Legal Analysis of The Formation of Regulations Red and White Cooperative to Improve the Welfare of Village Communities

Abstract

This study analyzes the regulatory framework governing the establishment of the Koperasi Merah Putih as a strategic instrument to enhance the welfare of rural communities in the districts of Demak, Grobogan, and Pati. Normatively, the formation of cooperatives is a direct implementation of Article 33(1) of the 1945 Constitution of the Republic of Indonesia, which mandates an economic system organized as a collective effort based on the principle of kinship. This principle is further reinforced by Law No. 25 of 1992 on Cooperatives, which stipulates that cooperatives function to improve the welfare of their members and society, while contributing to national economic development. This research employs a juridical-sociological approach to examine the gap between legal norms (das sollen) and their implementation in practice (das sein). Data were obtained through literature studies and field research in three districts with diverse socio-economic characteristics: Demak, an agrarian-coastal region vulnerable to disasters; Grobogan, a traditional agrarian district; and Pati, an area with a mixed economic structure that faces inequality and ecological vulnerability. The findings reveal that, despite strong social and economic potential, the implementation of the Koperasi Merah Putih initiative remains in its early stages and lacks structured development. The primary obstacles include low cooperative literacy, the absence of clear legal instruments within village institutions, limited technical assistance, and weak cooperative governance. Field observations further show that rural communities still perceive cooperatives mainly as savings-and-loan entities, resulting in the Koperasi Merah Putih not yet being recognized as a collective economic movement capable of strengthening the bargaining position of farmers, fishers, and MSME actors. Moreover, the lack of integration between cooperatives and village planning instruments—such as the RPJMDes, APBDes, and BUMDes—has created institutional fragmentation. Theoretically, this study is grounded in John Rawls' Theory of Social Justice, the Theory of Legal Effectiveness, and the concept of Maqāṣid al-Syarī'ah, all of which emphasize distributive justice, the functionality of law within society, and the pursuit of public welfare in economic governance. The results demonstrate that the effectiveness of regulations governing the Koperasi Merah Putih is highly dependent on alignment between legal norms, the readiness of village institutions, and human resource capacity. Therefore, this study recommends reconstructing cooperative regulations based on the values of Pancasila justice, providing a minimum of three years of intensive facilitation, promoting digitalization of village cooperatives, and strengthening oversight through regular audits. These measures are expected to ensure that cooperative operations are professional, transparent, sustainable, and genuinely capable of improving rural community welfare.