Responses of peasant paddy growers to farmers' organizations in West Malaysia

The subject of this study is the response of Malay paddy growing peasants to the efforts of the Malaysian government to organize them in so called Farmers' Organizations. In Peninsular Malaysia, paddy production is geographically concentrated on a number of coastal plains where paddy is the major - and for most peasants the only - crop, and the main source of household income. AS the farms are small and productivity is low, these areas form islands of poverty in a country which is relatively affluent in comparison to its Southeast Asian neighbours.<p/>In the 1960s and 1970s, the Malaysian government introduced a number of measures to improve the income of paddy smallholders and to become independant of rice imports. These measures involved large subsidies to the peasants. Funds for these subsidies were obtained from the more advanced sectors of the economy, such as the plantation and mining sectors. These public subsidies should be considered in the light of the government's efforts to eradicate poverty and to reduce the income differences between the predominantly rural Malays who are the indigenous population and the predominantly urban immigrant Chinese. Practically all paddy smallholders are Malays.<p/>The most important development in the paddy sector was the construction of large scale drainage and irrigation schemes in the coastal paddy areas, in order to enable the production of two paddy crops per year (double cropping). As an additional measure steps were taken to help the peasants obtain the full benefits of these facilities by establishing Farmers' Organizations (FOs) which they could join voluntarily. These FOs were to provide farm support services, such as supplying seed of new paddy varieties, chemical inputs, credit and extension advice and the buying up of the paddy. Other tasks of the FOs were to promote the co-ordination of paddy production activities of the peasants and to strengthen the peasants' position as a producers group vis-à-vis other economic interests.<p/>The main reason for assigning these tasks to a newly created organization rather to than the existing rural co-operative societies was that the latter operated on a very small scale and lacked the ability to manage these complex tasks. Many rural co-operative societies were completely inactive. FOs operated on a larger scale and the management was in the hands of government officers seconded to the FO. The activities of the FOs also benefitted from larger subsidies than the co-operatives were given. This meant that FOs, despite their formal structure as voluntary associations administered by a board and assembly representing the members, were very dependent on and strongly influenced by the government.<p/>The main objective of this study was to identify the sociological factors which influenced the response of paddy growing peasants to the establishment of FOs Three aspects of this response were studied:<br/>1. the affiliation of peasants to FOs;<br/>2. the members' contributions to the development of FOs;<br/>3. the utilization of FO services and the adoption of improved paddy cultivation practices.<p/>A second objective was to compare the peasants' response to FOs, in the Krian and Muda irrigation schemes. These schemes represented the two different types of government intervention in paddy production in Malaysia. In the Muda scheme there was a project authority, the Muda Agricultural Development Authority (MADA), which was responsible for the FOs the other organizations providing farm support services and operating the irrigation system. This provided a favourable opportunity to co-ordinate the various farm support services at FO level. In the Krian irrigation scheme there was no project authority and the various services were provided by separate agencies. This made local co-ordination difficult. The FOs, in Krian were supervised by the state office of the Farmers' Organization Authority (FOA), a federal agency. This office supervised all the FOs, in the state Perak, the FOs in the Krian scheme being only a small section.<p/>Due to the exploratory character of the study, only one FO could be studied in Krian and one in Muda. It appeared that in both research areas the FOs) were in fact field offices established to perform service functions under the control and supervision of FOA (in Krian and MADA (in Muda). In both areas, they concentrated mainly on the provision to their members of short term production credit and inputs. In providing credit, the FOs acted as agents of the Agricultural Bank. The credit activities were confined to the administrative routine of processing loan applications and disbursing inputs and cash. other farm support services were of minor importance. Although initially loan repayment records had been high, the recovery of the loans had become increasingly difficult in both areas. Despite the fact that the organizational set-up in Muda offered better opportunities than in Krian to link credit supply to for instance agricultural extension activities, this however was not capitilized on in actual practice.