Expenses issue causes rift in credit unions' organisation

Directors of the Irish League of Credit Unions who tried to get details concerning the expenses being claimed by other directors were refused the information, writes Colm Keena

Discontent over lack of transparency on the issue is understood to have led to the first failure, in its history, by the board to unanimously agree on signing-off on the league's annual accounts.

The accounts were approved by a majority vote of the 16-member board. They will be presented to the league's a.g.m. in Killarney in April.

The league President, Mr Jim McMahon said last night that he would not breech the confidentiality of the board meeting but said that the board had approved the accounts which had been audited by PriceWaterhouseCoopers and signed as being in order. He would not comment on whether the approval had been unanimous.

"All members of the board are volunteers and get no recompense," he said. They get civil service mileage, substance and overnight allowances, according to the President. "Nobody is ripping off or making money out of being a director of the Irish League of Credit Unions," said Mr McMahon.

A decision by the board that two members and their spouses should attend a conference in the Caribbean later this year has also caused concern among some directors. The board has also decided that a number of representatives should attend a conference in Poland.

The decisions are seen by some members as inappropriate at a time when the league is facing severe financial difficulties following the collapse of its Isis technology project after expenditure of €34 million (£27 million).

"There are staff cuts and other pressures, so how can you justify expenditure on international conferences? It would be legitimate if the league could get any value out of them, but there is no evidence that these trips are of value.

"There are restraints on staff development but at the same time board members don't see themselves as part of the restraint process."

Mr McMahon said that there was "nothing unusual about members of the board representing the league abroad". He added that Mr Gerry Foley of the Rush Credit Union in Co Dublin was attending a meeting in Poland in his capacity as Chairman of the Board of the World Council of Credit Unions.

There is an ongoing dispute over board procedures in relation to expenses, according to the source. "Certain directors asked for access to the information (on claimed expenses) and were told they were not legally entitled to it."

A small number of directors are understood to have voted against signing-off on the accounts. Annual board expenditure on issues such as travel, meals and foreign trips is usually about €320,000.

Mr McMahon said that it was important that people could express themselves at board meetings without the details coming into the public domain and he was against discussing what had gone on at the meeting.

Divisions in the board which have not healed are damaging its effectiveness, according to a source. The league has more than 500 affiliated credit unions which have 2.6 million members and more than €5.5 billion on deposit.

It has been suggested that the league might move from its headquarters on Mount Street in Dublin. The league bought the building for under €3 million in 1996 and renovated it for about €4 million.