INDUSTRIAL AND PROVIDENT SOCIETIES (AMENDMENT) (NORTHERN IRELAND) ORDER 1976 (Hansard, 2 March 1976)

§ The PARLIAMENTARY UNDER-SECRETARY of STATE, NORTHERN IRELAND OFFICE (Lord Donaldson of Kingsbridge)

My Lords, I beg to move that the Draft Industrial and Provident Societies (Amendment) (Northern Ireland) Order 1975, which was laid before this House on 10th February 1975, be approved. Article 3 of this order seeks to amend the Industrial and Provident Societies Act (Northern Ireland) 1969, so as to increase from £1,000 to £5,000 the statutory limit on the value of shares which any individual member of an industrial and provident society may hold. Noble Lords may recall that last March this House debated the Industrial and Provident Societies Act, which introduced certain amendments to the law in Great Britain this order will similarly amend the Northern Ireland legislation on industrial and provident societies to keep it in line. It also provides that the rules of a registered society may be changed by a simple resolution of the committee, thus enabling the society to take immediate advantage of the permitted increase. Article 4 enables any future amendments of the new limit of £5,000 to be effected by regulations made by the Registrar of Friendly Societies for Northern Ireland with the consent of the Department of Commerce, but any such amendments cannot reduce the limits below the amounts now proposed.

990 This order also deals with credit unions. I should explain to your Lordships that credit unions are composed of people who share a common bond of residence or employment in a particular locality and who join together to encourage thrift by means of savings. These savings are then used to advance loans to members at limited interest rates. In Northern Ireland credit unions are specially controlled under the industrial and provident societies legislation. Many of the provisions governing ordinary industrial and provident societies apply to credit unions, but separate provisions covering such things as membership, dividend and interest rates, size of loans, investment of funds and appropriation of profits, were also enacted to meet their special needs. Article 5 of this order seeks to increase the limit on the amount of shares which any individual member of a credit union may hold from£1,000 to£2,000, and this may also be increased by regulation. The proposed increases are necessary mainly to offset the effects of inflation and, also, in the case of industrial and provident societies proper, to give these societies an opportunity to expand their member-owned capital. These increases should, therefore, have a stimulating effect on the work of the bodies concerned. Accordingly, I commend the order to the House. I beg to move.