Marie Sherlock (Labour) | Oireachtas source

I welcome the Minister of State. This is an important piece of legislation. The restructuring board was set up to undertake a very important and arduous piece of work in terms of consolidating and restructuring the credit union sector in this country. It is a very important sector in terms of allowing access to borrowing for so many within communities who would otherwise not have that access. The work of the board was to oversee the restructuring, which it did. There are 40% fewer credit unions now compared with 2011. It was a large body of work. An Seanadóir Kyne raised a very important issue with regard to the incomplete projects and if the dissolution or unwinding of the board from 2017 is hasty. The projects have been handed over to the Central Bank of Ireland, which acts as the regulator but it also has a consumer protection mandate. I think in particular of a number of credit unions I know that are subject to lending restrictions. Drumcondra Credit Union was liquidated earlier this year. In spite of its protection role, the Central Bank of Ireland did not undertake any exercise to understand how members were, in effect, left in the lurch. The credit union was the sole financial service provider for some who also had savings and insurance cover with it. There are questions and concerns about the work of the Central Bank in terms of completing the restructuring work within the credit union sector.

While we are discussing the dissolution of the restructuring board we should use the opportunity to discuss and reflect on the future direction of the credit union movement. A number of reviews were commissioned and completed in recent years by the Government. The question is what is the Government’s plan now with regard to any future reports on the structure of the credit union sector and the implementation of recommendations. I understand the Department of Finance is currently undertaking a review of the credit union policy framework. That is on foot of a previous recommendation from the credit union advisory committee. We need clarity on where the Department stands with regard to the recommendations for the credit union sector.

We have 280 credit unions in this country. It is a smaller number of credit unions but the individual credit unions are bigger. There are real questions about how credit unions can function as an alternative to conventional banks. We are witnessing a transformation in financial services and how people access them but a significant cohort of people do not have access to conventional banks. The question is how we support credit unions to strengthen their role in day-to-day banking and in lending and borrowing.The second key question concerns enabling credit unions to lend to affordable housing bodies and for social housing. Some of that demand has been met. In 2018 credit unions were allowed to invest in tier 3 approved social housing bodies up to a value of €700 million, through a regulated investment vehicle. That is very welcome, but I have seen repeated statements from the Minister for Finance that the Central Bank and the Department have completed their role with regard to enabling credit unions to lend to the housing sector, in particular to social housing. My understanding from the credit union movement is that there is a strong desire to be able to lend more. I want to hear from the Minister of State about his plans in that regard, if there are any.