Mr. Kieron Brennan:

On behalf of the members of the alliance, I thank the committee for inviting us to participate in its consideration of credit union finance for social housing provision. We are four housing bodies - Clúid, Co-Operative Housing Ireland, Oaklee Housing and Respond! - that co-operate on matters of housing supply. We are four of the larger approved housing bodies, AHBs, and collectively provide more than 12,500 homes for families across Ireland. Some 3,000 of these have been delivered in the years since 2010 or, in other words, since the end of 100% capital funding. We have a delivery pipeline of 6,000 new homes to be delivered over the remaining years of the Rebuilding Ireland plan and are potentially some of the largest customers for credit union investment. All of us are tier 3 AHBs, have experience in accessing private finance and have been certified for lending by the Housing Finance Agency.

The national housing action plan, Rebuilding Ireland, identifies AHBs as key delivery partners for social housing, recognising "their track record in terms of both housing provision and management". This builds upon support for the sector in the Housing Policy Statement 2011 and Social Housing Strategy 2020, published in 2014. There is a clear and ongoing Government policy of support for AHBs playing a central role in social housing delivery.

Rebuilding Ireland sets out the key recommendation that the Government "should seek to mobilise as quickly as possible, all possible sources of funding, including funding from the Housing Finance Agency, Strategic Investment Fund, the Irish League of Credit Unions and Irish Pension Funds, to increase the supply of social and affordable housing". Regarding credit unions, the proposed addition of investments in tier 3 AHBs as a permitted investment class is welcome to us as a potential additional source of finance as we seek to play our part in responding to pressing local housing need. It would assist in promoting credit unions to our members and tenants and would offer an opportunity to showcase the potential for local social investment by the movement.

For our organisations, credit unions play a key role in local communities in promoting sound money management, providing access to travel, education and home improvements, and tackling the challenges associated with moneylenders. The ongoing sustainability of the credit union movement is vital to us and the members and tenants whom we represent. We also see key additional benefits for credit unions themselves from the higher yields that may be possible compared with the current range of permitted classes of investment. It would also allow credit unions to invest in a highly visible way in the delivery of services of value to the local community and to strengthen their bonds with their members.

Liquidity and stability are obviously key issues for all financial services providers. As the Central Bank's consultation paper notes, at the end of 2016, credit unions had assets of €16.1 billion, loans of €4.1 billion and investments of €11.4 billion. Given the range of permitted investments under the 2006 guidance note, it is clear that the movement as a whole has more than adequate levels of liquidity and is suffering from falling rates of investment income. We believe that diversification of the investment portfolio can be undertaken to provide for improved investment returns while sustaining adequate liquidity levels.

As a proposal that would support AHBs and credit unions, we welcome the consultation from the Central Bank on credit union finance for social housing. We have provided a collective response to that consultation and have circulated a copy of it to the committee. In it, we set out some of the key features of the funding arrangements for new AHB delivery through the capital advance leasing facility, CALF, and the payment and availability agreements. These and associated schemes can provide confidence to the Central Bank and credit unions about the robustness of social housing as an investment class. We are happy to provide more detail to committee members during our conversation.

The current consultation represents the culmination of many years of work by credit unions and housing providers in seeking to make the case for locally backed social housing delivery. The Housing Alliance would value the support of this committee in the context of the current consultation, both for the benefit of housing delivery and for the good of the credit union movement.

We thank the committee again for the opportunity to present to it and we are happy to answer whatever questions members might have.