<p/>It appeared that the main comparative advantage of the organizational set-up in the Muda area compared to that in Krian was that the MADA project authority covered a much smaller area than the state office of the FOA, this facilitated the communication between FO personnel and their supervisors. The latter could also provide more support for the field staff. This made it easier to undertake non-routine activities that required frequent consultation with the supervisors. These activities were only undertaken by the FO in Muda, which ran a chicken farm and a mini-supermarket in a nearby town. However, these activities were of minor importance when compared to the routine task of credit supply. Therefore, the difference in performance between the Krian and Muda FO.was not as large as might have been expected.<p/>In order to recruit members, FO personnel in both Krian and Muda contacted peasants who were already in close contact with various government agencies and helped other peasants in their dealings with these agencies. The task of canvassing for members was left to these local contacts. only a section of the potential membership was invited by them. A large proportion of the non-invited peasants regarded access to FO membership as a priviledge controlled by the contact person. Only the more educated of the non-invited peasants joined the FO on their own initiative if they considered this to be in their interest.<p/>According to both members and non-members the most important and often only motive for joining the FO was to get cheap credit. However, the low interest rate only outweighed the costs of obtaining FO credit for peasants who needed large amounts of inputs. Those who operated a small paddy farm could obtain their inputs more conveniently from private shops. Thus, the operators of large paddy farms were overrepresented in the FOs. In both Krian and Muda the FOs had appealed to about half of the potential membership.<p/>Members of an FO must accept some responsibility and make contributions in time and money by attending and participating in meetings and buying capital shares, if the FO is to develop into a farmers organization. These member-contributions were generally low in both the FOs studied. One of the reasons was that the individual's access to the benefits of FO membership was not directly dependent on these contributions. Secondly, the benefits remained rather limited and might not have been a sufficient incentive. A third cause of low member-contributions was the loosely structured character of the local society. This made it difficult to develop the permanent commitment required for these contributions. Finally, a fourth cause was the government's emphasis on a quick increase in the number of FOs and its neglect of the need to build up commitment of the members to the FO. This has created a tendency of government agencies to act on behalf of the peasants rather than help the peasants to act for themselves and has also contributed to the general tendency of peasants to lean on the government rather than stand on their own two feet.<p/>The board and the assembly of the FO who represented the members, left much of the responsibility for the operations of the FO to the staff. They also accepted that actions suggested by them could not be carried out without prior approval by the FO staff's superiors in FOA or MADA. Rather than administering the FO the main function of the board and assembly was to communicate the wishes of the members to government agencies over which they had no control. These wishes received due consideration and often led to adaptations in the activites of these agencies.<p/>In both Krian and Muda the efforts of the FOs to change paddy cultivation practices were confined to the provision of farm support services to individual members. There were no attempts to co-ordinate the paddy production activities of the members. The farm support services of the FOs studied had only reached a small section of the peasants in both research areas, primarily those with larger farms, more education and more contacts with the world outside the village. However, this had not led to differential adoption of the new cultivation practices. The necessary inputs were also avaiable to non-members. They could be obtained from local shops, either on credit terms or for cash. Since the extension advice given was very general and hardly changed from season to season, non-members knew what the advice included. No statistically significant differences in the cultivation practices of members and non-members were found. Peasants had tried out the recommendations and retained those practices that were found useful, while rejecting those that were not. Since then, peasants had continually experimented with new practices imitating friends and relatives and selecting their own new paddy varieties. The actual practices of both members and non-members bore only a vague resemblance to the official recommendations.<p/>The study recommends a number of improvements that could help the FOs to function more effectively. These include improvements in agricultural extension services and in the role of the FO in co-ordinating its members' paddy production activities. Apart from these paddy oriented measures other suitable FO activities should be investigated, e.g. in the small scale industries sector. Finally, the study indicates a number of problems that need to be solved before the responsibility for the FO can be transferred to the members.