Mr. Ed Farrell:

One of the six steps is the micro credit pilot, which was to get a pilot scheme up and running. It was more a regulatory procedure rather than any changes and the regulator. The registrar's people are part of the project group. They have been able to work with the group.

Housing and the small business are the two sectors that will need regulatory changes over investment rules that credit union are bound by at present. Credit unions have very few options on where to place the surplus money they do not lend. If they do not lend the money to their members, it is really a choice between bank deposit accounts or Government and-or bank bonds. Some 80% to 90% of our surplus money is in bank deposit accounts lying largely idle and earning very small income. It is against that background that we have the central vehicle in the six-step plan for small business and social housing to try to have a central pool of money so that the credit union, subject to the regulator changing the investment rules, could place the money into a central fund or trust. There would be expertise employed by that trust to assess the loan for the SME or the loan to the housing body for the social housing.

We are trying to centralise decision making and underwriting to convince people that this is a safe and prudent alternative use of credit union funds.

We launched our social housing proposal on international credit union day, approximately a month ago. When the Government launched its social housing strategy at the end of 2014, it talked about the formation of a financial vehicle into which pension funds and credit unions could place money which could then be used to build social housing. In our early engagement with the Department of the Environment, Community and Local Government, it became clear that it was a medium-term, rather than a short-term, priority and the Department asked us to think about the issue in some other way. Our paper contains two options. It makes reference to the Government's financial vehicle but also leaves open the option of credit unions creating their own financial vehicle, which would have underwriters and lending people who would access the loans from the approved housing bodies, namely, the not-for-profit companies which build social housing. This puts it further from the State's balance sheet. We were asked to do this by the Department because its vehicle was for the medium term, whereas we have the money ready to roll. We look forward to engaging with the Department and there is a meeting next week to get it started. It would require a small enough regulatory change to allow the investments, and not just bank deposits, to be formed in a central pool, properly managed and regulated as a central vehicle to lend to housing bodies that are also regulated entities.