Seán Kyne (Galway West, Fine Gael) | Oireachtas source

One of the features of the financial instability and turmoil that the country faced some five years ago was that of institutions acting outside their areas of traditional competency. Building societies exemplify this. Institutions that previously had been concerned solely with providing financial assistance to people to purchase homes expanded into commercial and property sectors. The results, as the House will be aware, were primarily disastrous. The shortcomings of the legislative framework became apparent and conspired with the failings in regulation and oversight to create a situation which has characterised government across many countries ever since.

In this context, the introduction of this legislation is welcome. The Central Bank Bill will extend the application of Part of 3 of the Central Bank Act 1971 to building societies. Incidentally, the legislation is also necessary to permit the continued restructuring of the pillar banks, including Bank of Ireland, which is seeking to complete the sale of specific assets and liabilities of ICS Building Society. The sale could not take place without the passing of this Bill.

It is vital and necessary for us to have a comprehensive and effective legislative framework in place which oversees and regulates our financial sector. We must learn from the grave and foolish mistakes of the first decade of this century, mistakes that have had such catastrophic consequences. Aside from this, we must also ensure a degree of flexibility so that we can return to normal healthy levels of financial activity. This includes borrowing and lending as well as saving.

On Monday last, the Minister of State, Deputy Perry, and I met representatives of St. Columba's Credit Union in Galway and the Ballybane Enterprise Centre in the city. Many Members from the west will be aware of those organisations on account of the successful SCCUL Enterprise Awards, which celebrate, reward and promote entrepreneurship and enterprise in Galway and the west. The main concerns raised at the meeting on Monday, as the Minister of State will be aware - they promised to send both of us a submission - centred on the restrictions currently in place on credit union lending. Notwithstanding some problems that arose with a number of them, credit unions are a hugely positive feature of Irish society and they play a considerable role in promoting financial inclusion and providing financial services to a wide number of people who might otherwise be excluded. The voluntary and community themes run to the core of the credit union movement.

SCCUL is a registered charity but it is separate from St. Columba's Credit Union in Galway. Established in 2002, its vision is to make a contribution to help prevent and alleviate poverty in the Galway city area, to develop leadership skills, to prevent socioeconomic isolation and to support the least privileged groups, and, as the Minister of State will be aware, it does wonderful work. It runs an exceptional credit union to a very high standard and with high reserves. It is as a result of prudent and careful management that it has these sizeable reserves. These reserves could be used to assist small to medium-sized local businesses that require finance for expansion. Such lending, in turn, would have a considerable positive impact on job creation.

With this legislation before the House, it is clear that the Government is open to introducing legislative changes and reforms which help businesses expand and create jobs while maintaining a high level of oversight and responsibility which are so essential in a sustainable economic system. I encourage the Ministers to examine legislation and amendments that would help credit unions to help local businesses to the benefit of communities across the country. As I stated, we are awaiting a submission from the group, but it has considerable reserves that it wishes to be able to promote in its area, either in terms of lending to businesses or for some of the capital infrastructure that is needed in its community in the Galway city area.

The latter part of the Bill concerns implementing a mechanism to facilitate the assistance which our country promised to provide to another of our European colleagues in difficulty. In Ireland, we have a proud history of helping those in need or those less fortunate even when we were not exactly in the best position. Through the determination and work of the Irish people, and the assistance from the EU and the IMF, we have exited the bailout programme and regained our economic sovereignty. It has not been easy and it has required sacrifices and difficult decisions but we have regained our economic sovereignty. Portugal will soon do likewise. Other European nations, however, most notably Greece, are still grappling with serious economic challenges. Just as Ireland assists less developed countries whose peoples continue to struggle with poverty, we have a duty to assist Greece, to which part of this Bill refers.

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