Tom Shehan (Fine Gael) | Oireachtas source

While the credit unions are deserving of all the plaudits and plámás they are getting today, what they really need is protection from the Central Bank and Mr. Matthew Elderfield, whose reputation precedes him. Having made inquires, I am aware of what happened under his watch to the credit union movement in another jurisdiction.

The Minister of State stated in his speech:

The report is focused on what is needed for the credit union system. It does not apply banking thinking; nor does it slavishly import models from other international credit union movements.

It is ironic that this is included in the Minister of State's speech.

On stabilisation, while the Government is making ¤500 million available, all of this money will be repaid through a levy. There is no bailout. All of this money will be repaid. Let us not get carried away. Ordinary members of credit unions will pay for this facility. The Minister of State mentioned that the credit union movement is not a banking system. While the title of this Bill is the Credit Union Bill 2012, the Central Bank is mentioned in it more times than is the credit union movement. On shared services, not every Garda station in the country has a breathalyser device, which is used to test the alcohol levels of a person suspected of drink driving. Shared services, in terms of their structure, will result in the demise of smaller credit unions. If I choose to have my single farm payment cheque paid into my credit union account I want it done by way of electronic transfer. If this facility is available in my town and not in my local credit union, it is obvious which one I will go to. Shared services must be as customer-friendly as possible.

As I understand it, the credit union movement currently has savings of ¤7 billion which it cannot lend. Only 25% of this money can be held by any one institution. There are only two pillar banks in this country, Allied Irish Banks and Bank of Ireland. This means the remaining 50% of credit union funds is invested in foreign banks. Perhaps the Government would consider establishing a bond of, say, ¤5 billion or ¤7 billion - there is still time to do so in this Bill - in which the credit union movement can invest, the return on which can be used by the Government for job creation and capital projects in this country. This would be a better use of credit union funds and would benefit every community in the country.

Section 29 provides that before introducing regulations - this relates back to banking-type thinking and the Central Bank and Mr. Elderfield - the Central Bank will be required to consult with the Minister for Finance, the Credit Union Advisory Committee and other credit union bodies. Although this is not specifically required in legislation, this consultation is to be done in accordance with a consultation protocol which has been published by the Central Bank. I will leave it at that until Committee Stage.