Fianna Fáil Spokesperson on Finance Michael McGrath has welcomed the statement by Minister of State Brian Hayes in the Dáil this afternoon that the fees being paid to the Special Manager appointed to Newbridge Credit Union by the Central Bank are ‘excessive’ and ‘should be reviewed’. Minister Hayes was responding to a topical issues debate in the Dáil submitted by Deputy McGrath.
Speaking after the debate, Deputy McGrath stated, “Given that the appointment of a Special Manager by the Central Bank to Newbridge Credit Union is likely to be followed by similar appointments to credit unions around the country, it is essential that a marker is laid down on the issue of excessive professional fees. Along with the €432 per hour being charged for the Special Manager, the other members of the team working with him will also come with very high charge out rates.
“I welcome Minister Hayes’ comments that the fees in this case are ‘excessive’ and ‘should be reviewed’ and I would hope the Government will now back up these words with action. The Central Bank needs to ensure that the fees charged by professionals appointed to assist credit unions are reasonable and reflect the financial reality facing the ordinary members of credit unions right throughout the country who will ultimately bear the cost of the fees.
“I was disappointed that Minister Hayes was unable to provide an update on Minister Noonan’s estimate from last October that the cost to the State of recapitalising the credit unions in difficulty is in the range of €500m to €1 billion or the timeline under which funds will be drawn down.
“Minister Hayes did indicate that financial institutions, including credit unions, would be required to start paying this year into the Resolution Fund established under the Central Bank and Credit Institutions (Resolution) Act 2011.
“While the final report of the Commission on Credit Unions due in March should shed further light on the issues in the credit union sector, it is essential that Government comes forward with a clear strategy for addressing the weaknesses that have been identified and sets out a plan that safeguards the future of credit unions as key financial service providers to local communities.
“It is important that credit union members continue to be reassured that all deposits up to €100,000 are fully secure under the State’s Deposit Guarantee Scheme. While a number of credit unions have difficulties that need to be addressed by the authorities, I believe that the credit union movement will continue to play a unique role at the heart of communities right throughout the country for many years to come.”