Thursday, 14 February 2019
Industrial and Provident Societies (Amendment) Bill 2018: Second Stage [Private Members]
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 It is outdated with many of the provisions within the legislation pre-dating the birth of the Irish State and thus no longer relevant.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 Given that vacuum and given the real obstacles posed by the existing, outdated legislation on the formation of co-operatives and-or their operation on the ground, Independents 4 Change has brought this very short Bill before the House and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.
Before I bring in the Minister of State, Deputy English, I want to confirm and agree the schedule of speakers. After the Minister of State we have Deputy Pringle, followed by Deputy Joan Collins, Deputy Kelleher, Deputy Broughan and Deputy Clare Daly. Is that agreed? Agreed.
I thank the Members for introducing this Bill and affording me the opportunity, in the absence of the Minister for Business, Enterprise and Innovation, Deputy Humphreys, to speak to it. The Minister is sorry that she is unable to attend the debate and I will outline her views for the Deputies. However, she will be happy to engage with Members at a later stage as we bring forward changes in this area.
The Minister; the Minister of State, Deputy Breen, and the Department are acutely aware of the continuing importance of the co-operative movement throughout Ireland, particularly to local and rural communities. Anybody who has been involved in politics or with a community will be aware of the benefit it brings. I was previously Chairman of the Oireachtas committee which brought forward the changes to the Companies Act and even at that stage we had a discussion on the importance of co-operatives. However, while the Minister is sympathetic to the well intended objectives of the Bill, she cannot support it in its current form and I will outline why.
Following the drafting and passage of the Companies Act 2014 which had been a priority for the Government and which now forms the basis of Ireland’s business regulatory environment, the Department of Business, Enterprise and Innovation has turned its attention to the review of the industrial and provident societies legislation. The Industrial and Provident Societies Acts 1893 to 2014 provide the statutory regulatory basis in Ireland for the formation and general operation of industrial and provident societies which are primarily co-operatives. After various piecemeal amendments introduced over more than 120 years, most recently in 2018, the Minister believes it is time to conduct a wholehearted review of what is a largely Victorian statutory code. Deputy Connolly voiced a similar desire. The purpose of the comprehensive review is not only to consolidate and modernise the existing legislation but also to ensure an effective legislative framework suitable for the diverse range of organisations using the co-operative model in Ireland.
As part of the root and branch review, the Department has conducted a public consultation process on the operation and implementation of the Industrial and Provident Societies Acts 1893 to 2014. Deputy Connolly referred to it and said it was a worthwhile review. The results of the consultation process were published on the Department's website in April 2018. The submissions highlighted the need for consideration of a wide range of issues, including providing co-operative societies with a distinct legislative identity, reflecting the co-operative ethos, reducing the minimum number of members, facilitating electronic filing and introducing audit exemptions in line with the approach taken in the Companies Act 2014.
Section 2 of the Bill proposes to reduce the number of members as a condition of the registration of industrial and provident societies. While a number of submissions to the Department have suggested a reduction in the minimum number of members, there was no consensus on what the minimum number should be. The Minister fully recognises the importance of creating favourable conditions for encouraging a range of start-ups, including co-operatives. However, she is of the view that this issue requires careful consideration and that further analysis is needed to ensure any proposed change does not have unintended consequences. For example, one of the issues that must be considered is ensuring the reduction in the minimum number of members does not act as an impediment to the establishment of viable and sustainable co-operatives with members who have the necessary skills to run these entities. Different approaches have been taken across Europe to the minimum number of members to form a co-operative, ranging from one in Finland to ten in Poland. As part of the legislative review, the Department will explore the various policy options for the optimum minimum number of members required to form a co-operative.
The Minister is also cognisant of new EU anti-money laundering directives that are due to be implemented shortly in Ireland. Every Irish company, apart from those listed in a regulated market, and industrial and provident society will be legally obliged to file its beneficial owner's details with the new register of beneficial ownership, RBO, within six months of it opening. Failure to file within the six-month period can result in the company or industrial and provident society being fined and prosecuted. Any person who holds or controls 25% or more of the shares or voting rights of a company or industrial and provident society, whether directly or indirectly, is a beneficial owner and required to be registered with the RBO. Reducing the current minimum membership requirement for co-operatives may have unintended consequences for smaller co-operatives. Again, it is important that we tease this out further and the Minister is happy to engage with Deputies on it.
Section 5 of the Bill provides an enabling provision for the Minister to exempt, by regulations, specified classes of societies to file annual returns or certain specified classes of documents that would otherwise be required to be included as part of an annual return. The Minister has serious reservations about this proposal. The existing companies legislative framework does not provide for exemptions from filing annual returns, the exception being investment companies regulated by the Central Bank which must deliver financial statements to the Companies Registration Office, CRO. The only total exemption from including financial statements with the annual return of a company applies to unlimited companies.
The co-operatives that are formed and registered in Ireland are limited liability entities. In return for the advantages of limited liability, the law requires them to disclose their financial statements to the public. This is a very important protection for employees. It is also an important protection for other entities doing business with them. After all, these other entities have employees and suppliers of their own. Without knowing the financial position of a co-operative, employees and others are asked to take a chance that a co-operative can pay wages or its bills. The exemption, as proposed in the Bill, potentially undermines transparency and trust which are essential elements in the effective functioning of co-operative societies and underpin the co-operatives' principles of open membership and members' economic participation. In the interests of co-operative members and the public interest the Minister cannot support this section of the Bill, as it stands.
It should also be noted that no response to the public consultation process requested exemptions from filing annual returns, as proposed in the Bill. Some responses, however, requested the introduction of audit exemptions for co-operatives in line with the approach taken in the Companies Act 2014. This is an area that will be explored further in the comprehensive review.
