Credit Union sector gets massive slap in the face from Government – Cowen

Published on: 01 December 2015

Offaly Fianna Fáil TD Barry Cowen has described the Government’s response to a crucial Dáil motion on the future of community credit unions as “a massive slap in the face for the sector.”

Astonishingly over a three-hour session, split over two days, not one single Cabinet Minister spoke during the Dáil debate initiated by Fianna Fáil.

Over 100 representatives of the credit union movement from all across the country attended the debate in the Dáil chamber last week.

Speaking during the debate Deputy Cowen said: “In my county, there are 35,000 members in Tullamore, 9,000 in Clara and up to 50,000 or 60,000 throughout the county.  Credit unions are integral and vital parts of communities.”

Fianna Fáil moved the special Dáil motion in response to Government plans to implement a new set of regulations by the end of the year which will put further restrictions on their activities. The most serious of these is the impending €100,000 limit on savings.  It will send out the wrong signal that Credit Unions are less safe than other financial institutions.

Deputy Cowen said: “The Government has told us there is a ‘perceived’ threat to the future of our community credit unions.  They couldn’t be more wrong.  The threat to our local credit unions is very real if Fine Gael and Labour continue down this current path.

“We know banks are withdrawing services throughout the country.  And in credit unions in Offaly and across the country right now we see interaction, vitality and engagement, while we see staff in banks introducing customers to machines – a colder, harsher reality that communities simply don’t want.

“I know from my own experience when earlier this year, Ferbane in my county lost Ulster Bank, which was the last bank in town, it benefits no-one when essential services leave these communities.  All they leave behind is increased isolation.

Deputy Cowen concluded: “This Government talks a good game about recognising the value of credit unions.  But when Fine Gael and Labour TDs were given the choice to vote to protect them, they bottled it.  Our credit unions have a real and meaningful role to play in the mortgage market to an extent, in the provision of social housing, which is now an emergency situation, if only the Government would let them.

“For example the Government talks about exploring the possibility of an input from the credit union movement with regard to social housing.  What exploration is required, when a credit union has the capacity to make available through a central fund, similar to the Canadian model, funding to local communities and local authorities to build houses in their area?  The Department of the Environment this time last year made a commitment with regard to a €4 billion investment over five years in social housing, whereby there would be 7,500 new homes throughout the country this year, 4,000 of which would be new builds.  The number that was built was 200, which is five per local authority.  My county must have been the exception because it got eight, although this was over the past four years.  The credit union movement has at its disposal investment capacity for local authorities and even a return of 2% would be far in excess of what is being received in the banks at present.  Instead all we hear from the Government is talk of pilot schemes and more studies.  In reality, it’s just more talk, and more platitudes.

“It is time for the Government and its party members in Fine Gael and Labour to realise that abjectly having failed to support credit unions they can hardly expect members of credit unions to support them.”

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