I will begin by expressing the sympathy of the Fianna Fáil Party and, I am sure, all Members of the House to the people and government of the Philippines on the disaster that has befallen them in recent days. It is heartbreaking to watch the reports of the national media on the scenes of devastation throughout that country. We are all thinking of the people there and of the many decent, hard-working members of the Filipino community working in this country. I commend the Government on its immediate offer of €1 million in aid. I urge the Tánaiste to investigate, as quickly as possible, the possibility of sending the rapid response unit to help in rebuilding that country.

Last week, the Central Bank published a report which indicated a huge increase in the number of people using licensed moneylenders. We are already concerned about the many unscrupulous unlicensed lenders working in this country. Across communities, the bulwark against these lenders is the credit unions. The Irish credit union movement has been diligent in combating such people, who charge exorbitant rates. Where banks have refused money to families and individuals, many have gone to their credit union where they found that the small sums of money they required to live on a daily basis were made available to them.

The circumstances resulting in Newbridge Credit Union being taken over by Permanent TSB are very unfortunate. There was something particularly unedifying in seeing the Central Bank go to the High Court on Sunday evening, which I believe was prompted by reports on the local radio station, Kfm, that this was going to happen this week.

The process has taken two years and has been inordinately expensive, costing upwards of €3 million. The end result is that the people of Newbridge have no credit union. Does the Tánaiste agree that the methods employed by the regulator and the Central Bank have been spectacularly unsuccessful? Will he confirm the Government's support and respect for and acknowledgement of the fact that the credit union movement throughout the country has delivered a great deal of vital support for communities?

Responding to a Topical Issue some time ago, the Minister for Finance, Deputy Noonan, indicated that 30 other credit unions may have been in trouble. In today's media, including the Irish Independent-----

I am sorry, but I ask the Deputy to conclude.

I will. In today's Irish Independent, Charlie Weston suggests that approximately 100 credit unions, some one in four, are in difficulty. Will the Tánaiste confirm that the Government's approach will be to ensure that, where credit unions get into difficulty, credit unions will be in place in local communities at the end of the resolution process to serve people's needs? Will the Tánaiste consider Newbridge specifically and ensure that the Financial Regulator and the Central Bank support the local community in its immediate efforts to establish a new and fully compliant credit union?

I join with Deputy Ó Fearghaíl, on behalf of the Government, in communicating our sympathy with the people of the Philippines, who are enduring a terrible natural tragedy. I acknowledge Deputy Ó Fearghaíl's welcome for the action that the Government is taking in providing emergency funding straight away in the form of €1 million through NGOs. We are also providing some practical assistance through tents, blankets and emergency facilities of that kind. We also have a rapid response core of technical people, which is ready to assist. We will work with the UN agencies to mobilise the greatest possible international response to that tragedy.

The Deputy asked me a number of questions arising from the action that was taken in respect of the Newbridge Credit Union. That action was taken in order to protect the members and savings of the credit union and to prevent a situation arising whereby the credit union would have to be liquidated. Other options had been looked at over a period of time, including the possibility of an amalgamation of that credit union with another credit union, but that did not work out.

The Deputy has asked me a number of specific questions and I want to answer them directly. First, on the Government's position in respect of the credit union movement, the Government supports the credit union movement. Credit unions in this country have provided great support to people. They operate with a not-for-profit ethos and on the basis of solidarity. I want to tell the Deputy directly that the Government continues to support the credit union movement. We back that in practical terms by having €500 million available in two funds to support the credit union movement - a fund that provides for restructuring of approximately €250 million and another fund for resolution of another €250 million.

Specifically regarding Newbridge, as the Deputy knows there were a number of exceptional circumstances in that case. The average loan issued by credit unions throughout the country is €7,764. There were 26 loans of an average €550,000 in Newbridge. There was one loan of €3.2 million, which was in excess of the Credit Union Act's restriction of a maximum of 1.5% of the total assets. Some 53% of loans exceeded five years' duration as opposed the maximum set out in the Credit Union Act of 20%. The Government would like to highlight its support for the future return of a credit union to Newbridge. We will work with people in Newbridge to that end.

The Deputy asked specifically about the reports in the newspaper about the number of other credit unions that may have difficulties. He mentioned a figure of one in four credit unions possibly being in difficulty and reports to that effect. There are 392 credit unions in the country. Based on the data submitted by the credit unions themselves, as of 30 September 2013 some 20 credit unions have reported regulatory reserves below the minimum requirement of 10% of assets. This gives rise to a capital shortfall in the region of about €11 million in total, but this has to be put in the context of the funds that the Government has made available of about €500 million. The Central Bank - this may be where the reportage has taken off - is working through a portfolio of approximately 100 credit unions on a case-by-case basis. This relates to issues that arise in those credit unions - levels of arrears, inadequate bad debt provision, high fixed asset to total asset ratios and other supervisory concerns. However, the actual number of credit unions that have reported regulatory reserves below the minimum requirement is 20 of the 392.

I thank the Tánaiste, as his response was in large measure positive. I take from his comments that the approach of the Government and the Central Bank will be to ensure that there will be credit unions in communities if changes have to be made on foot of resolution processes. I also thank the Tánaiste for indicating clearly that the Government and, I take it, the Central Bank will support the establishment of a new, fully compliant credit union in Newbridge. However, will he assure us that the procedures employed in Newbridge, which have been ongoing for 22 months at a cost of upwards of €3 million, resulting in there being no credit union to service the people of Newbridge, will be examined?

What is the position as regards the directors of the Newbridge Credit Union, who were subject to a gagging order, resulting in their being pilloried in the local and national press? They were accused of many things. They can now defend themselves and attempt to vindicate their good names.

What is the position on the building in Newbridge? Many people involved in the credit union movement across the country will wonder what will happen to their buildings if they become subject to the resolution process. The assets and liabilities of Newbridge Credit Union have been transferred to Permanent TSB. So be it, but what is the position on the building, which was built by, paid for and owned by the people of Newbridge?

The position in respect of Newbridge is that the assets and liabilities, excluding the building, have been transferred to Permanent TSB by way of the High Court order. In addition to that, the Governor of the Central Bank has requested a financial incentive of up to €53.9 million, which has been agreed to by the Minister for Finance. That money amounts to €23 million in cash up front to fill the hole in the balance sheet, restructuring and integration costs of €4.25 million, €2 million for other transferring liabilities and a risk share on the transferring loans whereby the State will absorb 50% of the losses where loans perform below their transfer values and 50% of the gains where they perform above their transfer values. If these loans were written off immediately with no recovery, it would result in an additional €24.7 million total cost.

Without the transfer to Permanent TSB, Newbridge would have been liquidated. There would have been a loss of €1.1 million in unprotected savings.

Other options were examined concerning Newbridge. As I mentioned earlier, there was the option of amalgamating with another credit union. The Central Bank also assessed other options, including the proposal by the Newbridge action group. That was rejected at the time because it did not provide a satisfactory solution to the capital deficit.

The Government will support whatever efforts are made to re-establish a credit union in Newbridge, whether that is a credit union from somewhere else establishing in Newbridge, or the local community establishing a new credit union there. We stand ready to support that because the Government has a strong commitment to the credit union movement and the work it does. We want to see successful credit unions and we hope that we will not have other situations like Newbridge.