Michael Creed (Cork North West, Fine Gael) | Oireachtas source

I thank the delegations for the presentations which have been most interesting. There is a debate in the Dáil tonight and there are parallel debates going on between the credit union sector and the Department. I hope we can collectively aim for an end game which involves something that is workable for everybody, not least the punter out there who puts his or her money in trust with the credit unions. I know that is what the credit unions want as well. We must be cautious as we go from an era of light touch regulation that we do not end up with a situation where we put people into a straitjacket that would not work for them either. I am generally conservative on the matter. I am in favour of making haste slowly. I would rather err on the side of caution than make the mistake of not sufficiently regulating the sector. We are involved in a process on which I hope we will reach a successful conclusion.

With your indulgence, Chairman, I will do a little bit of fishing. I do not wish to ask anyone specifically but whoever thinks it is appropriate to his or her area can respond. Most of the people in financial services to whom I have spoken said that in a recession people saved more. The credit unions now have to deal with a lot of money sloshing around and on which they must get a return. People have not been borrowing as they were previously because they were mending household balances among other issues. The credit unions now have the problem of having a lot of money on deposit. Is there a danger that the credit unions will get the balance wrong between long-term lending, which they want to get into, for example, the housing market, and short-term lending, which has been the core business of credit unions? I refer to the college grant, replacing the car, dealing with the hole in the roof or whatever else. Just because the credit unions have the immediate problem of having a lot of money on deposit, they could get the balance wrong and we could make regulations which might be out of sync with what might be a more normalised economy in a few years’ time.

The credit union movement is a very effective lobby group. I received many representations in my constituency but I did not get representations from all of the credit unions that operate there. I thought that was strange so I decided to make some inquiries on the matter. Why do some credit unions currently have their own in-house rules to the effect that they do not want deposits in excess of €100,000? Why do some credit unions consider that prudent and others do not?