Ms Fiona Cullen:

I thank Deputy Doherty for his questions. There is an argument for the term limits. There are dangers relating to entrenched leadership, but there needs to be a level of respect for the fact that some people have given decades of service to the credit union movement. It would be very naïve of any of us to think that will go away all of a sudden because we write something into statute or that that will be accepted by people who might have given 30 years of service to their credit union.

We do not accept the premise that there is no renewal in the boards of credit unions. At the moment credit union directors are elected at the AGM by their fellow members to carry out specific tasks under the Credit Union Act. That said, their term of office cannot exceed three years and just like the members present, they need to produce the goods to get back into a position to get elected again. There are people who have been returned again and again. We must ask ourselves why that is. Let us presume that in the majority of cases it is because people do a very good job. It is very difficult to quantify the impact. We have engaged in extensive consultation with the members of the league since the publication of the commission report. At the various engagements we have had, including at our AGM and at roadshows around the country, we canvassed their views a number of times and we continually hear that this is entirely the wrong thing to do.

The CEO and Mr. Edwards have spoken about the world experience. Every credit union has a set of rules registered under the Credit Union Act. We have a process whereby amendments to those rules come through the league AGM. There is nothing wrong with a credit union in its own circumstances with a sufficient pool of volunteers open to it, deciding that it is the right thing for that credit union and we would support that all the way. There is a difficulty with a statutory obligation to walk away after nine years. There are questions as to whether somebody would serve for nine years, go away for six and come back. That would be a loss to the credit union and the community. We feel it would be a much better to allow them to write it into the registered rules if it is beneficial for that particular credit union and if a board of directors, who are best placed to make such a decision, so decide.

Mr. Brennan and I participated in the commission and are very respectful work that was done. We know better than anyone how hard everybody worked. However, sitting in an office in the Department of Finance and coming up with wonderful plans may cause long-term damage to the credit union movement because at a particular time with particular external pressures there was a school of thought that it was the right thing to do.

Our thinking on the memorandum of understanding is as follows. There will always be tension between the regulator and the regulated - that is the way of the world. We are trying to do whatever we can to mitigate that. As far as we can see one of the things that would assist in that regard is if there was an agreement - obviously it does not create any legal obligation. However, it would provide clarity on the roles of each. There is an issue with the registry or the Central Bank needing written confirmations from the credit union as whether it has done something and vice versa. If a credit union is being directed to do something by the Central Bank we would want to see clarity around the particular issues that should be dealt with by written direction. For example, if a credit union is instructed not to hold its AGM for a period, there should be a formal written instruction from the regulator to the chairman of the board of the credit union. That would help with the difficulties that will always be there.