The protection of credit unions under the new Credit Union Bill is of vital importance Kilkenny Labour Deputy Ann Phelan told the Dáil during a debate on the new legislation. The lifelong credit union member said she was more than aware of the significant role each credit union has played and continues to play every day in communities across the country.
The Bill will strengthen the regulatory framework for credit unions and provide the basis for a restructuring of the sector over time, which will protect credit union members, she said. Such protection was of vital importance.
“Credit unions in this country have provided a safe and secure depository for savings of both low and middle-income families, and are a source of lending,” she said. “They are for many a financial haven, one of the first places to which we turn in times of financial difficulty or hardship. As we are aware, it was the basis of communities at a time when many families and individuals were not entertained by the banks. The only place to which one could turn was the credit union.”
The Deputy went on to point out that many credit unions had their humble beginnings in parish halls. They now have more than €15 billion in customer deposits and remain open for business. It is important this message is conveyed.
It was important also to convey the message, she said, that deposits of individual credit union customers are secure, as the €100,000 deposit guarantee scheme applies also to credit unions. Therefore, individual savings are protected.
“One of the primary aims of the Bill must be the protection of its members,” added Deputy Phelan.
Speaking on the same Bill, Fine Gael Deputy John Paul Phelan raised the issue of the importance of volunteers to smaller credit unions.
“Like most other parts of the country, that from which I come, namely, south County Kilkenny, has a large number of very small credit unions which do fine and important work. People who are involved with these organisations in a voluntary capacity have raised their concerns with me,” he said.
Such concerns related to the limit being placed on the period for which directors can remain in position. Deputy Phelan said he agreed with the principle of what the Minister was trying to do, which was agreed to by the representatives of the credit unions on the Commission. Many very small credit unions may only open for a number of hours in the evening a few days each week and will encounter grave difficulties in attracting a large turnover of new directors, he pointed out. In such circumstances, there should be a mechanism whereby the directors of such credit unions could be allowed to remain in position for longer than that proposed in the legislation.
The other issue he raised involved those volunteers who work in credit unions in the evenings when they have finished working in their normal place of employment.
“These individuals deal with members of the public who go to their credit unions in order to lodge money or avail of the other services on offer,” he said. “Many of the very small credit unions to which I refer rely to a large extent on voluntarism in order to operate. A balance can be struck in the legislation in order to ensure this voluntarism will be protected and that the people who give of their free time in order to ensure these institutions remain in operation will be accommodated.”