Catherine Connolly (Galway West, Independent) | Oireachtas source

I move: "That the Bill be now read a Second Time."

This Bill is entitled the Industrial and Provident Societies (Amendment) Bill. I will come back to the language but it is a straightforward Bill with seven sections. The first section under the heading "Definition" simply sets out that the principal Act is the 1893 Act and section 7, as is usual in any Bill, sets out the Short Title and collective citation. In between there are five short sections, 2 to 6, inclusive, which is the substantive part of the Bill. These sections seek to amend the main Act in a very practical and sensible way so as to ease the formation and the functioning of co-operatives on the ground. That is bun agus barr an scéal anseo chun é a éascú do chomharchumainn ar fud na tíre agus ar na hoileáin ionas go mbeidh sé i bhfad níos éasca comharchumann a eagrú agus a chur chun cinn.

There is no denying that the primary legislation, notwithstanding subsequent and various amendments up to 2014, is not fit for purpose. It is outdated with many of the provisions within the legislation pre-dating the birth of the Irish State and thus no longer relevant. Some of the provisions in the 1893 Act refer, for example, to how the law is to apply in Scotland and the Channel Islands. Other sections refer to feudal tenure while others refer to insane and lunatic members. The irony, which I will come back to, is that the Act itself no longer applies in England, which changed its Act in 2014. It is ironic that we are still working under this Act.

To be fair to the Department and the Government, in recognition of this, the Department of Jobs, Enterprise and Innovation initiated a welcome review of the Act. As part of that review it invited submissions. In the event, ten written submissions were made to the Department although I am subject to correction on that figure, but unfortunately nothing appears to have happened in the intervening period and no review report has been published to date. Given that vacuum and given the real obstacles posed by the existing, outdated legislation on the formation of co-operatives and-or their operation on the ground, Independents 4 Change has brought this very short Bill before the House and I anticipate the support of all parties, including the Government.

My colleague, Deputy Clare Daly, introduced the Bill on First Stage on 3 July 2018, just over six months ago, with the support of all parties and Independents, and given the brevity and importance of the Bill, I hope that it will go through the House very quickly. In essence, the amendments proposed in the substance of the very short Bill, from sections 2 to 6, seek to make the process of registering and running a co-operative much easier, in the first instance, by reducing the membership requirement which currently stands at seven to three members. This is provided for in sections 2(1) and 2(2) along with provision set out at section 3 for what will happen in the event of the number falling below three. The Bill also allows for audit exemptions in certain situations and this is set out in sections 4 and 5. Section 6 allows for the use of electronic communication with regard to the registration of co-operatives and also for specified other documents which are required to be lodged with the Registry of Friendly Societies. It is important to highlight that what is sought in the proposed changes are mechanisms which are already available under company law but not for co-operatives. What we are seeking here is simple, namely a basic parity with what exists for small companies such as the exemptions for audits, the electronic filing and the ability to function with one director. We are simply looking for some parity on that practical stuff.

It is also important to highlight that what is sought in the proposed amendments emerged as a common theme in the submissions as part of the review that the Department set up. On that, I thank publicly those who made the submissions. I read most of them and they were very helpful to me and my colleagues in this, in particular the Society for Co-operative Studies in Ireland, Co-operative Housing Ireland and the Irish Co-operative Organisation Society Limited. They took great pains to make written submissions in much more detail than I am doing. They highlighted many problems with the antiquated legislation but the common theme, among many others, was around the basic amendments we are seeking here.

I am not sure what attitude the Government is taking on it but for me it is straightforward and simple legislation. Quite clearly, more comprehensive legislation is also required. I am asking for something that will enable co-operatives to function much more easily in the meantime. When one looks at the Act, it is so outdated. The word co-operative does not exist in it. It is the Industrial Provident and Societies Act 1893 and of course we have amended it up to 2004. One would be hard pushed to find the word co-operative in it and one would really be hard pushed to understand it at this point because it is so antiquated. As I said, it is extraordinary that it no longer applies in England and the UK Government amended its legislation in 2014. In fact, under that it created a community benefit society to offer a distinct set of legal provisions for those co-operatives that are serving their communities. There are many issues on a broader scale with co-operatives such as those that are non-profit and those that are making a profit but to make the passage of the Bill easier at this point, we have taken the most basic changes as a starting point. There is a great need for consolidated legislation to cover all of the other issues raised in the submissions.

It is also of interest that in Europe, various countries have dealt with this in different ways. For example, in Greece, Italy and Malta there is support for co-operatives in their constitutions. They have gone that far to enshrine it in their constitutions while in other more northern and Nordic countries, the approach they took was to help co-operatives in the form of faoiseamh cánach, a relief under taxation. The EU itself has recognised the distinctive contributions of the co-operative model through the creation of the European Cooperative Society. In Scotland, I understand the legislation is particularly suited for co-operatives. It is difficult to come up with up to date research on this matter but what has emerged from Scotland is that those enterprises set up through the co-operative model have a high rate of success compared with private companies.

Of course in Ireland we know we have a long history and it would be wrong to stand here and speak about co-operatives without mentioning Horace Plunkett at the end of the nineteenth century who was to the fore in setting up the agricultural co-operatives. It would be wrong not to mention the constituency of my colleague, Deputy Pringle, and Glencolumbkille and Fr. McDyer and the tremendous and Trojan work he did along with the community there. It was throughout all of Ireland and tagraím do na comharchumainn uilig, Comharchumann Forbartha Árann i mo cheantar san áireamh. Mar Chathaoirleach ar Choiste na Gaeilge, na Gaeltachta agus na n-Oileáin, luaim go bhfuilimid ag taistil ó Ghaeltacht go Gaeltacht agus tá sé thar a bheith soiléir obair na gcapall atá á déanamh ag comharchumainn éagsúla ar an talamh. As Chairman of the Committee on the Irish Language, the Gaeltacht and the Islands, I have travelled and we are still travelling to visit every Gaeltacht in the country. There are many common themes but the most important one that jumps out is the work of co-operatives on the ground throughout all of the Gaeltacht areas and on the islands.

I mention the distinguishing features of co-operatives. This is a theme that has emerged through all of the submissions. Some of the submissions look for the seven defining features of co-operatives to be incorporated in any future legislation and if not actually incorporated in the legislation, that they would be the guiding force in any legislation on the ground on co-operatives. The distinguishing features identified over and over are the voluntary and open membership, democratic member control, member economic participation, autonomy and independence, education, training and information, co-operation among co-operatives and concern for the community. People have different experiences of co-operatives such as the very successful agricultural ones, particularly in the south of the country and we also have the credit unions as a good example of co-operatives. My experience is on the comharchumainn ar an talamh sna ceantair tuaithe agus ar na hoileáin. It would seem to me from what I have seen on the ground that the value for money achieved by their work for every euro invested is far higher than the value achieved with money invested in other companies. I am not seeking to distinguish because we obviously need companies but we are asking that we get consolidation of all the existing legislation as soon as possible. Update it and make it fit for purpose in the twenty-first century with a clear statement on co-operatives and then following on from that, bring in an education programme highlighting the importance of co-operatives, the value of same and what they are doing for the communities, for social enterprise and in making profit also.

It is so short that there is no need to say any more on this matter. Perhaps the Minister of State will indicate at an early stage whether the Government is supporting it. I can see no reason why it would not. There are no implications for the public purse and in the absence of anything being done following the review, we are asking for the most basic changes at this point. Not only are we asking for it as Independents 4 Change but all of the submissions have asked for it and we have picked out the common themes to take action now.

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