Pippa Hackett (Green Party) | Oireachtas source

Last Friday KBC decided to pull out of the Irish market. This follows the decisions of Ulster Bank to do the same and of Bank of Ireland to close 88 of its branches in our State later this year, causing much distress in many Irish towns. As it is clear that private banking is not serving us well, it is time to reconsider our options. Public banking has been a policy of the Green Party for a long time. In 2019 the Indecon report on public banking stated there was no need for a public bank because the level of competition in the Irish market was so strong. This, however, is clearly not the case any more. Before that, in 2018, the Government of the day commissioned the Local Public Banking in Ireland report, which, interestingly to me, examined the possibility of piloting such a bank in the midlands, suggesting it should be headquartered in Mullingar, with branches in Tullamore, Port Laoise, Athlone and Longford. We should consider such a pilot. The midlands in particular have had a tough time of it in recent years. Public banks keep money in a community. What is generated there stays there and is pumped back into new ventures or expansions. Credit unions already do this to an extent but are limited in their ability to function as banks. An Post also offers a range of financial services but they are similarly limited. A full public banking system could remove the barriers to microbusinesses, which are often turned down for credit. I am talking about the local café or hairdresser, those enterprises we have missed so much during this lockdown and which have suffered badly. Think also of new tourism ventures such as bike hire or small food-producing enterprises. Public banking allows for greater financial inclusion, and this has been linked to stronger, more sustainable economic growth. This is why so many countries support public banking. Public banks are already a successful part of the banking sector in 21 EU countries. In fact, the well-known German system of Sparkassen has been operating successfully since the late 1700s.

No doubt there will be much discussion about the future of Irish banking in light of these recent developments, and a banking forum involving all stakeholders, including the Department of Finance, would be a good place to start. Public banking needs to be part of that discussion.