Dan Boyle (Green Party)

The amendment that is to be proposed will give Senators an opportunity to speak as part of a wider debate. In my contribution on the motion I have moved, I hope to talk about the legislative changes that are needed. The amendment that has been tabled refers to the ongoing difficulties that exist. While I accept that many of them need to be addressed, I suggest that now is not the time to do that. Specific legislative proposals are required to bring about the changes that are needed. I hope Senators can take that on board in line with the spirit in which this motion has been moved. I hope the motion will move the debate away from the narrow macroeconomic issues with which we have been consumed over the past year. It is obvious that global difficulties are affecting flows of capital. Nations and large institutions are finding it difficult to access credit. These difficulties are having their most marked effects on individuals. The extent to which credit is made available to people depends on the economic standing they have in the first instance. The difficulty is that people are excluded from credit for reasons that are sometimes arbitrary, especially in recessionary times. When access to credit is denied to people, they are pushed further down the social ladder.

The concept of microfinance, which has been developed and refined internationally, is growing in popularity in Ireland. I will explain that a particularly Irish version of microfinance has been available for many years. I hope this debate will focus on microfinance as one of the means of achieving national economic recovery. In its ultimate sense, microfinance involves giving people who cannot get credit by ordinary means access to small sums of money to help them materially as they develop the lives they lead and wish to pursue. In developing countries, there has been a tendency for community groups to benefit from microfinance. Most of those involved in microfinance in such countries are women, who tend to be excluded from credit by the nature of conventional credit in most societies. The principle that underpins the concept of microfinance facilitates the flow in a community of funds that would not otherwise be available.

Microfinance is especially helpful for people who are establishing employment opportunities. The most recent unemployment figures show that Ireland has entered a phase of double-digit unemployment, sadly. Opportunities need to be offered to individuals, families and communities to help them to meet the challenges they encounter. One of the effects of large-scale unemployment is that it does not discriminate between the communities in which it occurs. We know from our experience during previous economic downturns that if the national unemployment rate is 10%, the rate in certain communities is two to three times that figure. We need to avoid a recurrence of that phenomenon by offering certain means of financial support. A version of microfinance has been made available in Ireland over the years through this country's credit union movement, which is almost 60 years old. Credit unions offer people small loans to allow them to do some of the things that microfinance allows them to do. The loans offered by credit unions continue to represent a small proportion of overall lending in this country. When credit union lending is considered in the context of overall lending in this country, it is clear it is not as targeted as it could be.

Other countries have put in place legislative means of doing what I propose we should do. The US Community Reinvestment Act provides for money from social and commercial lending institutions to be reinvested in particular geographical areas. We need to take this concept on board as we continue to re-examine how we structure our banks and financial institutions. One of the lessons we should learn from the banking and financial crisis is that lending practices have not been used to add greater value to certain localities or even to the country as a whole. The prime criterion has been to achieve the highest return in the quickest possible time. It may be difficult for some people to accept there should be a social dimension to the lending of money. On behalf of the Green Party, I contend that the adoption of such a principle would lead to greater long-term returns for society and for those who make the original investment.

The amendment to this motion that will be moved mentions many of the difficulties that have been faced by the Irish credit union movement over the years. It, perhaps, mirrors the position in which Irish banks and financial institutions find themselves. There are liquidity difficulties. It is somewhat apposite that tonight's debate takes place shortly after a recent news report referred to the registrar of credit unions, who operates within the Office of the Financial Regulator, moving against a particular credit union. I am probably very familiar with that credit union as it is on the main road between Cork and Dublin.