Sun | Jan 21, 2018

Legislation tabled to dissolve agri bank

Published:Saturday | April 8, 2017 | 12:00 AM

The Government has tabled legislation to dissolve the Agricultural Credit Board (ACB) - the regulatory agency for the National People's Cooperative Bank, which released an audit in 2015 showing that the bank approved and disbursed loans totalling $180 million to people already in arrears.

More than 200,000 farmers contribute to the 111-year-old bank and there was also a disputed claim that about $665 million, or 21 per cent of savings, was unaccounted for.

Karl Samuda, industry, commerce, agriculture and fisheries minister, promised last year that as part of the reform process, the 1961 ACB Act would be repealed. The repealing is to be done under the Agricultural Loan Societies and Approved Organisation Act, 2017, which was tabled in the House of Representatives this week.

According to the Memorandum of Objects and Reasons, the bill will repeal the ACB Act and transfer its monitoring and inspection functions relating to the management of agricultural loan societies to the registrar of co-operative societies.

The bill will also establish the Agricultural Appeal Tribunal and provide for the registration and regulation of agricultural loan societies by the registrar and the certification of approved organisations.

According to the Government, the new legislation will help to "modernise the agricultural sector to meet the demands of increased food security and agricultural productivity".

The ACB was criticised for a lack of proper oversight of the cooperative bank, resulting in the loans scandal.