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Tuesday, January 31, 2023

Housing Development, Poverty Alleviation and Cooperative Societies: The Nexus

Abstract: Housing is one of man’s basic essentials of life which
ranked second to food. In spite of this, its development requires
huge initial capital outlay, hence the ownership is steadily
becoming elusive especially for those within the low- income
cadre. Nigeria as one of the developing nations of the world is
faced with the twin problems of poverty and housing provision.
Housing financing and poverty alleviation has become
problematic issues for successive government in Nigeria as the
various poverty alleviation and housing financing options in the
country has failed largely due to bureaucratic bottleneck and
other corrupt practices. The paper therefore evaluates the efforts
of the Federal Polytechnic Ede academic staff union cooperative
society at alleviating poverty through housing development
financing. To achieve this, the study explored both quantitative
and qualitative research methodologies in order to empirically
investigate the activities of the society and established the nexus
between housing development, poverty alleviation and
cooperative societies. Both primary and secondary data were
collected and analyzed using descriptive statistical tool. Findings
from the study revealed that 270 staff members have benefitted
from the housing provision initiatives of the society with their
properties at various stages of completions, while 24 members
have also obtained their PhD and Master’s degree, 18 members
got exotic cars through the dedicated education and car loan
options. More so, the society provided soft and flexible loan
facilities at low interest rates through which staff members have
been empowered. The paper concluded by recommending the
introduction and sustenance of co-operative societies in
government institutions as a sure means for housing ownership
and urban poverty alleviation in the country.
Key words: Cooperative Society, Housing Development, Poverty
Alleviation and Low Income Earners.

ousing is said to be one of the basic needs of man and it
is second to food in the ranking of basic necessities of
man ([3], [8] and [12]). Despite the usefulness of housing to
man, its accessibility and affordability to people in the less
developed economies is gradually becoming elusive
especially for those within the moderate and low- income
brackets. Housing problem in Nigeria could be looked at from
both qualitative and quantitative angles but from whatever
angles it is viewed from, the underlying factor is usually the
financial aspect. The rural housing development problem in
Nigeria is usually more in terms of qualitative than
quantitative. Unlike the rural areas, the urban settlements
experience both quantitative and qualitative as well as housing
accessibility and affordability problems. [24] posited that the
Nigeria housing problems are plentiful and thus characterized
by regional variations which can be seen in terms of urban and
rural variances, hence the inability of city dwellers to pay for
decent accommodation or finance housing projects have made
a reasonable percentage of urban dweller who must reside
close to their place of employment or are in the city searching
for better life to resort to living in substandard and unhealthy
accommodations within the city centres. [21] opined that
larger proportion of the urban inhabitants, especially, the
urban poor lives in squalor, sub-standard and poor housing
that is situated in deplorable conditions and an insanitary
Vanderschueren cited in [15] confirmed the
multidimensionality and interconnectivity between poverty
and housing as both were related to economic variables such
as labour market; income and other social issues as
urbanization and public infrastructural facilities. Poverty is a
complex term with multidimensional measuring scales that no
single definition of the term can be said to be satisfactory.
Poverty to some scholars is a poor state that should be
measured from the perspective of comparing family income to
a set of poverty threshold, infrastructural facility development
accessibility while others are of the opinion that human capital
development and poverty gap index are the best means for
poverty measurement [28] and [10]. However, the four
central approaches commonly adopted in poverty analysis in
most development literatures include the poverty line
approach; the capabilities approach; the participatory poverty
assessments and the vulnerability approaches.
Ayedun, et al., (2017) argued that developing economies
especially in the African continent are experiencing extreme
poverty rates compare to other similar developing economies
of the world due to the continuous widening gap between the
rich and the poor which has resulted in the chronic challenges
of rising poverty and dwindling infrastructural development.
In Nigeria, for instance, the National Bureau of Statistics
(1999) have it that, the increasing poverty range has continued
unabated since 1980 as the national poverty level increased

