Richard Bruton (Dublin North Central, Fine Gael)

I am surprised the Minister has not commented on the savings protection scheme, which is topical. During the week the Minister stated that, with his EU colleagues, he is examining the deposit protection scheme that applies to other financial institutions. My understanding is that the credit union savings protection scheme does not even go as far as the deposit protection scheme we are proposing to improve. The upper limit of 90% up to €20,000 applies to savings generally whereas the upper limit in the credit unions savings protection scheme is €12,700, again at 90%.

There are reasonable grounds for concern that the system is not transparent — the note I read described it as discretionary, so there is an element of discretion as to whether or when the protection scheme kicks in. It is not a satisfactory position for credit union members that uncertainty persists regarding the savings protection scheme available to them, even in terms of whether 90% of their savings up to a value of €12,700 would be guaranteed in the event that a credit union were to get into difficulties. We should try to ensure credit union savers are offered the same protection as other savers. There should be no uncertainty as to the savings protection scheme's ability to deliver if a credit union were to encounter problems.

I am aware that discussions have been held on this important issue and that the Minister is trying to coax various parties to arrive at a solution that would satisfy the regulator, the Irish League of Credit Unions, which manages the savings protection scheme, and the breakaway group of credit unions, which may be more progressive or larger than the ILCU. While I understand that this creates difficulties and historical and other issues need to be managed, the Minister must signal to all parties that a prompt resolution to this problem is required, particularly given that the Oireachtas, in good faith, is proposing to give additional powers to credit unions to enable them to develop and expand. In return, we want the credit unions to offer protection to their savers and members. I ask the Minister to comment. He has indicated that progress has been made on the issue.

I have not had sight of the guidance note the Minister read. Equities are clearly a risky product, particularly for those who have invested in financial equities or Irish financial stocks, and securitised instruments have become a source of significant concern. Does the guidance note address other, perhaps even more risky vehicles in which credit unions might consider investing? In light of the experience of recent months, is there a case for issuing a revised guidance note to ensure credit unions have the best information available to the Minister and his advisers on these types of vehicles? It has transpired that these instruments and vehicles are not as they were described by the rating agencies. I understand, for example, that Ormond Quay was rated AAA, a better rating than that given to AIB or any other Irish bank. It might be worth considering issuing revised guidance to credit unions.

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