Mr. Ed Farrell:

There is a bit of history to it. Deputy Ryan asked about the Central Bank. The Central Bank lays down the rules and regulations individual credit unions must follow in the course of their business. Typically, credit unions take in money from their local membership and loan it out in small, unsecured loans for personal reasons while the other moneys would be put into investments and deposit accounts. They can only invest those moneys in government bonds and deposit accounts with the banks. In recent years, loan demand has declined so we have had a build-up of funds and a surplus above what we would wish. That is part of the story of how between €8 billion and €9 billion has not been loaned out. There is €13 billion in member savings and €4 billion has been loaned out. The other €9 billion has not been not loaned out and is largely lying idle and earning very little in bank deposit accounts.

Our paper put forward two options. Option 1 was to feed into the State-owned financial vehicle envisaged under the social housing strategy of 2014. If that State-owned vehicle was a runner, in the context of the on- or off-balance sheet debate we heard earlier, our money in that vehicle would have had a State guarantee and would have been compliant with the rules and regulations. It would have been almost like a government bond but now that it has become obvious that the State-owned vehicle will not get the blessing of being declared off-balance sheet our option 2, the indirect model, has become the focus of discussion with the two Departments and the Central Bank. The fact that it is not being explicitly guaranteed by the State means it does not fulfil the current rules and regulations laid down by the Central Bank. It is not a government bond or a deposit account, although the repayment of the loan by the approved housing body to the credit unions is quasi-guaranteed because there is a lease agreement between the housing body and the local authority, which is an arm of the State. The repayment is guaranteed even if the loan is not, so we are trying to work with the Central Bank to get it to tweak the rules and regulations on our investments - which are not really investments but money parked in deposit accounts - to allow us to move some of the money. We are not looking to move all of our members' money from current providers to a local approved housing body, we are seeking to move perhaps €1 billion of the €9 billion or €10 billion.

We have been in discussions with the Central Bank on the indirect model since the need to do so became obvious either late last year or earlier this year. To be fair to the Central Bank, it included references to social housing in its CP88 draft of the rules and regulations which did the rounds last year. After a six-month delay and a lot of toing and froing between the Central Bank and Members of the Oireachtas, it became law on 1 January last. The Central Bank suggested social housing might become part of the package of credit unions' investments but we still have to get it across the line and, like many such things, it is taking longer than we might like.

In answer to Deputy Durkan's question, we have been focused on approved housing bodies because that is where the Government strategy is focusing.

It not that we picked them because we know them or like them better. This was the call from Government. There is a history of meetings and engagements between ourselves and various people in the Department, and some of that dates back to before my tenure as chief executive officer. There has been a desire on our part to try to propose something that fits in with the Government strategy. That is the page we are on, as it were. If that one works and we get it moving, we can then look at something like the public private partnership mentioned. If this one does not get across the line we can look at that one anyway. We are not ruling anyone in or out. We are just trying to dovetail in with what was the stated aim in November 2014 of how social housing would be delivered for the period up to 2020.