On the proposed provisions for registration and filing by electronic means which form the third element of the Bill, these are positive proposals with which the Minister agrees, but they have been overtaken by events. As part of modernising the filing environment for the Registry of Friendly Societies, RFS, which includes co-operatives, on 6 December 2018, the Minister launched the RFS online facility. The launch was attended by several co-operative stakeholders, which are now using the new IT system to register new entities online, file annual returns and amendments to the rules of their societies electronically, make online payments for filings and order documents online. The fees for submitting applications to the RFS and filing documents were also reviewed in August 2018 to bring them into line with similar fee types used by the Companies Registration Office. The regulations included a provision for a reduction in fees for documents filed online. I am aware that the Bill was published last July prior to the reduction and that events have moved on since.
The Minister wishes to avoid the introduction of more piecemeal and fragmented legislation in this important area. She is also concerned about the introduction of measures that could reduce transparency. She considers that a more appropriate course of action is to consolidate in one statute all existing industrial and provident societies legislation, modernise it to eliminate outdated provisions and align it with the realities of the 21st century business and regulatory environment, with which Deputy Connolly would agree. I accept that the Deputy wanted to bring forward a smaller measure at first, but we all share the view that it is important to have consolidation in this area. This will ensure a level playing field between co-operatives and the other legal options for structuring enterprise activities and provide a conducive framework to allow the full potential of the co-operative model to be realised.
For the reasons I have outlined, the Minister cannot support the Bill. She proposes to take account of the wide range of views expressed in the public consultation process that has been undertaken, including what she recognises as genuine and well intended proposals outlined in the Bill, and bring forward comprehensive and reformed legislation in the area of industrial and provident societies later this year. As I said, she is happy to engage with Deputies in the process of developing the new legislation. When we brought forward the companies legislation previously, it benefited greatly from the co-operation and involvement of Members across the House in the committee and beforehand in fully engaging on it. There was a great deal of work involved and it helped that there was that engagement. The Minister will certainly be interested in working with Deputies as we approach the changes to be made in this area in the next year.
This Bill is very important in simplifying the process of starting a co-operative in Ireland, which must happen. I note that the Minister of State, Deputy English, said the Minister for Business, Enterprise and Innovation, Deputy Humphreys, would do this all of a sudden and that it would be done by the end of the year. That is amazing, considering that the legislation has been in place since 1874. Some 120 years later we will get to consolidate it.
That is indicative of the lack of importance that this and previous Governments have placed on co-operatives and their ability to contribute to our society. Rather, they have focused entirely on foreign direct investment, FDI, and the development of multinationals, which run riot around the country accruing great benefit. The schemes that would be of benefit to the citizens of this country and the places where they live have been put on the hind tit. Those policies have led to our industrial profile not being developed to benefit the people of Ireland rather than the businesses that have moved here.
Co-operatives are more developed and active in countries such as Germany than is the case here. Such development is not something to be afraid of. It would not communise Ireland - a prospect which I acknowledge would terrify Fine Gael.
The Irish Co-operative Organisation Society, ICOS, brilliantly outlines on its website the principles of co-operatives, which make them of value. It outlines that co-operatives are voluntary organisations open to all; that they are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions, with men and women serving as elected representatives accountable to the membership. In primary co-operatives, members have equal voting rights - one member, one vote - while co-operatives at other levels are also organised in a democratic manner. Members contribute equitably to, and democratically control, the capital of their co-operative. Members allocate surpluses for the purposes of developing the co-operative, benefitting members in proportion to their transactions with the co-operative and supporting other activities approved by the membership. Co-operatives are autonomous, self-help organisations controlled by their members. Emphasis is placed on education, training and information. There is significant co-operation among co-operatives, which work together through local, national, regional and international structures. Co-operatives work for the sustainable development of their communities, which stands in stark contrast to how business currently operates in this country. The multinationals exist to benefit their shareholders, of whom there are very few living and working here. We do not have much to fear from organisations that apply those principles their core, although the multinational businesses which want everything in society to prioritise their profit needs may not wish for them to grow in stature.
There is a long history of co-operative societies in rural Ireland. The agricultural co-operatives that are now public limited companies may not have benefitted their members as much as they could or originally intended. Co-ops in Donegal have survived over time. Deputy Connolly referred to some of them. The Glencolumbkille co-operative initiated by Fr. McDyer has fallen by the wayside but it provided hope for a significant time. My father worked there as a manager in the late 1960s and early 1970s. The most notable of co-operative is the Cope in Dungloe, which is still going today. It started out as the Templecrone Co-Operative Agricultural Society in 1906 and retains many of the characteristics of a co-operative today. Many co-operatives were created to meet a community need. For example, the Comhar Cumann na Rosann Teo knitting co-operative established in the 1970s and which operated until recently was a much-needed resource for the women of the area. It provided them with a means of creating income by selling their knitting and acted as a liaison to buyers in order to achieve a better prices for the produce, which is vitally important. Indeed, it pissed off many people in the local community who were benefitting from the work of the women and did not want them to organise as a co-operative. My mother was involved in that initiative through the Combat Poverty Agency, which did a significant amount of good work in terms of forming co-operatives in Donegal through the 1970s, of which this was a perfect example. Fishermen’s co-operatives were established in most coastal communities. Many have become private companies or fallen by the wayside because it has been difficult to keep them going.
This legislation might go some way to making co-operatives viable. Governments past and present have intentionally made it difficult for economic models other than the dominant private sector profit-driven model, which has wreaked havoc in our country, to flourish. The Bill is designed to amend the regulations relating to the establishment of co-operative societies in order to make the process of registering a co-operative far easier. It reduces the membership criteria from seven members to three, in line with regulations in most European countries. It allows for electronic filing and registration and audit exemptions, which are all available to other types of companies. These small measures will level the playing field and make the establishment of co-operatives far easier, as well as bringing us more in line with the rest of Europe.
