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Credit Union Bill 2012: From the Seanad (Continued)

Thursday, 13 December 2012

Dáil Éireann Debate
Vol. 786 No. 3

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(Speaker Continuing)

[Deputy Brian Hayes: Information on Brian Hayes Zoom on Brian Hayes] Amendment No. 31, made in the Seanad, follows on from the discussion on Committee and Report Stages in this House where the Minister committed to examining this section in order to allow a credit union to invest in public projects. This amendment arose out of discussion with the Office of the Attorney General on the issue, and makes clear that the power of the Central Bank to make regulations relating to investments includes scope for making regulations in respect of investments in public projects. The Minister remains open to credit unions coming forward at an early stage to outline their proposals in respect of such investments. A further amendment to this section was made in the Seanad. What the Minister has done in the amendment we asked the Seanad to agree - as it did - is effectively to include public projects for the purposes of allowing the Central Bank to make regulations. I know that was a key concern of Members opposite.

Deputy Richard Boyd Barrett: Information on Richard Boyd Barrett Zoom on Richard Boyd Barrett Again, I commend the Government on this amendment. It is one of the most important moves to acknowledge explicitly in the Bill a very positive suggestion made by the credit unions. In these rather bleak times when we often argue with one another about what not to do, and desperately look around for positive suggestions about what we might do, this is a positive, forward-looking and imaginative proposal by the credit unions that can benefit everybody. Not only is it important to include it in the Bill but I urge the credit unions, as did the Minister of State, to come forward with their proposals so that we can look at them and thereby take this suggestion seriously. It seems as if some of the desperately needed investment funds we would all like to see made available to invest in employment-rich and socially valuable projects are being offered to us by an organisation whose members have the best interests of this country at heart. It is a very positive move and I hope we not only include it in the Bill but also that we take up this suggestion and seek to develop it.

Deputy Pearse Doherty: Information on Pearse Doherty Zoom on Pearse Doherty I thank the Minister of State for responding positively to the request to put this amendment in the Bill, as tabled by me on Committee and Report Stages. I would have preferred a more explicit statement on State-guaranteed public projects but I recognise the wording presented by the Minister of State does not prohibit this, so I find it acceptable.

As the Bill passes into law, I acknowledge the Minister of State's comment that he is open to meeting the credit union movement. It is now up to the movement to step up to the mark. It has been seeking this amendment and therefore it should come forward with proposals. It is equally important that the Department of Finance should co-ordinate a position that can be proposed to the credit union movement. This would state the kind of investments envisaged, would point out that the credit unions had wanted the measure and note that it has been enshrined into law in terms as clear as day. It can ask them what their proposals are, ranging from small, medium and large packages. These may be the concern of the Department with responsibility for housing or the Department of Education and Skills, which can put them together with the co-ordination of the Department of Finance. It is a two-way street. I welcome this move.

Deputy Michael McGrath: Information on Michael McGrath Zoom on Michael McGrath I concur with the sentiments of previous speakers. This amendment is to be welcomed. It is satisfactory and gives explicit recognition to the possibility of credit unions investing in projects of a public nature, which is something they will welcome. I share Deputy Doherty's view that this option should now be explored fully by credit unions.

Deputy Brian Hayes: Information on Brian Hayes Zoom on Brian Hayes I hear what all the Deputies are saying. There is an opportunity here to do something imaginative. Although this section is all about ensuring that credit unions use their investments with judgment and common sense, there must be a recognition that where public projects arise that could have a mutual benefit for credit union members in communities known to credit unions, it makes sense to invest in them, having regard to any potential risks. The way we approached this in the amendment was to give power to the Central Bank to bring forward the regulations. This seemed to get over the legal hurdle that had been present up to the point when we had our discussions with the Office of the Attorney General. There is nothing to stop the Department of Finance, with other Departments, as Deputy Doherty suggested, bringing forward ideas and proposals or a scheme of ideas, in tandem with the regulations the Central Bank will make. This is positive because it is about delivering for an entire community. Such a community also looks to the future as to where its investments can best lie and how community benefit can best be obtained. They are the people who know best, and that can be tempered by a standard form of regulation which the Central Bank can stand over. I believe we are all in agreement on that.

