Posted on March 7th, 2021


Philip Gunawardene    was the creator of the Multipurpose Cooperatives Society. Until 1956, the cooperatives had been single purpose ones. There were separate cooperatives for food distribution, for savings and loan disbursement.

 There were about   10,500 of cooperatives   and they were of 70 different types. Philip decided to weld them into one organization, the Multipurpose Cooperative Society.  By 1958 a fair number of Multipurpose Cooperatives were formed, others were converted. There was terrific enthusiasm on the part of the public, said Meegama

The village level Multi-purpose Cooperative was a small unit and it would have to depend on the private sector for its stock. Therefore Multipurpose Cooperatives were combined into unions.  each Union of multipurpose Cooperative had a fleet of lorries to transport goods and distribute them to the to the individual multipurpose cooperatives This Union of Multipurpose Cooperatives played a major role in the development of the area  long  after Philip Gunawardene had left the  Ministry, said Garvin Karunaratne.

S. Piyasena, who had contested under MEP in the 1960 election, said that Philip’s greatest achievement was not the Paddy Lands Act, but the creation of the Multi-purpose cooperative society. Those days, where Gunasinghepura is today, you could see ranks upon ranks of stalls with cheap vegetables and other food items, brought there from all over the island by rows of lorries emblazoned with the insignia of the Multi-Purpose Co-operatives.

later he tried to reform the fisheries on the same lines of cooperatives to enable the fishermen to get some of the profits that were going to the middleman, the fish mudalali, but vested interest prevented this.

Philip took over the Cooperative Wholesale Establishment. CWE was selling a bare minimum of items at that time.  the public had to go to the private trader for the rest. Philip gave CWE trading rights and monopolies in respect of several items of food stuffs.  Philip wanted to make the CWE the sole importer of all essential food stuff.   He appointed a new Board of directors and the CWE had shown a profit in 1956 itself.

Philip found that there were five firms which imported fertilizer, Colombo Commercial, Baur, Shaw Wallace, Moosajee and two other small firms. They have a virtual monopoly. CCC, Baur and Shaw Wallace work together. The government subsidizes 50% of the cost to the paddy cultivator and also pays out enormous amounts for fertilizer for coconut, rubber and paddy.  All these go to the importing firms. We are their mercy said Philip.

Philip wanted to make the CWE the sole importer of fertilizer. The idea was opposed, by many including the Minister for Commerce.  Cabinet refused to give approval for CWE to import fertilizer.Even the Prime Minister had objected to the state importing fertilizers.

Philip then suggested creating a separate state organization for the purpose. It would be able to sell fertilizer cheaper. And eliminate the high profits the   three foreign firms were making   since they had a monopoly on it.  Nothing came of this.

The Marketing Department under Philip had four services, a Vegetable Marketing Scheme, a Fruit Cannery, a Bakery and Retail Fair Price Shops in all cities. I can state that The Marketing Department functioned very effectively under Hon. Philip  Gunawardena said  Garvin Karunaratne  I was Assistant Commissioner of Agriculture Marketing at the time.

The Vegetable and Fruit Marketing Scheme, implemented by the Marketing Department was something unique to Sri Lanka, said Garvin. Its function was twofold- to provide a high price to the producer to encourage production as well as sell to the consumer at cheap rates, a scheme that kept inflation of local produce in check, said Garvin.  This was a Scheme begun during the days of World War II. Under Philip, this mechanism had to work perfectly.  

Tripoli Market was the Headquarters of the Vegetable and Fruit Marketing Scheme. Garvin, together with another officer were in charge in 1956. Tripoli Market was   at that time, in a large hanger in the Colombo Goods shed. 

We bought vegetable and fruit from producers at the producer’s fairs all over the island. This controlled the prices at which the traders purchased vegetables. we then fixed a selling price higher than the   purchase price and kept ten to fifteen percent mark up to cover transport and handling.  

we sold vegetables at this price at 50 well stocked small retail shops in Colombo. the traders all fell in line. With vegetables   offered at low prices at our retail shops no one would buy from other  traders at a higher price  in this way we controlled the prices  very effectively  but unofficially.  

We did not use middlemen. We handled the goods from the producer to the consumer.  there were Purchasing Units in all the producer areas. Marketing Department had a Purchasing Unit present at every major vegetable fair. These Units purchased vegetables at a higher price than what the private trader paid.

 The purchasing price was decided at Tripoli Market which had 24 hour surveillance on the availability of produce and the prevalent wholesale prices at the Colombo Wholesale Market.  Three to four officers were on duty there.

The vegetables purchased at the Fairs were sent to Tripoli Market overnight by rail and lorry and by ten in the morning the vegetables had to be distributed to the retail units in all corners of the city. We had a staff with a dozen lorries always on the move in the City. The Department with over a hundred lorries, purchased only around ten percent of the produce, but that was sufficient to unofficially control the prices.

We had a staff of Marketing Officers in every producing area and Assistant Commissioners were always on the move. The Assistant Commissioners contacted major producers and advised them on what varieties were required for the market in Colombo. This was done through the Divisional Revenue Officers as well.

At Ratnapura where I worked in 1956, on four days in the week, I was driving on the tortuous roads to the Fairs at Embilipitiya, Colombage Ara, and Godakawela. I had to be there before six in the morning to ensure that my staff of Marketing Officers made purchases. The vegetables were packed and sent to Tripoli Market overnight. We had to relay the prices at which traders purchased at the Fairs to Tripoli Market and daily discuss prices. 

Marketing Department Cannery was probably set up by Philip, for Garvin says, The Cannery being established, the Department offered floor prices for Red Pumpkin, Ash Pumpkin and Pineapple, turning them into Golden Melon Jam, Silver Melon Jam and Juice. This stopped imports from Australia and saved our foreign exchange.  A Floor price meant that we purchased everything offered by the producer. the officer in charge of the Canning Factory went often to Europe to find markets for pineapples and we built up an export market.  (continued)

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