from 27% to 46% between 1980 and 1985. Though slight
decreased of about 42% was recorded some times in 1992,
thereafter, the economy experienced 67% increase in poverty
rate in 1996. Related to this postulation was the supposition of
Adebayo (2018), who was of the view that, Nigeria has
overtaken India in extreme poverty due to the fact that, about
87 million Nigerians (almost half of her population) are living
on less than $190 per day, which is far below the globally
recommended poverty line.
However, successive governments in Nigeria have come up
with series of programs as Better Life for Rural Women,
National Directorate for Employment, Market Money, Back to
Land, Housing for All, Small and Medium Enterprises among
others, which are all targeted at freeing Nigeria citizens from
the shackles of poverty but all to no avail. [17] maintained
that, the most appropriate means through which the already
battered national economy can be revamp and restore to its
lost glory and the restoration of self-esteem to the already
dehumanized Nigerians is through poverty alleviation and
urban housing development. Poverty have made housing
availability and accessibility more of a mirage than reality to
average Nigerians. Several housing financing options are
available on the shore of Nigeria. Among the available
options are: public option which transfer the financial burden
of owing a house to the public financier rather than the ‘poor’
private individual; the capital market option and the housing
cooperative initiatives.
Despite the globally accepted norm that decent housing is a
basic necessity of every citizen of a nation, evidences abound
that the provisions of adequate and decent housing by the
Nigeria government at all levels is steadily becoming elusive
[2]. It have been observed in previous literatures that the
activities of cooperative societies especially those in tertiary
institutions have been increasingly extended to the granting of
loans for the acquisition of land for members, encouragement
of incremental housing development through loans from the
society, site and services scheme and other form of housing
delivery efforts as well as granting of loans to mitigate
poverty ([12], [13] and [29]). This have not in any way
diminished the nations’ housing problem neither has it
completely solved poverty problems in the country. It is in the
light of the foregoing that this study evaluates the
contributions of the Academic Staff Union of Polytechnics
Credit Investment and Cooperative Society (ASUPCICS),
Federal Polytechnic Ede, towards housing delivery and
poverty alleviation.

Housing delivery, cooperative societies and poverty
Housing delivery system according to [4] involves a complex
process that flows in stages and in a sequential series to
produce a housing unit or units. Housing is a multifaceted
object whose development requires huge initial capital outlay.
The owner or residents decides its form, nature and the use(s)
to which it can be put in line with the operating laws; hence, it
forms the general part of the human institutional framework
[9]. Housing is a fundamental need for human dignified living
and an object that represents a foremost area of deprivation
for most people especially the urban poor in Nigeria. Thus,
the scope of housing is all inclusive as it goes beyond just a
mere shelter to include all infrastructural facilities and
services that makes life comfortable and worth living but the
omission of such basic infrastructure could bring about slum
and shanty town formation [10]. However, [27] is of the view
that, the effort at meeting the housing need can be seen
through the quantum of employment it generates for poverty
mitigations. Despite the unparallel importance of housing to
man, its adequacy in term of supply and affordability to the
common man in Nigeria, remain a herculean task to overcome
Recent studies conducted in Nigeria has confirmed the
existence of housing poverty and lag between housing supply
and population growth rate as successive governments in the
country pay more of lip-services to housing delivery than its
actual executions ([21], [10], [5], [16], [20] and [23]).
Housing poverty could be in terms of the quality of housing
occupied by those in the low-income bracket who are often
located in the slum areas of the city with almost complete
absent of modern infrastructural facilities. [26] evaluated the
options and challenges of financing housing for sustainability
in Nigeria and concluded that Nigeria have ineffective and
inefficient housing financing system. The study, urgently
recommended the reversal of the trend through the promotion
of good governance that will ensure stable economic and
political environment. Similarly, [11] examined the strategies
adopted by Lagos residents in solving their housing problems.
The study acknowledged the inadequacies of urban housing in
the state cum haphazard housing developmental syndrome
without adherence to the provisions of the state urban
development board. The study further revealed that
speculative housing development was gradually becoming the
trend in the state with independent mass housing initiatives
and working to specific mandates with specific decision
processes. It thus recommended the existence of residential
housing estate that will be devoid of all forms of
environmental challenges.
However, [8] argued that demand for housing is effective
demand but not notional or potential demand as the ability, the
value the purchaser places on the product and the willingness
of the purchaser to acquire the product counts and not his
mere wish. More so the degree of desperation of the intended
buyer to acquire the product is another factor that must be
considered. In Nigeria, the unsafe and insecure investors’
funds, weak institutional frameworks and the current void in
real property rental market due to the unstable micro and
macro-economic variables have negatively impacted on
workers’ earning and the real property market, thus, creating
several waves of hardship in real property development and
acquisition in the country.

