Fergus O'Dowd (Louth, Fine Gael)

Nobody taking it over may own more than the 15%. I do not object to the principle enshrined in what is being done. If the body wishes to stay mutualised, it can do so.

Pressure is clearly building from people which have been referred to as "carpetbaggers". There is a feeling that they would like to get their hands on the EBS. Anybody who may have borrowings or shares in the EBS may want it to demutualise, and they may want to get their €15,000 or €20,000.

I have looked at the experiences in the United Kingdom in the 1990s. The amounts of money were smaller when such bodies demutualised, and the benefit to the individual, be it the borrower or investor, was quite small. It was approximately £2,000 or £3,000. The money amount proposed for the Irish Nationwide is much bigger, significant sum. It would mean much to many people.

I have been told that if the Educational Building Society demutualised tomorrow, the benefit for the membership would be quite small. It would be much smaller than the current figure for Irish Nationwide.

This Bill is being rushed through. We have put down serious amendments to it, as the Government's amendment does not clarify anything. The future, particularly for the mutual building society, could be getting involved with credit unions nationally or international mutual banks. We need such market forces at play. We support the Bill in principle on the basis that we are neutral with regard to what building societies wish to do. We would like to see mutuality protected if that is the wish of a company.

The only issue which arises is in section 19, which we will return to. Perhaps the Minister of State will clarify on Committee Stage the question of resolutions. If, for example, at the next annual general meeting of the Educational Building Society, the management and directors do not place a resolution on demutualisation before the meeting, such a resolution cannot be discussed. The issue can be discussed. Is that the difference?

A member can stand up and seek the company to demutualise, and 1,000 people could agree. There would be a debate but a legal decision cannot be made if the resolution does not come from the top. That gives protection to the idea of mutuality. That is the reason it must come from the directors.

The argument then can be if a sufficiently large number of investors or members of the Educational Building Society wants to demutualise, the road for them is to sack the directors.

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