We need to face the fact that our economic model must change if we are to address the issue of climate change and meet our international and domestic obligations in that regard. The co-operative model can play a major role in facilitating that. Co-operatives can facilitate a revolution in renewable energy. Communities could own and manage their own renewable energy sources, bypassing the developer-led wind farm model which is greatly loved by Irish officialdom. Citizen co-operatives in Germany have been investing in the production of renewable energies for many years. Some are now considering how to buy the energy grid back from energy companies. Co-operatives in Hamburg succeeded in doing so, creating a new business model that many countries would like to emulate. Almost 40% of German renewable capacity is now locally owned, some by household domestic photovoltaic and some by local co-operatives, with hundreds of village and town-based schemes in place. This model has been suggested as a new form of decentralised socio-economic power, whereby local social entrepreneurship challenges the existing market system. The fact that there is local ownership and self-generation means that the existing developer-led utility companies are losing control of some parts of their market, which can only be good news for the people and the environment.
The growth of co-operatives could be part of a solution to the decline of towns and villages in rural Ireland. Residents could get together to form a co-operative and buy out the local pub, restaurant or butcher. The possibilities are limitless but require the right amount of political will. The Bill will enable co-operatives to become established and thrive. A co-operative-led economy could uphold the principles of a just transition, where workers’ rights are upheld such that workers can live and work within their communities and sustainable local economies can thrive. Workers’ rights would also be preserved through worker co-operatives, which are more resilient and productive than the alternative and provide greater benefits to workers and their communities. The Bill would facilitate an increase in the development to the co-operative sector in line with the needs of communities across the country. The co-operative model could be the perfect antidote to Fine Gael’s corrosive policies, which are undermining rural Ireland and the needs of communities across the country. If the Minister is serious about reforming the industrial and provident societies legislation, I ask her to provide a date for doing so. Unfortunately, I do not believe the will is there to make it happen.
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.
I welcome the opportunity to speak on this Bill. That it is being discussed on the floor of the Dáil gives us an opportunity to talk about the impact the co-operative movement has had on the country over many years, primarily through creameries and credit unions. These represent two obvious areas where co-operatives have been very much part of commercial life over the years. Anything that would incentivise the co-operative mindset and encourage people to come together collectively to address deficiencies in their communities or services or start with a concept is to be encouraged and welcomed. From that perspective, the thrust of the Bill is welcome.
There is an ongoing consultation process concerning legislative supports for co-operatives and how they function. This Bill could feed into that through a robust pre-legislative scrutiny process involving all the stakeholders intimately involved in the co-operative movement.
Co-operatives are for the benefit and participation of members and are based on membership loyalty. These are the three cornerstones of the co-operative movement. They have served this country exceptionally well. One could argue there should have been a greater proliferation of co-operatives in other areas. There have been quite a number of successes, however, primarily in agriculture and the credit area. Some of the largest Irish companies operating internationally serve as examples. Kerry Group was spawned from the co-operative movement in west Kerry. Huge companies have been created out of the co-operative concept. We should always try to ensure co-operatives are run in a way that is beneficial to their members while at the same time advancing the concepts of entrepreneurship and enterprise. They should not be allowed to stagnate and should reinvest continuously. They should not exist solely to serve the present membership but to work towards the development of services for the years ahead. Sometimes co-operatives failed to be innovative beyond the original concept for which they were established. We should try to encourage innovation in the context of the debate on the co-operative movement.
Reference has been made to the Scandinavian countries, Germany and the Baltic states where there has been a strong history and tradition of co-operatives. There is no doubt that they have benefited countries and economies over many years. They have a role to play in developing services in certain areas of the economy.
Reference has been made to alternative energy. One could argue that biomass and bio-digesters, for example, present opportunities for the coming together of communities and individuals in collective partnership, under a co-operative-type concept, to produce energy and afford associated benefits in the broader communities where the relevant infrastructure is located. One could argue a co-operative concept with buy-in from a community is welcome. If a co-operative is for the benefit and participation of its members, and is based on their loyalty, the concept of co-operation would be very much part of the ethos.
In trying to encourage the co-operative movement, one has to accept that one cannot give an unfair advantage to one group over another, particularly in commerce and business. Where there is limited liability for members of co-operatives by comparison with individuals involved in the same type of industry, business or enterprise elsewhere, the legislation must be fair, balanced and impartial to ensure no one has a significant advantage over another. With regard to tax liabilities or limited liability, for example, there should not be displacement by co-operatives of individuals who have established their own companies. There should at least be an element of balance.
The Irish Co-operative Organisation Society has made observations on this Bill. Overall, it is broadly supportive of it. One could argue some of the issues over membership and the make-up, such as the change in the registration number from seven members to three, and issues concerning taxation and the audit exemption, give rise to concerns. If, however, we accept we should encourage, foster and incubate the concepts of co-operatives, allowing them to become innovative, see beyond their immediate remit and evolve continuously, they can avoid stagnation. Certain co-operatives stagnated once their initial membership fell away. Very few were able to continue to evolve and be creative. Something that could stimulate a yearning to evolve continuously and respond to advances in technology and changes in the economy, society, general outlook, legislative supports, statutes and taxation would be beneficial.
It would be a good concept to bring this Bill into the pre-legislative scrutiny process. The Government has had a stakeholders' consultation process and, with that in mind, we could ensure that whatever Bill is brought back to the floor of the Dáil has broad support and takes into account the practicalities of what a co-op should be about, not an ideological view of what a co-op is about. It is for members and for participation and it stresses loyalty from and to membership while, at the same time, being creative and consistently innovative. The co-ops that have been successful in this country are ones that have been dynamic but many have been lethargic. Once the initial fervour of the establishment of the co-op fades away, there is little left, the co-op is hollowed out and does not make a contribution. I would like to see ideas around that concept and how to create a framework for co-ops to consistently innovate. That would require imagination in taxation and incentivisation through the taxation codes primarily.
