A motion of no confidence in the board of the Irish League of Credit Unions (ILCU) was defeated by a two-to-one majority at the University of Limerick yesterday.
The vote marked the conclusion of a marathon two-day special general meeting for the credit union movement to discuss the collapsed project to introduce a computer system which would link the member unions. The project cost £27 million (€34.2 million) before it was abandoned.
An amendment to the main motion, calling for the board to resign at the league's a.g.m. in April, was also defeated by a large majority.
Mr Jim McMahon, ILCU president, who described the meeting as a bruising weekend, was congratulated by wellwishers before he gave a press conference. He said that at the end of the two days, the results showed the 800 delegates, two from each of 400 credit unions, had confidence in the board following the £27 million write-off on the failed ISIS integrated computer system.
"They are angry, there was frustration out there, people wanted answers to questions," he said.
Mr John Gallagher, president of Tullamore Credit Union, which proposed the motion of no confidence, said he was returning to his own board "to bring back the feelings of the meeting".
"We are a little bit disappointed but we accept the decision." With 25,000 members, Tullamore is the second-largest community credit union in the league. The motion was defeated by 421 votes to 191. But the mood of the delegates had been signalled earlier in the afternoon when the amendment by the Independent Group's credit union was defeated by 400 votes to 219.
However, one delegate pointed out that it showed wide support outside the Tullamore credit union for action against the board. The large number of abstentions on each vote was indicative of the bad mood many people were in. "An awful lot of credit unions balked at the idea of voting no confidence in the board because there was no safety net there. There was no structure in place to actually replace it. That was a big fear with a lot of people.
"It shows that we have extremely archaic structures for what is now a very, very large financial undertaking. That is certainly one of the lessons that have been drawn from this."
Mr McMahon said a series of consultations would be held with the boards of the 536 credit unions in the country on how the movement should move on. "We are hoping to be able to present a report of some kind to the a.g.m. in Cork at the end of April."
He stressed that there was a need for a technology solution to link the credit unions in an era when the cheque was becoming a thing of the past. "Cash could very well become a thing of the past. If we are not in the electronic fund transfer system, we will have a serious problem."
The league is also anxious to develop a treasury management system and move from a situation where credit unions place their funds in banks on a daily basis. The ISIS project "as we know it is dead and buried", Mr McMahon added, but the concept had been right. "The concept is still right. The costings were wrong."
He said there were several ways in which some of the £27 million write-off associated with the £68 million project could be recouped and legal options were being considered.
For much of the two-day session, there were recriminations over the project's handling and the taking of responsibility for it. OSI, an international consultancy based in Britain which advised ILCUTECH, the ILCU subsidiary, on ISIS, has rejected criticisms made of it. Five of ILCUTECH's 10 board members are on the ILCU's 16-member board.
