Wednesday, 13 March 2019
Credit Union Restructuring Board (Dissolution) Bill 2019: Second Stage (Resumed)
Caoimhghín Ó Caoláin (Cavan-Monaghan, Sinn Fein)
The Bill will wind up the Credit Union Restructuring Board or ReBo. Members should recall that at the time of the board's establishment, it was feared that credit unions were likely to be the next domino in the banking collapse. However, although a few difficult years for credit unions followed, the predicted widespread collapses did not occur. Through their own resources and the solid foundations on which they were built, the credit unions weathered the storm with far less damage than predicted. That is to their credit. Their survival was achieved without the political support secured by the banks. In spite of Government policy then and now that puts banks first, the credit unions battled over-zealous regulation and the unresponsive political class who were in power to come out virtually unscathed on the other side of the storm. Credit unions proved resilient and the ReBo fund was barely called upon, with only €20 million of the €250 million being drawn down.
ReBo also assisted credit unions that wished to merge or otherwise change. I know some individuals were put out by the mergers but, in the round, they were sensible moves that allowed some smaller credit unions to find shelter. The Bill, therefore, simply unwinds ReBo, which is no longer needed as the sector has reconfigured itself. I am pleased to confirm that Sinn Féin will support the Bill's passage through all Stages.
The Minister will take on the responsibilities of ReBo, including legal liabilities. Can he clarify whether there are many outstanding legal cases involving ReBo and what anklet has been reserved to deal with those cases?
We support the Bill. I commend the credit union movement on its resilience through very difficult times. While the banks failed the Irish people, the credit union movement remained a rock for many families.
The recently published report of the Credit Union Advisory Committee shows the way forward for the sector. The much-heralded tiered regulation must become a reality. I still have serious concerns that the Central Bank regards the credit union movement as an amalgam of hundreds of small banks to be regulated with a big stick rather than as unique community-based institution serving families in a way that banks do not or do not want to do. I note the report of the Credit Union Advisory Committee also made the case for increasing the lending rate cap from 1% to 2%. This move makes sense and is in line with Sinn Féin's unanimously supported consumer credit Bill, which places a cap on moneylenders. This would, of course, be a voluntary move for each credit union. Will the Minister of State indicate his position on this and consider making such an amendment to this Bill?
It is incredible that, in the midst of an ever-worsening housing crisis, the Government and Central Bank have yet to facilitate the credit union movement to provide for housing loans. It is shocking that the political will to make this happen has been so elusive. The Minister of State at the Department of Housing, Planning and Local Government, Deputy English, gave a commitment that the SPV to be used by the Irish Council for Social Housing would be ready by the third quarter of 2018. He has said since that it would be the first quarter of this year. By my calculation, that gives him a couple of weeks, perhaps, to meet the deferred deadline. Will it be ready? Importantly, will it be in line with Central Bank regulations?
ReBo has served its purpose. It can be wound down. Thankfully, it never became a NAMA, either in the public mind or in reality, because, unlike the banks, the credit unions have a culture that is about sustainability and community. As a proud and, may I emphasise, grateful member of my local credit union, I say "Well done."