There is potential. There were successes in the original creameries, which were established long ago, and in the credit union movement. There is opportunity in the area of alternative wind energies for individuals to come together in a community wherein they can establish these types of infrastructural developments for the benefit and participation of members and the community. A sharing of dividends within that community and the broader community is a good concept and should be encouraged.
While I support the concept of the Bill, it needs to go through some form of scrutiny to embrace the concept of what a co-operative should be, pragmatically speaking, rather than just ideologically.
I am delighted to have the opportunity to contribute briefly on the Industrial and Provident (Amendment) Bill brought before us by my Independents 4 Change colleagues and I. It is a long overdue Bill that will amend the Industrial and Provident Societies Act 1893 in important respects, as my colleagues have outlined, and provide for connecting matters.
A co-operative by definition is an autonomous association of persons united to meet common economic, social, and cultural goals. They achieve their objectives through a jointly-owned and democratically-controlled enterprise. Co-operative movements emerged after the industrial revolution because of the upheavals and very bad treatment that workers and producers of that era endured. In England, people such as Robert Owen and enterprises such as the Rochdale Society of Equitable Pioneers were notable. In Europe, Raiffeisen Banks emerged as co-operative credit providers in response to restrictive credit conditions.
As my colleagues have outlined, Ireland has a long history of co-operative effort under the leadership of Sir Horace Plunkett, R. A. Anderson, Fr. Finlay and others. The Irish co-ops thrived from the 1890s and we are proud of our history, through the decades. My colleague has said, of course, that some of these co-ops later morphed into public liability companies, plcs. Some of the responsibility for that lies with the Minister of State because he and the Government have not come forward with modernising legislation because his party did not want to and neither did Fianna Fáil. They did not want to support the co-operative movement. Deputies Connolly and Pringle also mentioned the famous Fr. James McDyer and the Comharchumann na nOileán. We have a proud tradition in this area, going right back.
Co-operative financial services have also been successful in Ireland with the establishing of the credit union movement. It came to this country from the United States through the great John Hume, who started the first one in Derry. They began to develop all around the country. The Government's attitude to co-operative development was shown to some extent in the crash era in how it dealt with credit unions and building societies. For no good reason, the then Minister for Finance, the late Brian Lenihan, backed the Educational Building Society, for example, which was owned by its depositors, including my family, into Allied Irish Banks. Similarly with the credit unions, a quarter of a billion euro was put forward because credit unions were going to collapse but he never said, of course, that only €14 million or €15 million was used. Fine Gael's attitude to credit unions and the co-operatively owned financial sector has always been a bad and unsupportive one.
We welcome the fact that the Progressive Credit Union in my own constituency is about to launch a current account with a debit card, chequebook and so on. That is a valuable development although it could have happened 30 years ago. It did not happen because Fianna Fáil and Fine Gael were not prepared to bring in the legislation to make it possible.
We are all familiar with the development co-ops in Europe. We still wonder why the Sparkassen bank has not been allowed or encouraged to come into this country. I hear Deputy Michael McGrath asking, week in, week out, why we are paying 4% interest rates when the rest of Europe is paying 1%. Why is that the case? One of the reasons is that Sparkassen and other groups like that have not been encouraged.
We are familiar with co-op housing and the National Association of Building Co-Operatives, NABCO, and various other approved housing bodies which operate on a co-operative basis. There are small streets in my constituency which were built by a group of teachers, nurses and other people working together who actually created their own housing.
The Minister of State is also very familiar with the group water schemes programme. Horace Plunkett was from the Minister of State's own constituency in Dunsany.
Co-operatives are a powerful tradition in our country and it seems that, in the interim period, and particularly following the horrible years of grotesque capitalism under Margaret Thatcher and Ronald Reagan, we have totally neglected this sector.
There was, first and foremost, grotesque capitalism. At least the Chinese are building houses with their state construction company, which this Government is not doing.
We have a long and proud co-operative history that is still visible today. There is a legal lacuna and that is the reason the Minister of State is telling us tonight that we need consolidation. I have been looking for consolidation of the Traffic Acts for 15 or 20 years, nearly as long as I have been in this House, and I am still looking for it. Will the Government refer this to the Law Reform Commission? If the Government wants a comprehensive Bill, of which our Bill could be a part, will it bring it forward and stop talking about it? The Minister of State did not even mention the Law Reform Commission and whether or not it has ever had that task.
Europe has a great history of co-operatives. Deputy Joan Collins mentioned Italy. We also know about the Mondragon Corporation in the Basque country. It is a huge, powerful co-operative for the Basque nation - and it is a nation - within Spain. It played a role in promoting the economic well-being of the Basque people and all the people of the Iberian peninsula. The supporting legal systems of those countries are better than ours and that is the key point we are raising here.
The UK has a great tradition. The 70,000 workers in John Lewis stores own their own company. A John Lewis store in Liverpool or Manchester, or wherever, is owned by the people on the floor. It is their company. Waitrose, the food retailer, is another example. There is also a great tradition in the British Labour Party with co-ops. Many Members of Parliament are co-op members. It is the Labour and Co-Operative Party in the UK.
It is amazing that our legislation dates back to 1893. The Minister of State mentioned the 2014 Act but, again, Fine Gael has had an opportunity over the past eight years to modernise the legislation and it has not been taken. It is amazing that we are still relying on United Kingdom legislation that goes back before Independence. We recently celebrated 100 years of Dáil Éireann. Given the tradition the Irish tradition of co-ops and worker-owned industrial bodies that we have all outlined, we should have had modernising legislation by now.
The Bill reduces membership criteria from seven down to three. The Minister of State said he had a consultation on that and mentioned Finland and various other countries. My colleague, Deputy Clare Daly, in introducing the Bill, said that, in 2014, there were 237,753 small and medium enterprises, SMEs, in Ireland, employing almost a million workers. Those SMEs have an average of 3.87 employees per business, just over three. This is how we came up with three as the number that should be pursued.
