PLANS to introduce a credit union to help the poor have been scrapped. Commerce and Employment said that it could not justify the move. It could not see enough people taking part to allow a union to grow and sustain itself.
The idea has been around locally for more than three years. The Citizens Advice Bureau researched the potential take up and feasibility and invited an expert over to investigate further.
‘The Townsend report ‘which revealed the extent of relative poverty in the island’ believed that these sort of things are useful in a big community and it may be useful for us,’ said minister Stuart Falla.
‘One of the problems we found was critical mass - Guernsey doesn’t have enough people to support a credit union.’
He said that small towns in the UK often found them difficult to support and consultant Chris Funnell, who visited the island in 2004, said it would require about 10% of the population to get involved.
The department believes that more financial education should be pursued instead.
Deputy Falla said that the issue of people with a poor credit rating, who have to pay more for credit, would not have been solved through a credit union. That issue was being addressed separately.
‘There is a problem to be solved, but we think that a credit union is not the process appropriate for this relatively small community.’
Deputy Rhoderick Matthews, who promoted investigation of a credit union while chairman of the Consumer Group, was disappointed to hear that the idea had been scrapped.
‘I think it could have worked in a fairly modest way, but I don’t think that there has ever been much will among the States to push it far.’
Article posted on 12th May, 2007 - 12.00am
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