Seán Sherlock (Cork East, Labour) | Oireachtas source

Section 8, which the Senators are proposing to amend, removes the restriction in the current Act providing that the registrar must be absent for the powers, functions and duties to be exercised and performed by such other person as the Minister may authorise, and allows another person to act alongside the registrar. The change is necessary as, for the past number of years, the role of Registrar of Friendly Societies has not been a dedicated role, but has been fulfilled by the Registrar of Companies in addition to her existing duties.

The amendment proposed by the Senators, which I understand seeks to transfer powers of the Registrar of Friendly Societies to the Central Bank, will not operate as intended by the Senators because section 5 of the 1977 Act sets out powers of the Minister with regard to the Registrar of Friendly Societies and not the powers of the registrar. There is a reference to the powers, functions and duties of the registrar in section 5 but it relates to who may be authorised by the Minister to perform these powers, rather than setting out the powers themselves. Section 6 of the 1977 Act does relate to a specific power regarding cancellation of the registration of societies but, as I do not believe it to be the intention of the Senators in drafting this amendment to transfer powers solely relating to cancellation of societies to the Central Bank, I do not accept the amendment.

There have been discussions on, and it is intended to examine it further with the Central Bank and the Department of Finance, the appropriate prudential supervision for friendly societies.

It is intended to examine further with the Central Bank and the Department of Finance the issue of appropriate prudential supervision for friendly societies. At present the powers to exercise such supervision do not exist under the friendly societies legislation and therefore appropriate powers must be put in place. No existing powers can be simply transferred. It is considered that the best place to address the matter is under the Central Bank Acts rather than the Friendly Societies Acts.

I wish to restate what I said on previous Stages. The Friendly Societies Acts do not confer corporate status on societies or limited liability on members. The evidence in recent years is that it has become common practice for many charities and clubs to register as limited companies. I hope to give some confidence to Senator Barrett in addressing the points he has made by reiterating that the most realistic institutional option for introducing an appropriate system of supervision is the Central Bank, which is at the centre of financial supervision and financial stability oversight. It has a responsibility to provide in a fully integrated and co-ordinated manner for the prudential supervision and stability of all financial services within the financial system as a whole. To avoid the possibility of other bodies moving into this unregulated area it was decided to close registration to new friendly societies.