  Seanad amendment agreed to.

  Seanad amendment No. 32:

Section 12: In page 15, lines 38 and 39, to delete “appropriate” and substitute “necessary”.

  Seanad amendment agreed to.

  Seanad amendment No. 33:

Section 15: In page 19, to delete lines 1 to 5 and substitute the following:

“(6) The board of directors of a credit union shall be elected—

(a) where the organisation meeting occurs after the commencement of this provision (as amended by section 15 of the Credit Union Act 2012), by secret ballot at the organisation meeting and, subject to subsection (15) and section 57, subsequent vacancies on the board of directors shall be filled by secret ballot at an annual general meeting, and

(b) in any other case, by secret ballot at the annual general meeting first occurring after the commencement of this provision (as amended by section 15 of the Credit Union Act 2012) or, if earlier than that annual general meeting, at a special general meeting called for the purpose of such ballot and, subject to subsection (15) and section 57, subsequent vacancies on the board of directors shall be filled by secret ballot at an annual general meeting.”.

Deputy Brian Hayes: Information on Brian Hayes Zoom on Brian Hayes Amendment No. 33, made in the Seanad, makes provision for the election of the board of directors at the first annual general meeting or special general meeting called after the organisation meeting of a new credit union. This amendment was necessary to ensure consistency between the ways the board oversight and the board of directors are elected. It provides a transitional arrangement for the election of the board of directors at the first agm or sgm, following the commencement of the section. This was necessary given the decrease in the maximum number of directors that may be appointed to the board under this Bill - a reduction from a maximum of 15 to a maximum of 11, which was well debated on all sides.

On Committee Stage in the Seanad I noted there were incorrect cross references in these amendments and stated I would bring forward amendments on Report Stage to rectify these inconsistencies. They should refer to section 53(15), not to section 53(16). These amendments were made on Report Stage in the Seanad and the correct cross references have now been included in subsection (6).

  Seanad amendment agreed to.

An Leas-Cheann Comhairle: Information on Michael Kitt Zoom on Michael Kitt Seanad amendments Nos. 34, 37, 38, 40, 42 to 46, inclusive, 51 to 54, inclusive, 65, 73, 91, 93, 115 to 117, inclusive, 168 and 169 are related and may be discussed together.

  Seanad amendment No. 34:

Section 15: In page 19, lines 11 and 12, to delete ", (13) and (14)" and substitute "and (12)".

Deputy Brian Hayes: Information on Brian Hayes Zoom on Brian Hayes I refer to amendment No. 34. An amendment was made on Committee Stage in the Seanad to remove subsections (12) and (13) of section 15 as these will be provided for in a new fitness and probity regime which will be rolled out for credit unions on a phased basis, as recommended by the Commission on Credit Unions. Further amendments were also made to amend the cross references caused by the deletion of subsections (12) and (13) by amendment No. 37.

  Amendment No. 51 amended paragraph (f) in section 17(1). This section previously provided that a person performing management functions in a credit union must have particular knowledge, skills, experience, qualifications, competence and probity to carry out these duties effectively. This was deleted by an amendment in the Seanad as it would be covered separately under the fitness and probity regime which will be rolled out for credit unions over time. In effect, we are removing the fitness and probity references because they are surplus to requirements given that they will be rolled out over time. The application of fitness and probity requirements was agreed by the Commission on Credit Unions and will apply, depending on the nature of the scale and the complexity of the credit union concerned.

  Amendment No. 52 deleted paragraph (p), as it referred to requirements set out in subsections (12) and (13) of section 53. As these subsections were being deleted, paragraph (p) is now invalid. Amendments Nos. 53 and 54 also make the consequential cross references arising from the deletion of paragraph (p).

  Amendment No. 73 deleted paragraphs (b) and (c) of subsection (5) of subsection 63A, as inserted by section 21 of the Bill.


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