Cooperatives societies have been regarded as an institutional
machinery that is people oriented, owned, controlled and
aimed at empowering members who pulled their resources
together for the purpose of meeting each member needs. The
needs of members go beyond the mere obtaining of loan to
meet immediate needs to the financing of massive housing
projects. [12] studied cooperative societies, housing provision
and poverty alleviation in Nigeria using Covenant University
Staff Cooperative and Multipurpose Society Limited. Findings
from the study revealed among others the ability of the society
to assist members in embarking on massive housing
development projects on incremental basis in addition to
accessing funds for other family needs with ease. The study
concluded by asserting that project funded through cooperative societies’ approach offers great potentials as
frustrations inherent in the pursuit of achievements through
commercial bank loans at relatively higher and varying
interest rates are minimized and hence recommended the
establishment of Staff Co-operative Societies across all
segments of the country.
[2] also examined housing co-operative societies and
sustainable housing delivery in Oyo State, Nigeria. The study
revealed that organized private sector housing serves as one
sure means for enhance housing delivery in the country. The
study concluded that co-operative societies have assisted its
members to become home–owners which has gone a long way
in resolving housing problem especially among the low- and
medium-income urban dwellers in the country.
[3] Submitted that the enactment of Ordinance No 9 of 1935
brings about the operations of modern cooperative societies
which in recent time have become a trusted avenue for project
financing with low interest rate in the country. Through the
operations of cooperative societies, the nation has taken giant
stride and achieved a lot in the various areas of her
developmental efforts be it in the housing industry or human
capital development aspect of the economy. As one of the
most veritable and dependable sources of developmental
project financing in the country, cooperative societies have
helped in boosting productivity, creation of jobs and wealth as
well as the promotion of poverty alleviations through low
interest rate loan provision for housing project financing,
human capital development and for other basic needs ([18],
[14], [22] and [19]).
[13] assesses the impact of savings and credit cooperative
Societies as a panacea to accessing funds for housing
development to workers of public institutions in Nigeria using
the Institute of Agricultural Research (IAR), Ahmadu Bello
University, Zaria-Nigeria as case study area. Findings from
the study revealed that, the cooperators range of
dissatisfaction index (RDI) indicated 0.832 in terms of
cooperative loan which is the lowest compare to that of
National Housing Fund. This makes members of the
cooperative society to be well satisfied with cooperative loans
compared to other loan sources. The study concluded that
cooperative societies is a viable instrument for housing
projects funding for public institutions’ employees. From the
above presentation it has become clearer that cooperative
society fund is a cheap and better housing financing options
for the production of accessible and affordable housing as
well as job creation and poverty alleviation.
As a global phenomenon that is complex and
multidimensional in nature, scholar have found it difficult to
give a one size fit all definition of poverty as its tentacles have
been spread to several areas of human existence. [6] asserted
that the condition through which people lack the resources to
satisfy their basic needs can be said to be the state of poverty.
He further explained basic needs to mean those needs
necessary for human survival. However, The Central Bank of
Nigeria cited in [6] sees poverty as a state of an individual’s
inability to carter satisfactorily for his or her basic needs of
food, clothing and shelter. Also, as the incapability of that
individual in meeting other social and economic obligation,
absence of gainful employment skills, assets and self-esteem
and has limited access to social and economic infrastructure
such as education, health, portable water and sanitation and
consequently has limited chance for his or her capabilities.
[15] observed that to comprehensively defined poverty, the
dimensions of vulnerability, voicelessness and powerlessness
framework was added by the 2000/2001 World Development
Report. One thing that is constant is that from whatever
perspective poverty is viewed or defined, its effect is always
grievous and harmful to both the individual and the
[15] in their evaluation of the effectiveness of the Integrated
Poverty Alleviation and Housing Scheme (IPAHS) in
Ramotswa which is a settlement of about 32 km south-east
Gaborone, the capital city of Botswana, realized that, despite
the scheme’s high uptake, several challenges abound among
which are the poverty state of the people. The study therefore,
concluded by recommending government policy intervention,
the scheme sustainability through the coordination of the
various roles played by the stakeholders among others.
Similarly, [6] who examined the impact of poverty on housing
condition in Mushin, Lagos, Nigeria affirmed the
disproportionate settlements of the poor in the urban shanty or
rural areas and identified four economic groups where the
poor can be found in most developing countries of the world.
These groupings include the rural landless, the small farmers,
the urban underemployed and the unemployed. The findings
of the study established a nexus between poverty and
residents’ poor health condition and housing condition. It
recommended adherence to housing and building code
regulations, effectiveness of urban development policy as well
as improvement of sanitary conditions. However, [16] in his
assessment of Property Development as a Panacea to Poverty
Alleviation in Nigeria avers that there existed a positive linear
relationship between the percentage change in skilled labour
wages and percentage changes in the total annual number of
buildings constructed which could bring about alternative job
creation and poverty alleviation. The study recommended the

