Mr. Kevin Johnson:

I will take the Deputy’s questions in the order they were asked. Our understanding of the draft general scheme is that it does not prohibit a board from nominating one of its directors as treasurer. Our interpretation of the Bill is that it tries to distinguish between what we would describe as executive functions, that is, management and operations, and non-executive functions in terms of overall governance and strategic direction, which would be the primary role of the member elected board. It is good to see that the role of manager is being properly recognised and specified, although that in itself comes with a number of challenges for the holders of that role. We have found from experience that stronger and well run credit unions exhibit a positive relationship between manager and treasurer. It is essential that every member of the board understands the fundamentals of the business. The preparation and presentation of accounts are functions for the manager, but there is nothing to prohibit a board from nominating a director to take a lead role in financial matters. The commission’s report recommended that at least one member of the board should have financial experience. We have seen examples of finance committees working very well in a number of credit unions. We certainly welcome the proposed role for managers. These provisions simply formalise what already obtains in many credit unions, as well as placing a responsibility on managers to perform.

Credit unions can participate in credit union service organisations, CUSOs. The Credit Union Development Association is a CUSO because we are owned by a number of credit unions and have been established for a specific purpose. We exist to deliver value to our credit unions and, in fairness to them, they challenge us to deliver value at least once per year. There is nothing to stop a credit union from participating in a CUSO, but its nature depends on where it is regulated. CUSOs are regulated by different parts of the Central Bank according to their nature.