I do not see why the Minister of State cannot support this provision.
The Minister of State said only limited companies can have audit exemptions and he has reservations about this provision. He must acknowledge, however, the cost of an audit for many small co-operatives and social enterprises, which are not focused on profit-making but on service delivery for their communities, can make the model unattractive. It must be kept simple.
The Minister of State referred to a statutory instrument concerning electronic filing. Again, this could be put on a legislative basis rather than through a statutory instrument.
Tonight’s debate is valuable because this is an important sector. My colleague, Deputy Pringle, outlined a strong case of how it could become more important in the future in, for example, energy, coping with climate change and getting communities together. Co-operatives still have amazing potential in the finance and social media sectors. For example, some newspapers, because they cannot survive physically, are becoming the property of their readers online. That is a wonderful development and a way of sustaining newspapers.
There are many positive examples in our history of finance, housing and agricultural co-operatives. It is our hope that the Bill would make the establishment of a co-operative society that much easier to encourage community groups and local workers to adapt to a model which benefits the whole of society. Co-ops are based on strong values along with providing good jobs and services beneficial to communities. Long before I was in politics, I was involved in social enterprise. I am still a director of several community companies. I know from board meetings over the years the requirements needed to fulfil statutory rules. People are prepared to do that if they are simple rules. The Minister of State could kick the ball off tonight by accepting the legislation.
This short Bill is designed to amend the current regulations around the establishment of co-operative societies and to make the administrative process involved that bit easier. To hear the Minister of State's response was disappointing, however. We are in danger of talking ourselves into complexities which do not exist. We are not asking for the reinvention of the wheel. The Society for Co-operative Studies in Ireland and the Centre for Co-operative Studies at UCC provided submissions to the Department's review in 2017, a review which has not been published yet. I do not see why it cannot be accommodated.
The Minister of State said there is no consensus in reducing the criteria from seven to three members required to register a society. In fact, the proposal is pretty much in line with what prevails in the rest of Europe. The other measures we have looked for, such as audit exemptions, are available to other types of companies but not to co-operative societies. We are not looking for anything special.
When I heard the Minister of State tell us not to be concerned because we love co-operatives and the Government will deal with them in a giant repealing Bill, it reminded me of the approach to the updating of the coroner legislation, which is rooted in the 1960s. We were told not to amend it just to deal with maternal deaths because the Government would amend the whole legislation. At that stage, it had been under review for 18 years. After three years of messing around, the Government decided to come with a stand-alone Bill to deal with the one aspect of maternal deaths, which, incidentally, we still have not passed. The response to this Bill is identical.
There is no conflict for the Government to pass this Bill. If it has a bigger project, then it can work away on it. Meanwhile, we can build on this legislation. While we can all claim we support co-ops, we lag far behind the UK and the rest of Europe in this area. There has to be a reason for that. Given our proud history, we are not ideologically opposed to co-operatives. It is because the mechanisms to support co-ops are not as robust in Ireland as they are in other jurisdictions.
The issue of co-ops is ideological. I make no apology for that. The model is resilient, democratic and based on values which provide good jobs and good services beneficial to communities. They can obviously range in size from large companies to a small crèche or an initiative dealing with housing waste, energy or football teams. It is a fact that because of the ideology and the basis on which they are established, there are much more likely to reinvest their profits into resources, training, education and so forth, rather than dealing with shareholder profits. There are far less likely to contribute to environmental damage in their locality. They tend to be much more locally based which in this era of sustainability is particularly important.
We make no apology about placing this issue in the context of the economic turmoil that prevailed over the past decade which revealed quite starkly for many the insecurity of the market. It was a situation which had devastating consequences for jobs as well as vital services in our communities, especially our rural communities. It is no coincidence that the impact of this same economic turmoil in areas of the UK and Europe which had co-ops was far less devastating. For example, in Spain, 24% of Spanish companies were forced to close but only 6% of co-ops. There is a value in co-ops. We know from research in Scotland that the co-operative model is much more likely to succeed in the first five years than other start-ups. Given the amount of money taxpayers pay to start-up businesses, many of which end up failing, the success rate is far better with co-ops. It makes sense all round that we would invest in these co-ops.
The Bill we are putting forward is to strengthen the legal framework to ensure the co-operative sector is given the opportunity to fulfil its potential, as well as ensuring good governance and transparency which are important. Our measures do not in any way conflict with that. As Deputies said earlier, there are many examples in Ireland such as the Dublin Food Co-op and the Quay Co-op in Cork. The latter was established in 1982 by great activists like Arthur Leahy. It is a progressive workplace and business with a restaurant, bakery and three shops providing good foods, sustainable products, recyclable packaging, green energy resources and so forth.
We know the model has been incredibly successful. It can be adapted into areas such as waste collection. In my area, we have conducted detailed surveys on this. After privatisation, bin services operate in a non-regulated environment with consequences such as fly tipping. Residents have the nightmare of emissions with different bin company trucks going up and down their roads every single day of the week. We have suggested running a pilot scheme where the residents would provide that service as a co-op and operate their own bin trucks.
In the past decade, we have seen many companies shutting down. In 2016, a survey of small and medium-sized enterprises showed that half had no succession plans at all. In many instances, such companies die with the owner. The co-op model fits in very much with that and where worker buy-outs can save the jobs which otherwise would be lost. It is particularly pertinent against the rise of precarious employment which presents significant insecurity for workers in so many aspects of their lives.
It is interesting that a report from the UK trade union and co-operative sectors has called for joint initiatives to sustain decent work for people and protect them from the poverty trap. The trade union co-op platform is trying to advance worker ownership and control in the service industry to avoid what has taken place because of the ideology of the market, neoliberalism, the race to the bottom, insecure contracts and people not knowing what is what.
