Dan Boyle (Green Party)

It is a very large credit union and maybe some of its difficulties and those of other larger credit unions were caused by their attempts to be like banks — it was a case of too much too soon. Approximately 14 larger credit unions have broken away from the Irish League of Credit Unions in recent years. The credit union concerned, Mitchelstown Credit Union, was the first in Ireland to have an ATM machine. Adopting many of the characteristics of conventional banking may have created difficulties.

Many of the difficulties credit unions have are a combination of the credit crisis that exists anyway and legislative bars that exist due to legislation that needs to be reviewed. The Credit Union Act 1997 is 12 years old. It is an unofficial rule of thumb that ten years is the best period in which to review such legislation. With the changes being forced upon us we have an opportunity to examine the relationship between financial institutions and regulation in general, and how the credit union movement needs to be looked at in terms of how and by whom it is regulated and the legal structures. Now that a central banking commission has been proposed to supersede the Central Bank and the Financial Regulator, there is an opportunity for Members to question whether the registrar of credit unions should remain there or in a separate structure.

There are arguments by the credit unions about the types of restrictions they feel have been placed on them under the legislation. This is ironic because there seems to be more effectiveness or a greater willingness in terms of resources to use a regulation system for credit unions that did not apply to the conventional banking system. The office charged with enforcing that regulation, the registrar of credit unions, would argue that the legislation ties its hands in having the most effective form of regulation. I note that both problems are put outside. There are three problems: liquidity, the problems the registrar finds regarding enforcing regulations and the problems the credit unions have with the legislation.

The hope is that tonight's debate will address the need to re-evaluate the Credit Union Act and put in place a better Act and a system of regulation. This is needed for our system of social finance in this country and for better defining and using social finance, as it is for conventional banks and other financial institutions. On those grounds I move the motion and look forward to an open and interesting debate this evening.