Michael McGrath (Cork South Central, Fianna Fail)
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76. To ask the Minister for Finance if the registrar has received proposals from credit unions for business model changes since the new regulation making powers came into effect; and the number of amendments the regulations been made to facilitate these. [27880/16]

Michael Noonan (Limerick City, Fine Gael)
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The provision of regulation making powers to the Central Bank provides flexibility to allow the Central Bank in the future to review and update regulations as appropriate, on a timely basis following consultation. I have been informed by the Central Bank that they are keen to ensure that regulations remain appropriate for the credit union sector and in the future, where credit unions set out a clear path on how they wish to develop, consideration will be given to any amendments to regulations that may be appropriate. The Central Bank informs me that to date no amendments to the regulations have been made.

The Registry of Credit Unions at the Central Bank  recognises the strategic challenges facing the sector, the need to revitalise business models and to find ways of doing business to better serve members while delivering on their expectations. The Registry is committed to engaging with credit unions on their business model development proposals and is currently engaging with both credit unions and their Representative Bodies in relation to business model development. As part of their engagement process, in November 2015 the Central Bank established Sector Stakeholder Dialogues to facilitate engagement with credit unions. This was done with a view to gaining a better understanding of how credit unions want to develop their business model and to identify any changes that may be required to the regulatory framework to facilitate prudent development. Since the establishment of the Sector Stakeholder Dialogues six meetings have taken place.

While no concrete business model development proposals have yet been received, the Central Bank further informed me that to date the main focus of discussions has been on the following areas:

- Longer term lending;

- Additional services framework; and

- Publication of sectoral data.

Michael McGrath (Cork South Central, Fianna Fail)
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77. To ask the Minister for Finance if, in view of the fact that extensive powers were devolved to the registrar in the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016, he will consider providing for an appeals mechanism; and if he will make a statement on the matter. [27881/16]

Michael Noonan (Limerick City, Fine Gael)
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My role as Minister for Finance is to ensure that the legal framework for credit unions is appropriate for the effective operation and supervision of credit unions.

The Registrar of Credit Unions at the Central Bank is the independent regulator for credit unions.  Within her independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability and to protect the savings of credit union members.

Since 1 August 2013, under section 14 of the Credit Union and Co-operation with Overseas Regulators Act 2012, part VIIA of the Central Bank Act, 1942 has applied to credit unions. This provides credit unions with the right to appeal certain decisions of the Central Bank to the Irish Financial Services Appeals Tribunal (IFSAT). Appealable decisions include:

- certain decisions in the Credit Union Act, 1997 (1997 Act);

- refusal of approval under the Central Bank Reform Act 2010; and

- findings or orders of an inquiry under the Administrative Sanctions Procedure.

Under section 84A of the Credit Union Act, 1997 the Central Bank, before making regulations, is required to consult with:

- The Minister and the Credit Union Advisory Committee;

- Any other body that appears to the Bank to have expertise or knowledge of credit unions generally;  and

- Any other body that the Bank considers appropriate to consult in the circumstances.

The Consultation Protocol for Credit Unions, published by the Central Bank in 2012, indicates that the Central Bank will consult on new regulations that will, in the view of the Central Bank, potentially have a significant impact on the business of credit unions.

Under section 32M of the Central Bank, 1942 the Central Bank is required at least every 4 years to make arrangements for a peer review of the Central Bank's performance of its regulatory functions. A review of the Central Bank performance of its regulatory functions in relation to credit unions was carried out in July 2015 by the International Credit Union Regulators' Network (ICURN).  

Michael McGrath (Cork South Central, Fianna Fail)
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78. To ask the Minister for Finance if, in view of the fact that credit unions compete with banks and the State has a declared interest in ensuring that Irish banks remain viable and profitable, he will consider the establishment of an oversight body to ensure that the regulations are being implemented in a proportionate, fair and equitable manner. [27882/16]

Michael Noonan (Limerick City, Fine Gael)
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My role as Minister for Finance is to ensure that the legal framework for credit unions is appropriate for the effective operation and supervision of credit unions.

The Registrar of Credit Unions at the Central Bank is the independent regulator for credit unions.  Within her independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability and to protect the savings of credit union members.

Credit unions in Ireland operate under credit union specific legislation in the Credit Union Act 1997 and the Credit Union and Co-operation with Overseas Regulators Act 2012, with recommendations of the Commission on Credit Unions forming the basis for the 2012 Act and new regulations implemented. 

There are currently a number of measures in place which provide input by relevant stakeholders into new regulations and to provide oversight of the regulatory functions of the Central Bank in relation to credit unions. Before making regulations , under section 84A of the Credit Union Act 1997, the Central Bank must consult with the Minister  for Finance and the Credit Union Advisory Committee and any other body the Central Bank considers has credit union expertise or knowledge or that the Central Bank considers appropriate to consult. There is also a Consultation Protocol in place between the Central Bank and credit unions which ensures that the Central Bank consults on  new regulations that will, in the Central Bank's view, have a significant impact on the business of credit unions. Also, under section 32M of the Central Bank Act 1942 the Central Bank is required, at least every 4 years, to make arrangement for a peer review of the performance of its regulatory functions in relation to credit unions. The International Credit Union Regulators' Network carried out such a review of the Central Bank in 2015.

In June 2016 CUAC produced a significant report, reviewing the Implementation of the Recommendations of the Commission on Credit Unions fulfiling one of the key credit union objectives as outlined in the Programme for Partnership Government. The Report provides an in-depth analysis of the sector from a financial perspective and includes various stakeholder views, thus ensuring a balanced report. It provides focused and effective recommendations under seven specific headings; tiered regulation, section 35, consultation and engagement with the Central Bank, governance, restructuring, business model development and additional matters. On establishment of an Implementation Gro up consisting of credit union stakeholders, each of those recommendations will be considered in depth prior to implementation in a cohesive manner. 

The Government recognises the important role of credit unions as a volunteer co-operative movement in this country. The Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall and it is determined to support a strengthened and growing credit union movement.