initiation or facilitation of enabling environment for real
property investment by government. The study however,
concluded that the processes for the alleviation of poverty
adopted in Nigeria so far are more of consumption driven
rather than productivity or developmentally oriented program.
More so, workers’ wages tend to increase as more houses are
constructed each year with the multiplier effects of increase in
spendable income, saving in rent, job creation and better
productivity thereby reducing poverty level in the economy.


The Federal Polytechnic Ede have seven major vibrant
cooperative societies which are: the Federal Polytechnic Ede
Staff Cooperative Society (membership is open to all
categories of the polytechnic staff); ASUP Cooperative
Society ( strictly for academic staff members); WITED
Cooperative Society (for women in technical education);
Senior Staff Club Cooperative Society (for members of senior
staff clubs only); Commonwealth Cooperative Society (for
few selected likeminded Christian senior staff members) God
Favour Cooperative Society (for all staff member) and Islamic
Cooperative Society (for only Muslim staff).
The ASUPCICS, Federal Polytechnic, Ede, Nigeria which is
the focus of this study was established in year 2000 and was
registered in May 2001 as cooperative society, under the
cooperative societies and allied matter law of Osun state. The
prime objectives for the formation of the society are among
others to provide quick education fund access to academic
staff members at very low interest rate, low interest rate
housing loan to members and cheap access to household loan
(home furniture and other accessories). The overall aim is to
aid members promotion, take them from the shackle of
poverty by upholding the ethical value of openness, honesty,
care for all member, equity and fairness. The society that
started with less than forty member staff strength in
2000/2001 has grown to 420 members by 2018/2019
cooperative year.

The research work examined the contributions of Federal
Polytechnic Ede Academic Staff Union of Polytechnics
Cooperative Investment and Credit Society (ASUPCICS)
towards housing development and poverty alleviation since
inception. As part of information gathering procedure for the
study, both primary and secondary sources were explored.
Primary data were sourced through physical surveys
(participant observations) to identify the actual plots of land
acquired and developed by the cooperative society.
Questionnaires were also administered on the respondents and
back up with in-depth structural interview in order to elicit
viable information. Secondary data source used for the study
include information obtained through internet database,
books, journals, periodicals and magazines. Data obtained for
the study were analyzed using descriptive statistical tool. The
cooperative society have membership strength of 420
members out of which 370 representing 88% of the total
membership strength were selected for the study using
purposeful sampling technique. Out of the 370 questionnaires
administered, only 350 questionnaires representing 95% of the
total administered questionnaires were correctly filled and
returned for analysis. This was however considered adequate
as the analysis was based on the total numbers of
questionnaires correctly filled and retrieved.

