Pearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I move amendment No. 6:

In page 9, between lines 33 and 34, to insert the following:“7.—The Principal Act is amended by inserting the following subsection after section 6(5):

“(6) Nothing in this Act shall prevent a credit union from lending to a State guaranteed project which is in keeping with the objects for which credit unions are formed as stated in this section.”.”.

This amendment deals with social lending. The credit union movement has stated it wants to invest money in State-guaranteed projects, something we should all be encouraging, given the not-for-profit nature of the movement and the fact that many credit unions have to invest their money in banks and other financial institutions, both here and abroad. In the context of the reason credit unions were set up in the first place, if they can invest in State-guaranteed projects, be they schools, community centres or others of social value in their local communities, they should be allowed to do so. While I take on board what the Minister said on Committee Stage that there is nothing to prohibit credit unions from doing this, my amendment explicitly details the possibility of their lending to Government-guaranteed projects. It states there would be nothing to prohibit them from engaging in such lending. It is really a point of clarification and not contentious. The amendment asserts, "Nothing in the Act shall prevent a credit union from lending to a State guaranteed project which is in keeping with the objects for which credit unions are formed as stated in this section".

The report of the Commission on Credit Unions dealt with this issue in the executive summary recommendations Nos. 3.25, 3.26 and 3.27. Recommendation No. 3.27 states:

The Commission recommends that credit unions could take a more prominent role in developing and maintaining social inclusion lending schemes. These schemes should be backed up with support mechanisms to facilitate credit unions becoming more actively involved in social lending.

Given that the Bill is not just about the regulation of credit unions as they currently operate but is also about facilitating their future operation, it is appropriate that this measure be included in it. I, therefore, ask the Minister to consider accepting it. During an earlier discussion the Minister indicated that he was considering changing the scope of the Bill and mentioned the insertion of the word "public" into a specific section. A definition such as that proposed in my amendment would bring greater clarity to the issue. Perhaps, as with the previous amendment we discussed, this relates to an unfounded fear or a false perception, but the amendment should not be problematic for the Minister. It simply strives to clarify within the Bill that credit unions are allowed to engage in such lending should there be an appropriate programme or project. Obviously, later sections of the Bill deal with the issue of the Central Bank approving lending by credit unions, but this amendment is worthwhile.

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