Tom Barry (Cork East, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I welcome Ms McKiernan and thank her for her contribution. I have met with credit unions over the last while and it is very interesting to see the huge differential in scale between credit unions. It has become clear that the credit unions are unhappy with the €100,000 deposit protection. I understand Ms McKiernan's argument but they do not seem to accept it and the gap needs to be bridged and dealt with. They are not happy with the engagement. Many people put a lot of their time into this voluntarily and they feel almost hounded out of existence. While Ms McKiernan may have a remit it is important that the remit does not sound the death knell for credit unions. That needs to be kept in the back of Ms McKiernan's mind all the time. I acknowledge that, like all lending institutions, bad decisions were made by some credit unions - but we do not live back there, we live in the present and the future.

The witness said that some credit unions would find it hard to go onto new platforms. I have been in business for many years and in the last few years we have concentrated on doing the simple things effectively and sticking to our core business model. We have seen many examples of other insurance companies etc. losing fortunes by veering too far away from their core client base and they have gone back to their original client base. Maybe credit unions should be helped to go back doing what they are best at which is lending low amounts and keeping people away from loan sharks, with all the important social dividend that brings. We are veering into social projects and social housing but I suggest the credit unions should get the basics right first. The statistics reported by the CSO today indicate that car sales have increased by 30%. Credit unions were always good for car loans. A platform is not needed for that, a person just goes in looking for a car loan. We need to find out why this is not happening. If businesses are falling from €7 million to €4 million in lending is it because of the restriction under which they operate or has there been a fundamental change? If demand is there for car loans - which the credit unions were traditionally involved in - why is that business not going to credit unions now? These are the questions I would like answers to.

I do not agree with a one size fits all approach. It certainly does not fit in this area. Projects of a public nature were mentioned. I came across a particular credit union which was involved in lending to a crèche. This was fine but there was another private crèche over the wall. Two crèches in business back to back in a medium sized town does not suggest a very sound business decision. With declining loan books the credit unions are under pressure and not happy and I reiterate that credit unions need help to do their basics and then they can look at other dreams and platforms. The dialogue between Ms McKiernan's office and the credit unions needs to ramp up and those ideas need to be teased out. I would be interested to know how much communication she has with them and if she see a favourable outcome for credit unions.