Larry Butler (Fianna Fail)

I welcome the Minister of State to the House and thank Senator Boyle and the Green Party for tabling the motion.

This debate gives Senators an opportunity to discuss the important role micro-lending has played in the past 50 years. It also affords an opportunity to pay tribute to the credit union movement and individuals such as Nora Herlihy, Sean Forde and Séamus P. MacEoin who founded it 50 years ago. Credit unions have stood the test of time. They often made the difference for young fellows in villages who were to serve their time and needed to borrow money to buy the tools they required to do their job, whether as a plumber, carpenter or electrician. The credit unions provided micro-loans to enable them to do this. We should maintain and expand this form of lending.

I expect the credit unions to play a much greater role in our banking system in future. Many individuals with considerable experience in the financial services sector have lost their jobs and I hope the credit unions will recruit some of them. While the credit union movement has played an important role in the past 50 years, it must also move ahead. The Government has a major part to play in this regard.

Some €13.5 billion is held in credit union funds. We need to find new ways of using this money, including by way of bond. I sound a note of caution, however, because some credit unions became involved in unwise commercial investments. They did not understand what they were getting into. I do not like to name names, but Davy was one company that advised a number of credit unions on investment issues, and €30 million was paid back to the credit unions because they did not understand the products in question. They need greater expertise if they are investing. I would like to see the Government providing a bond in which they could invest, through which a dividend could be paid back to them every year. This would play a great role in expanding the credit union banking system and putting a stronger emphasis on credit unions. The Government is guaranteeing savings of up to €100,000 in the credit union so there could be a collaborative role, especially at a time when we need finance. Credit unions represent finance that is available to us within the country, ensuring that we do not have to go outside the country to obtain credit.

I also suggest we consider a national bond. There are people who are still patriotic enough to invest in such a bond to help the country out in a time of need. We could have bonds as low as €10, which would mean that the ordinary person in the street — the small person or the old age pensioner — could invest in the country. That is what we are talking about tonight.

It is good that Senator Boyle and the Green Party have tabled this motion as it makes us think outside the box. Not everybody is looking for €200,000 or €300,000 to expand a business. Most businesses are expanded on very small money. In many cases the ordinary person does not have a track record with banking, and the only way he or she can acquire finance is through the local credit union, to which he or she is known. That is a problem with banking. There was a time when one went to a bank for a loan and the manager knew one and would come down to see what one was doing. That does not happen anymore; one is just a name that goes up to headquarters and if the name does not fit, even with a very good idea for a new business, the banks will not look at one. That is why they got into trouble. They did not look at the projects. They said Joe Bloggs down the road was making money every year and never thought the day would come when he would not make money to pay them back. That is the great thing about small businesses; they will always pay their money back. I was in business for 35 years and the first person to pay one was the small person for whom one did a job.

When considering a bigger role for credit unions, we should look at how the €13.5 billion in credit unions could best be used for innovative development and small businesses. I thank the Green Party again for tabling this extremely good motion. The Seanad is an excellent place to discuss such issues. We should be putting forward motions such as this in the House. We have ideas here and we want them heard. If a good idea comes from across the floor, so be it. We are here to discuss all aspects of an issue. I support the motion.