Surveys have shown the impact of a working environment on people's mental health. There are very good studies even from America. There are many examples such as a simple bicycle shop where workers take ownership of it. They might be doing the same job they were doing previously but because they can set their own agenda and be responsible to themselves, it is an entirely different situation.
There is no reason for the Government not to accept the Bill. I am mindful that the Bill deals with workers' rights and many workers in this House were here very late last night and are here late tonight, and I know do not want to prolong things. It is unfortunate the House is sitting longer these nights because it is not good for our staff who are here either. I think the Government can accept the Bill. The Minister of State should rethink and let it move on.
I thank the Deputies from the Independents 4 Change group for introducing the Industrial and Provident Societies (Amendment) Bill 2018. Sinn Féin is very happy to lend our support to the Bill, as it is important legislation which will have a significant impact on the development of Ireland’s co-operative sector.
We welcome the amendment to reduce the number of members needed to establish a co-operative from seven to three. From a number of engagements we have held with stakeholders in the sector, we were continually told that this was a major barrier to the establishment of smaller co-ops.
Sinn Féin shares the view of the Deputies in the Independents 4 Change group that the development of our co-operative sector is vital to the development of a fairer economy. If we are serious about addressing inequality in our society, we must deal with the inequality of ownership in our economy. Co-operatives offer an alternative model of business which is focused on worker outcomes, worker well-being and community sustainability. They retain economic power at a local and regional level, and allow for community wealth building.
Sinn Féin is committed to developing our co-operative sector, particularly our worker co-operative sector. These are co-operatives in which the workers of the enterprise own at least 51% of the shares.
Across Europe, worker co-operatives have been found to be more productive, more resilient and to provide greater benefits to their workers, communities and society. Worker co-operative businesses are also more likely to pay the living wage, have lower pay differentials between the top and lowest earner, use fewer zero-hour contracts, and have shown exemplary degrees of corporate social responsibility and a strong commitment to sustainability.
Scotland is quickly becoming one of the world’s leading countries in the development of worker co-operatives. In 2005, the Scottish Government decided to establish Co-operative Development Scotland, a subsidiary of Scottish Enterprise, tasked with the responsibility of developing Scotland’s co-operative sector. In 2012, it made the decision to focus exclusively on the development of worker co-operatives and it has since seen a substantial threefold increase in the number of worker co-operatives. The Scottish Government chose to actively develop the sector through Co-operative Development Scotland, coupled with supportive legislation.
A quote from John Clark, chair of an employee-owned business and member of the steering group sums up the approach in Scotland as follows,
We have a choice: to be passive and allow the development of a support environment for EO companies [workers' co-ops] to happen without industry input, or to take a proactive approach and seek to actively influence how that environment evolves. We believe the proactive approach creates the prospect of making Scotland the best country in the world to establish and grow [workers' co-ops].
Scotland is now clearly reaping the rewards. Elsewhere in Europe, there are 800,000 workers in the Italian worker co-operative sector. As Deputy Broughan mentioned, Spain is home to the world’s largest worker co-operative, Mondragon, which has 80,000 workers and in 2015 had sales of €11 billion. The worker co-operative sector accounts for 13% of Sweden’s GDP, 16% of Switzerland’s, 21% of Finland’s, and 4% in France.
For many stakeholders, a key barrier to the development of a worker co-op sector has been an absence of state policy supportive of the sector, and even the existence of legislation which makes it more difficult to establish co-operatives, such as the Irish rule requiring seven members to establish a co-op. That is why in 2014, the French Government introduced the social co-operative law which specifically introduced legislation supportive of the worker co-operative sector. Italy has the Marcora and Basevi laws and Spain has its laws to assist worker co-ops.
Despite the many benefits of the worker co-operative model to workers and their communities, Ireland has yet to develop its own worker co-operative sector in any significant way. To date, the worker co-operative sector here can be described as undeniably small and arguably underdeveloped. This could be put down to two reasons, namely, a lack of legislation specific to worker co-operatives and an absence of Government support for would-be and existing co-operatives. This lack of co-operative development is particularly disappointing given that throughout Ireland’s history, agricultural and financial credit union co-ops have made a significant contribution to our society.
Sinn Féin wants to see the success of both of these co-operative sectors replicated in the development of our own worker co-operative sector. Similar to the Credit Union Act 1997, we should continue to progress legislation like this Bill in order to assist the sector with supportive legislation.
Sinn Féin will table an amendment to the Bill on Committee Stage to introduce a simple definition of a worker co-operative which could be inserted into the Industrial and Provident Societies Act in order to provide the sector with further support and protection.
In 1988, the Government attempted to develop the co-operative sector through the establishment of the co-operative development unit, CDU. This State body was devoted to the development of worker co-operatives and resulted in the growth of worker co-ops from 47 enterprises in 1991 to 73 in 1992, and again between 1996 and 1998 there was another spike from 66 to 82. Some argued that the unit would have been even more successful in developing the sector if it were not for the absence of a supportive legislative framework at the time. Disappointingly, however, Fianna Fáil in government closed down the CDU, ending all soft and hard support for the development of worker co-operatives. Since its closure, there has been no provider of support or information specific to worker co-ops, something which has been central to the development of the sector in Scotland, France, Italy and Spain.
In keeping with ILO recommendation 193 of 2002, Sinn Féin would like to see an environment in which co-operatives enjoy equal treatment with other types of enterprise. Governments should create an enabling environment and facilitate access to support services. Governments should provide policy and a legal environment conducive to the creation of worker co-operatives, provide grant support and develop partnerships with co-ops.
The success stories of Scotland, France, Italy and Spain all provide evidence that there is an alternative way to develop our economy. Sinn Féin wants a sustainable economy, not one driven by profit, but maintained by secure jobs and broad benefits shared by greater society. This is achievable through a co-operative economy. In order for this to happen, legislation such as this Bill is essential.
I again thank Deputy Clare Daly and her colleagues in Independents 4 Change for introducing the Bill, which Sinn Féin is very happy to support.
