In these difficult economic times, the co-operative sector can create jobs and assist hard-hit communities through an investment partnership between government, business and citizens. The federal government has recently renewed and enhanced the Co-operative Development Initiative, which helps new and emerging co-operatives and funds innovative co-operative projects. This is an excellent start, but this initiative is not designed to capitalize new and emerging co-ops. Because co-operatives are member rather than investor owned, they do not have access to most traditional sources of investment capital. A Co-operative Investment Strategy would be a partnership between the federal government and the co-operative sector which would assure the capitalization and financing of new and emerging co-operatives and the development of more community-owned businesses. It would consist of:

Pierre Lemieux, Member of Parliament for Glengarry-Prescott-Russell and Parliamentary Secretary to the Minister of Agriculture, was one of 16 Members of Parliament who met with national co-op sector representatives on November 23-24 to discuss the Co-operative Investment Strategy. Left to right: John Anderson, CCA Director of Government Affairs and Public Policy; Dominique Guénette, Director of Programs, Projects and Strategic Communications for the Conseil canadien de la cooperation et de la mutualité; Pierre Lemieux; CCA President Claude Gauthier.

1.   A Co-operative Investment Plan (CIP) which would provide a tax credit for members or employees of agricultural or employee-owned co-operative businesses who invest in their own co-ops. This would be a partnership between citizens who invest their own money and the federal government, which would provide the tax incentive.  Government monies (in the form of tax exemptions) would not be committed unless co-op members and employees first invest their own funds.

This would be similar to the current plan in Quebec, where $393 million was invested by members in eligible co-operatives from 1985 to 2006. The cost of a similar plan at the federal level is estimated to be $17-20 million per year and would generate some $120 million per year of new investment across Canada. The Canadian Federation of Agriculture endorsed the CIP as its number one priority in its 2008 Budget proposal.

2.  A co-operative development fund, which would be a repayable loan fund rather than a source of grant funding. Investments made under this fund would be based on an analysis of a co-operative's business plan and its capacity to pay back loans on the negotiated terms and over a specified period of time.

This new fund needs a one-time-only investment of $70 million from the federal government and after that it will be self-sustaining. The Fund would also seek additional financing from the co-operative financial sector. It would work like the Arctic Co-operative Development Fund, which was capitalized by the federal government in 1986 with $10 million and is now worth over $30 million. 

Please help us strengthen co-operative enterprises for the benefit of Canadians and their communities.
 
Send a letter of support to:

• Your Member of Parliament

• Honourable Jean-Pierre Blackburn, Minister of Veterans Affairs and Secretary of State  (Agriculture) responsible for co-operatives and rural development 

• Honourable Jim Flaherty, Minister of Finance