Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

I welcome the opportunity to speak on the Bill. Its aim to ensure effective access to cash across the State is a very welcome proposal. It will set criteria for the accessibility of ATM and cash service points so that no region is left behind. It is important that people have access to cash. It is not just older people; there are many people who are quite concerned about issues regarding online fraud, and this is a way to avoid it. We must also remember that organisations like MABS and other advisers are advising people who find it difficult to manage money or have limited resources to use cash because it is a more effective way to manage that money. We need to be conscious of that. As Deputy Shortall said, it is not just about being able to access cash, it is also about being able to use that cash.

There is merit in this. Despite significant Government investment in urban and rural regeneration funds, innovative funds to revitalise communities, a decision that was taken by the last Government which is now thankfully coming to fruition, we face a critical moment in our local communities. That is down in part to the future of the financial infrastructure in many of our provincial towns.

The decision by Bank of Ireland to close its doors in towns in my constituency such as Elphin, Strokestown, Ballygar and Dunmore has been a significant blow to these particular towns. This is coupled with the fact that Ulster Bank has withdrawn from the Irish market. We need to go beyond the measures before the House today. The actions of the banks to date underscore the urgent need for a State banking force. Before the pandemic, the towns I mentioned were on the path to revitalisation, supported by Government funding for tourism, rural regeneration and various town schemes. However, the closure of these bank branches has set back these recovery plans significantly.

We must now establish a State bank that serves SMEs and personal customers. Our current banking model excludes two key customer bases, namely, personal customers and small businesses. The Bill before us does nothing to address this. With 13% of people not using online banking, and even higher percentages in regional Ireland, we need to have accessible banking services throughout the country. We are speaking about simple services, not only with regard to 24-hour ATM access for withdrawals but also access for lodgements. This would make a significant difference for many of the towns, particularly for businesses that would be able to lodge cash. It is one thing to put an obligation or requirement on businesses to accept cash but then there needs to be a mechanism whereby the cash can be lodged in banks. It is not just about ATM withdrawals. The issue of lodgements also needs to be looked at to ensure these towns recover.

As a result of Covid, people in these towns found themselves acknowledging how important it was to have services in their local town. The actions that have been taken by the banks and the cost-of-living crisis have forced many people to move their business to the bigger towns. We need to take an active approach to try to reverse this. Part of doing this is establishing a separate independent banking force in this country. I propose that we establish a Dáil committee to drive the agenda of establishing a State bank through a cross-party approach. If we do not have a politically driven cross-party approach then it is doomed to failure. The reality is that the financial establishment in this country, in all its guises, is determined to ensure we do not have a third banking force, which would be a State co-ordinated banking force, that would actively compete against the two existing pillar banks.

There is no doubt that there is a mindset of absolutely blocking State involvement in the banking sector. Surely if Covid has taught us anything it is that, when needed, ways can be found for State intervention that is in the long-term public interest. A basic independent banking structure already exists in this country, although it is fragmented. Instead of a copy-and-paste model from some other country, we should start with our existing credit unions and post office network, along with our two existing State banks, namely the Strategic Banking Corporation of Ireland and Microfinance Ireland. Our post offices and credit unions provide a comprehensive branch network for personal customers. An Post has more than 500 post offices in locations without banks nearby. The Strategic Banking Corporation of Ireland and Microfinance Ireland are already designated to offer flexible finance to SMEs. Rather than trying to reinvent the wheel, we need to build on these key strengths and design an economic strategy for rebuilding our economy through our local businesses, which are so important to recovery outside our cities. Before the pandemic 250,000 SMEs accounted for 99.8% of total enterprises and 65% of total employment. SMEs are the backbone of the country and are vital if we are to re-establish a viable economy in many of our rural communities and towns. They are the backbone of these communities but they need to have access to banking services. We need to go significantly further than what we are speaking about in the Bill.

We also need to be far more proactive in providing a competitive mortgage market in this country and in providing access to affordable green finance for homeowners and landlords to improve the energy efficiency of their existing homes. This is not happening in the existing market. In tandem with the better energy homes scheme we should introduce 0% long-term loans for retrofitting homes, whereby repayments are paid back through utility companies based on energy savings, including the use of microgeneration technologies. We could significantly reduce the cost of retrofitting homes in this country if we allowed hydrotreated vegetable oil, HVO, to be used as a cheap alternative for people to switch to sustainable renewable energy. Some 90% of HVO could be blended with 10% kerosene tomorrow morning to ensure that all oil-fired central heating systems in this country could be converted for the cost of approximately €300.

The difficulty at present it is there is an agenda in the country to force people down the heat pump approach. People are not being given an alternative. A report from the SEAI has just been published which states one of the reasons people are being forced down this road is in case, if the cost of kerosene reduced, they might switch back from HVO to kerosene. The figures in this regard are stark. To convert an oil-fired central heating system to a renewable source of hydrotreated vegetable oil would cost approximately €300. To put a heat pump into a building that is 50 or 60 years old the cost is €80,000. We have significant targets to meet with regard to renewable energy. Putting this type of burden on families throughout the country, without the approach I have proposed of zero interest loans with people making repayments based on their energy savings, is irresponsible and puts an additional unnecessary financial burden on families.

While I am on the issue of financial burdens with regard the retrofitting of homes, for the warmer homes scheme we are still looking at a wait of in excess of 24 months, which is more than two years, for an older person to have their home retrofitted to meet the current needs in terms of energy efficiency. It is completely unacceptable that families and older people are left this length of time to have these retrofits carried out. This issue needs to be addressed urgently.

To return to the direct issue of financial services, during my term as Minister I developed a strategy with An Post to protect it from financial collapse. This was to use An Post-owned post offices as a focal point for the development of banking services and other Government services. An Post has the ability to become the offline partner for every Government service in the country, which could then be put completely online, saving a large amount of administration costs. Examples are motor tax, driver licences, passports and ID verification. I could go on and on about this. We could be using our post offices to allow people to purchase Government services with cash and still maintain the online mechanisms proposed by some agencies.

It is a win-win situation for everyone, and it is something we need to seriously look at again.

The establishment of a State bank is not just a financial necessity; I believe it is a social imperative in this country. It will provide our communities with the means they require to thrive and ensure that no one in this country, regardless of location, is left behind into the future and that people can continue to access banking services and use cash.

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