Dáil debates

Thursday, 14 February 2019

Industrial and Provident Societies (Amendment) Bill 2018: Second Stage [Private Members]

 

5:40 pm

Photo of Joan CollinsJoan Collins (Dublin South Central, Independent) | Oireachtas source

The purpose of the Bill is to simplify the process of setting up and running co-operative societies. It is short and sweet, comprising just seven sections. It a small but important step in terms of what is needed to develop a larger co-operative sector in the economy. It is probably safe to say that the Bill contributed to the decision of the Minister to launch the online offering of the Register of Friendly Societies on 6 December. I would be pleased to have played a role in that regard.

The Government should allow the Bill to progress to Committee Stage because the Industrial and Provident Societies Act it seeks to amend was introduced in 1893, as has been pointed out. The Friendly Societies and Industrial and Provident Societies (Miscellaneous Provisions) Act was passed in 2014. Members are aware that the process in respect of co-operatives partially collapsed in 2002.

Encouraging the development of co-operatives should be an important feature of developing the digital economy. That is why it is important that the Bill move to Committee Stage in order to discuss it and work with the Minister, the Government and other parties to get it moving quickly. Our economy is severely unbalanced and overdependent on foreign direct investment and very large transnational corporations. Some 80% of corporation tax is now paid by a small number of major multinationals. We cannot rely on that situation continuing, given the international pressure for reform of corporation tax laws in Europe.

The Bill also relates to the issues of jobs, regional development and a more balanced economy. The Department's Enterprise 2025 strategy targets the creation of 266,000 new jobs by next year, including 75,000 jobs resulting directly from FDI and 65,000 indirectly. FDI is being relied upon to create more than half the jobs targeted. State agencies focus on FDI to too great a degree. We need to refocus on developing local industry with an even regional base.

Co-operatives can play a key role, aided by a State investment bank and with advice and support from a designated State agency. This means re-establishing the co-operative development unit that closed in 2002. This unit was set up in 1998. Between 1991 and 1992, co-operative enterprises increased in number from 47 to 73. Between 1996 and 1998, there was another spike, with an increase from 66 to 82. The unit had a relatively good success rate while it existed despite the absence of legislation on co-operatives.

The Public Banking Forum of Ireland has done very good research and has come up with very workable proposals for developing a not-for-profit co-operative banking system with a remit to invest in small regional enterprises. This would make a good fit with a State programme to develop co-operative societies.

The International Labour Organization, of which Ireland is a member, has called on governments to provide policy and a legal environment conducive to the creation of workers' co-operatives. It states governments should provide grants and develop partnerships with co-operatives. That is what we are signed up to, and we should be moving much quicker in this regard.

We have a history of co-operatives dating back to the 19th century. The credit union movement and the agricultural co-operatives are very successful examples. However, we lag far behind by comparison with countries such as Italy, Spain and France. In Italy, there are over 800,000 employee owners in co-operatives. Emilia-Romagna is a prime example in that it has 8,000 co-operatives producing 40% of the area's GDP. They play a key role in the economy. Per capitaincome in the region is 25% above the overall Italian per capitafigure and 36% above the EU average per capita. The unemployment rate is lower and the inequality level is among the lowest in the European Union. Spain has 275,000 people in worker co-operatives. The Mondragon Corporation co-operative ranks around tenth in the top 300 global enterprises. In France, the worker co-operative buy-out sector has saved 600,000 jobs and accounts for 10% of GDP today.

The encouragement and development of this area would be a big step forward in rebuilding our economy and creating greater regional development. I ask the Minister of State to accept this Bill and not to oppose it. I ask other parties to get involved. I am aware that Sinn Féin has done work on co-operatives and the legislation, as I am sure have other parties.

We produced our Bill in July last year and hoped to have it on the agenda much sooner. In saying that, I believe it could still play a very progressive part in the overall debate if allowed to proceed to Committee Stage. It might actually spur the Government into introducing legislation to deal with this matter. Co-operatives in Ireland could be very positive for our indigenous economy.

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