Dan Boyle (Cork South Central, Green Party)

Does the Minister feel that after nine years, the Credit Union Act 1997 is badly in need of reform given that significant problems have arisen particularly regarding the asset to loan ratio of credit unions, which at the time of the introduction of the Act was 2:3 and is now approximately half of the asset base of credit unions? Further difficulties arise in terms of the ability to put money on deposit with credit unions as opposed to holding shares, given that the current limit of €26,000 set by the 1997 Act puts credit unions at a severe disadvantage particularly with the maturation of the special saving investment accounts. A limit of closer to €100,000 would be more appropriate.

The restrictions on investments as a result of the Credit Union Act mean that many credit unions now have debt capital and are forced to invest in a very restrained way which yields little return. Would the Minister agree that credit unions should be free to invest in the same way as other financial institutions and in the same way that the National Pension Reserve Fund is allowed to invest particularly regarding equities? Can the Minister confirm that the only legislative proposals on the table at the moment emanate from the Financial Regulator regarding changing the terms of the savings protection scheme for credit unions, which will threaten the ability of credit unions to operate on an all-island basis because of their membership of credit unions in Northern Ireland?

The Minister for Finance is obliged to make new legislative proposals for credit unions owing to the current fraught relationship between credit unions and the regulator for credit unions because, as many of us feared at the passing of the Central Bank and Financial Services Authority of Ireland Act, having the regulator for credit unions included within the Office of the Financial Regulator has compromised the ability of credit unions to be treated in a distinct way. This is especially true now, nine years after the introduction of the Credit Union Act.

See this speech in context