RADICAL LEGISLATION to reform the regulation of banks has been passed in the Dáil amid Opposition anger at the guillotining of an “absolutely critical” Bill and debate on just 13 of 56 amendments.
The Central Bank Reform Bill merges the Central Bank with the Financial Regulator and transfers consumer information roles from the Financial Regulator to the National Consumer Agency.
Provisions in the Bill regulating credit unions were sharply criticised by the Opposition, who claimed they would facilitate commercial banks to “ravage” the deposits of credit unions. The legislation passed by 69 votes to 65.
Tánaiste Mary Coughlan defended the imposition of the guillotine and said there had been more than 15½ hours of discussion on the second stage of the Bill. The Government was anxious to have it passed “prior to the summer recess” and could not change the order to extend the debate.
Fine Gael leader Enda Kenny described the legislation as crucial “in view of the gross incompetence and mismanagement of regulatory affairs by the Government”. It was “absolutely critical that it be debated thoroughly”.
Labour leader Eamon Gilmore said the Government was cutting off debate on the legislation on the day that Ireland had come “first in the league table for having the worst bank in the world. We are told today that Anglo Irish Bank is the biggest loss-maker of any bank in the world and that is on top of the fact that the Irish bank bailout is the most expensive bailout anywhere in the world.”
Opposition amendments to give credit unions statutory recognition in the legislation were rejected by Minister for Defence Tony Killeen, standing in for Minister for Finance Brian Lenihan.
The Irish League of Credit Unions has criticised new regulations in the Bill which will apply to credit unions as well as to banks. It describes them as unreasonably restrictive and says they will hinder it from helping members the way they had previously.
Labour finance spokeswoman Joan Burton asked: “Why will Fianna Fáil not in this legislation give due recognition in an orderly and structured way to the credit union movement?” She said credit unions did not indulge “in massive speculation and the ruination of their financial institutions”.
“We should not allow the credit union sector to be wiped out, which is the aspiration of certain commercial banks.”
Kieran O’Donnell (FG, Limerick East) said the €22 billion that had been put into Anglo Irish had “gone down the toilet”. “I do not know of a red cent that has been put into the credit union movement”.
Seymour Crawford (FG, Cavan-Monaghan) said the Bill obliged the Central Bank to establish an advisory group on credit unions and he described the provisions as “prudent, balanced and proportionate”.
