopted as 

 a first principle. When necessary a beginning will have to be on a small 

 scale. The society must learn to walk before it can run. Development will 

 depend on capitalisation. 



If sufficient capital cannot be raised by subscription for shares, a loan 

 will be necessary and sufficient security will have to be forthcoming. A 

 shortage of capital may induce the society to dispose of shares to other than 

 those directly interested, but in a producers' co-operation the sale of stock 

 must always be limited to the grower of the product marketed, stock must 

 be transferable only to growers, and the amount of stock held by any indi- 

 vidual must be limited. 



Benefits accruing from membership must be distributed among members 

 in proportion to the amount of business effected, and not in proportion to 

 the amount of share capital subscribed by each member. 



Wliereas in a producers' co-operation, subscriptions to capital should be in 

 proportion to the bearing acreage of the member, the returns must be in 

 proportion to the actual business effected; this is essential to quality and 

 uniformity. 



A maximum rate of interest on capital should be determined to prevent 

 (a) fluctuation in price of shares; (h) speculation in shares; and (c) capital- 

 isation from a profit-making point of view in lieu of the non-profit co- 

 operative ideal. 



It makes very little difference whether voting power is based on the 

 principle of " one-man-one-vote," or whether voting power is in proportion 

 to (a) capital invested, or (&) business effected, for the limit placed on the 

 holding of any individual and the restriction of membership to people with 

 similar interests will secure sufficiently democratic control. An essential 

 feature of the Rochdale pioneer system was one-man-one-vote, and while in 

 a co-operative store that principle would perhaps be wiser, in a producers' 

 concern voting power in proportion either to acreage or to business, in 

 accordance with the basis of share distribution, should prove satisfactory. 

 But wherever the one-man-one-vote principle is departed from, sufficient 

 guarantees must exist to prevent (a) too many shares coming into the 

 possession of one man; and (b) accumulations of shares passing into the 

 hands of possible opponents of the scheme. 