I am conscious that not everyone was here when I spoke earlier. I will not go back over the whole speech. I thank the Members who have introduced the Bill. I accept that they are interested in the area. There is always the suggestion, as Deputy Pringle said, that the Government does not want this and we will put it on the long finger. Opposition Deputies always assume that we do not want things even though we have a duty to bring forward proper legislation. Just because the Independents 4 Change put something in a Bill does not make it absolutely right. It does not mean that we always oppose it either.
The Minister for Business, Enterprise and Innovation, Deputy Humphreys, and the Department are committed to reform. That process of change started at the end of 2017 and early 2018 before the Bill was introduced. I am sure the Bill Deputy Joan Collins introduced in July had an influence on some of the changes that happened in December. However, she should accept that the Minister had started a process to review this area and make changes. The Department has form in this. It introduced a massive piece of work - I think about ten years of work - in the Companies Act 2014. Deputy Kelleher was probably a Minister of State in the Department at the time it started and it was followed through in our time in government. The Department of Business, Enterprise and Innovation is committed to reform. The assumption that is it always against reform or change is not always true and it is not always fair to say that. There is a process it needs to go through and it started some time ago. It is not being long-fingered. The intention is to introduce it this year.
The Deputy might have heard it before, but not from this Department, which has proven its worth in this respect. Let us recognise that piece of work because I know the amount of work that went into introducing the changes and consolidation in the other Act.
We all agree on the benefits of co-operatives. As we have outlined, in the credit union movement, in agriculture and even in housing, co-operatives have been doing great work. I look forward to seeing credit unions funding housing proposals which have been provided for in changes to legislation. The sooner that comes together, the better. We recognise that.
It is clear that we all recognise the continuing importance of the co-operative movement throughout Ireland. Furthermore, we all share a strong desire to modernise legislation that underpins the continued sustainability and success of the co-operative model.
We diverge only on how to achieve these aims. That is part of the work we have to do and we will tease through that in the months ahead. The Minister is very clear that she would like to work with the Deputies on this in the months ahead and has asked for their co-operation in that regard.
The proposed Bill may be well intended but it cannot be supported by the Minister in its current form for the reasons I outlined in my opening remarks. The Minister would like to avoid the introduction of more piecemeal and fragmented legislation in this important area. She is also concerned about the introduction of measures that will reduce transparency and which could result in unintended consequences that may have a negative impact on the co-operative movement, a movement that we all want to support. We already have a strong co-operative movement in this country, although one would think, having listened to some of the speeches tonight, that we do not.
The Minister considers that a more appropriate course of action is to consolidate into one statute all existing industrial and provident societies legislation and to modernise it to eliminate outdated provisions and align it with the realities of a 21st century business and regulatory environment. This will ensure a level playing field between co-operatives and the other legal options for structuring enterprise activities and will provide a conducive framework for the full potential of the co-operative model to be realised. Deputy Kelleher made reference to the importance of a level playing field earlier.
Deputies asked why it is taking so long to complete the review in order to modernise this whole area. The Government recognises the continued importance of the co-operative movement throughout Ireland, particularly to local rural communities, with over 200,000 such companies registered in Ireland. The focus of the Department in recent years has been on consolidating, reforming and modernising our companies legislation and getting that piece right. This has been a major contributory factor to continued investment and new start-ups during the years when we needed new jobs in large numbers. This Department has form in producing legislation and action plans to facilitate the provision of additional jobs. That was the Department's focus and this significant undertaking, involving the largest volume of substantive legislation in the State's history, has been completed successfully and the new legislation now forms the basis for Ireland's business regulatory environment. The Companies Act 2014 was followed by the transposition of a number of EU directives including EU 2006/43/EC, as amended by EU 2014/56EU, the coming into force of EU Regulation No. 537/2014 as well as the Companies (Accounting) Act 2017 and the Companies (Statutory Audits) Act 2018. There was a lot happening in this space and a lot of change. The Friendly Societies and Industrial and Provident Societies (Miscellaneous Provisions) Act which came into effect in 2014 was aimed primarily at easing the regulatory burden on co-operative societies. It addressed particular problems that were identified in the co-operative sector and has helped to ensure that this model thrives and grows.
The Minister wants to ensure that the review currently under way takes on board all of the views of interested parties. The public consultation process is complete and it is important that the review takes into account all of the views expressed, some of which differ to those expressed by Deputies in the House today. Deputies Pringle and Kelleher referenced the Irish Co-Operative Organisation Society, ICOS. Interestingly, ICOS made a submission to the Department only yesterday with some observations on this Bill. It was very clear that it favours retaining the seven member minimum because it believes that a lower number might bring visibility and sustainability into question. Deputies have portrayed as gospel the need to lower it but that is not gospel according to members of the sector. It is important that we have proper consultation and tease out all of the issues involved. ICOS also emphasised the importance of annual returns for transparency purposes. It said that it would prefer the audit exemption to be in primary legislation rather than by ministerial order. I make these points to demonstrate that there are other views out there on these issues. The Deputies seemed to suggest that everything they have put forward is right but it is the job of the Department to tease it through, to get everyone's views and to bring forward legislation of which we can all be proud.
Independents 4 Change Deputies would appreciate a copy of the ICOS submission, if possible. The Minister of State has said that the Government is with us regarding co-operatives. While I welcome that, the problem is that I have not seen any evidence of it. I have not seen any evidence of a sense of urgency either. We are talking about 121 years to bring in the 2014 Act, 123 years to bring in the review and 126 years later, we are looking at Victorian legislation. As I have said previously, it is ironic that the English have changed it for the better in terms of facilitating and encouraging co-operatives on the ground in every way possible.
