Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

The way in which the Government is dealing with the credit unions and the way this debate is being conducted is both telling and instructive, particularly when one considers how it deals with the banks, other financial institutions and the IFSC Clearing House Group. The latter ensures the policies of big for-profit financial institutions are translated, almost word for word, into Government policy.

The Bill before the House has the potential to do serious damage to the ethos of the credit union movement, which is deeply ironic. We must ask whether credit unions should be made to look more like the banks more or whether the banks should be made to resemble the credit unions more closely. Do we not need a financial system which operates much more along the lines of the model offered by credit unions rather than on the basis of the for-profit ethos of the banks and major financial institutions which caused the economic crash? Most ordinary and sensible people would say the credit union movement offers the sort of model we require.

It was not the credit unions that got us into the current crisis. They offer an alternative model for a financial and banking system, but some of the measures contained in the Bill seriously threaten to undermine their ethos. These measures will also give rise to the possibility of some credit unions either being forced to close or merge with each other. Furthermore, they will undermine the democratic principle which lies at the heart of the credit union movement.

As a result of the fact that a guillotine is being imposed on Second Stage, we do not have the time to elaborate on the issues involved. That is outrageous, particularly as we were only informed about the use of the guillotine at the last minute. The term limits being imposed by the Minister seriously threaten to undermine the volunteer basis on which credit unions are run and will be particularly detrimental to small credit unions. The prohibition on family members serving on the boards and committees of credit unions also seriously threatens to undermine the volunteer basis on which the movement operates. The move to abolish the position of treasurer will shift the balance away from members controlling credit unions and towards full-time managers doing so.

The imposition of decades' worth of banking legislation on the credit unions is a serious mistake. It is also a misapplication of the type of regulation needed for the out of control banking sector but which is not required for the very sensible and functioning credit union movement. The regulation to which I refer may well threaten to undermine that movement. Credit unions only lend approximately 40% of the money they hold. Rather than being obliged to deposit that money in the banks or send it to other countries, they want to be able to use it to finance valuable community projects. They also want to lend it to the Government in order that it might initiate job creation projects, etc. However, the credit unions are not being facilitated in this regard. As the previous speaker indicated, credit unions want provision to be made for the sharing of services in order that their members might access such services in their own credit unions but also at others throughout the country. It was promised that the legislation before the House would facilitate the sharing of services. However, it does not contain specific provisions in that regard.

There are many other issues which arise. I urge the Minister to listen to the credit unions and their members and pay heed to their ethos. Credit unions offer a model that the for-profit banks have completely failed to offer.

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