The membership profile of the cooperative society revealed
that the society have more male academic staff as members
than female. The reason for this may be connected to the
appointment profile of the Polytechnic staff as male staff out
number their female counterpart. A glimpse at the record of
membership of Academic Staff Union of Polytechnic in the
institution also indicated that the union through which the
cooperative society was formed have male dominated
memberships. The composition of the cooperative
membership strength is as presented in table 1 below:


Table 2 shows a steady upward movement in the savings
capability of members across all cadres of academic staff who
are members of the cooperative society within the study
period. Saving strength of members started to increase from
below one million Naira to over two million naira per annum.

Table 3 reveals the various loan types available to members
and which members can assess, the allowable loan repayment
period and the chargeable rate of interest. Regular loans are
the normal loan that every member is entitle to, which is
usually twice the asset or savings of the cooperative member
who seek the loan. If regular loan is sought for 12 months then
a flat interest rate of 3% is charge, if it is to last for between
13months to 18 months, 6% interest rate is charge but if above
19 months, 10% is charge. Housing loan is a loan targeted at
incremental housing development (home ownership) granted
base on individual ability to repay the loan as evidence in his
or her payment advice slip and that of the two guarantors. It is
granted at 3% for between I to 12 months and 7% for loan

period of between 13 to 24 months. Car loan is to assist
members acquire car of their choice and is at a flat interest
rate of 15% for loan period of 20 months. Education loan is
fixed at one million naira maximum with 5% interest rate.
Household loan is loan granted to assist members acquire
household equipment and attract 5% interest rate. Additional
loan and special loans are granted to those members with
special need but who are already servicing other loan with the
cooperative. Loan to non-members attract 10% flat interest
rate with all loan request passing through clearance house.
Local Purchase Order (LPO) financing is open to members
and non-members at flat interest rate of 15% as shown in table 3

quarters or the housing of her staff. This and other factors
have directly or indirectly impacted on the property rentals
market of several states with negative consequential effect of
rental hike and impoverishment of tenants among others. To
curb this menace, ASUPCICS was motivated to introduce
housing loan scheme or plot acquisition scheme for members
to develop. The society since inception have acquired land in
four locations (Ede, Owode, Gere and Akoda ASUPCICS
housing scheme sites) for about 270 members of the society at
affordable prices. The society also went ahead to assist her
members with the survey and registration of the land and layout design of the estate. Willing members are as well
encouraged to procure building materials with the help of the
society’s household loan window. Apart from helping
members to develop their plot with ease and the needed peace
of mind, the issues of land contestations or conflict which is a
common feature in most cities are removed. All loans granted
by the society are repay on instalment through monthly
deductions from members salary. The analyzed content of the
society’s record as presented in table 4 further reveal the
categories of loan and the percentages of the annual amount
disbursed as loan for each of the categories. The spread of the
annual loan allocations and disbursement by the society is as
presented in table 4

Table 5 presented the total loans disbursed towards housing
development by the cooperative society within the period
under study. The highest loan amount that was disbursed is N
145,200,000 in 2018/2019 cooperative year. Out of the
amount disbursed, N 105, 600,000 was for housing loan while
N 39,600,000 was disbursed as household loan. However,
2011/2012 and 2012/2013 cooperative years witnessed the
least loan disbursement as the total housing and household
loans requested, granted and disbursed to members was N
62,400,000 for each of the years. The reason given for the low
loan disbursement was low savings by cooperative members.

Table 6 present the analysis of housing development loans
applied for, granted and disbursed within the study period. In
2011/12 cooperative year, 39 staff members applied and were
granted both housing and household loans. That is, 15
members were granted housing loan while 24 members
obtained household loans within the period. On the other
hand, 2014/15 cooperative year exhibits the worst loan
disbursement towards housing development despite the
overall improvement in total annual deductions from N
180,000,000 to N 2I6,000,000 (N36,000,000). The reason for
decline in housing related loan could be as a result of the
increase in regular loan request by members as shown in table