In terms of the Bill itself, I will be the first to admit that it is not perfect. However, it is a Bill that is being supported by almost everyone in Dáil Éireann, with the exception of Fine Gael Members, although I am not sure where the Labour Party stands on the Bill. It is interesting to note that when the Labour Party was in power with Fine Gael, that Government had a massive majority but the legislation was not changed. That is when it should have been changed, as I am sure the Minister of State would agree. That Government had a massive majority and if it was seriously interested in supporting the co-operative movement, it should have done so then. That said, if the Government has had a moment on the road to Damascus, I welcome that. I truly welcome the fact that this Dáil is going to work on behalf of the co-operative movement.
The Minister of State pointed out that events have overtaken us in some senses and I welcome that. Deputy Joan Collins has already pointed out that the Bill has forced a tiny bit of change in that electronic filing has been possible since December. Again, that could have been done much earlier. If we are to accept the bona fides of this Government, and I do not wish to be negative-----
I am saying something positive in the sense that I have said that the Government has had a moment on the road to Damascus, which is good. This new Dáil is making changes. This is only my third year in this House but I have spoken about this to longer-serving colleagues. When was the co-operative movement last discussed in the Dáil? Was legislation for co-operatives ever discussed in the Dáil in the Minister of State's time? When Fine Gael and the Labour Party had an overwhelming majority and prior to that, when was it discussed? I do not think it was ever-----
I will wait for the Minister or State to come back to me on this but to my knowledge, it was never discussed.
I have the privilege of being the Chair of the Comhchoiste na Gaeilge, na Gaeltachta agus na nOileán. Yesterday we had a very good briefing from the Minister for Foreign Affairs and Trade, Deputy Coveney, on the omnibus Brexit legislation that will go through the Dáil in a record amount of time. We cannot put through Bille na dteangacha oifigiúla or even minimal legislation to make it easier for co-operatives on the ground but we can push through an enormous amount of Brexit legislation in a short number of weeks.
Interestingly, provision is being made for Enterprise Ireland. The legislation will be changed to facilitate all sorts of companies and to make things easier for them, with extra money being made available with no limits, changes with regard to research and development and money being paid up front. All of those changes can be made very quickly and perhaps rightly so, but I have not yet had a chance to go through it all in detail. The point is that they can be made very quickly without any problems and yet there is a big problem with regard to co-operatives, despite the overwhelming evidence on the ground, across Europe and elsewhere, of their importance. This is also despite the evidence from the Government's own documents which emphasise the importance of the co-operative movement, including the Forfás report on social enterprise in Ireland which was published in 2013 and the Government's White Paper on Ireland's transition to a low carbon future, among other policy documents. Both of the aforementioned documents identify the co-operative model as being core to developing community-based enterprises in each sector. What happened as a result of that? Not too much-----
Deputy Clare Daly's office did tremendous work on this and I pay tribute to them for that. All Bills at this stage of the process are far from perfect but that is why we have a legislative process. That is why Bills go on to the next Stage, to be discussed in detail. That is also why there is pre-legislative scrutiny. The resources on the side of the Government are enormous. David and Goliath springs to mind in the context of the resources available to the Opposition, although things are changing slowly in that area. We will have access to draftsmanship in the future. At this point, however, this is a basic Bill which contains a number of provisions. The provision relating to electronic filing has been overtaken by events, which I appreciate. The provision relating to reducing the number to three was a common theme in the submissions and is also in keeping with Europe and other countries. At the very least, if the Government is sincere about supporting co-operatives on the ground, then it should let this Bill go to Committee Stage.
Let it be teased out. Give an opportunity to the stakeholders to make their presentations to the committee. This would show real bona fides on the part of the Government. Co-operative legislation has never been discussed on the floor of the Dáil until now, 2019.
If the Minister of State thinks this is negative, he needs to refer to a dictionary. What we have done with the support of Fianna Fáil and Sinn Féin is table an important Bill. We tried to take the least offensive way forward by providing for only minimum changes, with no implications for the Government. This Bill presents the Government with an opportunity to show it is behind co-operatives. I accept there are deficiencies in the Bill.
The Minister of State spoke about a lack of transparency and accountability. I, above anyone else, would never stand over a system that lessens accountability. I spend every Thursday at the Committee of Public Accounts where, week after week, we see the effect of bad governance and lack of processes. This Bill has nothing to do with that. The purpose of reducing from seven to three the number of members required to register a society brings it into line with other European countries to align it with the companies that do not have the same demands upon them. In regard to the accounts, it is an enabling provision. Regulations can be made. In regard to audited accounts, that can be included. It is one of the major requests from the various submissions because it is such an onerous task on small co-operatives.
Tá deis iontach anseo don Rialtas a chur in iúl do na comharchumainn ar an talamh go bhfuil sé taobh thiar den ghluaiseacht seo. Is deis iontach é chun cur in iúl go bhfuil sé oscailte breathnú ar an reachtaíocht seo agus leasuithe a dhéanamh ar an gcéad chéim eile atá le teacht.
In regard to the Minister of State's request that we not be negative, I do not believe any speaker tonight has been negative. We have pointed out the advantages for co-operatives on the ground and the wonderful opportunities that present, from agriculture, to recycling, to the energy we need urgently in terms of climate change.
I do not think the Minister of State is going to change his mind at this point. I ask him to look again at the positive aspects of this Bill. It has put the issue of co-operatives on the floor of the Dáil and it seeks only minimal changes. It is to be hoped it will put substantial pressure on the Government to deliver the legislation that is needed urgently. We do not need consolidating legislation. Rather, we need legislation that has a vision for co-operatives, spells out what a co-operative is, and enshrines within it the seven basic principles. We then need that legislation to be followed with regulations to roll out a competitive co-operative system on the ground that balances all of the aid and assistance being provided to Enterprise Ireland, IDA Ireland and, to a lesser extent, Údarás na Gaeltachta. There is a need for all of this. The Government is doing this for Enterprise Ireland in the context of Brexit. Let us see it in regard to the co-operative movement that is struggling on the ground and getting much more value for money.