Jack Wall (Kildare South, Labour)
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Question 100: To ask the Minister for Finance if he will make a statement on his address of 29 April 2006 to the consultative general meeting of the Irish League of Credit Unions. [19289/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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In my address to the Consultative General Meeting (CGM) of the Irish League of Credit Unions (ILCU) on 29 April 2006, I acknowledged the success of the credit union movement in Ireland and the opportunities and challenges for the future. In that context, I noted the important role of the legislative and regulatory framework in influencing the future development of the credit union model.

I made clear in my address that I have no preconceptions regarding the shape of the model for the future development of credit unions and that all proposals for changes in the legislative framework will be assessed on their merits drawing on the advice of the Credit Union Advisory Committee (CUAC) the expert advisory body on credit union matters under the Credit Union Act — and key stakeholders such as the League.

In terms of the regulation of the credit unions, I emphasised that all stakeholders recognise that strong prudential standards are a prerequisite to the growth and development of credit unions and that strong dialogue is a prerequisite for regulatory policy that is evidence-based and effective, and for regulatory practice that conforms to the highest international standards.

I outlined to the CGM progress in implementing the Social Finance Initiative announced in Budget 2006, drawing attention to the long-established role of credit unions in combating financial exclusion in rural and disadvantaged areas and the innovative programmes of social investment undertaken by certain credit unions. I provided an update to the CGM on progress in relation to a number of current issues of concern to credit unions:

∙the investment framework;

∙regulatory and legislative changes; and

∙limits on longer-term lending by credit unions.

In relation to the reform of the League's Savings Protection Scheme (SPS), I confirmed that from a public policy perspective, the overarching priority is to have legal certainty regarding the protection of savers in credit unions and indicated that the next step was to assess the League's current set of proposals against the objectives set for savings protection arrangements by CUAC's report on SPS and the Annual Reports of the Registrar.

In conclusion, as set out in my address to the CGM, it is essential to strike an appropriate balance between the need to facilitate credit unions in adapting effectively to the changes taking place in society and in the financial sector, while also maintaining appropriate standards of prudential supervision, with a view to supporting the long-term sustainability of the credit union movement in Ireland.