Pearse Doherty (Donegal, Sinn Fein)
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242. To ask the Minister for Finance the steps being taken to ensure the voluntary ethos of the credit union movement at all levels is protected and fostered; his views on whether sufficient guidance is provided to directors that sit on boards in a voluntary capacity to allow them carry out their regulatory duties; and if he will make a statement on the matter. [1902/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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Credit unions have a key role to play in providing access to credit and other important services in local communities throughout the country. The Government recognises this and has put in place a number of measures to ensure that credit unions can continue to provide these vital services to their members and to safeguard the stability of the sector into the future. These measures include: 

- establishment of the Commission on Credit Unions;

- publication of the Credit Union and Co-operation with Overseas Regulators Act 2012;

- establishment of the Credit Union Restructuring Board – ReBo;

- establishment of a stabilisation levy to support credit unions that are undercapitalised but are otherwise viable;

- availability of €250 million for voluntary restructuring of credit unions facilitated by ReBo;

The Commission on Credit Unions was given a mandate to review the future of the credit union sector and make recommendations in relation to the most effective regulatory structure for credit unions, taking account of their not-for-profit mandate, their volunteer ethos and community focus, while paying due regard to the need to fully protect members’ savings and financial stability.

The Final Commission Report, March 2012 informed the publication of the Credit Union and Co-operation with Overseas Regulators Act 2012, which contains over 60 of those recommendations, and also made a number of recommendations regarding strengthening of the regulatory framework of credit unions, including more effective governance and regulatory requirements.

The 2012 Act provides the statutory basis for the restructuring of credit unions and placed the Credit Union Restructuring Board (ReBo) on a statutory footing. The Government provided €250m to the Credit Union Fund for restructuring on a voluntary, incentivised and time-bound basis. The Government also provided a further €250 million for resolution purposes to ensure the safety of members’ savings. In line with the Commission Report, Part 4 of the 2012 Act also provides for a stabilisation process that addresses short-term problems at credit unions that are viable but undercapitalised.

The Central Bank is committed to providing supports to the credit union sector to assist volunteers in fulfilling their regulatory duties. The Credit Union Handbook sets out the main legislative and regulatory requirements for specific areas and contains additional guidance which credit unions and their volunteers may find useful in furthering their understanding of the various requirements for that area. The Handbook is updated regularly, specifically when new regulations are introduced or new guidance on a specific area is necessitated. On introduction of the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016 (the 2016 Regulations) an FAQ document was published to assist credit unions.

The Central Bank holds an annual series of information seminars throughout the country to which credit union staff and volunteers are invited. These seminars provide updates on regulatory developments impacting the sector and provide attendees with an opportunity to meet with staff from the Registry of Credit Unions to discuss issues and pose questions they may have. The Registrar, Deputy Registrar(s) and staff from the Registry of Credit Unions frequently present on regulatory developments and various other topics at events held by the credit union bodies and other advocacy bodies who provide training and supports to the sector. The Central Bank website contains a dedicated section for credit unions which contains a repository of information in relation to credit union regulation and contains recent publications and reports which are useful aids to credit unions, their staff and volunteers.

The Central Bank remains committed to meaningful engagement with credit union directors and other volunteers who provide a significant contribution to the credit union sector.

Finally, credit unions in Ireland have their own credit union specific legislation which acknowledges the credit union ethos. This undoubtedly also demonstrates awareness of the distinction between credit unions and other financial service providers. I consider, from the number of credit union specific changes that have been implemented that it is evident that the Government clearly recognises and has done much to preserve the ethos of the credit union sector.