Head of credit union to resign in new year

The general secretary of the Irish League of Credit Unions, Mr Tony Smyth, has agreed to resign the post in January. His departure follows a failed £27 million (€34 million) investment on a computer system for the league's 537 branches which ran significantly over-budget before its collapse earlier this year.

Mr Smyth leaves as the league faces a significant euro changeover operation and concludes a strategic review of its structures.

The reasons for his departure were not stated in the text of a statement sent to credit union branches by its executive and board. It said: "The president and board wish to inform you that it has been mutually agreed that Mr Tony Smyth will resign from his position as general secretary of the league with effect from January 4th." In addition, the statement thanked Mr Smyth for his work. It was signed by Mr Smyth and league president Mr Jim McMahon. Attempts yesterday to contact Mr Smyth at his home and at his office failed. Attempts to contact the league's spokesman also failed.

While Mr McMahon confirmed that Mr Smyth was resigning, he declined to answer any other questions. "There is a mutual agreement that he should go and that is as far as I am prepared to go," he said.

Mr Smyth joined the league six years ago from the Civil Service, where he worked at the Department of Finance.

The league's ISIS computer initiative was halted five years after it started after estimates suggested it might cost between £68 million and £100 million to complete. Its failure prompted the establishment of the review chaired by the industrial relations consultant, Mr Phil Flynn. Initiated at the league's a.g.m. last April amid fears of a split in the league, the review is scheduled for completion by February.

A motion of no confidence in members of the league board was rejected at that meeting, from which the press was excluded. However, the meeting voted against accepting a report by the supervisory committee, which was charged with monitoring the board's activities and reporting to the a.g.m.

Project management shortcomings exposed during the project led to a widely-held view that individual credit unions had outgrown the antiquated structure of the league. Indeed, this was acknowledged by Mr McMahon in a prepared address to the a.g.m.

Referring to the ISIS project, he said that the league's structures and procedures had let it down "when the pressure was on". "The league fully accepts that we got the ISIS project wrong. There are no excuses."

The review chaired by Mr Flynn is designed to come forward with proposals for adoption at the 2002 a.g.m. next April.

The credit unions have 2.6 million members, with more than £4.5 billion on deposit.

The Minister for Finance, Mr McCreevy, yesterday signed a commencement order allowing the creation of "special term share accounts" which exempt holders from DIRT on dividends where certain funds are invested for a minimum of three or five years.