The study in tables 1 and 2 found that, out of the 420
cooperative society membership strength, only 127
representing 30% of her members are female while the
remaining 293 representing 70% of the total membership
strength are male. More so, it was observed that there was a
progressive upward trend in contributors’ savings as more
savers moved from the low saver cadre- that is, less or equal
to one million naira (≤ 1million) saving range to medium level
saver of between one to two million naira savings per annum.
This portrays the good management capabilities of the
executive members and the confidence of members in their
handling of the cooperative affairs. This is however, in line
with the submission of [12] that good management and the
hope of obtaining loan at short notice boost savers’
The study also revealed in tables 3 and 4 that ASUPCICS
offer her members and non-members wide range of loan types
with a slightly higher rate of interest for non-members. All
loans are granted at short notice subject to availability of fund.
Thus, issue of bureaucratic bottle-neck, hidden charges and
other unexplainable deals associated with commercial bank
loans transactions are circumvented by members who
obtained cooperative loans. More so, cooperative societies
charge the least interest rates on loan and allow for flexible
loan repayment as loan repayment period can be re-negotiated
from time to time so as to reduce the financial stress of the
debtor. Members who obtained huge loans from the society
used such loans for projects that engages others especially the
artisan thereby reducing the numbers of the unemployed
youths on the street and in turn reduces poverty level in the
country. This is congruent with the earlier submissions of [3];
[12]; [14]; [13], [16] and [27] who argued that housing
delivery through cooperative societies initiatives have the
potentials of reducing financial stress, alleviating poverty,
providing direct and indirect jobs for a large number of people
and increasing better productivity with enhanced spendable
income. However, the study’s findings negate the assertions
of [26] who places much emphasis on private and public
sectors, institutional lenders and capital market as housing
financing alternatives as well as the documentations of
Balchin cited in [13] it negates the documentations of Balchin
cited in [13] which projected cooperative societies as a model

that is unsuitable for the low income group.The finding
further revealed that, loan interests are charged base on loan
repayment period and Local Purchase Order (LPO) financing
meant for contractors is charge at a flat interest rate of 5% for
3 months loan period. However, the society gives priority to
regular loan with about 50% and 60% of her total loans
disbursed in 2012/2013 and 2014/2015 with the least loan
allocation of 35% in 2016/17 cooperative years. Housing loan
had its highest loan disbursement of 40% in 2016/17 and the
least allocation in 2012/13 and 2015/16 while household loan
got it highest allocation in 2017/18 and least in 2013/14.
Attendance of conferences and acquisition of higher
certificates are most often done through Tertiary Education
Trust Fund (TetFund) intervention; hence education loan
received less applications. The other types of loans rarely
sought due to the slightly higher interest rate are LPO
financing and special loan.
Again, the analysis of the society’s documents further
indicated that the society have so far acquired 48 acres of land
equivalent to 384 plots of land in the four locations for her
members. This translated to more academic staff members
becoming landlords which invariably reduces poverty rate as
money that would have been use for rent payment can now be
use for something else. More so, staff members acquire exotic
cars with ease courtesy of the cooperative car loan initiative.
Most staff have completed and tastefully furnished their
houses with the help of housing and household loans.
Members and non-members alike who have contracts but
require money to finance it, have assessed the LPO finance
loan initiative, thus finance several contracts to their credit.
Furthermore, jobs are created as the loan taken through the
housing and household loans are used for housing
development which create jobs for the artisan hence a strong
nexus exist between cooperative societies, housing
development and poverty alleviation. This is congruent with
the view of [16] that housing development have the multiplier
effects of rent savings, increasing spendable income and
enhances better productivity.
The study further found that, the housing loan option of the
cooperative society have significantly increased housing stock
which invariably brought down housing demand pressure and
thus gradually stabilizing the effect of skyrocketing property
rentals of the past years. The finding is consistent with [7].
The study assesses the nexus between cooperative societies,
housing provision and poverty alleviation using ASUPCICS,
Federal Polytechnic Ede, Osun state as the case study. The
study established the nexus between property development,
poverty alleviation and cooperative societies through the
confirmations of the significant contributions of the society
towards housing development and poverty reduction which is
done through the provisions of access to quick and low
Interest rate loan facilities. It is on the findings of the study
that the paper recommends the need for the establishment and
sustenance of robust and possibly transparent and corrupt free
cooperative societies at local, state and federal agencies and
parastatals in Nigeria for housing ownership and urban
poverty mitigation in the country.


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